Business Law Text and Exercises 8th

Edition Miller Solutions Manual

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 Answers to Issue Spotters,
Using Business Law,
Real-World Case Problems
& Ethical Questions

CHAPTER 8

CRIMINAL LAW AND CYBER CRIME

ANSWERS TO ISSUE SPOTTERS

1A. Without Jim’s permission, Lee signs Jim’s name to several checks that were issued
to Jim and then cashes them. Jim reports that the checks were stolen and receives
replacements. Has Lee committed forgery? Why or why not? Yes. Forgery is the fraudulent
making or altering of any writing that changes the legal liability of another. In some instances,
however, authorization to sign another’s name negates a charge of forgery.

2A. Carl appears on television talk shows touting a cure for AIDS that he knows is
fraudulent. He frequently mentions that he needs funds to make the cure widely available,
and donations pour into local television stations to be forwarded to Carl. Has Carl
committed a crime? If so, what? Yes. Federal law makes it a crime to use the mails, a
telegram, a telephone, radio, or television to defraud. Carl has committed a violation of federal
wire fraud statutes.

A-1

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A-2 APPENDIX A: ANSWERS TO END-OF-CHAPTER QUESTIONS

ANSWERS TO USING BUSINESS LAW

8–1A. Types of crimes
1. Carlos has suffered a form of larceny called picking pockets.
2. Carlos has committed larceny—the wrongful taking of another’s personal property
without breaking and entering another’s premises, and without the use, or threatened use, of
force.

8–2A. Theft
Roy has committed embezzlement. The crime of embezzlement is committed when a person
entrusted with another’s property or money fraudulently appropriates it. That Roy may have
intended to repay the “borrowed” funds is no defense (although an embezzler who returns what
has been taken may not be prosecuted because the owner may not wish to take the time to make
a complaint, give depositions, appear in court, and so on). Depending on how Roy engineered
the theft, he may have committed other crimes—forgery, larceny, or a computer crime, for
example.

ANSWERS TO REAL-WORLD CASE PROBLEMS

8–3A. White-collar crime
Yes. The acts committed by Matthew Simpson and the others, and described in this problem,
constitute wire and mail fraud. Federal law makes it a crime to devise any scheme that uses the
U.S. mail, commercial carriers (FedEx, UPS), or wire (telegraph, telephone, television, the
Internet, e-mail) with the intent to defraud the public.
Here, as stated in the facts, Simpson and his cohorts created and operated a series of
corporate entities to defraud telecommunications companies, creditors, credit reporting agencies,
and others. Through these entities, Simpson and the others used routing codes and spoofing
services to make long distance calls appear to be local. They stole other firms’ network capacity
and diverted payments to themselves. They leased goods and services without paying for them.
And they assumed false identities, addresses, and credit histories, and issued false bills, invoices,
financial statements, and credit references, in order to hide their association with their entities and
with each other. The “scheme” was to defraud telecommunications companies and other
members of the public to the perpetrators’ gain of a variety of goods and services. Wire services—
the Internet, and presumably phones and other qualifying services—were used to further the
scheme.
In the actual case on which this problem is based, a federal district court convicted
Simpson of participating in a wire and mail fraud conspiracy (and other crimes). On appeal, the
U.S. Court of Appeals for the Fifth Circuit affirmed the conviction.

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accessible website, in whole or in part.
 CHAPTER 8: CRIMINAL LAW AND CYBER CRIME A-3

8–4A. Criminal liability

Yes. Green exhibited the required mental state to establish criminal liability. A wrongful mental
state (mens rea) is one of the elements typically required to establish criminal liability. The
required mental state, or intent, is indicated in an applicable statute or law. For example, for
murder, the required mental state is the intent to take another's life. A court can also find that the
required mental state is present when a defendant’s acts are reckless or criminally negligent. A
defendant is criminally reckless if he or she consciously disregards a substantial and unjustifiable
risk.
In this problem, Green was clearly aware of the danger to which he was exposing people
on the street below, but he did not indicate that he specifically intended to harm anyone. The risk
of death created by his conduct, however, was obvious. He must have known what was likely to
happen if a bottle or plate thrown from the height of twenty-six stories hit a pedestrian or the
windshield of an occupied motor vehicle on the street below. Despite his claim that he was
intoxicated, he was sufficiently aware to stop throwing things from the balcony when he saw police
in the area, and he later recalled what he had done and what had happened.
In the actual case on which this problem is based, after a jury trial, Green was convicted of
reckless endangerment. On appeal, a state intermediate appellate court affirmed the conviction,
based in part on the reasoning stated above.

8–5A. Search
Yes, a cross-gender strip search is unreasonable if there is no emergency—such as a riot or
natural disaster—to justify it. Whether a search is reasonable under the Fourth Amendment
requires balancing the need for the search against the invasion of personal rights that the search
entails.
Here, there was no emergency situation, and there was no apparent justification for
conducting a cross-gender strip search. In addition, the manner in which the search was
conducted seems unreasonable. A female officer performed the search while several male
officers watched, and one videotaped the search. There was no reason for the female officer to
conduct the search immediately rather than another officer whose gender was the same as
Byrd’s.
In the actual case on which this problem is based, the court held that the search performed
on Byrd was unreasonable and violated Byrd's rights under the Fourth Amendment to be free from
unreasonable searches.

8–6A. Embezzlement
Yes. When a person entrusted with another person’s money fraudulently appropriates it,
embezzlement occurs. Even if the money is not physically removed from the other’s possession
embezzlement occurs if a person has control over the other’s money and has the intent of
converting it to his or her own use.

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accessible website, in whole or in part.
A-4 APPENDIX A: ANSWERS TO END-OF-CHAPTER QUESTIONS

In this problem, Sisuphan had the required intent at the time of taking the funds, In
determining whether Sisuphan’s intent was fraudulent at the time of the taking, the main issue
was not whether he intended to spend the cash that he had taken. Rather, the deciding factor was
whether Sisuphan intended to use the funds for a purpose other than that for which the dealership
entrusted it to him. Sisuphan’s stated purpose was to jeopardize the employment of his
subordinate. This purpose indicated his fraudulent intent.
In the actual case on which this problem is based, Sisuphan was convicted of
embezzlement.

ANSWERS TO ETHICAL QUESTIONS

8–7A. Informing suspects of their rights
When this rule was first imposed, some observers argued that it would hamper police efforts to
bring criminals to justice. Exceptions were made for the admission of some confessions that
occurred before suspects were advised of their rights. Now some observers argue that there are
too many exceptions, making the situation confusing for police and the courts. Alternatives include
enforcing the requirement in all cases or dropping the requirement and videotaping all
interrogations.

8–8A. Identity theft

Omole perpetrated a sophisticated scheme that involved planning, execution, and avoidance of
detection. He defrauded individuals out of $90,000—which could be described as their “hard-
earned money”—and would likely have cheated them and others out of more if he had not been
stopped. He expressed contempt towards his victims and the court.
Omole’s conduct can be perceived as arrogant—a display of a feeling of superiority—and
lacking empathy for others, particularly his victims. There is no indication that he had any sense of
what it takes to live in society without cheating, stealing from, and victimizing others. To behave
ethically requires at least a willingness to refrain from illegal conduct and a degree of empathy for
others. Omole’s conduct showed that his character lacked these qualities. In other words, he
seems to have had no ethical principles. It might be countered that he was twenty years old and
that his behavior reflected only the self-centeredness of youth.
It might be pointed out that if Omole had put the ingenuity and energy he expended on his
illegal scheme to legal, practical use, he might have engineered a successful business. Instead,
his lack of ethics robbed himself and others of money and property, as well as the opportunity to
trust and be trusted and to do business in good faith.
In the actual case on which this problem is based, Omole was convicted and given a
sentence that the government appealed as too lenient. The U.S. Court of Appeals for the Seventh
Circuit vacated the sentence and remanded the case for resentencing.

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accessible website, in whole or in part.