Old Fashioned Theft vs Social

Most people have a pretty good grasp on theft. An object belongs to one person and someone else takes it. There’s an ownership issue and a transference of the item or cash to another without knowledge or permission. For instance, a few weeks ago the news carried a story of an employee at Yale stealing electronic equipment. She ordered equipment over and above what was needed, sold the surplus, and pocketed upwards of $40Million. That’s a lot of cash.

One can only assume that she was able to get away with the scam for that long because she was in a position of trust. The status of employees was beyond reproach and hence normal protocols of employees taking at minimum a week’s vacation were waved away. This last part is social theft. It’s distinct from material theft.

Let’s take another example. Bernie Madoff plead guilty in 2009 to running the largest Ponzi scheme in the world and was sentenced to 150 years in prison. Taking people’s money and not giving it back to them is old-fashioned theft. The social component of Madoff’s scheme was to rely on his community ties to feed his graft. Wikipedia calls it affinity fraud.

Madoff targeted wealthy American Jewish communities, using his in-group status to obtain investments from Jewish individuals and institutions. Affected Jewish charitable organizations considered victims of this affinity fraud include Hadassah, the Women’s Zionist Organization of America, the Elie Wiesel Foundation and Steven Spielberg‘s Wunderkinder Foundation. Jewish federations and hospitals lost millions of dollars, forcing some organizations to close. The Lappin Foundation, for instance, was forced to close temporarily because it had invested its funds with Madoff.^[109]

When an actor internalizes a benefit received by being a member of a public group and then steals, the deceit is double.