Forfeiture of Illegal Gain: An Economic Perspective

Posted: 29 Feb 2008

See all articles by Roger A. Bowles

Roger A. Bowles

University of York - Department of Economics

Michael G. Faure

University of Maastricht - Faculty of Law, Metro; Erasmus University Rotterdam (EUR) - Erasmus School of Law

Nuno Garoupa

George Mason University - Antonin Scalia Law School, Faculty

Date Written: 2005

Abstract

Legislation enabling courts to confiscate or remove illegal gain has grown rapidly across a wide range of countries within both civil and common law systems. We review these developments from an economic perspective and show that there are certain types of offence for which the removal of illegal gain may provide a valuable complement to more traditional sanctions such as fines. Offences committed sequentially in small units and where the `victims` are unaware of offences as they are being committed may be very difficult (and costly) to detect. The probability of the offender being detected and convicted are correspondingly very low and the costs of getting convictions thus become very high. With a very low probability of detection efficient deterrence can be achieved only with extremely high fines. Some legislatures have preferred to give courts powers to remove illegal gain as an alternative means of increasing deterrence. We argue that the fact that these powers have most often been developed for offences such as environmental crime and drug trafficking lends support to our contention that more traditional sanctions have failed most conspicuously in areas of crime which tend to be repeated and `victimless`.

Suggested Citation

Bowles, Roger A. and Faure, Michael G. and Garoupa, Nuno, Forfeiture of Illegal Gain: An Economic Perspective ( 2005). Oxford Journal of Legal Studies, Vol. 25, Issue 2, pp. 275-295, 2005. Available at SSRN: https://ssrn.com/abstract=821679

Roger A. Bowles (Contact Author)

University of York - Department of Economics ( email )

Heslington
York, YO10 5DD
United Kingdom

Michael G. Faure

University of Maastricht - Faculty of Law, Metro ( email )

PO Box 616
Maastricht, 6200 MD
Netherlands
+31 - 43 - 388 30 60 (Phone)
+31 - 43 - 325 90 91 (Fax)

HOME PAGE: http://www.michaelfaure.be

Erasmus University Rotterdam (EUR) - Erasmus School of Law ( email )

3000 DR Rotterdam
Netherlands

Nuno Garoupa

George Mason University - Antonin Scalia Law School, Faculty ( email )

3301 Fairfax Drive
Arlington, VA 22201
United States

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