Russell Wasendorf Case, Research Paper Example

Russell Wasendorf Sr., the founder of the now bankrupt Peregrine Financial Group Inc., was sent to prison for 50 for what prosecutors believe was a theft of more than $215 million from his company’s customers (Gullo et al., 2013). This case is notable because it calls to attention the many challenges that law enforcement has in controlling white collar crime. As Wasendorf’s company began to fail, he refused to admit it to his employees and stock holders and instead chose to steal his client’s money and make himself appear successful; as a consequence, his company received more clients and more investors (Foley, 2013). While this is illegal, it is clear that many businessmen have successfully attempted similar acts in the past. Therefore, the major challenge in controlling white collar crime is detecting whether a crime has been committed in the first place.

To best address this challenge to control such crimes from happening again, the IRS needs to become more involved and detailed in its review of company taxes. Efforts need to be made to detect the fraudulent accounting being conducted by both the company’s own accountants and the board. It is impossible to hide this sort of money if the company is reporting its finances as the law requires. In addition, companies who earn above a certain net worth per year should be required to submit additional accounting reports to the government. Since companies who seem to be earning high amounts are at the highest risk for committing these kinds of crimes, this would limit the amount of executives who attempt to do so. This would be additionally useful because it would make the company’s finances more available for stockholders, which is their right as part owners.

References

Foley RJ. (2013). Peregrine CEO Russell Wasendorf Sr. Facing 50-Year Prison Sentence For Stealing Customer Funds. Huffington Post Business. Retrieved from http://www.huffingtonpost.com/2013/01/31/peregrine-ceo-sentence_n_2590519.html

Gullo K, Pettersson E. (2013). Peregrine’s Wasendorf Gets 50 Years for Theft of Millions. Bloomberg News. Retrieved from http://www.bloomberg.com/news/2013-01-31/u-s-wants-peregrine-s-wasendorf-imprisoned-for-50-years.html