ECONOMIC CRIMES

(Transnational Crimes)
 WELCOME!

Introduction
To
Economic Crimes
 Economic Crime
• Economic crimes or referred to as “commercial crimes” or
“white collar and organized” crimes are illegal acts that
are characterized by fraud, concealment, or a violation of
trust and are not dependent upon the application of threat,
physical force or violence.
• It is perpetuated in creative manners which can be
classified among, but not limited to the following:
* Asset Misappropriation * Money Laundering
* Insurance Fraud * Securities Fraud
* Financial Misrepresentation * Investment Schemes
* False Pretences
* Corruption and Bribery (racketeering and extortion)
* Counterfeiting (product piracy and industrial espionage)
 Economic Crimes
 Are crimes that particularly hurts directly the
economy of the individual persons, community
and the country as a whole. (ex. Robbery or
theft, frauds, smuggling, Organized crimes, Tax
Evasion, Drugs Trade, Money Laundering white
collar crimes etc.)

 generic terms used in this survey to denote

wrongful or criminal activities to or in an
organisation, intended to result in the gain of
money or benefits for the perpetrator(s).

 We are: * All Victims

* All Perpetrators
 Economic Crimes

Some crimes have multiple motives and

economic gain may be a secondary goal.
Furthermore, offenders themselves are not
always conscious of their motives and they
may be unable to distinguish between the
reasons that precipitated their actions and
the rationalizations or justifications that
follow them.
White-Collar and
Organized
Crime

© 2004 Pearson Education, Inc.

White-Collar Crime

Violations of the criminal

law committed
by a person of
respectability
and high
social status,…
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White-Collar Crime

…in the
course of
his or her
occupation

© 2004 Pearson Education, Inc.

White-Collar Crime

The financial cost of

white-collar crime is
probably several
times as great as…
© 2004 Pearson Education, Inc.
White-Collar Crime
…the financial costs of all
the crimes which
are customarily
regarded as the
“crime problem”
© 2004 Pearson Education, Inc.
White-Collar Crime
White-collar
criminals are
far less
likely to be
investigated,…
© 2004 Pearson Education, Inc.
White-Collar Crime
…arrested, or
prosecuted
than are other
types of
offenders
© 2004 Pearson Education, Inc.
 White-Collar Crime
• Edwin Sutherland defines the White-Collar Criminal
as a person with high socio-economic status who
violates the laws designed to regulate his
occupational activities. These laws include to certain
sections of the regular penal code, trade regulations,
anti-trust, commerce and securities laws, the laws
regulating advertising, patents, trademarks and
copyrights.

• It’s not a victimless crime. A single scam can destroy

a company, devastate families by wiping out their life
savings, or cost investors billions of dollars (or even
all three, as in the Enron case). Today’s fraud
schemes are more sophisticated than ever, and we
are dedicated to using our skills to track down the
culprits and stop scams before they start. – FBI
 White-Collar Crime
• The common purpose in the enactment of laws
governing white-collar crimes is in order to protect
competitors, customers, investors, inventors, wage-
earners, and other classes of persons from injuries
and also to protect the system of free enterprise and
other social institutions.

• White Collar Crimes are characterized by

FRAUD.

• Fraud —the art of deliberate deception for

unlawful gain is as old as history; the term "white-
collar crime“ has since become synonymous with the
full range of frauds committed by business and
government professionals.
White Collar Crimes

F - Financial
R - Rewards
A - Acquired
U - Under
D - Deception
• A phrase connoting a variety of frauds,
schemes, corruptions, and commercial
offenses committed by business
persons, con artists, and public
officials. The term was originally
intended as a classification of offenders
but has expanded to include a broad
range of non-violent offenses that have
cheating and dishonesty as their
central element. Consumer fraud,
bribery, and stock manipulation are
examples of white-collar crime
The most serious economic-related crime
in the country today!
 White Collar Crimes examples:
Graft and Corruption - the unlawful use of an official position
to gain an advantage in contravention of duty. This can involve
the promise of an economic benefit or other favour, the use of
intimidation or blackmail. It can also refer to the acceptance of
such inducements

• Bribery - When money, goods, services,

information or anything else of value is offered with intent to
influence the actions, opinions, or decisions of the taker. You
may be charged with bribery whether you offer the bribe or
accept it.

• Extortion - Occurs when one person illegally

obtains property from another by actual or threatened force,
fear, or violence, or under cover of official right.
 Graft and Corruption

The government employs legal measures and anti-

corruption bodies to combat the problem of graft and
corruption.

1. LEGAL MEASURES
a. The 1987 Philippine Constitution Article XI of the
1987 Philippine Constitution, “Accountability of
Public Officers”,

• states in Section 1 that “public office is a public trust.

• Section II of the same article states that the

President, Vice-President, members of the
Constitutional Commissions and the Ombudsman
may be removed from office on impeachment for
bribery and graft and corruption.
 Graft and Corruption
b. Republic Act No. 3019 also known as the Anti-Graft
and Corrupt Practices Act of 1960

c. Executive Order No. 292 or the Administrative Code

of 1987 (This order reiterates the provisions
embodies in Sec. 1, Article XI of the 1987
Constitution.)

d. Republic Act No. 6713 also known as the Code of

Conduct and Ethical Standards for Public Officials
and Employees of 1989

e. Republic Act No. 6770 also known as the

Ombudsman Act of 1989
 Graft and Corruption

f. Republic Act No. 7055 also known as An Act

Strengthening Civilian Supremacy over the Military.

g. Republic Act No. 7080 also known as the Act

Defining and Penalizing the Crime of Plunder.

h. Republic Act No. 8249 also known as the Act

Further Defining the Jurisdiction of the
Sandiganbayan

i. Presidential Decree No.46 declares it unlawful for

government personnel to receive gifts and for
private persons to give gifts on any occasion
including Christmas, regardless of whether the gift is
for past or future favors. It also prohibits entertaining
public officials and their relatives.
 Graft and Corruption
j. Presidential Decree No. 677 requires the
Statement of Assets and Liabilities to be
submitted every year.

k. Presidential Decree No.749 grants

immunity from prosecution to givers of bribes
and other gifts and to their accomplices in
bribery charges if they testify against the public
officials or private persons guilty of those
offenses.
 2007 SWS Survey of Enterprises
on Corruption
 50% of managers see corruption as part of how
government works
 3 out of 5 managers see a lot of corruption in the public
sector and that there will be no improvement in 7yrs

Rated Poor (-11 to -30): DOTC, DILG, DOJ,

PCGG, DENR and PNP
Rated Bad (-31 to -50): LTO, House of Reps,
COMELEC and BIR
Rated Very Bad (<-50): DPWH, BOC
2. CONSTITUTIONAL ANTI-CORRUPTION
BODIES
a) The Office of the Ombudsman (OMB)
b) The Civil Service Commission (CSC)
c) The Commission on Audit (COA)
d) The SandiganBayan

3. OTHER GOVERNMENT ANTI - CORRUPTION

BODIES
a) The Department of Justice (DOJ)
b) The National Bureau of Investigation (NBI)
and the Philippine National Police (PNP)
c) The Presidential Commission on Good
d) The Presidential Commission against Graft
and Corruption Government (PCGG) created
under Executive Order No.151 by then
President Ramos
 White Collar Crimes examples:
• False Pretences' (inc. estafa) - the intentional
action of a perpetrator to deceive those in fiduciary
positions and make a personal or financial gain
involves an employee being deceitful to his company,
often by playing on its goodwill. The loss to the
company comes through a misapprehension of the
employee’s actions by the employer.

• Asset Misappropriation (inc. embezzlement) - the

theft of company assets (including monetary
assets/cash or supplies and equipment) by company
directors, others in fiduciary positions or an employee
for their own benefit is a breach of trust where an
employee or officer misuses his authority by
managing a company’s assets for his own benefit.
 White Collar Crimes examples:
• Tax Evasion - When a person commits fraud in
filing or paying taxes.

• Financial Misrepresentation - company accounts

are altered or presented in such a way that they do
not reflect the true value or financial activities of the
company

• Securities Fraud - The act of artificially

inflating the price of stocks by brokers so that
buyers can purchase a stock on the rise.

• Insurance Fraud - To engage in an act or

pattern of activity wherein one obtains proceeds
from an insurance company through deception.
 Insider Trading
When a person uses inside, confidential, or advance information to
trade in shares of publicly held corporations.
BWRC insider trading/stock price manipulation scandal
Best World shares went up dramatically from P0.80 to P145 per
share in violation of the Revised Securities Act.
 Investment Fraud
One of the largest and most successful
investment scams in the Philippines is the
Ponzi scheme, a type of pyramid scheme where
money from new investors is used to provide a
return to previous investors. The scheme
` collapses when money owed to previous
investors is greater than the money that can be
raised from new ones. Ponzi schemes always
collapse eventually.
Investment Schemes
Glasgow , MTST, Multitel,
Exsior
Where an unsuspecting victim is contacted
by the actor who promises to provide a
large return on a small investment.
The original Charles Ponzi
 Special Laws in the
Philippines geared towards
the Control of Economic
Abuses
1. RA 9160 as amended by RA
9194, known as an Act defining
the crime of Money Laundering
Law of 2001, Providing
Penalties thereof and for other
purposes
2. RA 8293, Intellectual Property Law of 1997,
an act prescribing the intellectual property code
and establishing the intellectual property office,
providing for its powers and functions, and for
other purposes.

 Section 4. Definitions. –
4.1. The term "intellectual property rights" consists of:
a) Copyright and Related Rights;
b) Trademarks and Service Marks;
c) Geographic Indications;
d) Industrial Designs;
e) Patents;
f) Layout-Designs (Topographies) of Integrated Circuits; and
g) Protection of Undisclosed Information (n, TRIPS).
3. RA 1405 – An Act
Prohibiting
Disclosure or
Inquiry into
Deposits with any
Banking
Institution and
Providing Penalty
therefore.
Otherwise known
as Bank Secrecy
Law of 1955.
What is Economic Organized
Crime?
Economic Organized Crime is a crime perpetuated by
“organized criminal groups” with the aim of
committing one or more serious crimes or offenses in
order to obtain, directly or indirectly, a financial or
other material benefit.

In order to be considered as transnational, a crime

must involve the crossing of borders or jurisdictions.
REFERENCES

 Verbal instruction of DILG to

Acting Director, CIDG for the
CIDG to give more emphasis
to the investigation of
economic crimes; and
 CIDG Mission and Function
 TF MISSION:

 The Task Force through its Task

Force Units, shall aggressively
investigate and actively assist in
the prosecution of economic
crimes
LOI 01/07 CIDG ANTI-ECONOMIC CRIMES
TASK FORCE dtd January 11, 2007

 Prescribes the creation/activation

of the CIDG Anti-Economic
Crimes Task Force.
 It further outlines the operational
guidelines in its conduct of
investigations of economic
crimes.
 IMPLAN TO LOI 01/07 CIDG ANTI-
ECONOMIC CRIMES TASK FORCE
(CN:ECHO WARRIOR) dtd January 12, 2007

 Sets forth the CIDG mission

and functions in the
implementation of LOI 01/07
relative to the
creation/activation of the
CIDG Anti-Economic
Crimes Task Force
Anti-Public Corruption Unit

 Responsible in providing
support to the Ombudsman
and other government anti-
corruption agencies/offices
in its investigation into
alleged public corruption.
Intellectual Property Rights Unit

 Responsible in the
investigation of violations of
all relevant Philippine laws
that protects Intellectual
Property Rights.
 Financial Institution Frauds Unit
 Responsible for the identification,
targeting, disrupting, and dismantling of
criminal organizations and individual
engaged in fraud schemes which target
Philippine financial institutions. Areas
investigated include: financial institution
failures, insider fraud, identity theft, check
fraud, ATM/credit/debit card fraud,
counterfeit negotiable
instruments/currencies, check kiting, loan
fraud, and mortgage fraud.
The Other Significant Frauds Unit
 Responsible for significant
frauds not within the
purview of the other Units
targeting individuals,
businesses and industries to
include: corporate fraud,
insurance fraud, health
care-related fraud,
securities and commodities
fraud, telemarketing fraud,
land titling fraud, large-
scale illegal recruitment,
Asset Forfeiture/Money Laundering Unit

 Responsible for promoting

the strategic use of asset
forfeiture and ensures the
employment of money
laundering violations in all
investigations of the Task
Force.
Asset Forfeiture/Money Laundering Unit

 It shall also assist other

government agencies/offices
doing investigation on illegal
drug-related financial crimes,
counter-terrorism financing
and/or proceeds of
smuggling/illegal gambling
activities, Thru the AMLA
Desk of the CIDG.
Technical and Computer Forensics Unit

 Responsible in providing
innovative, scientific,
engineering, and technical
solutions to the most
critical operational problems
faced by other units.
Further, it shall provide
the Task Force with the
necessary capability to do
accounting and digital
forensics, Thru the Cyber
Thank You & Good Day!

THE END