SJSU White Collar Crime

Please review this article for May 6 class on Fiduciary Fraud:

Trader who lost $7 billion says bosses approved

French trader told investigators supervisors OK as long as he made money

http://www.msnbc.msn.com/id/22867180/from/ET/

 

Another article for April 1 Class

Ex-Safenet CFO gets six month sentence for stock options backdating:

C:\Documents and Settings\DCALLAWAY\Local Settings\Temporary Internet Files\Content.Outlook\BHV9WY3X\News and Information from Factiva.html

Spring 2008 Course Syllabus

San Jose State University
College of Applied Sciences and Arts
Justice Studies Department

JS 135 -- White Collar Crime
Spring Semester 2008

Instructor: David Callaway Office Hours: Friday 12:15-1:15 p.m.

Office: MacQuarrie Hall 521 Cell Phone: (415) 308-7977

E-mail: SJSUDavidCallaway@gmail.com Class Mtgs: Tues. 5:30-8:15 p.m., MH 523

Assuming I can figure out how to create one, you will be able to find the course syllabus, class handouts on my SJSU website, www.sjsu.edu/faculty/callaway

Course Description

The course catalog reads: "Growth and development of white collar crime in the United States: crimes at the workplace, computer fraud, swindles, embezzlement, bribery and graft at the corporate and governmental levels."

And that is certainly true, as far as it goes. We will be focusing on some of the most interesting crimes that are being committed, many of them in right here in your own back yard, including corporate fraud, securities fraud (including revenue recognition fraud, stock options backdating, and insider trading), trade secret theft, consumer fraud, environmental crime, tax evasion, as well as bribery, embezzlement, and mail and wire fraud committed by individuals. Although I am not sure this qualifies as a "Course Learning Objective," my hope is that you will come to see this area as far more fascinating than so-called "street" crime: anyone can rob a bank (although I wouldn't recommend it); the real challenge is to be able to buy a bank and turn it into your own personal ATM machine. We will explore the nature of white collar crime inductively, by looking at examples of the countless and myriad ways people have devised over the years to cheat one another. (I am a prosecutor, not a sociologist.) The focus of this course will be on the crimes themselves, the criminals who commit them, and how prosecutors and investigators go after them and defense lawyers defend them.

Course Learning Objectives

By the end of the semester students should know what "white collar" crime is, how it differs from other types of crime, and they (meaning, in this case, "you") should be able to discuss intelligently the characteristics that make this form of crime unique: the kinds of criminals who commit it, the means by which they do so, and how they are prosecuted and defended in court.

Required Texts/Other Readings

Textbooks:

Rosoff, S., Pontell, H., and Tillman, R., Profit Without Honor: White Collar Crime and the Looting of America, Prentice Hall, 4^th ed. (2006).

Johnston, D., Perfectly Legal: The Secret Campaign to Rig Our Tax System to Benefit the Super Rich – and Cheat Everyone Else, Portfolio Trade (2005) (available in paperback from Amazon, Barnes & Noble, and other online sites for around ten bucks), ISBN 13: 9781591840695.

Weblog: White Collar Crime Blog. http://lawprofessors.typepad.com/whitecollarcrime_blog/ (Students should review this weblog at least weekly and be prepared to discuss the preceding week's entries in class)

Additional Reading: There will be additional readings that I will announce at least one class period before they are due. (Most are already embedded in the course syllabus.) The readings will be available on-line. Students who miss a class are responsible for obtaining the assignments from another student (or, if I have one by then, my website).

Also Recommended: De la Vega, E., United States v. George W. Bush et al., Seven Stories Press (2006) (also available in paperback online for around ten bucks), ISBN-13: 978-1583227565.

Prerequisites: Upper division standing or instructor consent

Course Requirements

Grades will be based on a combination of a mid-term exam (25%), final exam (40%), and a term paper (25%). Both the mid-term and final exams will be essay questions. The remaining 10 % will be based on class participation, which basically means showing up prepared and with something to say (and not, say, spending the entire class time IM'ing). Details regarding the term paper will be handed out no later than the second week of class.

The highest grade possible will be an A+. Plus and minus grades will be given for every grade down to a D -. 90% and higher will be an A (with plus and minus grades as follows: 90-93 % = A-, 94-96 = A, 97 and up = A+). The same breakdown will apply to B (80-90%), C (70-80%), and D grades (60-70%). Hard to imagine we would need to go there, but less than 60% would be an F.

Classroom Protocol

Please show up on time. Please turn in your term paper on time. Also, see above re: IM'ing. This (or any of its disrespectful cousins) will be frowned upon when I am in front of the class, and will be extremely frowned upon if there is a guest speaker.

Library Liaison

Your library liaison is Nyle Monday, telephone 808-2041. Nyle.Monday@sjsu.edu.

University Policies

Dropping and Adding

You are responsible for understanding the policies and procedures about add/drops, academic renewal, etc. found at http://sa.sjsu.edu/student_conduct. You should be aware of the new deadlines and penalties for adding and dropping classes.

Academic Integrity

Students are expected to be familiar with the University's Academic Integrity Policy. Please review this at http://sa.sjsu.edu/student_conduct.

"Your own commitment to learning, as evidenced by your enrollment at San Jose State University and the University's integrity policy, require you to be honest in all your academic course work. Faculty members are required to report all infractions to the office of Student Conduct and Ethical development."

Instances of academic dishonesty will not be tolerated. Cheating on exams or plagiarism (presenting the work of another as your own, or the use of another person's ideas without giving proper credit) will result in a failing grade and sanctions by the University. For this class, all assignments are to be completed by the individual student unless otherwise specified. If you would like to include in your assignment any material you have submitted, or plan to submit for another class, please note that SJSU's Academic Integrity policy F06-1 requires approval of instructors.

Accommodations

If you need course adaptations because of a disability, if you have emergency medical information to share with me, or if you need special arrangements in case the building must be evacuated, please make an appointment as soon as possible or see me during office hours. Presidential Directive 97-03 requires that students with disabilities register with the DRC (Disability Resource Center) to establish a record of their disability."www.drc.sjsu.edu

Special accommodations for exams require ample notice to the testing office and must be submitted to the instructor well in advance of the exam date.

Grievances

If you have questions regarding grading policies or any other aspect of the course, please make an appointment with me. For information about grievance policies/procedures, you can consult the university catalog, the Justice Studies department secretary for appointments with the department chairperson, or the University ombudsman.

SJSU Writing Center

As you can see, your success in this class will be heavily influenced by the quality of your writing. (As someone who works outside of academia, I can assure you that the same is true of your future success in almost any professional or business environment.) If you think that your writing skills could use improvement, you should be aware of the SJSU Writing Center and the services it offers. The center is staffed by professional instructors and upper-division or graduate-level writing specialists from each of the seven SJSU colleges. SJSU's writing specialists have met a rigorous GPA requirement and they are well trained to assist all students at all levels within all disciplines to become better writers.

Course Schedule (JS 135 Spring 2008)

(Note: subject to change with fair notice.)

Week	Date	Topics, Readings, Assignments, Deadlines
1	1/29	Syllabus and handouts; Introduction. Profit Without Honor (PWH), Chapter 1.
2	2/5	Consumer fraud; telemarketing fraud; false advertising; PWH, Chapter 2; articles on Canadian Lottery Scam: http://phoenix.about.com/cs/seniors/a/canadianlottery.htm; Chinese Inheritance Scam: http://sanfrancisco.fbi.gov/dojpressrel/2007/sf101607.htm and Nigerian Scam: http://www.snopes.com/crime/fraud/nigeria.asp)
3	2/12	Crimes by the government; PWH Chapter 8; at 7:00 p.m., guest speaker Elizabeth de La Vega, author of U.S. v. George W. Bush, will explore the hypothesis that President Bush and senior White House officials engaged in a criminal conspiracy to deceive the public into supporting the Iraq war. She may also share her views on the trial, conviction, and pardon of former Vice-Presidential Chief of Staff I. Lewis "Scooter" Libby. (See her comments here: http://www.commondreams.org/views06/1004-30.htm; and here: http://www.antiwar.com/engelhardt/?articleid=9851 But, just to keep things bipartisan, let's take a look at how former President Bill Clinton abused his pardon power: http://www.time.com/time/nation/article/0,8599,99302,00.html
4	2/19	Unsafe products, mortgage fraud. Guest speaker: loan broker Robert W. Callaway will discuss the sub-prime mortgage mess and how it came about. PWH Chapter 3.
5	2/26	Environmental crime; overlapping roles of state, federal, civil, criminal, and administrative agencies; PWH Chapter 4; see also http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/10/05/BAGJRLIN0M1.DTL; and http://www.fda.gov/bbs/topics/NEWS/2006/NEW01486.html
6	3/4	United States Sentencing Guidelines; please review Chapter 1 (all); Chapter 2 (only Section 2B1.1, including all commentary); Chapter 3-5 (all). The Sentencing Guidelines are available here: http://www.ussc.gov/2007guid/tabcon07_1.htm. (From there you can download and read the individual subsections; section 2B1.1 loads very slowly, however, so please be patient)
7	3/11	Corporate and Securities fraud: revenue recognition, insider trading, and stock options backdating fraud; PWH Chapter 6. White Collar Crime Prof blog discusses restitution issue here: http://lawprofessors.typepad.com/whitecollarcrime_blog/2008/01/sentencing-reye.html See also SEC complaint against Gregory Reyes, et al. here: http://www.sec.gov/litigation/complaints/2006/comp19768.pdf And Government's Sentencing Memorandum: http://lawprofessors.typepad.com/whitecollarcrime_blog/files/us_v_reyes_government_sentencing_memo_jan_10_2008.pdf; and, to show I'm fair, defendant's sentencing memorandum is here: http://lawprofessors.typepad.com/whitecollarcrime_blog/files/us_v_reyes_defendant_sentencing_memo_jan_10_2008.pdf
8	3/18	Securities and corporate fraud continued (possible guest speaker)
9	3/25	No class (Spring Break)
10	4/1	Computer crime, trade secret theft, and export enforcement; PWH Ch. 11; guest speakers: Matthew Parrella, Chief, Computer Hacking and Intellectual Property (CHIP) Unit for the U.S. Attorney's Office; and Stephen Adams, Senior Director, Global Litigation and Confidential Asset Management Group for Applied Materials, Inc.
11	4/8	Mid-term exam. (Note: I will be searching for evidence of WCC in Ecuador; exam to be monitored by a stand-in)
12	4/15	Public corruption; PWH Chapter 9; see also these articles regarding the 2006 indictment on (and ultimate dismissal of) bribery charges against former San Jose Mayor Ron Gonzales: http://www.bayareanewsgroup.com/multimedia/mn/news/archive/norcal/mn_grandjury_norcal_2005.pdf (Civil Grand Jury Report); http://www.bayareanewsgroup.com/multimedia/mn/news/archive/norcal/norcal_gonzales_indictment_062206.pdf (criminal indictment); http://bayareanewsgroup.com/multimedia/mn/news/gonzales_courtruling_061307.pdf (court order dismissing indictment)
13	4/22	Health care fraud; PWH Chapter 10; Term Papers Due
14	4/29	Tax evasion, tax avoidance, and plain old tax "planning." Johnston, Perfectly Legal (see Required Texts, above)
15	5/6	Fiduciary fraud: Crime in the banking, insurance, and pension fund industries; PWH Chapter 7; other articles TBA.
16	5/13	Institutional corruption: Mass Media and Religion; PWH Chapter 5. Preview of final exam
17	5/20	Final Exam