Karma, from my personal research into Hinduism and Buddhism, is nothing like it is portrayed in the West. It is merely a quantification of cause and effect. And from what I understand of the scripture that I've read, it seems it is even misrepresented in the native culture itself. The lay practitioners believe it to be some sort of heavenly currency, that the more good they get, the better rebirth they will get... yet, ultimately, the goal in both Hinduism and Buddhism is the same: liberation from the cycle of karmic/samsaric rebirth. They completely ignore the fact that the goal is to get rid of all your karma (good and bad) and be released from samsara (into Brahman or nirvana).
Also, from my personal interpretation of the Upanishads (the commentaries on the Aranyakas, which are commentaries on the Brahmanas, which are commentaries on the Vedas), I've come to understand that there is no continuous "self" or "soul" that continues on after death, only the sole collection of experiences culminating together and having a particular influence on another person's new life. Its not Person A keeps being Person A in a new body, more like Person A becomes Person B, becomes Person C, etc. They all share a connection, but it isn't an individual, or unique "soul" (since according to the Upanishads: the Self is Brahman, Brahman is Consciousness, and We are all Brahman). I know that's what the Vedas say, but the Upanishads are further commentaries on the Vedas, that expand and improve some ideas. They are accepted as shruti.
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Also, just as another point, karma doesn't always effect you in this life, it can take many lifetimes before its effects manifest themselves (or so goes the belief). So just because someone doesn't recieve karmic "justice" in this life time, doesn't mean they won't in a future life time (i.e. a worse rebirth).
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