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General Strain Theory

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In 2016 alone, there were over 200,000 arrests made involving white collar crimes (UCR, 2016). Although white collar crime makes up less than 1% of all arrests made, it can cost its victims upwards of trillions of dollars in fiscal damages each year (ACFE, 2014). Despite its detrimental cost to its victims, very few theories are capable of explaining why white-collar crime takes place. General strain theory is one of the few theories capable of explaining the phenomenon of white collar crime, naming the presence of negative stimuli and goal blockage, among other factors, as central causes of criminality, despite the background or demographic of the offender. In The Wolf of Wall Street, Jordan Belfort grew up in a middle-class family, and turned …show more content…

General strain theory was first developed in 1992 by sociologist Robert Agnew. The theory states that criminality stems from a combination of being placed in situations which cause strain and the negative emotions which stem from it. Agnew outlines four categories of strain-inducing situations; the addition of negative stimuli, the removal of positive stimuli, disjunction between expectations and reality, and failure to achieve goals (Agnew et. al, 2001). The impact of these situations is then largely affected by the magnitude, recency and duration of the situation, as well as how many negative situations are occurring in the individual’s life at the same time (clustering). Ultimately, these situations lead to negative emotions, such as anger, frustration, depression or disappointment. These negative emotions, when combined with ineffective coping mechanisms, prompt the individual to turn to criminality. This definition gains specificity when looking at white collar crime, defining economic blockage in particular as the leading cause of white collar crime (Simpson et. al, 2009). The previous four categories transform when looking at white collar crime, shifting the focus towards the individuals economic and financial issues and …show more content…

Rothschild for six months, Jordan received a promotion to a position as a stockbroker, and was promptly laid off the same day due to the Black Monday crash. This situation in particular, placed an enormous amount of strain on Jordan as a positive stimulus was removed, via the loss of his job, and a negative stimulus was added, via pressure to provide for himself and his wife. These were added to the strain already being placed on Jordan through the disjuncture of his expectations and reality. In addition to the clustering of these negative events, losing a job was of high magnitude to Jordan as he viewed his position as a stockbroker as essential to the removal of another strain in his life, the gap between his desired wealth and his actual lower middle-class lifestyle. Although Jordan was able to obtain a job as a stockbroker in a relatively short time, the effect of his recent unemployment impacted his decision to use illegal selling tactics when he returned to work. The combination of these factors led to feelings of disappointment, frustration and fear within Jordan, ultimately leading him to the use of illegal “pump and dump” selling techniques, in which a stockbroker provides a client with false “insider” information in order to intentionally drive up the value of an often, worthless stock, and convince the client to invest

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