Reference no: EM133342982

Assignment:

Case Study (White-Collar Crime)

Jonathan Lebed became interested in the stock market when he and two others competed in a stock-picking tournament during high school. He subsequently came up with a scheme to make real money, working out of his bedroom. Using brokerage accounts set up by his father, he bought cheap stocks electronically that were traded on the stock exchange. He would then flood message boards on the Internet with false and misleading postings that gave the impression that these cheap stocks would soon become valuable. Messages such as "Net stock to gain 1000 percent." combined with false stories that he was a company president, created the illusion that he had inside knowledge about these inexpensive stocks and the companies that issued them. To prevent his identity or the source of the postings from being revealed, he used many fictitious names when posting the misleading messages about the cheap stocks he had purchased.

As soon as the stock prices rose in response to his postings, Lebed would sell his shares for a quick profit. According to investigators, he profited between USD 11,000 to more than USD 70,000 on each trade. Ultimately, he was charged with using the Internet to manipulate stocks and earning USD 273,000 in illegal profits. The case was settled when he agreed to pay the Government USD 285,000.

Questions:

1. Explain whether you would characterize this scheme as white-collar crime or organized crime?

2. How can the Organized Crime Convention be used to identify the difference between these two forms of crime?