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1997-98 Academy Text Supplement

Chapter 21-9

Federal Crimes: White Collar/Economic Fraud/Bank Robbery

Statistical Overview

• In 1996, there were 465,000 arrests for fraud crimes and 15,700 arrests for embezzlement. In addition, there were 121,600 forgery and counterfeiting offenses charged in 1996. (Federal Bureau of Investigation. (released September 28, 1997). Crime in the United States, Uniform Crime Reports, 1996, p. 214. Washington, DC: U.S. Department of Justice.)
• In 1994, there were 419,800 arrests for fraud crimes and 14,300 arrests for embezzlement. In addition, there were 115,300 forgery and counterfeiting offenses charged in 1994. (Bureau of Justice Statistics. Sourcebook, 1995, p. 394. Washington, DC: U.S. Department of Justice.)
• The results of a nationwide study of fraud conducted by the National Institute of Justice found that 58% of survey respondents reported having experienced a fraud victimization or an attempted fraud victimization. (Titus, R., Heinzelmann F., & Boyle, J. "The Anatomy of Fraud: Report of a Nationwide Survey, August, 1995." National Institute of Justice Journal. Washington, DC: National Institute of Justice, U.S. Department of Justice.)
• Projected losses to telemarketing and direct personal marketing fraud schemes alone figure to be more than $40 billion annually. (Ibid.)
• It is estimated that as little as 15% of fraud victims report cases of fraud to the police or other law enforcement agencies. (Ibid.)
• According to the latest survey by the American Bankers Association, check fraud accounts for losses of at least $815 million a year, or more than 12 times the $65 million taken in bank robberies annually. (San Jose Mercury News. Wednesday, January 2, 1996)
• Contrary to common belief, older people are less likely to be victims of fraud than younger people. Older people are, however, more likely to report economic crimes than their younger counterparts. (Titus, R., Heinzelmann, F. & Boyle, J. (1995, January). "Victimization of Persons by Fraud." Crime and Delinquency, 41:1:58. Washington, DC: National Institute of Justice, U.S. Department of Justice.)
• Fraud victims with some college or a college degree appear to be the most vulnerable to fraud schemes, with persons who did not graduate from high school being the least vulnerable. Ibid., p. 60)

• Of successful fraud attempts, respondents to a study conducted by the National Institute of Justice indicated that of those respondents who fell prey to a fraud scheme, 85 percent lost money or property; 20 percent suffered financial or personal credit problems; 14 percent suffered health or emotional problems directly related to their victimization; and 14 percent of fraud victims lost time from work. (Ibid., p. 54)

Office for Victims of Crime Efforts to Assist Fraud Victims

In April of 1997, the Office for Victims of Crime (OVC) published the most recent revised Guidelines for implementation of the Victims of Crime Act. Importantly, many of these revisions addressed services and assistance to victims of economic crimes. As OVC states, while VOCA funds cannot be used to compensate victims of fraud for their financial or property losses, many supportive services can be provided to these victims, including counseling and advocacy and support throughout the criminal justice system.

In its revised 1997 guidelines, OVC encouraged states to fund new or expanded services for victims of fraud and economic exploitation. (1997 VOCA Victim Assistance Final Program Guidelines, Sections IV.B and IV.C)

Specifically, the amended Guidelines address the following key issues relating to victims of fraud and economic exploitation:

• The definition of "victim" was expanded to include victims of financial crimes.
• The definition of "elder abuse" was expanded to include economic exploitation and fraud.

• The definition of "previously underserved" priority areas was expanded to include victims of fraud crimes.

As a result, VOCA grant funds may be used to support many direct services for fraud victims. These services can include those that address:

• Immediate health and safety

• Mental health assistance and support groups

• Respite care and serving victims with disabilities

• Credit counseling advocacy or other special services

• Restitution advocacy

• Public presentations

• Advanced technologies, such as notification of victims in mass fraud cases

In addition to the important changes in the VOCA Guidelines, OVC has supported several projects to improve the treatment and services afforded to victims of economic crimes. These efforts include:

• VOCA Federal Victim Assistance/Demonstration Project on White Collar Crime Victimization. This project, as previously discussed in this chapter, is an ongoing collaborative effort between OVC and the United States Attorney's Office for the Northern District of California to improve services for white-collar crime victims. The demonstration project will identify, implement, and document promising practices for assisting white-collar crime victims with the goal of having these important services replicated by other U.S. Attorney's Offices nationwide. An important component of the project is to develop a referral network of programs across the nation that is able to assist victims of white collar crime and fraud.
• Promising Strategies and Practices to Improve Services to White Collar Crime Victims. OVC provided support to the Police Executive Research Forum (PERF) to develop a comprehensive package of materials for federal criminal justice personnel to use in their efforts to assist federal victims of while collar crime and fraud. PERF, in cooperation with an AD-HOC Department of Justice Working Group (composed of representatives from the Executive Office for U.S. Attorneys, National Institute of Justice, Federal Bureau of Investigation, Federal Law Enforcement Training Center, and other federal criminal justice agencies and victim assistance programs) collected model policies and procedures and a wide range of other key information to produce the following: a camera-ready victim pamphlet, a victim handbook, a coordinator guidebook, and a 20-minute videotape on assisting white collar and fraud victims.
• Other Efforts to Address Victims of Economic Crime by the Office for Victims of Crime. OVC is funding several additional projects that involve federal, state, and local efforts to address victims of economic crime. These projects consist of training, technical assistance, demonstration, and other efforts that are designed to prevent and address telemarketing crimes targeted to senior citizens, are national in scope or will have national impact, and provide products or materials that can be adapted and disseminated to senior citizens groups and others who come into contact with elderly victims of crime. Projects currently funded by OVC include: the Elder Financial Exploitation Prevention Program in Oregon; the Telemarketing Fraud Project for Latino Elderly in Washington, D.C.; Operation Fraud Stop: A Partnership to Reduce Telemarketing Fraud and Assist Victims conducted by the National Sheriffs Association in Alexandria, Virginia; and telemarketing fraud prevention, public awareness, and training activities in Maryland.
• Nation's First White Collar Crime Summit. Following National Crime Victims' Rights Week, in April of 1998 the Office for Victims of Crime (OVC) co-sponsored, in conjunction with the National White Collar Crime Center of Morgantown, West Virginia, the nation's first Economic Crime Summit in St. Louis, Missouri. This landmark conference brought together over 500 individuals representing federal, state, and local justice agencies and a wide range of programs serving crime victims. Highlights of the conference included a focus group on improving services and support for victims of white collar crimes conducted by OVC staff, and numerous workshops targeting the specific needs of victims of white collar crimes, including presentations of model programs.

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