Critics of criminal justice in countries
ranging from the United States to Korea have
long complained of a glaring imbalance:
white-collar criminals typically receive far
greater leniency than other crooks. Could a
similar inconsistency exist within companies?
A new study of economic crime suggests
that it does. PricewaterhouseCoopers
surveyed 5,400 companies globally and
found that when corporations discover
employee fraud, they deal more harshly
with middle managers and lower-level
employees than with their top managers.
For example, they are more likely to file
criminal charges when low-level employees
are involved.
There’s an irony here: The same study
finds that the more senior the employee, the
greater the damage to the business.
John Donker a PwC partner in Hong
Kong, argues that such inconsistency sends
the wrong message to employees. “The ethical
tone in an organization is very important
for dealing effectively with economic crime,”
he says. “If senior executives are being punished
less, that’s clearly a problem.”