Sunday, November 23, 2003

Using rewards to catch white collar criminals
In this report Bruce Chapman (Centre for Economic Policy Research, ANU) and Richard Denniss (The Australia Institute) outline a new approach both to detecting and punishing the crimes of insider trading and collusion. They propose that financial incentives be offered to individuals or firms participating in illegal activity in return for the provision of evidence against other participants. In order to ensure that attractive incentives can be offered, and large fines levied, it is also proposed that a revenue contingent payment mechanism be utilised to extract both incentive payments and fines from firms and individuals convicted of these offences. The use of a revenue contingent penalty payment increases the certainty of collecting penalties while reducing the incentive for recourse to bankruptcy.
· Incentive payments and fines [(The Australia InstitutePDF file)]