Ethical Business Issues and Solutions

Executive Summary

This business report focuses on a case study of a doctor whose firm has been committing white-collar crimes. It presents the ethical dilemma faced by the accounting officer and analysis of the options available. It also gives a justification for why the fraud committed is a white-collar crime. It also suggests the possible optimum alternative that can be taken to salvage the situation. The report also recommends how people should conduct themselves in their professional world to overcome ethical dilemmas and avoid committing crimes.

Table of Contents

Executive Summary. 1

Introduction. 3

Saul’s Ethical Dilemma. 3

Why the Medicare Fraud is a White-Collar Crime. 4

How Saul Should Approach the Situation. 4

Recommendations. 5

Conclusion. 5

References. 6


Businesses are often faced with tempting instances to commit white-collar crimes in their day to day operations (TAŞTAN, 2019). When they fall into the temptations, it leads to their finance and records team being faced with challenges to choose between being ethical by bringing the wrongdoings to light or swimming by the fraudulent waves of their employers. This business report will focus on a case study of a white-collar crime committed at a clinical business. It will also analyze the ethical dilemma posed to the accounting officer. This analysis will form the basis for the officer to come up with the best solutions to solve the puzzle.

Saul’s Ethical Dilemma

An ethical dilemma that is also referred to as an ethical paradox is the challenge is decision-making to choose between two or more alternatives (Figar & Đorđević, 2016). The possible options are neither ethically acceptable in their different ways. Ethical dilemmas are usually complicated in nature although they seem to have a straight forward solution. The idea behind solving such dilemmas is to emerge with the optimal option among the competing alternatives (Forester-Miller & Davis, 2016). Often is such dilemmas, some options are morally right while others are relatively immoral. The alternatives have a kind of consequence to the decision-maker which is mostly not pleasant.

Saul in the case is faced with an ethical business dilemma that he does not have an option but to solve. The dilemma has presented him with a challenge to choose between exposing Dr. Robert Smith to the authorities and Medicaid for two mistakes. The first mistake is that Dr. Robert Smith has been charging Medicaid for patients who are not their target beneficiaries which are supposed to be low-income earners. Secondly, he has been double charging the patients by getting payment from both the patients and Medicaid. This can be termed as a professional fraud which is punishable by law (Bennett, Levinson, & Hioki, 2017).

This means that, if Saul decides to report the matter to the authorities and the Medicaid, his brother may suffer a jail term and maybe lead to the collapse of the business. This will consequently lead to his brother losing the progress of his dream of becoming a heart surgeon. The family may also hate Saul for exposing his brother who gave up on his dream career to stay with the sickly dad and the town people. Therefore, this decision would leave Saul tainted as an enemy to his family and the entire town.

On the other hand, if Saul decides to keep it a secret and solve the matter with Dr. Smith, the habit may continue as a normal thing. Consequently, Medicaid may come to learn this fraud being committed at the business during their audits. This time, the mistake will be attributed to Saul who is in charge of records. This discovery may lead him to imprisonment and revoking of his practicing license. This would render Saul a fraud and unethical in his career. This situation is therefore an ethical dilemma for Saul of which he has no option but to choose between the two alternatives which have consequences which are bad to him.

Why Medicare Fraud is a White-Collar Crime

The term white-collar crime has increasingly been used in sociology, criminology, and politics, and business in recent times. The term is however used in substantive criminal law (Victoria, 2019). The question is what white-collar crime is and which kind of cases should be considered as white-collar. It is worth noting that in the newly enacted Sarbanes-Oxley Act, which is among the most vital sections of the federal criminal law legislation within many years, this term takes a notable appearance and importance. The definition of white-collar crime is highly contested among criminal law scholars, sociologists, and other social science scholars (Reurink, 2016). Most of the scholars define it according to their field and analytical bias. Despite the differences in definitions, there are a few similarities in all. General observation shows that white-collar crime is non-violent and is committed for financial gain (Chen, 2020).

With the general observation of white-collar crime being a non-violent fraud and having a financial gain to the fraudulent person, the crime committed by Dr. Smith in the case study may be considered white-collar (Gottschalk, 2016). This is because, he did not forcefully or violently attack the patients and clients to double pay their bills, or did he attack Medicaid to pay out the bills for patients who had already paid in cash. Secondly, this fraud, as said in the case study, and revealed by Saul, has earned Dr. Smith $75,000 which is a huge financial gain to him. This white-collar crime committed by Dr. Smith can be categorized as corporate fraud. This involves an exaggeration of figures by business with the aim of financial gain to the business. It seems from the case study that, Dr. Smith presented exaggerated invoices and statements to Medicaid for them to consider paying his business. This has been a common type of crime committed by private health facilities against the clients and health insurance schemes in different countries (Miller, 2013).

How Saul Should Approach the Situation

Being a professional accountant requires one to not only have accounting expertise but also the ability to uphold ethical business and reporting. Many accountants are in their career faced with ethical dilemmas to serve the interests of their masters, that of the authorities or that of the public (Steenwijk & Gould, 2019). A competent accountant should be able to stand by ethical business procedures and business reporting. This is not only because they are expected to have a moral standing but also because they may be left liable to a mistake done by the firm and consequently be charged with white-collar crime.

In the case study provided, Saul has two options that he can choose from. They all harm him. They include; reporting his brother for the crime committed and see him suffer a jail term and keeping the fraud unknown to anyone else and hope that no one finds out, which will be a risk of him being jailed in case it is found out. However, the family may suffer the loss of their son to a jail term. This presents a need for Saul to be analytical about the decision he takes.

To come up with the optimal alternative, Saul should adopt an approach that will leave him with only one option which has the least economic evil and the greater good for all the affected parties. In adopting the value theory approach, both alternatives seem to have equal effects on him and the family ( This makes him left with an option to find another alternative besides these two because this is a dilemma in which another solution can be considered.

Saul should, therefore, make Dr. Smith understand the negative consequences the crime may bring to the family. Then he can advise him to present the records to Medicaid as an accidental mistake then pay the overcharged amount. This would settle the issue and gain confidence in Medicaid for being honest. Considering the behavior of Dr. Smith portrayed in the case study, of arrogance and leaving Saul stranded wondering what to do, it is much expected that he will ignore the advice. If this happens, Saul should resign and save himself from the mess and this would consequently make Dr. Smith sort out the mess since employing another person who has no family ties with him will be easier for him to e exposed (Liao, Kwan, & Li, 2015).


Many people have in one or more instances been faced with an ethical dilemma in their professions and businesses. People should always hold onto the ethical alternatives that are available. This will champion moral business operations.

Business owners are often faced with numerous chances and temptations to commit white-collar crimes. They should always overcome the temptation as it has a short-term financial gain but can cost the loss of the entire venture and jail term and a tarnished reputation.

Professionals, especially accountants and auditors are often faced with an ethical dilemma. They should always stay firm in professionalism and ethical operations. This will in a big way reduce the economic crimes recorded across the world and promote professionalism in companies.


There are always those instances in everyone’s professional undertakings that they are faced with an ethical dilemma. This calls for one to always be analytical in whatever they do in their professions.  This helps people in choosing options and solutions which have the optimal benefit to every party involved. In conclusion, the ethical business will always have a longer life compared to that with fraudulent practices. Always choose the former.


Bennett, M. W., Levinson, J. D., & Hioki, K. (2017). Judging Federal White-Collar Fraud Sentencing: An Empirical Study Revealing the Need for Further Reform. IOWA LAW REVIEW [Vol. 102:939, 939-1000.

Chen, J. (2020, May 10). White-collar Crime. Retrieved August 1, 2020, from httap:// (n.d.). Ethical Dilemma. Retrieved August 1, 2020, from CFI Education Inc:

Figar, N., & Đorđević, B. (2016). MANAGING AN ETHICAL DILEMMA. ECONOMIC THEMES (2016) 54(3):, 345-362.

Forester-Miller, H., & Davis, T. E. (2016). Practitioner’s Guide to Ethical Decision Making. Retrieved August 1, 2020, from American Counselling Association:’s-guide-to ethical-

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Liao, Y., Kwan, H. K., & Li, J. (2015). Work-Family Effects of Ethical Leadership. Journal of Business Ethics Vol 128 No. 3, 535-545.

Miller, A. (2013). White coats and white-collar crime. Canadian Medical Association Journal, January 8, 2013, 185(1), 19-20.

Reurink, A. (2016). From elite lawbreaking to financial crime: The evolution of the concept of white-collar crime. MPIfG Discussion Paper, No. 16/10, Max Planck Institute for the Study of Societies, Cologne, pp. 1-31.

Steenwijk, E., & Gould, S. (2019, June 6). Dealing with ethical dilemmas with confidence. Retrieved August 1, 2020, from International Federation of Accountants:

TAŞTAN, S. B. (2019). White-collar criminals and organizational criminology: Theoretical perspectives. In S. B. TAŞTAN, Ethics in Research Practice and Innovation (pp. 296-322). Istanbul, Turkey: IGI Global Global Publishing.

Victoria, A. (2019). White-Collar Crime. DOI: 10.13140/RG.2.2.19821.64483, 1-8.

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