Understanding Business Offenders: A Comparative Analysis of Workplace Deviance, Convenience and Control

Understanding Business Offenders

Understanding Business Offenders

A Comparative Analysis of Workplace Deviance, Convenience, and Control

Petter Gottschalk and Christopher Hamerton

First published in 2025 by

Berghahn Books

www.berghahnbooks.com

© 2025 Petter Gottschalk and Christopher Hamerton

All rights reserved. Except for the quotation of short passages for the purposes of criticism and review, no part of this book may be reproduced in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage and retrieval system now known or to be invented, without written permission of the publisher.

Library of Congress Cataloging-in-Publication Data

A C.I.P. cataloging record is available from the Library of Congress

British Library Cataloguing in Publication Data

A catalogue record for this book is available from the British Library

ISBN 978-1-80539-789-2 hardback

ISBN 978-1-80539-790-8 epub

ISBN 978-1-80539-791-5 web pdf

https://doi.org/10.3167/9781805397892

Contents

List of Illustrations

Introduction

1. Interpreting and Understanding Offender Characteristics

2. Business Offenders and Convenience

3. Understanding Business Offenders and Nonoffenders: Comparative Fieldwork

4. Interpreting Female Business Offenders

5. Moving beyond the Emancipation Hypothesis

6. Conceptions of Comparative Corruption: Understanding the Business of Mafia in Iran

7. Profit in Crisis: The Role of Reactive Motive and Opportunity

8. Longitudinal Perspectives and Complex Culpability

9. Inconvenience and Business Offenders: Attempting Bottom-Up Control

Conclusion

References

Index

Illustrations

Figures

Figure 2.1. Structural model of convenience theory. © Petter Gottschalk & Christopher Hamerton.

Figure 3.1. Research model to predict the ability to prevent financial crime. © Petter Gottschalk & Christopher Hamerton.

Figure 3.2. Expanded research model to predict the ability to prevent financial crime. © Petter Gottschalk & Christopher Hamerton.

Figure 3.3. The final research model to predict the ability to prevent financial crime. © Petter Gottschalk & Christopher Hamerton.

Figure 3.4. Sequential model of combined factors leading to financial crime. © Petter Gottschalk & Christopher Hamerton.

Figure 4.1. Convenience propositions for the Iranian pink-collar offenders. © Petter Gottschalk & Christopher Hamerton.

Figure 5.1. Female offending fraction and gender equality index. © Petter Gottschalk & Christopher Hamerton.

Figure 6.1. Convenience propositions for the Iranian mafia. © Petter Gottschalk & Christopher Hamerton.

Figure 7.1. Convenience propositions for COVID-19 fraud. © Petter Gottschalk & Christopher Hamerton.

Figure 8.1. Convenience propositions for Rødtangen insurance fraud. © Petter Gottschalk & Christopher Hamerton.

Figure 8.2. Convenience propositions for Rødtangen witness corruption. © Petter Gottschalk & Christopher Hamerton.

Figure 10.1. Elements of reducing and eliminating misconduct convenience. © Petter Gottschalk & Christopher Hamerton.

Tables

Table 3.1. Measurement instrument for understandability of wrongdoing. © Petter Gottschalk & Christopher Hamerton.

Table 3.2. Measurement instrument for convenience propositions. © Petter Gottschalk & Christopher Hamerton.

Table 3.3. Descriptive statistics for responses. © Petter Gottschalk & Christopher Hamerton.

Table 3.4. Potential determinants of understandable occupational crime. © Petter Gottschalk & Christopher Hamerton.

Table 3.5. Potential determinants of understandable corporate crime. © Petter Gottschalk & Christopher Hamerton.

Table 3.6. Mean scores for convenience for assumed offenders (1) versus non-offenders (2). © Petter Gottschalk & Christopher Hamerton.

Table 3.7. Convenience significance for assumed offenders versus nonoffenders. © Petter Gottschalk & Christopher Hamerton.

Table 3.8. Mean scores for convenience for assumed offenders (1) versus nonoffenders (2). © Petter Gottschalk & Christopher Hamerton.

Table 3.9. Convenience significance for assumed offenders versus nonoffenders. © Petter Gottschalk & Christopher Hamerton.

Table 3.10. Comparison of India (individual and corporate) with Norway. © Petter Gottschalk & Christopher Hamerton.

Table 3.11. Responses to statements about pressure to commit financial crime. © Petter Gottschalk & Christopher Hamerton.

Table 3.12. Responses to statements about willingness to commit financial crime. © Petter Gottschalk & Christopher Hamerton.

Table 3.13. Responses to statements about position to commit financial crime. © Petter Gottschalk & Christopher Hamerton.

Table 3.14. Responses to statements about questionability when committing financial crime. © Petter Gottschalk & Christopher Hamerton.

Table 3.15. Responses to statements about knowledge when committing financial crime. © Petter Gottschalk & Christopher Hamerton.

Table 3.16. Measurement instrument for convenience propositions. © Petter Gottschalk & Christopher Hamerton.

Table 3.17. Comparison of India (individual and corporate) with Norway and Iran. © Petter Gottschalk & Christopher Hamerton.

Table 5.1. Various gender perspectives on perpetrators. © Petter Gottschalk & Christopher Hamerton.

Introduction

This book focuses on understanding business offenders through an exploration of workplace deviance and crime. The work is founded on the close examination of a number of illustrative contemporary case studies and underpinned by the analysis of original comparative fieldwork. Adopting an offender-based perspective while emphasizing the central role of convenience, the approach is interdisciplinary, the authors seeking to inform, develop, and augment the existing literature on white-collar and corporate criminology while being attentive to the clear implications for strategic business management studies. The book inter alia argues that the traditional centrality of the individual actor within narratives of white-collar offending has receded somewhat in recent years despite being a founding artifact within its late twentieth century discourse. As a consequence, a detailed reassessment is overdue.

While adopting convenience theory as its primary theoretical tool, Understanding Business Offenders fits within a systems theory foundation as an explanation of the social conditions that influence and support elite offenders and offending. This permits the adoption of a macro to micro view of globalized economic systems and complex markets as well as the specific actions of actors within these systems. As an– initial introductory example of scope, the high profile Unaoil case involved a criminal investigation by the United Kingdom’s Serious Fraud Office (SFO) and National Crime Agency (NCA) during 2016. This followed allegations of suspected bribery, corruption, and money laundering within the oil industry, claims that were first referred to the police in 2011. The SFO investigation focused on four senior employees based in the UK and Iraq and led to convictions and lengthy prison sentences. However, concerns over the veracity of the accusations and the investigative process were raised throughout the trial and three of the defendants appealed. The Court of Appeal (CoA) subsequently overturned their convictions and fundamentally criticized the SFO approach by stating that challenging serious fraud requires an understanding of business offenders, offenses, and systems to avoid serious disclosure failures, as the international arbiter Spotlight summarized:

Although the SFO initially secured a string of successful prosecutions, these early wins have quickly unraveled as the agency’s conduct of the case came under sharp scrutiny from the courts. Two convictions have been quashed on the basis of serious disclosure failures and the SFO’s handling of the case is now the subject of an independent review by the Attorney General. (Spotlight 2022)

Thus, it is argued that developing an understanding of business offenders and their workplace deviance is an issue of great importance when preventing and detecting white-collar crime, alongside a developed comprehension of public awareness and censure (Fish et al. 2022). Throughout this study, the term business offender(s) principally refers to privileged individuals who abuse their trusted positions to commit financial crime to benefit themselves or the business (Benson 2021; Berghoff and Spiekermann 2018; Sutherland 1983). Understanding this context reflects the extent to which financial crime by business offenders makes sense (Gupta and Gottschalk 2022). Here, understanding is posited as a requirement to be able to assess and explain white-collar crime and then to prevent, detect, and investigate wrongdoing and then to prosecute and defend white-collar individuals in the legal process. Terminology associated to understanding reflects comprehension, awareness, insight, and judgment (Ngo and Paternoster 2016; Shadnam and Lawrence 2011). An understandable deviant act is usually neither acceptable nor justifiable in the sense that the situation could justify wrongdoing or even make the offender entitled to such wrongdoing. Yet an understandable act can be recognizable, explainable, and by some observers even tolerable, with tolerance frequently reflecting the extent to which an act is permissive and excusable—to tolerate is to endure someone or something unpleasant or disliked (Peixoto et al. 2023). The extent of tolerance of business offenses has previously been highlighted and been measured in studies of the perceived seriousness of white-collar crime (Alcadipani and Medieros 2020; Simpson et al. 2022).

A further exploratory tenet of this book is that white-collar and corporate offenders and offenses are of particular interest when incorporating specific social scrutiny, since people tend to disagree about the seriousness of financial offense by members of the elite in society—public understanding and tolerance varies. Early research into the phenomenon of white-collar crime suggested that public and political opinion about seriousness had stymied objective legislative response regarding relevant policy and punishment—a historical state of affairs readily indefinable in the present. In terms of recent key research, Rafael Alcadipani and Cintia Medieros (2020) found that white-collar crime on behalf of the corporation tends to be perceived and treated as corporate irresponsibility and not as misconduct, wrongdoing, offending, or as a serious violation of the law. Similarly, Cintia de Oliveira and Rafael da Silveira (2020) found that in many countries, the idea that corporations do not commit crime still prevails. This comparative position in terms of limited understanding or perception was confirmed by Cedric Michel (2016), who found that white-collar offenders are still significantly more likely to avoid criminal indictment, prosecution, conviction, and incarceration compared with street offenders. Significantly, Matthew Logan and colleagues (2019) argued that public support for the indictment, prosecution, conviction, and imprisonment of white-collar offenders is on the rise—research that suggests growing public awareness. Public perception is certainly a key variable when considering an objective view or normative standard of offender behavior. Francis Cullen, Cecilia Chouhy, and Cheryl Jonson (2020) studied public opinion about white-collar crime, and while identifying a public willingness to punish white-collar offenders, they also recorded that public opinion about inflicting punishment on white-collar criminals varies depending on clarity of culpability, typical harm, violation of trust, and a need to show equity—all variables that might be affected by individual or group behavior, during or after the offense.

The identification of such a highly open field in terms of understanding across so many developed jurisdictions positions Understanding Business Offenders as both relevant and timely. Relevance supported by the concept of convenience and an appreciation of the wider field of business crime as incorporating both offense and offender-based perspectives. Therein, the offense-based perspective focuses on nonviolent acts for financial gain, while the offender-based perspective focuses on members of the elite in society who abuse their professional positions for financial gain. The most enduring description of white-collar offenders from within the discipline of criminology is still Edwin Sutherland’s (1983) emphasis on persons of respectability and high social status who commit economic crime in the course of their occupations. This offender-based definition emphasizes the public need for understanding in terms of business offenders’ high social status, power, and respectability as the key features of white-collar crime. Thus, here, the authors mainly apply and adapt this classical perspective on white-collar crime as a conceptual starting point, guiding the reader through close comparative analysis of original fieldwork and a number of key international case studies. In doing so, the treatment attempts to offer nuanced and compelling contemporary insight into the process of white-collar criminal process, while critically exploring the perception and understanding of elite defendants within this under-researched area of the globalized public sphere.

Understanding Business Offenders is structured into nine chapters bookended by a concise introduction and a reflective conclusion. The first two chapters describe and elaborate the principal subject terminology and theoretical perspectives used, respectively. This foundation is then followed by a series of substantive chapters which present, evaluate, and analyze original empirical research and/or key contemporary case studies to exemplify business offenders and elucidate elements of understanding. A concise overview of chapter coverage and linkage follows.

Chapter 1

. Interpreting and Understanding Offender Characteristics. Here the conceptual basis for business crime is introduced as economically motivated crime committed by individuals in privileged positions in business and public organizations. Within the traditional offender-based context, crime is committed by an abuse of trust to benefit the individual by using occupational crime or to benefit the organization by using corporate crime. This focus develops a way to evaluate managerial ethics and workplace morality, and various foundational theoretical constructs that are used in this treatment, including aspects of offender recidivism and offender reflection, the latter illustrated by a case study from the United States. Two further case studies follow: the first evaluates themes of strategic understanding and the second, processual understanding.

Chapter 2

. Business Offenders and Convenience. In this extended chapter, the authors present the theoretical foundation used throughout the book, introducing determinants of business crime based on the theory of convenience. Convenience in this theoretical interpretation has clear lineage to the foundational studies of white-collar and corporate crime presented in chapter 1

. Moreover, it allows individual convenience orientation as a determinant to the extent that a person of respectability and high social status in the course of his or her occupation will make a decision to break rules and violate laws whenever alternative decisions are less convenient. This posits a high degree of importance on certain organizational and individual elements, specifically those around motive, opportunity, and willingness. Following a consideration of expediency in business offending, the convenience theory is elaborated in terms of its key tenets—motivation, opportunity, and willingness—prior to the exploration of crime as a convenient choice. Convenience theory is then utilized as a device to explain and analyze empirical work and case studies in the remaining substantive chapters.

Chapter 3

. Understanding Business Offenders and Nonoffenders: Comparative Fieldwork. This chapter is based on large scale empirical fieldwork in four contrasting international socioeconomic jurisdictions—India, Norway, the United States, and Iran. The impetus behind this research was a desire to evaluate business offenders working within the expanding globalized economy and exposure to, and understanding of, overlapping aspects of international socioeconomic systems and cultures. Moreover, while there are a number of integrated criminological theories that attempt to explain the phenomenon of deviance and crime, researchers have consistently emphasized that it is difficult to test such theories empirically, particularly within the business sphere. Here, the application of convenience theory appears to offer a viable and transferable model, underpinned by its offender-focused deductive construction. This model allows for the evaluation of both actual and potential white-collar offenders by testing their motive for financial crime, their opportunity in organizational settings, and their willingness to engage in deviant behavior.

Chapter 4

. Interpreting Female Business Offenders. Chapters 4

and 5

are interrelated and posit an extended and detailed analysis of gendered perspectives in terms of understanding business offenders, a further key research arena that is often neglected in terms of the business crime mainstream. A peculiar anomaly when considering the immediately clear disparity in female offending patterns and apparent lack of public and professional perception and concern. Added attention might aid a developed and contemporary understanding of female offenders within this discrete subject area. Establishing coverage includes detailed conceptual analysis and further original comparative sociocultural fieldwork implementing convenience themes.

Chapter 5

. Moving Beyond the Emancipation Hypothesis. This chapter builds on the conceptual focus of its predecessor in terms of seeking to augment the literature and understanding on gendered perspectives in business crime. Here the comparative focus is extended to explore conceptions of stability in terms of female involvement in white-collar crime independent of the extent of gender inequality. This is undertaken via an empirical evaluation of five internationally varied jurisdictions: Iran, Portugal, Norway, India, and the United States. The research suggests relative convenience as a potential explanation for the stability. The authors argue, inter alia, that in an organizational setting with greater gender equality, convenient opportunities increase to commit and conceal financial crime, but at the same time, there is a reduced motive and willingness to commit and conceal financial crime for women who are potential offenders.

Chapter 6

. Conceptions of Comparative Corruption: Understanding the Business of Mafia in Iran. As suggested throughout the book when considering our limited understanding of business crime, the use of convenience emerges as a useful device in evaluation and understanding. This chapter aims to discuss the role of convenience applied in Iranian business culture, principally through the examination of a number of lucrative business sectors popularly labeled mafia—a culturally unique, media-driven term—and how this established terminology and perception affects the perpetration of financially motivated crime. For this purpose, we select and discuss some of the convenience propositions that might explain mafia business operations in Iran. The procedure used to collect data in this study was close documentary analysis, namely the guidelines used in the form of notes or quotes, searching legal literature, books, and other sources related to the identification of issues in this study both off-line and online. What emerges is offered as a theoretically grounded sociocultural treatment of an unusual comparator of business offending.

Chapter 7

. Profit in Crisis: The Role of Reactive Motive and Opportunity. This chapter presents a one-sided theoretical study of convenience propositions that emerged for white-collar offenders during the COVID-19 pandemic via the abuse of the Norwegian government’s crisis support packages for business enterprises during 2020 and 2021. Special motives, special opportunities, and a special willingness for deviant behavior in the abuse of financial aid occurred during the period of national emergency. Stronger motives—both based on possibilities and threats—are discussed. The application of a one-sided approach relates to a necessarily objective focus on convenience propositions that are special to the pandemic situation. The other side, while primarily consistent, is concerned with potential inconvenience propositions that are special to the pandemic situation. This novel approach allows for critical evaluation of the behavior of potential business offenders during periods of crisis and emergency, an important consideration in terms of future research and improved understanding of business offenders presented with the rare motives and opportunities facilitated by crisis and emergency.

Chapter 8

. Longitudinal Perspectives and Complex Culpability. Our understanding of business offenders is occasionally based upon a relatively simple and culturally established deviant practice, as in the case study examined in this chapter, which commences with a fraudulent insurance claim. Here, the white-collar offender was experiencing serious financial problems running a hotel that was suffering heavy losses. A fire could trigger substantial compensation from the insurance company, so arson was organized to alleviate the impending threat of bankruptcy via the receipt of a large payment from the insurance company. However, what makes this case interesting as an authentic example of the acts and omissions of business offenders is the longitudinal and layered blame game that ensued among the individuals involved in the arson and fraudulent insurance claim, a process that spanned two decades and initiated a series of escalating legal proceedings and complex investigatory processes.

Chapter 9

. Inconvenience and Business Offenders: Attempting Bottom-Up Control. Traditionally, control in organizations is concerned with top-down approaches, where executives attempt to direct their employees to align their work with organizational objectives. Bottom-up control refers to the manner in which organizational members can use different types of control mechanisms—such as whistleblowing, transparency, resource access, or culture—to monitor, measure, and evaluate executives’ avoidance of deviant behavior and influence them toward achieving the organization’s goals in efficient and effective ways. This final substantive chapter addresses the challenge of directing executives to align their work with laws, rules, and ethics. Various bottom-up approaches are explored based on the theory of convenience with a focus on pragmatic organizational measures to make white-collar crime less convenient for potential offenders.

Conclusion. This final section of the book offers an extended reflective conclusion. It reviews the necessarily selective coverage of the book and recaps aspects of offender understanding and seriousness, including public awareness and regulatory process. The conclusion also contains a final summary and tabular analysis of value orientation and personal motivation, misconduct, transparency in terms of organizational opportunities, and the imposition and effect of normative pressure—fertile subjects for further research within this developing subject area. It is hoped that the empirical socioeconomic and sociocultural global comparisons that primarily encompass Norway, the United States, India, and in particular, Iran, provide a stimulating international perspective. Moreover, the continuous application of both theoretical explanations and empirical analyses provide depth and concrete understanding to the concepts raised within the text, which in turn inform the existing literature on our understanding of business offenders.

CHAPTER

1

Interpreting and Understanding Offender Characteristics

White-collar crime is economically motivated crime committed by individuals in privileged positions in business and public organizations (Sutherland 1939, 1983). Crime is committed by abusing trust to benefit the individual through occupational crime (Benson and Chio 2020) or to benefit the organization through corporate crime (Bittle and Hébert 2020). White-collar crime is unlawful conduct that elites and the powerful commit with little fear of coming into contact with the criminal justice system. White-collar offenders commit and conceal their crime in a professional setting where they have legitimate access to premises, resources, and systems. White-collar crime includes all categories of financial offenses such as fraud, corruption, manipulation and theft.

Perceived seriousness of white-collar crime has been studied as a factor that can influence the involvement or lack of involvement of the criminal justice system (Simpson et al. 2022). For example, Francis Cullen, Cecilia Chouhy, and Cheryl Jonson (2020) studied public opinion about white-collar crime, and they found public willingness to punish white-collar offenders. However, they also found that public opinion about inflicting punishment on white-collar criminals varies depending on the clarity of culpability, typical harm, violation of trust, and a need to show equity. Some studies have shown that the public apply criteria that regard corporate criminality as a very low enforcement priority (e.g., Andriaenssen et al. 2020). Rafael Alcadipani and Cintia Medieros (2020) found that white-collar crime tends to be perceived and treated as corporate irresponsibility and not as misconduct, wrongdoing, offending, or law violation.

Managerial Ethics and Workplace Morality

Within complex modern business organizations adherence to accepted professional practices and codes are perceived, and received, as meeting normative behavioral standards, essentially elements of natural law. However, such moralities are often seen to be absent in cases of white-collar malpractice and wrongdoing. Here, a manager or executive frequently manifests as a leader lacking a moral compass, who does not respond to the ethical component of business situations or the existence of workplace deviance. A potential business offender, the amoral manager lacks a moral response during ethical situations. Matthew Quade, Julena Bonner, and Rebecca Greenbaum (2022: 274) defined amoral management as a leader’s consistent failure to respond to issues that have ethical implications. Amoral management can result in wrongdoing and be harmful for the organization. Amoral management might cause deviant behavior among other employees as they lack a motive of behaving ethically in the workplace. Unethical behavior can include lying, cheating, stealing, defrauding, manipulating, and bribing.

The moral obligation to abide by the law can be ignored by amoral management. They have no moral culpability (Berghoff and Spiekermann 2018). Moral collapse happens when organizations are unable to see that bright line between right and wrong. Seven signs of ethical collapse can become visible: (1) pressure to maintain high numbers; (2) fear and silence overrides openness; (3) young executives and a larger-than-life CEO; (4) a weak board; (5) conflicts; (6) unequaled innovation; and (7) goodness in some areas atones for evil in others. There is silence when employees are confronted with executive misconduct (Sherer 2022).

Amorality is different from immorality as the latter refers to consciously choosing deviant behavior (Kavoukis 2022). Jessica Craig (2019) suggested a link between a lack of self-control and morality based on the situational action perspective. The perspective argues that an individual’s morality is the central individual-level variable in predicting offending. It also hypothesizes that low self-control will only predict offending among those with low morals.

Masoud Shadnam and Thomas Lawrence (2011: 379) applied the institutional perspective to explain moral decline and potential crime in organizations:

Our theory of moral collapse has two main elements. First, we argue that morality in organizations is embedded in nested systems of individuals, organizations and moral communities in which ideology and regulation flow down from moral communities through organizations to individuals, and moral ideas and influence flow upward from individuals through organizations to moral communities. Second, we argue that moral collapse is associated with breakdowns in these flows and explore conditions under which such breakdowns are likely to occur.

Such absence of workplace morality and corruptive managerial flow can manifest in scandal or crisis. A scandal can be an act of elite deviance that might include financial, physical, and morally harmful behavior committed by privileged members in society. A crisis linked to a series of scandals can be a fundamental threat to the organization, characterized by particular ambiguity in cause, effect, and means of resolution (Bundy and Pfarrer 2015; König et al. 2020) and augmented by public awareness and understanding.

Conceptualizing Offender Recidivism Magnitude

Recidivism refers to repeated crime by offenders, fundamentally the tendency of convicted criminals to reoffend. According to Heather Collins, Heather Lonczak, and Seema Clifasefi (2017), recidivism is defined as the behavior of a person repeating an illegal act after having experienced negative penal consequences of a previous offense. Joshua Long, Matthew Logan, and Mark Morgan (2021) found that white-collar prisoners were not more or less likely to return to prison compared to other inmates. Recidivism ranges from 7 percent to 29 percent in various empirical studies of convicted white-collar offenders (Clarkson and Darjee 2022). Frequently, the severity of punishment has shown to have no effect on recidivism while the only perceptible social effect is whether or not the convicted offender has to go to prison (Mears and Cochran 2018). For example, in Norwegian legislation, an offender can be sentenced to prison but the verdict says that actual incarceration depends on the convict’s behavior in the coming years.

The existence of rational choice among convicted white-collar offenders is a matter of recidivism, that is, what subjectively perceived benefits and costs are after incarceration. Repeating white-collar crime might be a rational choice since the collateral effects of being sentenced a second time can be much lower than the first time. On the other hand, the opportunity can be drastically reduced the second time. Thus, when rationality is considered, the prison experience can either support the special resilience hypothesis or the special sensitivity hypothesis (Logan 2015; Logan et al. 2019), which strongly influences perceived costs of recidivism. The special sensitivity hypothesis suggests a relatively tougher life for white-collar inmates. Matthew Logan and Tayte Olma (2020) have labeled special sensitivity a myth when faced with the empirical reality that supports the special resilience hypothesis. Special resilience suggests that white-collar offenders are able to adapt to prison life more successfully than other inmates are (Logan et al. 2019; Uhl 2022).

According to Jean McGloin and Wendy Stickle (2011: 430), One of the key factors that scholars suggest differentiates chronic offenders from their non-chronic counterparts is an earlier age of onset. Recidivism from low self-control can—in addition to the age of onset—be a matter of risk factors in personality traits and family conditions (Listwan et al. 2010). Shelley Listwan, Nicole Piquero, and Patricia Voorhis (2010) measured recidivism in terms of new arrests. Katie Friedricks, Reema