WEBVTT - How White-collar Crime Works 0:00:00.280 --> 0:00:02.920 Brought to you by the reinvented two thousand twelve Camray. 0:00:03.160 --> 0:00:07.320 It's ready. Are you welcome to you Stuff you Should 0:00:07.400 --> 0:00:16.280 Know from House Stuff Works dot Com. Hey, and welcome 0:00:16.320 --> 0:00:20.000 to the podcast. I'm Josh Clark. There's Charles W. Chuck Bryant, 0:00:20.680 --> 0:00:26.360 uh stiffing on his laqui uh mineral water and um 0:00:26.640 --> 0:00:30.159 this isn't even a sponsored by location. Done this like 0:00:30.200 --> 0:00:34.280 two or three times? Yeah, I agree, call us uh. 0:00:34.320 --> 0:00:36.360 And since you put the two of us a couple 0:00:36.360 --> 0:00:39.480 of microphones in an ice cold can of refreshing Laquais 0:00:39.600 --> 0:00:42.440 mineral water together, you have something called Stuff you Should Know. 0:00:42.560 --> 0:00:46.120 It's a podcast. It's a podcast. I'm looking to see 0:00:46.120 --> 0:00:49.159 who makes this actually. Oh no, I thought I was 0:00:49.200 --> 0:00:52.280 gonna say, like Coca Cola and small let No, it's 0:00:52.400 --> 0:00:56.400 a Sundance beverage company. Oh yeah, they're huge for Minnesota. 0:00:56.440 --> 0:00:59.920 I think that's perfect. That is a perfect sponsor for stuff. 0:00:59.920 --> 0:01:03.200 You know, a little guy that's producing a great product. Agreed. 0:01:03.880 --> 0:01:13.000 Uh So, Chuck, I've got an intro today. Stop criticizing me. Um. So. 0:01:14.000 --> 0:01:21.240 Very recently, a trio of Brits economists, British economists, they're 0:01:21.280 --> 0:01:25.320 like walking saltines. Very exciting. Um. But anyway, these guys 0:01:25.360 --> 0:01:29.120 did something pretty cool. They studied bank robberies, and their 0:01:29.120 --> 0:01:32.959 study was published in a journal called Significance. It's actually 0:01:33.040 --> 0:01:35.319 kind of a cool journal. It takes statistics and applies 0:01:35.360 --> 0:01:39.080 it to real world stuff, so it's an interesting statistics journal. 0:01:39.480 --> 0:01:42.120 If there is such a thing, um, And if there is, 0:01:42.200 --> 0:01:45.160 this is it. And what these guys found was that 0:01:45.280 --> 0:01:48.120 bank robbery is actually a really terrible way to make 0:01:48.160 --> 0:01:52.920 a living. Yes, I would agree with that morally, economically 0:01:52.960 --> 0:01:57.200 it's a terrible way to make a living too, the right. Yes, 0:01:57.280 --> 0:01:59.280 they looked at they looked at a lot of variables, 0:01:59.320 --> 0:02:01.760 like the number of people involved, and they found that 0:02:01.800 --> 0:02:05.280 the bigger the gang, the more um, the bigger the 0:02:05.320 --> 0:02:08.560 hall I guess. But it also meant that's one extra 0:02:08.639 --> 0:02:10.959 mouth to divide up amongst unless you're like one of 0:02:10.960 --> 0:02:14.120 those bankrupers that just kills everybody afterward. Yeah, you don't 0:02:14.160 --> 0:02:15.800 want to get in bed with one of those guys 0:02:15.680 --> 0:02:18.240 like Ben Affleck, or like in Heat, when there are 0:02:18.240 --> 0:02:20.519 a lot of killing afterward. In Heat and in the 0:02:20.840 --> 0:02:23.639 town ben Affleck's a recent heist movie, a lot of 0:02:23.680 --> 0:02:25.720 killing going on. I was gonna let that one walk by, 0:02:25.800 --> 0:02:28.760 but you brought it up twice. I enjoyed it. Um. 0:02:28.760 --> 0:02:32.320 Oh really uh and okay, So anyway, Um, there's a 0:02:32.360 --> 0:02:34.880 lot of variables involved. But what they found is, no 0:02:34.919 --> 0:02:38.080 matter what, in the u K, you can make off 0:02:38.120 --> 0:02:41.919 with about thirty one graham. That's not bad, per yes, 0:02:42.160 --> 0:02:44.600 and on average that's what that's what the take was. 0:02:45.280 --> 0:02:47.600 So in the UK it's not so bad. Um. But 0:02:47.720 --> 0:02:49.520 at the same time, thirty one grand, what are you 0:02:49.520 --> 0:02:51.560 gonna do with that? Yeah? I mean, if you want 0:02:51.560 --> 0:02:53.079 to live the high life, you gotta rob like four 0:02:53.120 --> 0:02:56.120 or five banks a year easy, right or right? Okay 0:02:56.280 --> 0:02:59.239 or um. If you're in the US, you have to 0:02:59.320 --> 0:03:02.880 rob it more than that. So the UK suffers about 0:03:02.919 --> 0:03:04.800 a hundred and six bank robbers a year. In the 0:03:04.919 --> 0:03:09.000 US there's twelve thousand, and of those twelve thousand, the 0:03:09.080 --> 0:03:13.120 average take is like four grand. They only have how 0:03:13.120 --> 0:03:19.400 many a year. That's they have really stiff, stiff gun laws, 0:03:19.440 --> 0:03:21.720 and I think that probably determs bank robbery because you 0:03:21.800 --> 0:03:24.080 kind of have a gun or a note in your 0:03:24.080 --> 0:03:26.320 pocket and that says something. Well, these guys figured out 0:03:26.320 --> 0:03:30.480 that the presence of a firearm increased your take um. 0:03:30.560 --> 0:03:33.840 But anyway, so forty bucks that's not much at all now, 0:03:33.960 --> 0:03:36.080 and about a third of bank robberies I guess in 0:03:36.160 --> 0:03:40.960 both countries yield nothing zero zero. So it's a lot 0:03:41.000 --> 0:03:44.480 of hard work, a lot of risk, for very little gain. 0:03:45.560 --> 0:03:49.640 The real money is in white collar crime. Oh yes, 0:03:49.840 --> 0:03:54.040 you want to make some cash quick, maybe one good heist. 0:03:54.400 --> 0:03:55.800 It's gonna set you up for the rest of your 0:03:55.800 --> 0:03:59.120 life and even if you're caught. Even if you're caught, 0:03:59.200 --> 0:04:02.320 the chances are you will have a mild, if any 0:04:02.440 --> 0:04:06.640 penalty leviaging against you. White collars the way to go. Yeah, 0:04:06.800 --> 0:04:10.960 we're talking guys who um tell people that they are 0:04:11.080 --> 0:04:15.880 financial investors and get friends and family and uh parents 0:04:15.880 --> 0:04:18.480 of the little league that they coach to give them 0:04:18.560 --> 0:04:21.720 nine hundred grand. Um. There's other guys who just have 0:04:22.040 --> 0:04:26.520 little penny stock companies that pump up their um stock 0:04:27.400 --> 0:04:33.480 prospects called stock touting, and um dump all of their shares. UM. 0:04:33.560 --> 0:04:36.880 That's investor fraud. They make hundreds of thousands, if not 0:04:36.960 --> 0:04:38.919 millions of dollars. It's where the real money is, and 0:04:40.000 --> 0:04:44.720 historically speaking, it has really low risk even if you're called. 0:04:44.800 --> 0:04:46.960 All right, so we're endorsing white collar crime. We're not 0:04:47.120 --> 0:04:51.159 endorsing it. I was being facetious. I thought you met 0:04:51.320 --> 0:04:55.080 up with white collar crime in no. No. As a 0:04:55.080 --> 0:04:57.960 matter of fact, it's going down. The times are definitely changing. 0:04:58.000 --> 0:05:00.480 There's a big struggle going on right now is to 0:05:00.920 --> 0:05:04.600 figuring out the just the right amount of punishment with 0:05:04.640 --> 0:05:07.000 white collar crime, because there's a lot of factors involved. 0:05:07.120 --> 0:05:10.520 It's a lot different from blue collar crime e g. 0:05:10.680 --> 0:05:14.039 Stealing a car, robbing a bank. There's a lot of 0:05:14.080 --> 0:05:18.560 differences that differentiated. Let's separate the two, um And one 0:05:18.560 --> 0:05:22.600 of those now is the the sentencing forum is probably stiffer, 0:05:23.040 --> 0:05:25.680 which is a total reversal from how it used to 0:05:25.680 --> 0:05:28.120 be before. And they've also closed a lot of the 0:05:28.120 --> 0:05:31.480 club beds down that got so much press. Yes, well 0:05:31.520 --> 0:05:35.240 they've they've changed them. They're still there, they just are changed. Well, 0:05:35.240 --> 0:05:38.120 a lot of more shut down like period. Yeah, just 0:05:38.160 --> 0:05:45.960 to ship them to real federal penitentiary penitentiaries. Penitentiaries. Uh. 0:05:46.200 --> 0:05:48.400 That reminded me of a word that will definitely be 0:05:48.440 --> 0:05:53.880 hearing at some point in this podcast. It's oh yeah, 0:05:53.920 --> 0:05:56.359 because that's definitely white collar. Part of the problem with 0:05:56.360 --> 0:05:58.720 white collar crime, Josh, as you know from reading this 0:05:58.800 --> 0:06:01.479 is that uh um, it's hard to come up with 0:06:01.480 --> 0:06:04.680 an exact definition of what constitutes it. So that's why 0:06:04.720 --> 0:06:08.680 they have a hard time getting great statistics on punishment 0:06:08.800 --> 0:06:12.039 and finds levied and how many of they're catching. But 0:06:12.760 --> 0:06:18.640 I'm gonna go with non violent crime that typically involves 0:06:18.680 --> 0:06:20.240 and you have to sit things like typically because it's 0:06:20.279 --> 0:06:23.760 kind of all over the map. Typically involves um deceit 0:06:23.839 --> 0:06:29.080 and fraud given by a perpetrator because of their occupation. Yeah, 0:06:29.320 --> 0:06:31.080 And for that reason, a lot of times it's called 0:06:31.120 --> 0:06:35.880 occupational um crime. Yeah. Uh. And if you look at 0:06:35.880 --> 0:06:37.680 it through that view, which is a very broad view 0:06:37.720 --> 0:06:40.440 of white collar crime, it's not just the exacts and 0:06:40.480 --> 0:06:43.960 the three thousand dollar suits who are perpetrating this. It's 0:06:44.040 --> 0:06:48.320 the guy who's stealing pencils from work, Yeah, or violent 0:06:48.960 --> 0:06:50.680 especially somebody asked him if you did it, and he 0:06:50.680 --> 0:06:54.479 says no, And it's because you are You're You're granted 0:06:54.520 --> 0:06:58.200 this opportunity through your occupation. I would call that petty theft. 0:06:58.800 --> 0:07:01.960 It's but I'm saying, like a very very broad definition 0:07:01.960 --> 0:07:04.440 of white collar crime that that definitely counts. But for 0:07:04.480 --> 0:07:06.240 the most part, when you think of white collar you 0:07:06.240 --> 0:07:11.120 think about the CEO as you think about investor fraud, embezzlement, 0:07:11.200 --> 0:07:13.920 that kind of stuff exactly. Uh, feds have been after 0:07:13.960 --> 0:07:17.360 in the United States, uh, in earnest since nineteen seventy four, 0:07:17.360 --> 0:07:21.560 as far as a a dedicated division the FBI. Yeah, 0:07:21.640 --> 0:07:24.120 and that's because the NIX and I read and then uh, 0:07:24.400 --> 0:07:27.360 despite that, about three hundred billion dollars a year. And 0:07:27.400 --> 0:07:33.400 that's a pretty rough estimates, the two estimate. So let's 0:07:33.440 --> 0:07:36.000 talk about a few ways you can commit white color crime. Yeah, 0:07:36.160 --> 0:07:40.240 because the definition you gave us like beautiful, it's pretty good. Um, 0:07:40.280 --> 0:07:42.640 and there are some that just like I said, investment 0:07:42.680 --> 0:07:47.160 fraud or embezzlement or just prototypical white collar crime. Insider 0:07:47.200 --> 0:07:49.720 trading is one that's a big one which falls under 0:07:49.760 --> 0:07:53.440 securities fraud, right Uh yeah, I mean it's a type 0:07:53.440 --> 0:07:57.360 of securities fraud. So basically insider trading. We've I swear 0:07:57.480 --> 0:08:00.880 we've done something on this. I don't think so it 0:08:01.000 --> 0:08:03.800 must have been in our Fenian Freddie presentation then and 0:08:03.880 --> 0:08:06.920 then we studied a lot of this stuff. Yeah, and 0:08:06.960 --> 0:08:08.760 I thought we'd done a podcast and I guess not. 0:08:09.360 --> 0:08:12.680 But insider trading is essentially like, um, let's say that 0:08:12.960 --> 0:08:15.640 you and I find out that Discovery had an awesome quarter, 0:08:16.080 --> 0:08:18.400 and so we go and buy a bunch of Discovery 0:08:18.480 --> 0:08:21.480 stock for nothing, and then it just shoots through the 0:08:21.520 --> 0:08:25.000 roof after the stock price comes out. That's inside of trading. Sure, 0:08:25.200 --> 0:08:29.840 that's using private knowledge about a publicly traded company for 0:08:29.920 --> 0:08:33.400 your own game. That's a no no we to other people. 0:08:33.800 --> 0:08:37.800 That would count as well. And then Stewart, yeah, that 0:08:37.960 --> 0:08:40.600 they took part and then they would be UH insider 0:08:40.640 --> 0:08:43.720 traders as well, exactly. And it works the opposite way 0:08:43.760 --> 0:08:45.360 as well, Like if you find out that there's a 0:08:45.400 --> 0:08:48.560 lot of terrible information, terrible information is going to make 0:08:48.559 --> 0:08:52.200 your stock drop that you sell before that information becomes public, 0:08:52.480 --> 0:08:56.439 you're in trouble, big trouble. Securities fraud, which UM insider 0:08:56.440 --> 0:08:58.839 trading is kind of like that UM, but it is 0:08:58.880 --> 0:09:01.960 also manipulated and cooking the book keeper that term of 0:09:02.000 --> 0:09:07.560 your own company too. Maybe undervalue UM a stock before 0:09:07.600 --> 0:09:10.320 it goes public or I mean, there's all different variations, 0:09:10.679 --> 0:09:14.439 but it basically involves manipulating numbers in a dishonest way, right, 0:09:14.480 --> 0:09:18.440 that pumping up scheme where it's stocked outing. There's that's 0:09:18.520 --> 0:09:23.439 all securities fraud. UM and then there's anti trust violations 0:09:23.440 --> 0:09:25.080 for another good one that this has been kind of 0:09:25.120 --> 0:09:30.960 big lately. So, um, Google is supposedly hogging the YouTube metadata, 0:09:31.280 --> 0:09:34.199 which is preventing Microsoft from making a decent app for it. 0:09:34.920 --> 0:09:38.200 Yeah and um and Google's like, well, it's proprietary or whatever. 0:09:38.240 --> 0:09:40.080 And I was like, no, you gotta kind of have 0:09:40.120 --> 0:09:44.440 to share that. That's they're alleging an antitrust violation. Companies 0:09:44.520 --> 0:09:47.160 kind of police one another with that. And then also 0:09:47.240 --> 0:09:48.960 price fixing is a big one, which is like the 0:09:49.000 --> 0:09:52.559 opposite of companies policing one another. It's collusion between companies 0:09:52.800 --> 0:09:56.920 and like Apple and book publishers, um fixing the prices 0:09:56.960 --> 0:10:01.080 of e books allegedly has been going on. Yeah, yeah, man, 0:10:01.080 --> 0:10:03.000 it's going on all over the place. That it's it's 0:10:03.000 --> 0:10:07.800 a dirty, dirty, dirty world bribery one of the oldest 0:10:07.880 --> 0:10:11.520 tricks in the book. Um. Obviously that's involves some sort 0:10:11.559 --> 0:10:16.360 of a payoff or a kickback in exchange for uh 0:10:16.760 --> 0:10:20.600 whatever information. Um, I get the bid, my company gets 0:10:20.760 --> 0:10:23.240 your bid with this government job, and I get a 0:10:23.280 --> 0:10:27.280 little kickback or I give you a little kickback rather um, 0:10:27.320 --> 0:10:31.600 any kind of maybe favorable decision that can influence your company. Yeah, 0:10:31.679 --> 0:10:34.440 a little little grease in the palm going on. Here's 0:10:34.520 --> 0:10:39.520 three high quality frozen steaks. Please consider it, and you 0:10:39.679 --> 0:10:44.240 say consider granted. And within each of these steaks is 0:10:44.360 --> 0:10:47.800 a one million dollar bill. It's not even an it 0:10:47.880 --> 0:10:50.599 doesn't even exist. What frozen steaks with money in a 0:10:51.080 --> 0:10:54.360 million dollar bill? Okay, we know about frozen deutsch marks. 0:10:54.360 --> 0:10:56.520 Somebody sent us a dollar. By the way, I want 0:10:56.559 --> 0:10:59.240 the dollar. We'll we'll give you fifty cents, right, I 0:10:59.240 --> 0:11:00.880 guess it's thirty three in the third we gotta give 0:11:00.960 --> 0:11:04.800 Jerry or cut. Don't go there, we'll talk about it later. 0:11:06.800 --> 0:11:10.599 Embezzlement Office Space. Everyone's seen the movie Office Space, that 0:11:10.679 --> 0:11:12.839 little program they had to like shave a sin or 0:11:12.880 --> 0:11:17.320 something off of a transaction. That's embezzlement. They were given 0:11:17.360 --> 0:11:23.000 the opportunity through trust, with books, with accounting, they basically 0:11:23.000 --> 0:11:26.120 add access to the money and skim them off the top. 0:11:26.600 --> 0:11:36.600 Which we have done a podcast on schemes um So 0:11:36.679 --> 0:11:40.720 basically all of the those are all the stars. There's 0:11:40.720 --> 0:11:45.439 also other ones like m espionage, industrial espionage, corporate SPI, 0:11:46.520 --> 0:11:50.400 white collar. Remember the lady who tried to sell Pepsi's 0:11:50.400 --> 0:11:53.520 secret to coke? Yeah, that was pretty hackney. No Coke's 0:11:53.559 --> 0:11:56.360 secret to PEPSI because she was like, wait right here 0:11:56.559 --> 0:11:58.120 she was, and they went and called the cops. She 0:11:58.120 --> 0:12:01.280 didn't do a real good job, but she was surprised. UM. 0:12:01.559 --> 0:12:05.920 Environmental law violations like dumping toxic waste. Yeah, covering that 0:12:06.040 --> 0:12:10.560 up like Aaron Brockovich style. UM. One of the things 0:12:10.559 --> 0:12:12.240 they point out in here, which is when it comes 0:12:12.240 --> 0:12:15.800 to things like your little office space scheme that you 0:12:15.920 --> 0:12:20.320 just touted. UM. A lot of times, it's difficult to 0:12:20.400 --> 0:12:24.480 imagine victims. Like in office space, they think no one's 0:12:24.480 --> 0:12:28.520 gonna miss a penny. Is a huge company, So you 0:12:28.559 --> 0:12:32.760 commit these crimes without realizing that someone has hurt somewhere 0:12:32.800 --> 0:12:35.440 down the line. If you dump your stock, your company 0:12:35.520 --> 0:12:37.800 stock that you know is about the tank. And I'm 0:12:37.800 --> 0:12:41.080 not saying it's understandable, but if you've like worked your 0:12:41.120 --> 0:12:44.880 whole career investing in this company with your four own 0:12:44.960 --> 0:12:47.439 k you know it's about to tank, You're like, man, 0:12:47.520 --> 0:12:49.600 I need to sell this or else I'm done for. 0:12:50.040 --> 0:12:52.720 My family's done for. You don't think about the people 0:12:52.800 --> 0:12:56.960 buying the stock, they're the victims. No, It's absolutely true, 0:12:56.960 --> 0:13:00.840 And I mean, like you are being pawned. You're pawning 0:13:00.880 --> 0:13:03.120 your problem off on somebody else. But I think you 0:13:03.200 --> 0:13:08.480 paint a really really excellent scenario, Like you can in 0:13:08.559 --> 0:13:12.679 some cases feel bad for the white collar criminal um, 0:13:12.920 --> 0:13:15.440 especially if it's just some average Joe who's worried about 0:13:15.480 --> 0:13:18.160 is for a one case um or in the case 0:13:18.200 --> 0:13:21.679 of Enron, you don't feel bad for the upper dudes. 0:13:21.920 --> 0:13:25.160 You feel bad for everyone in that company that got defrauded, right, 0:13:25.160 --> 0:13:27.480 But they were strictly victims. They didn't they didn't turn 0:13:27.480 --> 0:13:29.760 around and like try to dump the stocks. But that 0:13:29.760 --> 0:13:33.079 that's a very visible case of like screwing over your 0:13:33.080 --> 0:13:35.480 own employees. But you make a good point, like even 0:13:35.520 --> 0:13:38.120 if the even if the criminal is sympathetic, there still 0:13:38.200 --> 0:13:41.920 is a victim, even if it's just some amorphous trader 0:13:42.040 --> 0:13:44.360 they'll never meet, even if the victim is some like 0:13:44.440 --> 0:13:48.600 hedge fund manager. It's really tough. There's like a really 0:13:48.679 --> 0:13:51.360 weird spectrum here. There's like I don't know if it's 0:13:51.360 --> 0:13:56.200 a Bell curve or like the UV spectrum, who knows. 0:13:56.880 --> 0:14:01.000 But there's sympathies like placed in different spot sympathies and 0:14:01.040 --> 0:14:05.760 anti antipathies placed along this this depending on who did 0:14:05.800 --> 0:14:08.440 what and what they gained from it and what their 0:14:08.480 --> 0:14:11.520 motives were agreed, because you gotta also have credit card 0:14:11.559 --> 0:14:16.959 fraud and computer and mail fraud and counterfeiting and things 0:14:17.000 --> 0:14:20.480 like that, like you know the Nigerian email scams. That's 0:14:20.520 --> 0:14:22.920 white collar. But and they're in the same boat as 0:14:22.960 --> 0:14:27.960 like ken Ley and Jeff Skillings exactly same scummy crooks. 0:14:28.080 --> 0:14:30.480 Or let's say you commit a little credit card fraud 0:14:30.600 --> 0:14:33.680 and you or bankruptcy fraud and you're dislike, does it 0:14:33.840 --> 0:14:35.400 be easy way to get out of my debts? Or 0:14:35.440 --> 0:14:38.120 I just say someone stole my credit card. It's very 0:14:38.160 --> 0:14:41.880 easy there to not envision a a victim because it's 0:14:42.600 --> 0:14:45.880 it's Chase Manhattan Bank, and like they're gonna notice. But 0:14:45.960 --> 0:14:48.440 what happens is they raise the rates on you and me, 0:14:49.640 --> 0:14:51.880 and all of a sudden, everyone across the board is 0:14:51.880 --> 0:14:56.440 paying more money for stuff. Yes, that is that is true. 0:14:58.440 --> 0:15:01.880 That is very true, and that is I think everybody 0:15:01.880 --> 0:15:04.240 should probably. I think a good companion piece that occurred 0:15:04.240 --> 0:15:06.880 to me is to go listen to our wide corporations 0:15:06.880 --> 0:15:10.000 have the same rights as you. One of the fundamental 0:15:10.040 --> 0:15:13.520 flaws of UM corporate policy is that you serve your 0:15:13.840 --> 0:15:17.840 shareholders first. Like you need to adhere to the law, 0:15:17.920 --> 0:15:21.240 but really, ultimately, like anything you can do to serve 0:15:21.280 --> 0:15:25.440 your shareholders is your mandate as a as a corporate governor. 0:15:26.160 --> 0:15:30.600 Um that includes keeping the profit margin as high as possible, 0:15:31.120 --> 0:15:33.600 which you're not gonna go to your your shareholders and 0:15:33.640 --> 0:15:36.240 be like, hey, we're making enough money. We took kind 0:15:36.240 --> 0:15:38.920 of a hit, but we're still making a ton of profit, 0:15:39.440 --> 0:15:41.520 so we'll just take a little hit this year. No, 0:15:42.000 --> 0:15:45.640 it's where we took a hit, so we're gonna fire people. 0:15:46.720 --> 0:15:49.960 However you reconcile that, I mean, that's your own personal beliefs, 0:15:50.040 --> 0:15:52.560 like what what you feel about that? But that is 0:15:52.960 --> 0:15:56.560 reality as far as business goes, Right, there's fraud, there's 0:15:56.600 --> 0:16:00.120 adjustments to the fraud, absorbing the fraud, and it's the 0:16:00.200 --> 0:16:03.120 corporation trying to get as lean as possible. Yeah, they're 0:16:03.120 --> 0:16:05.200 not going to take the hit for that. They're not 0:16:05.200 --> 0:16:08.320 gonna say, oh, well, a bunch of people defaulted on 0:16:08.360 --> 0:16:10.120 their credit cards this year. I guess we'll just have 0:16:10.160 --> 0:16:13.360 a bad year. And I know in reality that's how 0:16:13.400 --> 0:16:15.880 it works, but it's I just find it disingenuous to 0:16:15.880 --> 0:16:18.880 be like, well, everybody suffers, you know, like people lose 0:16:18.920 --> 0:16:21.720 their jobs because of thought. It's like there's a there's 0:16:21.720 --> 0:16:24.040 a point b in there that that has to be 0:16:24.040 --> 0:16:27.480 held accountable to some degree. Well, which is your own 0:16:27.960 --> 0:16:31.000 freaking ethical code of conduct? And like, how about not 0:16:31.040 --> 0:16:32.680 doing that because it's the wrong thing to do. No, 0:16:32.760 --> 0:16:35.520 but I'm saying, like there's an institution that's absorbing the 0:16:35.600 --> 0:16:38.320 hit and then turn around firing this poor guy. Yeah, exactly. 0:16:39.320 --> 0:16:42.560 It's just it's tough because I came across a word 0:16:42.760 --> 0:16:46.240 when they were describing white collar crime giving a definition 0:16:46.280 --> 0:16:50.880 of it, and they said, victims colon diffuse. You don't 0:16:50.920 --> 0:16:55.000 meet the person that the victim passes along the hit 0:16:55.120 --> 0:16:59.360 to other people. It's a big it's nebulous. And even 0:16:59.400 --> 0:17:02.240 if they're raised rates by like a quarter of a 0:17:02.280 --> 0:17:04.879 percentage point, or you're paying an extra two dollars as 0:17:04.880 --> 0:17:09.400 a consumer a year, it's like it's still not right. Yeah, 0:17:09.600 --> 0:17:12.159 you know, it's not right all over the place. So 0:17:12.200 --> 0:17:16.000 where did this come from? Uh, Josh, it came It 0:17:16.080 --> 0:17:20.440 sounds like it came from a cold wool delivery boy. 0:17:22.160 --> 0:17:23.720 I want to know more about this. Was this dude 0:17:23.800 --> 0:17:25.480 just cold or did he really steal a lot of wool? 0:17:25.760 --> 0:17:28.040 So you're talking about the carriers. The Carrier's case of 0:17:28.119 --> 0:17:33.520 fourteen seventy three, it's the first um white collar trial, yes, 0:17:33.880 --> 0:17:37.080 um and and it resulted in the first white collar 0:17:37.240 --> 0:17:41.480 law in fifteenth century England. And this wool transporter was 0:17:41.560 --> 0:17:43.439 given a bunch of wool and said, hey, take this 0:17:43.480 --> 0:17:47.480 wool to this person, and it was his job. So 0:17:47.560 --> 0:17:50.080 he decided to instead just keep the wool for himself 0:17:50.080 --> 0:17:52.520 for his own use. So he looked into this more. Yeah, 0:17:52.560 --> 0:17:54.040 I thought he might have been like cold on his 0:17:54.119 --> 0:17:56.199 journey and said, you know, I'm gonna keep some of 0:17:56.200 --> 0:17:58.399 this wool. Now, he kept some of the wool. He 0:17:58.520 --> 0:18:00.720 I think he kept all of it, but somebody gave 0:18:00.760 --> 0:18:03.919 it to him. He's like, thanks, chump, and he was. 0:18:04.040 --> 0:18:06.720 But the key is, and this is something that has 0:18:06.880 --> 0:18:10.639 has woven into the history of white collar crime. What 0:18:10.800 --> 0:18:13.920 he did was not illegal at the time. The law 0:18:13.960 --> 0:18:16.520 that was enacted as a result of the Carrier's case 0:18:17.240 --> 0:18:20.600 was they were saying, Okay, this isn't this isn't illegal, 0:18:20.640 --> 0:18:23.399 but it's obviously there's a huge problem with this, so 0:18:23.400 --> 0:18:25.960 we're going to create a law right that outlaws this 0:18:26.080 --> 0:18:29.040 act so people can't do it anymore. Good point, and 0:18:29.119 --> 0:18:31.600 basically that's what happened. Well, that's kind of what happens 0:18:31.600 --> 0:18:33.480 with every law. I guess, someone commits it first and 0:18:33.520 --> 0:18:36.120 then someone says, hey, maybe we shouldn't do that. Yeah, yeah, 0:18:36.160 --> 0:18:39.960 I guess. But in this case, especially like uh, the 0:18:40.000 --> 0:18:43.600 Industrial Revolution in the West, obviously you started getting these 0:18:43.640 --> 0:18:46.520 larger corporations and all of a sudden, things like monopolies 0:18:47.040 --> 0:18:51.480 and price fixing and employee uh safety and all these 0:18:51.480 --> 0:18:54.960 things come into effect for the first time. So that's 0:18:55.000 --> 0:18:57.280 sort of when it was really born, and when they 0:18:57.320 --> 0:18:59.840 started saying, hey, we need to look at something called 0:19:00.040 --> 0:19:03.560 to trust. Yeah. Again, like monopolies were not illegal, but 0:19:04.080 --> 0:19:06.880 when a company bought up all of its competitors and said, oh, 0:19:07.760 --> 0:19:11.160 suddenly the price for your groceries like through the roof, 0:19:11.560 --> 0:19:15.040 where else you gonna go, it wasn't illegal. But the 0:19:15.040 --> 0:19:18.919 the people of the world started screaming and governments finally responded, 0:19:19.160 --> 0:19:21.760 And it was really the US that first had the 0:19:21.800 --> 0:19:25.520 real first solid response in the Sherman Anti Trust Act 0:19:25.880 --> 0:19:29.720 in like the eighteen seventies maybe I think nine, named 0:19:29.720 --> 0:19:34.359 for John Senator John Sherman, Ohio Republican dude Chairman of 0:19:34.359 --> 0:19:37.280 the Senate's Finance Senate to Finance Committee, which I didn't 0:19:37.320 --> 0:19:40.440 know they even had way back then. I forgot didn't either, 0:19:40.520 --> 0:19:42.760 but I mean it seems like a basic committee there. 0:19:43.160 --> 0:19:45.880 So this is interesting. And that it was voted on. 0:19:46.400 --> 0:19:49.520 It won by vote of in the Senate one in 0:19:49.560 --> 0:19:52.440 the House by two forty two to zero, so there 0:19:52.480 --> 0:19:55.840 was one dude that didn't vote for it. And then 0:19:56.080 --> 0:19:58.119 I think twenty five years later when they came up 0:19:58.119 --> 0:20:00.960 with the Clayton Anti Trust Actor, really put some punch 0:20:01.000 --> 0:20:03.879 into the Sherman Act. It was two seventy seven to 0:20:03.920 --> 0:20:06.840 seventy four and forty six to sixteen. So in that 0:20:06.920 --> 0:20:10.880 twenty four years it sounds like maybe things got slightly 0:20:10.960 --> 0:20:13.960 corrupt here and there. Well it wasn't that it was that. Well, 0:20:14.119 --> 0:20:17.200 maybe it was, but there was also some real problems 0:20:17.200 --> 0:20:19.879 with the Sherman Act. It was really vague. It basically 0:20:19.960 --> 0:20:24.600 said like now from here fourth all um anti competitive 0:20:24.800 --> 0:20:27.600 corporate measures are illegal, and then it left it to 0:20:27.680 --> 0:20:30.320 the courts to decide what was what, and the courts 0:20:30.400 --> 0:20:32.760 weren't really in the mood to enforce it, so it 0:20:32.800 --> 0:20:38.040 went largely unenforced. Although American Tobacco Company and Standard Oil 0:20:38.119 --> 0:20:40.359 like two of the biggest companies in the country were 0:20:40.400 --> 0:20:44.479 dissolved under the Sherman Act, Standard Oil big time. Imagine that. 0:20:44.560 --> 0:20:49.000 Like imagine going to a company now and saying like, hey, Apple, 0:20:49.400 --> 0:20:51.920 you're just too big, so we're gonna dissolve you into 0:20:51.920 --> 0:20:55.000 thirty one companies. We have all these federal regulators here 0:20:55.000 --> 0:20:56.679 and they're gonna come in and look at everything, and 0:20:56.680 --> 0:21:01.800 that dissolve you into different companies. Sorry, that's what they did. Okay, 0:21:01.840 --> 0:21:03.600 even still it didn't have enough tea, so they came 0:21:03.640 --> 0:21:05.960 up with the Clayton Anty Trust Act, and then that 0:21:06.040 --> 0:21:09.119 one really spelled things out, like, um, you couldn't do 0:21:09.200 --> 0:21:13.520 price discrimination anymore, which if you were black in America 0:21:13.600 --> 0:21:18.800 during the Gym Crow era, price discrimination was mind boggling. 0:21:18.960 --> 0:21:21.080 Oh yeah, you walk into a store if you're allowed 0:21:21.080 --> 0:21:23.080 in there to begin with, and they'll just make up 0:21:23.119 --> 0:21:26.320 whatever price they want. It's it was really I'm reading this, 0:21:26.480 --> 0:21:29.280 um consumers in an America book, and it's at this 0:21:29.400 --> 0:21:34.560 point now is really just this blemish on American history. 0:21:34.960 --> 0:21:37.639 I mean, like slavery wasn't bad enough to like have 0:21:38.040 --> 0:21:43.879 slavery light through the Jim Crow era. It's just disgusting. Um, Okay, 0:21:43.920 --> 0:21:52.240 so there was no price discrimination allegedly, corporate mergers were outlawed. Yeah, um. 0:21:52.320 --> 0:21:55.320 And then interlocking boards where you have like competitive companies 0:21:55.640 --> 0:21:58.160 but the same people on the board of each Right, 0:21:58.280 --> 0:22:01.000 you can't have that. And then also elusive contracts where 0:22:01.000 --> 0:22:06.520 it's like hey, home Depot, you can sell our um 0:22:06.680 --> 0:22:09.840 weed whackers, but you can't tell anybody else's those contracts 0:22:09.880 --> 0:22:13.960 are out right. They do stuff like that now though, right, 0:22:15.160 --> 0:22:17.359 maybe not exclusively, but they carry lives. They do not 0:22:17.680 --> 0:22:21.919 limited number of brands, corporate mergers, interlocking boards, exclusive contracts, 0:22:22.640 --> 0:22:26.159 all that stuff one a way, it all got chipped away. 0:22:26.240 --> 0:22:29.199 It's just I mean this, this, this act is like 0:22:29.320 --> 0:22:32.080 not in forts anymore. Basically, Well, that's one things that 0:22:32.119 --> 0:22:35.399 bugs me about like grocery or actually the big box 0:22:35.600 --> 0:22:40.040 hardware stores. Grocery shopping. You you only have access to 0:22:40.320 --> 0:22:43.479 what they who they have partnered with, right, whether it's 0:22:43.480 --> 0:22:45.639 your potato chip that you want or your weed whacker 0:22:45.680 --> 0:22:47.360 that you want. It's true, and most of the big 0:22:47.359 --> 0:22:52.640 box stores also have exclusive contracts the other way. It's like, yeah, 0:22:52.760 --> 0:22:55.560 we'll sell your weed whacker, but you can't sell it 0:22:55.960 --> 0:22:59.119 no one else can. So it's like a real gamble, 0:22:59.160 --> 0:23:03.000 I understand, like sign on to one of these giant corporations. Well, 0:23:03.040 --> 0:23:05.680 that's one in the Walmart effect. That was one of 0:23:05.280 --> 0:23:08.040 the things I think they used to. It's like a 0:23:08.040 --> 0:23:11.920 tent company or an awning company, and like this mom 0:23:11.920 --> 0:23:13.600