...but asking why we feel the way we feel
You can answer that question yourself in one or two sentences after you've read
Aristotle's Nicomachean Ethics.*
Or take a look at what John Rawls wrote about "considered judgment"*. discussion over.
(That said, it's probably a little disappointing and only leads back to my previous post).
*Summary of what Aristotle said about the role of education: "The point of origin of all ethics is the 'That' (= the intention, purpose), and if it is clear, the Why-question becomes obsolete for one's actions. Whoever studies ethics (= condemns or defends Elmo) must already have a good character (of course now you'd have to read what Aristotle considers 'good') to have a saying."
**"We can discard those judgements made with hesitation, or in which we have little confidence[...]
Considered judgements are simply those rendered under conditions favourable to the exercise of the
sense of justice, and therefore in circumstances where the more common excuses and explanations for
making a mistake do not obtain."
So, if you already have a good character by the old Greek's definition (this doesn't mean you're perfect though), you know enough about Elmo's action to say that it's wrong, without having to ask why.
I don't really know him/her at all, so I couldn't really say
Crime and fraud is still bad no matter if you're personally involved or not. Sooner or later you or your loved ones could be affected, but that shouldn't be the only reason to care about it.