General strain and procedural justice in retail banking. A qualitative case study with a multi-theoretical approach to improving compliance policy
| Date | 04 July 2016 |
| DOI | https://doi.org/10.1108/JFC-10-2015-0058 |
| Pages | 588-604 |
| Published date | 04 July 2016 |
| Author | Peter Leasure |
| Subject Matter | Accounting & Finance,Financial risk/company failure,Financial crime |
General strain and procedural
justice in retail banking
A qualitative case study with a
multi-theoretical approach to improving
compliance policy
Peter Leasure
Department of Criminology and Criminal Justice,
University of South Carolina, Columbia, South Carolina, USA
Abstract
Purpose – The purpose of the current study is to examine the applicability of general strain and
procedural justice theories to retail banking deviance in an effort to improve compliance programs.
Design/methodology/approach – This objective is achieved through a qualitative case study of
active members of the retail banking industry guided by three research questions. First, how do
participants view their companies’ current compliance programs? Second, what types of crime or
deviance are present in the data in which general strain and procedural justice theories are indicated?
Third, what ethics and compliance recommendations can be made from the identied deviance and
underlying theories?
Findings – Results indicate that current ethics and compliance programs are viewed as having serious
aws. Results also show the presence of a large amount of fraud based deviance in which both general
strain and procedural justice theories seem to be implicated. Specic compliance enhancements are
proposed in light of these ndings.
Originality/value – The current study is one of the rst to examine white collar crime deviance and
ethics and compliance programs in the retail banking industry. Conducting research in specic
industries is key as ndings from a study in a particular industry may not extrapolate to another.
Further, the current study uses a qualitative approach, which allows a deeper understanding of
underlying mechanisms, with participants who have committed some form of deviance and are active
members in their industry. Because of this fact, this study has the potential to provide new and different
insights than a study conducted using students or other such participants and hypothetical scenarios.
Keywords Ethics, Compliance, Banking, Procedural justice, General strain
Paper type Research paper
White-collar crime is a growing problem that continues to cause a signicant amount
damage of each year. In the USA, the Federal Trade Commission documented an
increase of more than 200,000 complaints (an 11 per cent increase) of several specic
types of white-collar crime, including identity theft, fraud and other complaints from
2011 to 2013. Over 2.1 million complaints were led, with losses to individuals exceeding
US$1.6 bn (Federal Trade Commission, 2013). The FBI and the Association of Certied
Fraud Examiners estimate that the annual cost of all white-collar crime as being
between US$300 and US$660 bn (Huff et al., 2010). It is difcult to quantify the true cost
The author would like to thank Gary Zhang for his help on theory research.
The current issue and full text archive of this journal is available on Emerald Insight at:
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JFC
23,3
588
Journalof Financial Crime
Vol.23 No. 3, 2016
pp.588-604
©Emerald Group Publishing Limited
1359-0790
DOI 10.1108/JFC-10-2015-0058
of white-collar crime due a number of reasons, including a lack of ofcial statistical
information and empirical studies on the topic, the nature of white-collar crime and the
rapidly changing high-tech methods of commission (Huff et al., 2010). However, it is
clear that white-collar crime is becoming more prevalent. A 2010 report by the National
White Collar Crime Center found that nearly one household in four was victimized by
white-collar crime within the past year, and that about one in six people were victimized
by white-collar crime within the past year (Huff et al., 2010). At a victimization rate of
24.2 per cent for households, white-collar crime is occurring more frequently than
property crime and violent crime combined.
One popular method used to combat white-collar crime at its source is the
implementation of ethics and compliance programs by corporations and other
businesses[1]. However, Kieffer and Sloan (2009, p. 318) identied the problem that
“such efforts have not been evaluated or if they have, there is no consensus among
ethicists concerning the quality of such programs”. The current study seeks to ll this
gap noted by Kieffer and Sloan (2009) by examining compliance in the retail banking
industry[2].
Previous research in the retail banking context uncovered and detailed deviance in
the retail banking industry by using grounded theory analysis (Leasure and Zhang,
2015). In relation to the uncovered deviance, the previous study found that several
criminological theories could have relevance in explaining retail banking deviance. A
main argument of the current paper is that criminological theories, especially general
strain and procedural justice, can be extremely useful tools in creating more effective
ethics and compliance programs. The objective of the current study is therefore to
examine retail banking deviance which implicates general strain and procedural justice
theories in hopes that such an analysis can provide information that can be used to
improve ethics and compliance programs. This objective is achieved through the
following research questions. First, how do participants view their companies’ current
compliance programs? Second, what types of crime or deviance are present in the data in
which general strain and procedural justice theories are indicated?[3] Third, what ethics
and compliance recommendations can be made from the identied deviance and
underlying theories?
The present study contributes insight to this area in several additional respects as
well. First, the current study is one of the rst to examine white-collar crime deviance
and ethics and compliance programs in the retail banking industry. Conducting this
type of research in specic industries is a key, as ndings from a study in a particular
industry may not extrapolate to another. Second, qualitative research allows for a
deeper understanding of white-collar crime deviance and ethics and compliance
programs in the retail banking context. Finally, the current study is one of the rst to use
a qualitative approach with participants who are active members in their industry.
Because of this fact, the present study has the potential to provide new and different
insights than a study conducted using students or other such participants and
hypothetical scenarios (Piquero et al., 2005;Thurman et al., 1984;Harrington, 1996)or
participants who have already been sanctioned and studied out of their work context
(Benson, 1985;Cressey, 1953;Willott et al., 2001;Jesilow et al., 1993).
This study begins with a review of literature on white-collar crime itself to provide an
overview of the concept. Next, literature will be reviewed dealing with the main cannons
of general strain and procedural justice theories as well as works which have empirically
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General
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