Generally, corporate scandals occur because of the actions of a number of people. We propose that transactional, personalized charismatic leaders who are politically astute may create an environment where their subordinates commit crimes of obedience. According to social cognitive theory, individuals behave immorally by disengaging their self-regulatory mechanisms [Org. Behav. Hum. Decis. Process 50 (1991a) 248; Bandura, A. (1991b). Social cognitive theory of moral thought and action. In W.M. Kurtines and J.L. Gerwitz, (Eds.), Handbook of moral behavior and development (vol. 1, pp. 45-103). Hillsdale, NJ: Erlbaum]. Leaders can cognitively reconstrue the conduct to convince the subordinates that the behavior is morally justified. The employees can disclaim their agentive role in the consequences of the action and leaders can use their authority, power, status, and social influence to convince employees that they have no choice in their behavior. The organizational structure may allow employees to "just do their jobs" without consideration of the consequences. Finally, leaders can frame behavior in such a way that others believe there really are no negative consequences, and thus, no victims. We conclude with some recommendations on how to run an organization effectively yet with moral issues activated. (C) 2004 Elsevier Inc. All rights reserved.