The willingness to report employee offences to the police in the business sector
| Author | Giulia Mugellini,Giang Ly Isenring,Martin Killias |
| DOI | 10.1177/1477370815623569 |
| Published date | 01 May 2016 |
| Date | 01 May 2016 |
| Subject Matter | Articles |
European Journal of Criminology
2016, Vol. 13(3) 372 –392
© The Author(s) 2015
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DOI: 10.1177/1477370815623569
euc.sagepub.com
The willingness to report
employee offences to the
police in the business sector
Giang Ly Isenring, Giulia Mugellini and
Martin Killias
University of St. Gallen, Law School, Switzerland
Abstract
Not all crimes are reported to the police. The same is true for employee offences experienced
by firms. Indeed, companies that are victims of white- or blue-collar crime do not systematically
report the incidents to the police or to other official authorities. Victim studies and victimization
surveys are recent attempts to provide an insight into the amount of unreported crime. Drawing
on the most recent business crime survey conducted in Switzerland, this article focuses on
victim reporting of acts committed by employees such as fraud, theft, and unfair competition
and examines for the first time for this country the variables associated with firms’ reporting
behaviours. The analysis reveals that several factors might influence the reporting behaviour of
firms. The decision to report a crime or not varies and depends on the type of business, the type
of crime, its severity or the amount of damage resulting from the crime, the fear of reputational
damage, or trust in the police.
Keywords
Business crime, employee offence, police, reporting behaviour, victims
The reporting of crime against business
In the last decade, some important business studies that were focused on crime commit-
ted by employees have been developed at the international and European levels by both
governmental and private institutions (Home Office, 2013, 2014; PwC, 2012; Transcrime,
2012; UNODC, 2005, 2013), shedding light on the reporting behaviour of businesses
that are the victims of crime. However, research addressing the crime-reporting practices
Corresponding author:
Giulia Mugellini, University of St. Gallen Law School (LS-HSG), Tigerbergstrasse 21, CH-9000 St. Gallen,
Switzerland.
Email: giulia.mugellini@unisg.ch
623569EUC0010.1177/1477370815623569European Journal of CriminologyIsenring et al.
research-article2015
Article
Isenring et al. 373
of businesses (especially small businesses) is rare in comparison with research related to
individuals and households (Carcach, 1997; MacDonald, 2001).
For a long time, crimes committed against businesses have been rarely reported or
even hidden from the authorities, with the exception of some significant cases of white-
collar crime. The reasons for the reluctance of businesses to report crimes against them
are various and complex. In the early years of white-collar crime being explored as a new
concept, the hidden nature and the lack of understanding of white-collar crime in general
and crimes against businesses in particular was asserted to be the main reason for non-
reporting (Sutherland, 1945). However, later on other factors were indicated as being
responsible for limiting the reporting of crime to the police or relevant authorities.
The characteristics of the victim firm, the costs of the loss and the nature of the offence
are most likely determinant elements in the decision to report. Several studies revealed
that the reporting of crime does appear to be correlated with the type of crime (Home
Office, 2013, 2014). Crime surveys on businesses have revealed that, whereas crimes
such as burglary and robbery tend to be reported to the police, other crimes such as
employee theft, credit card fraud and customer theft are likely to go unreported to the
police (Home Office, 2013, 2014; Taylor, 2002). Of all the crime types, incidents of
vehicle theft were the most likely to be reported, with a 100 percent reporting rate accord-
ing to the combined 2012 and 2013 Commercial Victimisation Survey data (Home
Office, 2012, 2013). In the case of fraud, reporting behaviour is also known to be rare.
According to Deem (2000), the reason for this lower rate is that victims of financial
crimes feel they are treated as ‘second-class victims’ in the court system. Other studies
revealed that the most understandable reason for the lack of fraud reporting had to do
with the uncertainty of restitution (Nerenberg, 2000). Therefore, victims of fraud prefer
not to waste their time reporting a loss for which they would rarely receive restitution
(Levi, 2001).
Almost no differently from other types of crime, trust in the police and the perception
of the reactions of the police after reporting the crime play an important role in the deci-
sion to report a crime or not. Data from the Small Business Crime Survey conducted with
Australian small businesses showed that the reasons most strongly linked to non-
reporting of fraud (in particular cheque and credit card fraud) were that the police were
unable to help or to identify the offender (Taylor, 2002). The survey also found that the
reasons mostly linked to non-reporting of customer theft were that business owners
believed that reporting would not have achieved anything. The same was also found in
cases of attempted burglary, which were primarily not often reported because business
proprietors usually thought that the police were not interested in resolving the matter.
Hence, how the police conduct an investigation is strongly linked to future reporting
behaviour (Taylor, 2003).
In addition to the rational reasons for reporting, personal reasons could also influence
the decision of businesses to report, such as involvement in the crime commission (e.g.,
in the case of bribery and corruption or extortion). Some firms, because of fear for their
reputation and in order to preserve their clients’ trust, are not willing to report crimes that
took place in their firms.
However, although there has been considerable research into the hidden figures of
crime incidents against individuals and the reasons for non-reporting related to these
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