Transaction Systems and Unlawful Organizational Behavior

• NCJ Number: 84353
• Journal: Social Problems Volume: 29 Issue: 4 Dated: (April 1982) Pages: 373-379
• Author(s): D Vaughan
• Date Published: 1982
• Length: 7 pages
• Grant Number(s): 2 T32 MH15123
• Sponsoring Agency: US Dept of Health, Education, and Welfare
• Publication Format: Article
• Publication Type: Report (Study/Research)
• Language: English
• Country: United States of America

Annotation

Transactional systems which develop to cope with the complex legitimate exchange between organizations can also be used to secure gains unlawfully, as illustrated by Medicaid abuses.

Abstract

Because transactions of complex organizations are characterized by high degrees of formalization, intricate processing and recording methods, exchange based on trust, and general monitoring procedures, illegal conduct can be carried out with little risk of detection. Furthermore, the transaction systems of some organizations may be criminogenic, repeatedly generating violations between organizations through falsification of market signals or creation of system interface problems. Unlawful conduct may also occur because the transaction system itself blocks legitimate access to resources. Opportunities for violations multiply as transaction system complexity increases. Medicaid is an example of a highly complex criminogenic transaction system plagued by violations as a result of the factors functioning individually to generate illegal behavior, as well as acting in combination to present opportunities for violation both through a market signaling situation and system interface problems. Due to excessive red tape, burdensome paperwork, inadequate verification of data, and poor quality control, some providers manipulate the Medicaid system to their advantages, particularly by willfully misrepresenting their eligibility data. Reducing the complexity of transactions by monitoring and adjusting the criminogenic features of the transactional system may also reduce rates of violation. Such changes may decrease opportunities for illegality, improve the risk of detection, and decrease the probability of system interface problems, thus eliminating a source of motivation to pursue resources unlawfully. Changes that decrease the possibility that an organization will commit an offense also decrease the possibility that an organization will be victimized by other organizations or its own membership. The reference list contains 18 entries.