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How America should be addressing its 'dirty money' problem around white-collar crimes, according to a legal scholar

  • Jennifer Taub is a legal scholar and advocate who's testified as a banking law expert before Congress and appeared on MSNBC and CNN. 
  • The following is an excerpt from her new book, " BIG DIRTY MONEY: The Shocking Injustice And Unseen Cost of White Collar Crime. "
  • In it, she examines white collar crime, its history, and why these offenders fail to face the consequences that street level criminals do from Congress and the Supreme Court.
  • She explains how the country's biggest crimes — like the financial crisis in 2008 to the ongoing opioid epidemic — have taken a toll in its citizens on a systematic level and the US can do better moving forward. 
  • Visit Business Insider's homepage for more stories .

Insider Today

America, we have a big dirty money problem.

The corporate crime, elite impunity, and public corruption disease did not infect us overnight, though. We've been exposed now for so very long that we are almost immune. Almost.

If you still get angry when you see prosperous predators get away with it, we still have a chance to fight back. I'm ready to speak up about what's broken and promote specific, significant, and enduring fixes. At the end of this chapter, following these proposed solutions, I'll explain why and how you can join this effort.

You don't need a law degree or a lobbyist's contact list to exert influence. There are more honest people in America who believe that when we get big money out of politics and when big businesses and the elite are made to obey the law, we are all safer and our society is more just. 

In a nutshell, here's the problem:

The extremely wealthy and well connected have incentives and opportunities for crime and corruption. Absolute power corrupts absolutely.

Extreme wealth is criminogenic and members of the upper classes provide one another with a kind of mutually assured immunity. It's difficult for law enforcement with comparatively limited resources to intervene.

Prosecutors also have insufficient incentives to pursue complex and time-consuming cases against respectable high-status individuals and business entities. And the tools they have to detect and punish offenders have been dulled by the courts.

Furthermore, the urgency to prioritize white collar crime is low when it's hard for the public to see the victims.

Our most powerful counterweights are whistleblowers and journalists. Yet they lack the protection and financial support they need.

Finally, we have incomplete and inconsistent data available on the amount and nature of white collar crime and white collar offenders. So what are the corresponding solutions? 

Cleaning up the mess

First, we should create and fund a new division within the Justice Department to focus on detecting, prosecuting, convicting, and incarcerating big money criminals. This elite crime division should monitor the usual suspects so as to prevent crime where the incentives and opportunities are most prevalent.

It's absurd that the same corporations face serious criminal or civil investigations and then reoffend again and again — often under the same leadership. Thus, a high priority of this new division should be to end the dependence on deferred prosecution and nonprosecution agreements. These DPAs and NPAs with large corporate offenders should not be allowed unless responsible high-level executives are prosecuted.

If no one at the top is responsible, then the corporation itself if guilty should face criminal charges and a trial where witnesses testify and the public can learn of the misdeeds. 

As Nobel laureates George Akerlof and Robert Shiller explain in their book "Phishing for Phools," "If business people behave in the purely selfish and self- serving way that economic theory assumes, our free-market system tends to spawn manipulation and deception."

The only way to stop their behavior is through sure and painful enforcement. Take their money, take their liberty, set an example.

Success for prosecutors should be measured not by the number of cases closed, but instead by the scope of the harm and the number of victims helped by pursuing the matter. Implementation of this policy would recognize that white collar crime should be treated as seriously as organized crime. This division would have devoted funding, specially assigned attorneys, dedicated FBI agents, and support staff. It would focus on securing compliance with the law by bringing meaningful, complex cases against powerful offenders. It would take on large-scale firms where new and dangerous products and complicated regulations exist. It would also monitor marketing and new developments and bring early cases to stave off emerging threats before they develop into industry practices.

The division would work closely with devoted contacts within the enforcement divisions of the major federal administrative agencies. Instead of waiting for referrals, it would proactively research and anticipate businesses under stress that might choose to cut corners or engage in a race to the bottom. 

Second, we need to empower and encourage law enforcement to take on those difficult and time-consuming cases involving elite offenders and large businesses. To do so, we must amend some of the federal laws that have been weakened by the courts. This includes our antibribery statute. The law prohibiting bribery of public officials must be updated to create an outright ban on any gift giving to or acceptance of gifts by members of Congress above a specific low- dollar threshold. 

We also need to make it easier for law enforcement to trace money laundering, and make it harder for natural persons to hide behind shell companies formed in highly secretive jurisdictions, including Delaware.

Toward this end, Congress should enact the Corporate Transparency Act, which has already passed in the House. It would require corporations, LLCs, and other business entities that appear to be shells (such as those that have few to no employees) to disclose, on an ongoing basis, their beneficial owners to the Treasury Department's Financial Crimes Enforcement Network (FinCEN). This will help detect money laundering and tax evasion schemes.

In addition, federal prosecutors should be better trained in the use of the responsible corporate officer doctrine to hold criminally accountable those executives who are in a position to affect the health and safety of the public. 

Third, we need to create more visibility and protections for victims of white collar crime. Toward this goal, we should create a nationwide registry for white collar criminal offenders. That way, before engaging in consumer or business transactions, ordinary people can consult the registry. This is similar to the concept of a sex offender registry, but given that white collar crime cases are typically prosecuted at the federal level, and offenders can live one place and use internet, mail, and telephone to target people across the country, it should be centralized. 

In addition, Congress should amend the Crime Victims' Rights Act of 2004 to make it more accessible to people harmed by white collar crime. Surviving family members of those who got hooked on opioids because of OxyContin, for example, should be informed before any government settlement.

On tax evasion, imagine the impact if, in a tax fraud sentencing, a voice were given to those who depend upon public funds, such as mayors, town governments, citizens, or school boards. In addition to a voice, victims also need social safety nets. We cannot expect everyone to be fully compensated by offenders through civil and criminal settlements.

Everything from extended unemployment insurance to Medicare for All helps those who have lost their savings to fraudsters, or lost their jobs because they chose to leave a corrupt business or spoke out against its criminal practices and were fired.

Fourth, we need to protect and support both independent investigative journalists and whistleblowers. Independent journalists perform the difficult research that law enforcement under political pressure or other constraints cannot always perform. They shed light on major social problems and help rouse and rally the public to demand change. Yet they are under financial and physical threat. Congress should allocate funds to independent investigative journalist organizations that agree to share their research with newsrooms nationwide after initial publication so they can build on their work. 

We also need to empower whistleblowers, not just protect them from retaliation. Presently, under the qui tam provisions of the False Claims Act, we give whistleblowers special standing to directly sue contractors that are defrauding the federal government; the government can then choose to intervene and take over the matter and the whistleblower receives a portion of the recovery.

Congress should expand this to provide standing to whistleblowers for a wider range of white collar crimes. Also, Congress should ban forced arbitration for both employment and consumer legal disputes. This will give employees and consumers their day in court and let sunlight disinfect workplaces and businesses. 

Fifth, we must restore funding to the IRS so it can recover money that goes uncollected due to understaffing. The agency must close the estimated $800 billion "tax gap" — the difference between what the IRS believes it is owed and the tax receipts it actually collects.

In addition, with more staff, the IRS can avoid the problem of having to let so many delinquent accounts go uncollected due to expiration. Also, Congress should close the glaring loopholes in the tax code and also create a more equitable system, including a wealth tax, to help decrease the vast income inequality that makes so many of the uber- wealthy above the law in the first place. 

And sixth, we need to improve data collection across all law enforcement agencies nationwide that report through the FBI's Uniform Crime Reporting system. We need to be able to track all criminal offenses, including designated white collar offenses, the income and assets of the alleged offenders, and the estimated financial losses involved.

Further, there needs to be one centralized database to track to their final disposition the numbers and types of all civil charges and settlements by all federal agencies, even where these cases do not result in referrals for criminal prosecution by the Justice Department.

Meeting the challenge

A hundred years ago, progressive legal reformer Louis Brandeis wrote, "Sunlight is said to be the best of disinfectants; electric light the most efficient policeman." But today, to clean up this white collar crime epidemic, we need more than vision. Today the crime today is hiding in plain sight. Now we need to use our voices.

As abolitionist Frederick Douglass proclaimed in 1857, "Power concedes nothing without a demand. It never did and it never will."

It's time to demand an end to this elite crime spree. We must act, and not just for us, but for the society that will be here generations to come. We owe it to our children and grandchildren. And we owe it to the people who have come before us, like journalist Daphne Caruana Galizia.

The last two sentences of her final blog post were: "There are crooks everywhere you look now. The situation is desperate." May her memory be a call to action. 

From "BIG DIRTY MONEY" by Jennifer Taub, published by Viking, an imprint of Penguin Publishing Group, a division of Penguin Random House, LLC. Copyright © 2020 by Jennifer Taub.

Jennifer Taub is a legal scholar and advocate whose writing focuses on "follow the money" matters — promoting transparency and opposing corruption. She has testified as a banking law expert before Congress and has appeared on MSNBC's Morning Joe and CNN's Newsroom. Taub was the Bruce W. Nichols Visiting Professor of Law in fall 2019 at Harvard Law School and is now a professor of law at the Western New England University School of Law. A former associate general counsel at Fidelity Investments, she is a graduate of Yale College and Harvard Law School.

essay on white collar crime

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White-collar Crime: The Major Aspects of Corporate and Occupational Crime Laws 

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What Is White-Collar Crime?

Understanding white-collar crime, corporate fraud, money laundering, securities and commodities fraud.

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What Is White-Collar Crime? Meaning, Types, and Examples

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

essay on white collar crime

Investopedia / Eliana Rodgers

White-collar crime is a nonviolent crime often characterized by deceit or concealment to obtain or avoid losing money or property, or to gain a personal or business advantage.

Examples of white-collar crimes include securities fraud, embezzlement, corporate fraud, and money laundering. Entities that investigate white-collar crime include the Securities and Exchange Commission (SEC), the National Association of Securities Dealers (NASD), the Federal Bureau of Investigation (FBI), and state authorities.

Key Takeaways

  • White-collar crime is a nonviolent crime of deceit or concealment to obtain or avoid losing money or to gain a personal or business advantage.
  • Securities fraud, embezzlement, corporate fraud, and money laundering are white-collar crimes.
  • The Securities and Exchange Commission (SEC), the National Association of Securities Dealers (NASD), the Federal Bureau of Investigation (FBI), and state authorities investigate white-collar crime.

"White-collar crime" is a term first coined by sociologist Edwin Sutherland in 1949 who defined it as a crime committed by a person of respectability and high social status during his occupation. White-collar workers historically held non-laboring office positions while  blue-collar  workers traditionally wore blue shirts and worked in plants, mills, and factories.

High-profile individuals convicted of white-collar crimes include Ivan Boesky, Bernard Ebbers, Michael Milken , and Bernie Madoff . Their crimes have included insider trading , accounting scandals, securities fraud, and Ponzi schemes .

Rampant new white-collar crimes facilitated by the internet include so-called Nigerian scams , in which fraudulent emails request help in forwarding a substantial amount of money to a criminal ring. Other common white-collar crimes include insurance fraud and identity theft .

$3.7 Billion

The Madoff Victim Fund (MVF) distributed over $3.7 billion to nearly 40,000 victims worldwide in connection with the Bernard L. Madoff Investment Securities LLC (BLMIS) fraud scheme .

The FBI cites large-scale corporate fraud perpetrated by many throughout a corporate or government institution, as among its highest enforcement priorities. This type of crime incurs a significant financial loss to investors and can damage the U.S. economy and investor confidence.

Corporate fraud gathers the widest group of partners for investigations, including the FBI, the U.S. Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), the Financial Industry Regulatory Authority, the Internal Revenue Service, the Department of Labor, Federal Energy Regulatory Commission, and the U.S. Postal Inspection Service.

Falsification of Financial Information

The majority of corporate fraud cases involve accounting schemes that are conceived to deceive investors, auditors, and analysts about the true financial condition of a corporation or business by manipulating financial data, share price, or other measurements to inflate the financial performance of the business.

In 2014, Credit Suisse pleaded guilty to helping U.S. citizens avoid taxes by hiding income from the Internal Revenue Service and paid penalties of $2.6 billion. Bank of America sold billions in mortgage-backed securities (MBS) tied to properties with inflated values without proper collateral and agreed to pay $16.65 billion in damages.


Self-dealing occurs when a  fiduciary  acts in their own best interest rather than in the best interest of their clients. Considered a  conflict of interest , this illegal activity can lead to litigation, penalties, and termination of employment for those who commit it.

Self-dealing includes front-running , when a broker enters into a trade with the foreknowledge of a non-publicized transaction that will influence the price of the asset, resulting in a financial gain for the broker. It also occurs when a broker or analyst buys or sells shares for their account ahead of their firm's buy or sell recommendation to its clients.

Insider trading occurs when individuals act upon or divulge to others information that is not yet public and is likely to affect share price and company valuations once it is known. Insider trading provides an unfair advantage for individuals to profit and does not matter how the material nonpublic information was received or if the person is employed by the company.

Money laundering is accepting cash earned from illicit activities, such as drug trafficking, and making the cash appear as earnings from legal business activity. Criminals often filter money from crimes such as human and narcotics trafficking, public corruption, and terrorism in a three-step process:

• Placement is the initial entry of a criminal’s financial proceeds into the financial system.

• Layering separates the criminal’s financial proceeds from their source and creates a deliberately complex audit trail through a series of financial transactions.

• Integration occurs when the criminal’s financial proceeds are returned to the criminal after "laundering" from what appear to be legitimate sources.

A cash-based business, such as a restaurant that is owned by a criminal organization, is a common tool to launder illegal money. Daily cash receipts may be inflated to funnel illegal cash through the restaurant and into the bank for distribution to the owners.

Anti-Money Laundering Act of 2020

The  Anti-Money Laundering Act of 2020 assists financial institutions in their efforts to meet their obligations under laws and regulations designed to combat money laundering by targeting foreign and domestic terrorist financing, transnational criminal organizations, drug trafficking organization activity, human trafficking, and human smuggling, and proliferation financing.

The perpetrator of a securities fraud can be an individual, such as a stockbroker, or an organization, such as a brokerage firm, corporation, or  investment bank , and includes crimes such as:

• High-yield investment fraud involves promises of high rates of return coupled with claims of little or no risk in investments like commodities, securities, and real estate.

• Ponzi  and pyramid schemes are fraudulent investment scams that generate returns for earlier investors with money taken from later investors.

• Advance fee schemes involve fraudsters convincing their targets to advance small amounts of money with a promise to deliver greater returns.

• Broker embezzlement schemes involve illicit and unauthorized actions by brokers to steal directly from their clients, usually with a myriad of false documents.

• “ Pump and dump ” schemes artificially inflate the price of lower-volume stocks on small over-the-counter markets. "The 'pump' involves recruiting unwitting investors through false or deceptive sales practices, public information, or corporate filings. Once the target price is achieved, the perpetrators “dump” their shares at a huge profit and leave innocent investors to foot the bill.

• Late-day trading is the illegal practice of recording trades that are executed after hours as having occurred before a mutual fund calculated its daily net asset value (NAV). Late-day trading can dilute the value of a mutual fund's shares and harm long-term investors.

What Are Well Known Securities Fraud Cases Investigated by the FBI?

Examples of cases of securities fraud are the  Enron , Tyco, Adelphia, and  WorldCom  scandals.

What Are the Penalties for White-Collar Crime?

If convicted, an individual may be sentenced to time in county jail, state prison, or federal prison, depending on the severity of the crime. Additionally, fines may be imposed as well as required restitution to the victim.

Who Investigates Securities Fraud?

Allegations of securities fraud are investigated by the Securities and Exchange Commission (SEC) and  Financial Industry Regulatory Authority (FINRA), often in concert with the FBI.

State authorities can also investigate investment scams. In a unique attempt to protect its citizens, the state of Utah established the nation’s first online registry for white-collar criminals where photos of individuals who are convicted of a fraud-related felony rated as second-degree or higher are featured on the registry.

What Are Anti-Money Laundering Rules Used in Banking?

Many companies, especially those involved in finance and banking, have anti-money laundering (AML) rules in place to detect and prevent money laundering. For banks, compliance starts with verifying the identity of new clients, a process sometimes called  Know Your Client (KYC) and customer due diligence detects  money laundering strategies  like breaking up large money laundering transactions into smaller ones to evade reporting limits and avoid scrutiny.

What Is Intellectual Property Theft?

Intellectual property theft is a white-collar crime which robs people or companies of their ideas, inventions, and creative expressions, known as intellectual property, and may include trade secrets and proprietary products or movies, music, and software.

Securities fraud, embezzlement, corporate fraud, and money laundering are considered white-collar crimes, perpetrated traditionally by those in corporate or office settings. The SEC, NASD, the FBI, and state authorities work in concert to investigate white-collar crimes which are often prosecuted at the federal level. Penalties for committing a white-collar crime include prison, fines, and restitution.

Federal Bureau of Investigation. " White-Collar Crime ."

Edwin H. Sutherland. "White Collar Crime," Page 9. Dryden Press, 1949.

U.S. Department of Justice. " Justice Department Announces Additional Distribution of More than $568 Million to Victims of Madoff Ponzi Scheme ."

U.S. Department of Justice. " Bank of America to Pay $16.65 Billion in Historic Justice Department Settlement for Financial Fraud Leading up to and During the Financial Crisis ."

U.S. Department of Justice. " Credit Suisse Pleads Guilty to Conspiracy to Aid and Assist U.S. Taxpayers in Filing False Returns ."

State of Utah Office of the Attorney General. " White Collar Crime Offender Registry ."

  • What Is Fraud? Definition, Types, and Consequences 1 of 31
  • What Is White-Collar Crime? Meaning, Types, and Examples 2 of 31
  • What Is Corporate Fraud? Definition, Types, and Example 3 of 31
  • What Is Accounting Fraud? Definition and Examples 4 of 31
  • Financial Statement Manipulation 5 of 31
  • Detecting Financial Statement Fraud 6 of 31
  • What Is Securities Fraud? Definition, Main Elements, and Examples 7 of 31
  • What Is Insider Trading and When Is It Legal? 8 of 31
  • What Is a Pyramid Scheme? How Does It Work? 9 of 31
  • Ponzi Schemes: Definition, Examples, and Origins 10 of 31
  • Ponzi Scheme vs. Pyramid Scheme: What's the Difference? 11 of 31
  • Money Laundering: What It Is and How to Prevent It 12 of 31
  • How Does a Pump-and-Dump Scam Work? 13 of 31
  • Racketeering Definition, State vs. Federal Offenses, and Examples 14 of 31
  • Mortgage Fraud: Understanding and Avoiding It 15 of 31
  • Wire Fraud Laws: Overview, Definition and Examples 16 of 31
  • The Most Common Types of Consumer Fraud 17 of 31
  • Who Is Liable for Credit Card Fraud? 18 of 31
  • How to Avoid Debit Card Fraud 19 of 31
  • The Biggest Stock Scams of Recent Time 20 of 31
  • Enron Scandal: The Fall of a Wall Street Darling 21 of 31
  • Bernie Madoff: Who He Was, How His Ponzi Scheme Worked 22 of 31
  • 5 Most Publicized Ethics Violations by CEOs 23 of 31
  • The Rise and Fall of WorldCom: Story of a Scandal 24 of 31
  • Four Scandalous Insider Trading Incidents 25 of 31
  • What Is the Securities Exchange Act of 1934? Reach and History 26 of 31
  • Securities and Exchange Commission (SEC) Defined, How It Works 27 of 31
  • Financial Crimes Enforcement Network (FinCEN) Overview 28 of 31
  • Anti Money Laundering (AML) Definition: Its History and How It Works 29 of 31
  • Compliance Department: Definition, Role, and Duties 30 of 31
  • Compliance Officer: Definition, Job Duties, and How to Become One 31 of 31

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essay on white collar crime


 The term “white-collar crime” was first used by criminologist Edwin Sutherland back in 1939 for the various nonviolent crimes usually committed in commercial areas for financial gain (McNISH, 2010). There is a common misconception that the white-collar crimes do not have victims, and thus they are not that dangerous. Indeed, these crimes are committed without the use of weapons or threats of physical violence, but it does not mean that they are really harmless. According to the FBI, in the United States white collar crimes steal more than $ 300 billion a year (Gottschalk, 2011).

All kinds of white collar crime are taking place in our community nowadays. The most wide spread crimes are fraud, fraud with bankruptcies, bribery, computer fraud, credit card fraud, counterfeiting and securities, corporate appropriation of funds, “identity theft” (using other people’s financial documents), securities transactions which use insider information, insurance fraud, “money laundering”, obstruction of justice, perjury, tax evasion, economic espionage, artificial price bubble, etc (Williams, R. (2013).

With the rapid development of Internet technologies, there is a rapid development of Internet fraud schemes. For example, online investment scheme is one of the recent ones. Commission on Securities and Exchange Commission on Law Enforcement, and criminal trials indicate that criminals use two basic methods to manipulate securities markets for personal gain. First, in so-called “pump-and-dump” projects, they usually disseminate false or misleading information in order to cause a sharp rise in stock prices which are not in demand, or shares of companies not having substantial assets and leading operations. Immediately after that they sell their shares of such companies to get substantial profits before the stock price falls back to its normal low level. All other buyers of the stock, unaware of the falsity of the information, become victims of the scheme as soon as the price falls.

For example, in one federal prosecution in Los Angeles, the defendants purchased shares in a bankrupt company NEI Webworld, Inc. for the sum of 130,000 dollars, directly or through an intermediary. Assets of NEI Webworld, Inc. had been liquidated several months before. Then the defendants sent e-mail messages to hundreds of Internet bulletin boards, falsely stating that wireless telecommunications company planned buyout of NEI Webworld. At the time defendants purchased shares of NEI Webworld, share price ranged from 9 to 13 cents apiece. However, one day share price of NEI Webworld rose in 45 minutes from $8 per share to $15.5-16, and half an hour later it fell to 25 cents per share. The defendants made ​​a profit of 362,625 US dollars (Benjamin, 2011).

In another federal case in Los Angeles, a man who worked for California company PairGain Technologies, created a fake website Bloomberg news, which had fake news about the impending PairGain Technologies acquisition by an Israeli company. He sent fraudulent e-mail messages with links to fake Bloomberg news site to financial news bulletins. On that day PairGain Technologies shares rose by about 30% before the company issued its own refuting press release (Wanless, 2010).

At the moment in San Diego, there is a federal prosecution of massive fraud using the Internet and telemarketing to attract potential investors in the so-called “general partnerships” involving investments in “high technology”, such as Internet shopping mall and Internet access providers. The scheme defrauded more than 3,000 victims nationwide for nearly $ 50 million (Miller, 2013).

Corruption, as one of the types of economic crimes, is very common in our society and it slows the development of the country. In the anti-corruption fight it is recommended to implement legislative reform, which would bring not harsher penalties for corruption, but simplification and reduction of state control (reducing the frequency of inspections, tax cuts) in order to reduce the very possibility of abuse official position.

However, legislative actions of the State can not make a decisive breakthrough in the fight against corruption (at least because of the fact that the fight against corruption sometimes is headed by corrupt officials). Decisive success is only possible by increasing the dependence of the state of citizens. This requires such long-term institutional reform as reducing the number and size of authorities, creation of special or even independent of the State institutes authorized to investigate allegations of corruption (for example, Sweden and some other countries have institution of Ombudsman), introduction of ethical standards for authorities, etc. Finally, the fight against corruption is impossible without the help of whistleblowers. In the US, the informant receives from 15% to 30% of identified material damage and he is protected from persecution of violators (Kim, 2012).

Economists say that successful fight against corruption provides immediate benefits that are many times higher than the related expenses. According to some estimates, $1 spent for the fight with corruption brings an average of 23 dollars in the fight against corruption at the level of state and about 250 dollars in the fight at the international level (Brody, 2010).

General recommendations to fight white collar crime in the community include the following actions by the state:

  • ensuring political and economic stability in the society
  • creating legal framework necessary for effective fight against economic crimes
  • improving the system of government agencies dealing with economic crimes
  • increasing control of the public authorities for the activities of enterprises, which commit most economic crimes, including the activities of their officers and materially responsible persons
  • strengthening preventive, precautionary actions of authorities fighting with economic crimes (in particular, explore conditions that contributed to the commission of crimes and take measures to prevent further similar crimes).

Fighting white-collar crime is one of the main problems of modern society. This struggle must be carried out in all possible ways. Since the damage from such crimes is huge, the end justifies any means. According to the FBI, between 2007 and 2009, white-collar crimes amounted 3.8% of all crimes committed in the United States. Despite their relatively small number, annual average white-collar crime costs victims much more than ordinary theft or robbery. For example, average property crime costs a victim $1.8 thousand, while the average white-collar property crime costs $9.2 thousand. White-collar crimes today account 42% of all crimes committed by using a computer (Akopyan, 2010). Many experts expect the growth of this number. According to National Fraud Center, the number of arrests for white-collar crime, especially fraud and misappropriation of corporate funds, has increased dramatically over the past few years, while the number of arrests for crimes related to violence against the person declines.

White-collar crime is very dangerous. It causes great damage to society and country as a whole and, ultimately, each of us. Today, fight with this type of crime is of utmost importance. State and federal laws, and the US Constitution give the federal government the authority to curb white-collar crimes. A number of federal agencies, including FBI, Tax and the US Secret Service, US Customs Service, Agency for Environmental Protection, deal with white-collar crimes. In addition, most states use their agencies to fight white-collar crime. Penalties for white collar crime are very strict, much more severe than for other crimes (Waldie, 2010).

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White collar crime.

White Collar Crime Theoretical Perspectives of Criminal Behavior Three broad theoretical models of criminal behavior have historically prevailed. These models include psychological models of criminality, sociological models of criminality, and biologically -- based models of criminal behavior. Each of these models suggests different ideologies and different methods of control for criminal behavior; however, there is quite a bit of overlap in each one. Psychological Theories of Criminal Behavior Psychology is a broad discipline that involves many subcategories. In general psychological theories of criminal behavior share several core fundamental assumptions (Mischel 1968). First, in psychological theories of behavior the primary unit of analysis is the individual. Secondly, psychological theories of behavior typically describe personality as the driving unit of behavior within people. Third, social consensus defines normal standards of behavior. Fourth, criminal behaviors result from aspects of the personality that are either dysfunctional, abnormal, or inappropriate. Criminal behaviors may address certain needs and individuals. And….

Association of Certified Fraud Examiners. (2008). Available at:  http://www.acfe.com/uploadedFiles/ACFE_Website/Content/documents/2008-rttn.pdf .

American Psychiatric Association. 2013. Diagnostic and statistical manual of mental disorders (5th Ed.). Arlington, VA: Author.

Benson, M.L. And Simpson S.S. (2009). The white-collar crime, an Opportunity Perspective. London: Routledge.

Brody, R.G., Melendy, S. And Perri, F.S. 2012. Commentary from the American Accounting Association's 2011 Annual Meeting Panel on Emerging Issues in Fraud Research Accounting Horizons. Accounting Horizons 26(3), pp. 513-531.

White Collar Crimes Supervisor: (Insert) The paper focuses on specific aspects of white collar crime. The paper primarily focuses on answering two questions directly related to white collar crime. The first question is a comparative analysis focusing on the laws on white collar crime within the United States and other countries. The question also analyzes the extent of operative power to counter the white collar crimes and strictly apply the laws and regulations between the two chosen countries. The second question takes the analysis a little further and focuses specifically on methods of practical enforcement between the two countries as well as the possible variations that might exist in the two countries in the social stigma and punishment related to white collar crimes in both countries. USA and UK -- White Collar Crime egulations The countries, USA and UK, have strict laws against white collar crimes and do tend to apply them strictly across….

Blumberg & Associates (2012). Penalties of White Collar Crime, p. Accessed from:  http://www.azblumberglaw.com/CM/FSDP/PracticeCenter/Criminal-Law/White-Collar-Crime.asp?focus=topic&id=4 

Croall, H. (2001). Understanding White Collar Crime. Biddles Limited, Guildford and Kings Lynn, p. 123-139.

Friedrichs, D.O., (2010). Trusted Criminals (4th Ed.). Belmont, CA: Thompson Learning, p. 253-273.

White Collar Crime: Identifying Valid Deterrents for White Collar Criminals ecent studies suggest that white collar crime is on the rise (Chayet, Waring & Weisburg, 2001; ecine, 2002). Many stereotypical beliefs regarding white collar criminals have been debunked over time as researchers start understanding what white collar crime is and who it effects. White collar crime affects all communities regardless of affluence, demographics, social factors or other considerations. White collar crime comes in many forms. Some traditional examples include bank fraud, blackmail, bribery, credit card fraud, extortion and more. The intent of this research is to examine what factors contribute to white collar crime and what action law enforcement officials can take to effectively deter criminals and protect citizens from fraud related to this type of crime. Background The term "white collar crime" was first used by Edwin Sutherland in 1939 as he addressed the American Sociological Society (Chayet, Waring & Weisburg, 1). At….


Chayet, E.F., Waring, E & Weisburd, D. (2001). White-collar crime and criminal careers. Cambridge, England: Cambridge University Press.

Poveda, T.G. (1994). Rethinking white-collar crime. Westport, CT: Praeger Publishers.

Recine, J.S. (2002). "Examination of the white collar crime penalty enhancements in the Sarbanes-Oxley Act." American Criminal Law Review, 39(4):1535.

hite Collar Crime: hen most people think of white collar crime today, they think of Enron and Martha Stewart -- or of a nebulous idea of a kind of crime that only the "upper class" or the very powerful occasionally engage in. However, white collar crime is actually pervasive across all sectors of American society. Although many might imagine that white collar crime is essentially "victimless" in comparison to other criminal acts, this is far from the case. Not only are billions of dollars illegally gained (and lost) to the activities associated with the concept, but entire lives are often destroyed in the process. "hite-collar crime" as a concept was coined in a 1939 speech presented by Edwin Sutherland at the American Sociological Society (LII, 2004). During the speech, Sutherland explained that this type of crime is one "committed by a person of respectability and high social status in the course of….

Works Cited:

Hurst, Charles. (2003). "Social Inequality Forms, Causes, and Consequences." 5th Edition. Pearson: London.

LII, Legal Information Institute. (2004). "White Collar Crime: An Overview." Retrieved from web site on October 4, 2004, from,  http://www.law.cornell.edu/topics/white_collar.htmlwhite-collar  crime: an overview

Rasmussen, Hanna. (2004). "Insider Trading." Retrieved from web site on October 4, 2004, from,  http://economics.about.com/cs/finance/a/insider_trading.htm 

Valenti, Catherine. (2004). "With Insider Trading, The Key Is Who Knew What and How They Knew It." Retrieved from web site on October 4, 2004, from,  http://abcnews.go.com/sections/business/DailyNews/insidertrading_020624.htmlThe

White collar crime is one of the most controversial subjects in America today. With the recent conviction of home-economics guru Martha Stewart for white-collar-crime related issues, the subject has only become more high profile. As white-collar crimes are continually portrayed in the media, the public can only conclude that white collar crime is a serious problem in American businesses. White collar crime is not necessarily limited to businesses, but can also rear its head in elected governments. In a March 05 article on Philly.com, Warner, Einhorn and Davies describe the many of the legal aspects of an ongoing corruption probe of Philadelphia city hall officials. In the article, the authors note that the Street administration has hired a staggering 14 private law firms to represent city interests in an ongoing corruption probe. From this information, Warner, Einhorn and Davies suggest that as many as 12 city officials may be implicated in….

Warner, Bob, Einhorn, Erin and Davies, Dave. 14 Law Firms Reap Bugging Biz. Posted on Fri, Mar. 05, 2004. 08 March 2004.  http://www.philly.com/mld/dailynews/news/local/8111509.htm

White Collar Crimes

White Collar Crimes he first definition states that this is an illegal act committed via non-physical means by guile to gain personal advantage. his definition's drawback is that it belittles white collar crimes; that harm people physically and psychology and arouses concern in the society. he other is divided into two parts; occupational crime which are committed by individuals to promote their personal interests and corporate crime committed by organizations executives to benefit the company (Sutherland, 1949). White Collar Crime over Elite Deviance he application of deviance in the realms of white collar generates several fundamental problems. Deviance is associated with individuals such as alcoholics and mentally ill. White collar offenders are fully integrated into the society and are perceived as normal without any disorders. White collar crime offenders are in conformance with occupational norms, rather than deviating; deviance is characterized by peer group conformity but in the white collar crime, deviance from….

The price tags attached to some white collar crimes are so huge that they are difficult to comprehend. For example, the price of bailing out a single corrupt savings and loan institution surpassed the total of all the bank robberies in American history; making the public aware that engaging in white crime is serious just as other crimes. Recent Data Processing Management Association reports that computer crime loss to banks is higher than $500,000 has made the public know that white collar crime is serious and damaging than most crimes.

White Collar Crime Victims

Most individuals have a mistaken belief that they are immune from scams thus harboring the notion that white collar victims deserve their fate. The most disturbing fact is that white collar crimes are not perceived as criminal offenses but simple bad judgment on the part of victims, by both the general public and by the victims themselves (Leap, 2007). Besides, some victims

White Collar Crimes Governmental Crimes The extent of damage that the application of imperialistic conquests, warfare or threat of nuclear power can have on the psyche, finances and structure of the weaker countries of the world is devastating. All concepts merely aim to use force to take from the weaker states. The imperialistic conquest is a form of white collar crime because while it does not really endanger the lives of the civilians under control of the imperial government, but it does however deprive them of enjoying the fruits of their labor. On the other hand, the perception with most imperialist takeovers is that the countries taken over don't have the structure to make the best use of their utilities so foreign takeover is necessary to provide structure i.e. It does not necessarily constitute as a white collar crime. Warfare and the threat/use of nuclear power are violent crime as their applications endanger….

Strader, J.K. (2002). Understanding White Collar Crime. Matthew Bender & Company, Inc.

White Collar Crime Theories Laws and Processes

White Collar Crime Theories, Laws and Processes Explain white collar crime in terms of various theories related to criminology and crime. A white collar crime is an illegal and unethical act that violates public trust (Friedrichs, 2010). Common examples include misrepresentation, stealing, misappropriation, self-dealing, and corruption (Echols & ichardson, 2011). Most are crimes of opportunity and hold similar characteristics to corporate crime -- fraud, insider trading and other illegal acts of a financial nature. A "white collar" prosecutor or defense attorney, for example, would most likely define "white collar crime" as crime that does not necessarily involve force against a person or property; involve narcotics; relate to organized crime activities; relate to such national policies as immigration, civil rights, and national security; or involve "vice crimes" or the common theft of property (Minkes, 2010). Many white collar criminals are first time offenders. There are several basic theories in which white collar crime can….

Braithwaite, J. (2010). Diagnostics of white-collar crime prevention. Criminology & Public Policy, 9(3), 621-626. doi:10.1111/j.1745-9133.2010.00655.x.

Echols, R.L., & Richardson, E.J. (2011). White-Collar Defense. Tennessee Bar Journal, 47(12), 14-20.

Friedrichs, D. (2010). Trusted Criminals: White collar Crime In contemporary Society. Mason, OH: Cengage Learning.

Minkes, J. (2010). Silent or invisible?. Criminology & Public Policy, 9(3), 467-473. doi:10.1111/j.1745-9133.2010.00642.x.

White Collar Crime in Contemporary

In an environment where violent crimes outweigh white-collar crimes, the prosecutor will allocate his resources to fighting violent crimes. esource availability thus determines how many cases will be pursued by the prosecutor's office. The prosecutor may also evaluate the type of crime affecting an area. This will enable the office to pursue a tougher sentence for the crimes in the area. The increase in white-collar crimes has forced the prosecutor's office to increase resources allocated to white-collar crime. Political influence also plays a role in the crimes pursued by the prosecutor's office. A case attracts public interest may be pursued by the prosecutor to ensure that the public is satisfied. The prosecutor is likely to allocate resources to find evidence against a defendant accused of defrauding a public company. This will ensure that the credibility of the prosecutor's office is maintained. Political pressure on the office of the prosecutor may….

Bazley, T. (2008). Investigating white collar crime. Upper Saddle River, N.J: Pearson Prentice Hall.

Boyes, W., & Melvin, M. (2008). Microeconomics. Boston: Houghton Mifflin Co.

Friedrichs, D.O. (2010). Trusted criminals: White collar crime in contemporary society. Belmont, CA: Wadsworth Cengage Learning.

Gottschalk, P. (2010). White-collar crime: Detection, prevention and strategy in business enterprises. Boca Raton: Universal Publishers.

White Collar Crime and Public Order Crime

White-Collar Crime and Public Order Crime The objective of this study is to distinguish between white-collar crime and public order crime. The differences will be explained between the two crimes. As well, two statutes and two cases will be located with one statute and case illustrating white-collar crime and one case and statute illustrating public order crime. The cases and statutes will be summarized noting the elements of the crimes and the requisite for criminal burden of proof. Possible defenses to the selected crime will be assessed and this study will conclude with an explanation on why these statues and case law interpretations are important for the criminal justice professional to understand. Definitions White-collar crime is reported as not being "an official legal crime category. Individuals are arrested and prosecuted for specific crimes such as forgery, fraud, or embezzlement." (United States Department of Justice, nd, p.2) The term 'white-collar crime' is "an analytic….

White-Collar Crime (nd) United States Department of Justice. Retrieved from: http://bjs.ojp.usdoj.gov/content/pub/pdf/to-wcc.pdf

Crimes Against Public Order (2013) Legal Match Law Library. Retrieved from:  http://www.legalmatch.com/law-library/article/crimes-against-public-order.html 

The Code of Alabama 1975 (2013) Section 13A-9-45: FALSIFYING Business RECORDS. Retrieved from: http://alisondb.legislature.state.al.us/acas/codeofalabama/1975/coatoc.htm

The Code of Alabama 1975 (2013) Section 13A-5-4 Article 1 Designation of Offenses. Retrieved from: http://alisondb.legislature.state.al.us/acas/codeofalabama/1975/coatoc.htm

White Collar Crimes White-Collar Crimes

This law contributed to the development of the white-collar crimes since it was yet another restriction on the operation of the employers. MODULE 6/DISCUSSION 2 -- egulatory System and White Collar Crime What are the principal differences and points of intersection between private policing and public policing? It is often difficult to differentiate between the two since private police often behave like the public police. The point intersection arises from the reasoning that both of the two are contained in the criminal justice field making the two inevitable for the security of individuals in the society. The differences only arise when exploring their activities and responsibilities. Private policing, in the white-collar crime arena, is a form of crime prevention detection and apprehension provided by the private organization or agents for commercial purpose (Friedrichs, 2010). The elite would have rather used the private police forces in protecting them while they committed crimes instead….

Friedrichs, D.O. (2010). Trusted criminals: White Collar Crime in Contemporary Society.

Belmont, CA: Wadsworth Cengage Learning.

White-Collar Crime Impact

White-Collar Crime Discussion White-collar crime differs significantly from street crime. In addition to having varying punishments and penalties, each classification of crime in this case has unique targets. It should, however, be noted that in most cases, both classifications of crime tend to be intentional and well-planned. Impact of White-Collar Crime According to Edwin H. Southerland (as cited in Vito, Maahs, and Holmes, 2005, p. 411), a white-collar crime could be defined as "a crime committed by a person of respectability and high social status in the course of his occupation." The perpetrator of white-collar crime could, therefore, be an accountant, professional banker, fund manager, etc. In most cases, white-collar crime is motivated by, amongst other things, financial gain. According to Vito, Maahs, and Holmes (2005, p. 412), "white-collar offenses are as harmful to the public as street crimes." To individuals, white-collar crimes could lead to financial turmoil, extreme stress, and ill health as….

Davies, P., Francis, P. & Greer, C. (Eds.). (2012). Victims, Crime, and Society. London: SAGE Publications.

DiMarino, F.J. & Roberson, C. (2013). Introduction to Corporate and White-Collar Crime. Boca Raton, FL: CRC Press.

Ferguson, J.E. (2010). White-Collar Crime. New York, NY: Infobase Publishing.

Titus, M.R. & Gover, A.R. (2004). Personal Fraud: The Victims and the Scams. Crime Prevention Studies, 12(1), 133-151.

White Collar Crimes There Are Two Major

White Collar Crimes There are two major categories of crime majorly grouped into 'blue collar' and 'White Collar' crimes. The blue collar usually involves violence and of interest here is the 'white collar' which is usually found among the well educated and informed people in the society. The white collar crimes are mainly committed by the upper educated class through the pen and paper, do not involve a lot of violence and may not necessarily involve crimes against humanity. But the blue collar crimes are predominantly violent crimes that may involve serious injuries or even death. They do not require much educational intelligence to commit and are common among the poorer population of the society (Gonzales J.D., 2011). One such case that has of late attracted the attention of the media with its beginning being in 2009 and the conclusion being this month is the case of od Blagojevich, who now faces….

Guardian, (2011). Rod Blagojevich, former Illinois governor, found guilty of corruption.

Retrieved June 28, 2011 from  http://www.guardian.co.uk/world/2011/jun/27/rod-blagojevich-barack-obama-senate-seat 

IB Times, (2011). Blagojevich Verdict: Guilty of Trying to Sell Obama's Senate Seat. Retrieved June 28, 2011 from  http://www.ibtimes.com/articles/170243/20110627/blagojevich-verdict.htm 

The New York Times, (2011). Jury Finds Blagojevich Guilty of Corruption. Retrieved June 28,

The criminal acts within those legitimate realms continue to be more familiar and ongoing. When there are rampage on the WCCs and Organized crimes, the line existing between them and other groups they infiltrate in will definitely start blurring resulting to illegal corporations and to states that are rogue. The other reason is that WCCs and organized crimes are both money motivated. This means that, the two crimes are committed for money, but it is usually true that, the crimes that are committed for money cannot be all as a result of WCCs and organized crime. However, crimes such as violence and infractions of laws usually occur due to monetary acquisition even though they could be they are not part of the organized crime. This still shows how it may be very hard to differentiate WCCs from organized crimes in 21st century (Baker, 2004). The other issue making this difficult is….

Baker, J.S., (2004). The Sociological Origins of "White-Collar Crime. Conservative Policy Research and Analysis. Retrieved September 27, 2012 from  http://www.heritage.org/research/reports/2004/10/the-sociological-origins-of-white-collar-crime 

Rosenzweig, P., (2002). Sentencing and Enforcement of White Collar Crimes. Conservative Policy Research and Analysis. Retrieved September 27, 2012 from  http://www.heritage.org/research/testimony/sentencing-and-enforcement-of-white-collar-crimes

White Collar Crimes Criminality Theories a White

White Collar Crimes Criminality Theories A white collar crime can be simply defined as the framework that instigates immoral actions that don't always endanger lives but do harm the society in one way or another (Freidrichs, 2010). The aspects or factors that might thus be considered by white collar theories to validate a crime as a white collar crime include the following: It is defined illegal: no act if officially legal or illegal till there is a law in place for it defining it as such. It involves human input: any and all white collar crimes involve an input of a human to be conceived and completed. All human inputs that are considered factors of the white collar crimes are harmful to the society at some level and are thus countered either on a state/legal level or through informal structure of cultural norms or standards. It is a mental phenomenon: any and all white collar….

Friedrichs, D.O., (2010). Trusted Criminals (4th Ed.). Belmont, CA: Thompson Learning.

Hall, S., Winlow, S. And Ancrum, C. (2008) Criminal Identities and Consumer Culture, London: Willan/Routledge.

Slattery, Martin (2003). Key Ideas In Sociology. Nelson Thornes.


Criminal Justice

White Collar Crime Theoretical Perspectives of Criminal Behavior Three broad theoretical models of criminal behavior have historically prevailed. These models include psychological models of criminality, sociological models of criminality, and biologically…

White Collar Crimes Supervisor: (Insert) The paper focuses on specific aspects of white collar crime. The paper primarily focuses on answering two questions directly related to white collar crime. The first…

White Collar Crime: Identifying Valid Deterrents for White Collar Criminals ecent studies suggest that white collar crime is on the rise (Chayet, Waring & Weisburg, 2001; ecine, 2002). Many stereotypical…

hite Collar Crime: hen most people think of white collar crime today, they think of Enron and Martha Stewart -- or of a nebulous idea of a kind of crime…

White collar crime is one of the most controversial subjects in America today. With the recent conviction of home-economics guru Martha Stewart for white-collar-crime related issues, the subject has…

Discussion Chapter

White Collar Crimes he first definition states that this is an illegal act committed via non-physical means by guile to gain personal advantage. his definition's drawback is that it belittles…

White Collar Crimes Governmental Crimes The extent of damage that the application of imperialistic conquests, warfare or threat of nuclear power can have on the psyche, finances and structure of the…

White Collar Crime Theories, Laws and Processes Explain white collar crime in terms of various theories related to criminology and crime. A white collar crime is an illegal and unethical act…

In an environment where violent crimes outweigh white-collar crimes, the prosecutor will allocate his resources to fighting violent crimes. esource availability thus determines how many cases will be…

White-Collar Crime and Public Order Crime The objective of this study is to distinguish between white-collar crime and public order crime. The differences will be explained between the two crimes.…

This law contributed to the development of the white-collar crimes since it was yet another restriction on the operation of the employers. MODULE 6/DISCUSSION 2 -- egulatory System and…

Research Paper

White-Collar Crime Discussion White-collar crime differs significantly from street crime. In addition to having varying punishments and penalties, each classification of crime in this case has unique targets. It should,…

White Collar Crimes There are two major categories of crime majorly grouped into 'blue collar' and 'White Collar' crimes. The blue collar usually involves violence and of interest here is…

The criminal acts within those legitimate realms continue to be more familiar and ongoing. When there are rampage on the WCCs and Organized crimes, the line existing between…

White Collar Crimes Criminality Theories A white collar crime can be simply defined as the framework that instigates immoral actions that don't always endanger lives but do harm the society in…


White Collar And Organized Crime Essay

  • 3 Works Cited

Exercise 3: White Collar Crime. In A Looking Glass Of A

In a looking glass of a sociologist, we can see white collar crime in our everyday world. When it presents itself; the victims are left hurt and the rest in awe of their awful actions. White Collar Crime is defined as “White collar crime overlaps with corporate crime because the opportunity for fraud, bribery, insider trading, embezzlement, computer crime, and forgery is more available to white-collar employees.” stated by James Henslin. White Collar Crime can be seen in the Libor Scandal, as a prime example.

Define White Collar Crime

  • 5 Works Cited

White Collar crime is not a crime unto it self, but instead a criteria that has to be met in order for a crime to be considered as White- Collar Crime; (Blount, 2002) hence the reason why Corporate Crime is also considered as White- Collar Crime. At the same time, White Collar Crime and Corporate Crime can be seen as distinct criminological categories, however, in order to reveal this, this essay will firstly be exploring Sutherland's definition of white collar crime and the perplexity with this definition of white-collar crime. It will then be looking at the modification which had to take place with Sutherland's definition of white-collar crime in order to established a distinction between white-collar and corporate crime.

Sutherland's Concept of White Collar Crime in the 21st Century

White collar crime is often associated with crimes committed within businesses. These include different forms of fraud such as tax fraud, welfare fraud, money laundering, and property crime (Simpson & Benson, 2009: 42). These forms of white collar crime often have a huge impact on the welfare of the society in profound ways. For instance, according to an article authored by McGrath, a company that suffers losses from fraud must make up for this loss by for example raising the prices of its products. Hikes in prices would mean that consumers would be required to dig dipper into their pockets thus affecting their finances. The loss from fraud could also make the affected company to take drastic measures such as layoffs or implementing salary cuts for the employees (McGrath, n.d).

White Collar Crimes And Street Crimes

White-collar crimes are just as prevalent today as ordinary street crimes. Studies show that criminal acts committed by white-collar criminals continue to increase due to unforeseen opportunities presented in the corporate world, but these crimes are often overlooked or minimally publicized in reference to criminal acts on the street. Many street crimes are viewed as unnecessary, horrendous crimes because they are committed by lower class citizens, whereas white collar crimes are illegal acts committed by seemingly respectable people whose occupational roles are considered successful and often admired by many (Piquero, 2014). These views often allow white collar crimes to “slip through the cracks” and carry lesser charges or punishment.

Essay on White-Collar Crime Vs. Street Crime

Most everyone goes home after a long day of work and watches the news. Think, what is usually reported? The weather, local activities, headline news, or daily criminal activity. Shootings, stabbings, homicides, etc. are all discussed by media anchors these days. This causes most everyone in our society to become familiar with crimes that are considered street crimes. What most people don’t hear about on the news is what is considered white-collar crime, sometimes known as corporate crime. White-collar crime not only is less reported in the media but also receives weaker punishments than street crime. This paper will first discuss the similarities between the two types of crime and then explain why their punishments are strongly

THe Mafia Essay

     Exactly what is the Mafia? Mafia, more specifically the Italian-American Mafia, is a group of criminals organized into "families," and operating primarily in North America. Also known as La Cosa Nostra, at one time there were 26 families in the United States - roughly one for each major city. The Mafia composed of bosses of numerous families, mostly New York, was the overseeing authority for all of the other La Cosa Nostra families. New York City is the place of origin for organized crime in the United States. Currently, there are five families in the New York City outfit of the La Cosa Nostra. The five families are, the Gambinos, Genovese, Colombo,

Controlling Organized Crime

Since the 1990’s, organized crime has become a problem among U.S. citizens. The Mafia was the earliest group to show its strengths of power and manipulation among citizens and business of New York City. From the time of the Mafia’s rise, other criminal organizations have surfaced using their power to corrupt personal within business for the gain of finance and political strength. In today society, one of the main question when it comes to these groups is how can criminal organizations be controlled? This paper will identify the problems presented and the various relationships established by organized crime. It will describe the legal limitations associated with combating

White Collar Crime: Ponzi Scheme with a Focus on Bernard Madoff

Most people, when they hear the word “crime,” think about street crime or violent crime such as murder, rape, theft, or drugs. However, there is another type of crime that has cost people their life savings, investors’ billions of dollars, and has had significant impacts of multiple lives; it is called white collar crime. The Federal Bureau of Investigation defines white collar crime as

Strain Theory White Collar Crime

White-collar crime is defined as the financial motivations of non-violent crimes that are committed by professionals of business and those of the government. In the field of criminology, Edwin Suthelan (1939), a socialist who was the first person to define white-collar crime as a crime that respectable and those people of higher social status commit. The crimes include those associated with fraud, bribery, embezzlement, cybercrime, money laundering, theft of the identity and many more crimes that are nonviolent. For the white collar crimes, the offenses committed should produce some gains financially. The crimes are thereby committed by those persons holding various positions in businesses or organizations, and it is because of this position they can gain access to amounts of huge money that they get from the people like customers with whom they serve. The criminals involved are not caught in activities that are violent, involved in drug issues or illegal activities.

White Collar Crime And Its Effects On Society Essay

In 1939, American sociologist Edwin Sutherland introduced the phrase “white-collar crime”. White-collar crime is a nonviolent crime committed by a business or large corporations. They are usually scams or frauds to gain wealth in society. The people who are guilty of this crime lie, cheat and steal from investors of their company or business. Even though these crimes are non-violent, they have major impacts on the society. Their companies become non existent and families get destroyed. All of their life savings and savings for their children get taken away, and they become bankrupt. Not only does it affect their families, the investors who believed in their business lose millions or even billions of dollars.

The Corruption Of White Collared Crime

In this day and age, a corporation, family, or individual always has a potential risk of encountering fraud within their money supply. On average, fraud and abuse costs U.S. organizations more than $400 billion annually (Federal Bureau Investigation, 2010). Many may think that white collared crime is only money laundering or stealing, but that is only two out of the sum that countless culprits get away with. The term “white-collar crime,” originally coined in 1939 is synonymous with the full range of frauds committed by business and government professionals (Federal Bureau Investigation, 2010). These frauds include anything from bankruptcy fraud, money laundering, identity theft, corporate fraud to a wide number of threats all circling

White Collar Crime And Corporate Crime

White-Collar Crime consists of occupational crime and corporate crime. Occupational crime refers to offences committed against legitimate institutions businesses or government by those with "respectable" social status. It includes the embezzlement of corporate funds, tax evasion, computer crime and expense-account fraud. It is not every day that we hear about white-collar crimes but these non-violent crimes are on the rise to the top. Federal Bureau of Investigation states that USA, for example recorded white collar crimes amounting $300 billion every year (Cornell University, 2010). White-collar crime is relatively a new idea. It has many aspects that are practical for study and further interpretation to clear some of its dark areas. White-Collar Crime was once introduced by Edwin Sutherland in 1939 during his speech in American Sociological Society. The following crimes actually performed are Bribery, Extortion, Insurance, Fraud, Embezzlement, Cybercrime etc. People who participate in these criminal activities are highly powerful and respectful among the society. The following activities include description about White-collar Crime, Investigation of White Collar Crime and The Consequences of committing a White-collar Crime.

White Collar Crime Essay example

In this paper the exciting criminal phenomenon known as white-collar crime will be discussed. Corporate Crime and Computer Crime will be discussed in detail. Crime preventative agencies such as the NCPC (National Crime Prevention Council) will also be researched. White Collar Crime The late Professor Edwin Sutherland coined the term white-collar crime about 1941. Sutherland defined white-collar crime as "a crime committed by a person of respectability and high social status in the course of his occupation" (Siegel 337) White-collar crime includes, by way of example, such acts as promulgating false or misleading advertising, illegal exploitation of employees, mislabeling of goods, violation of weights and measures statutes, conspiring to

White Collar Crime Is A Serious Issue Essay

White collar crime is a serious issue in the United States. White-collar crime is “a crime committed by a person of respectability and high social status in the course of his occupation” (cornell.edu). Examples of such offenses include bribery, credit card fraud, insurance fraud, bank fraud, blackmail, extortion, forgery, securities fraud, tax evasion, embezzlement, repair scams, Ponzi and pyramid schemes. These non-violent crimes are responsible for an estimated $250 billion to $1 trillion in economic damages each year (Martinez). Individuals who commit white collar crimes have an increased likelihood to experience injustice compared to those who commit a street crime as noted in multiple studies detailed in various scholarly articles. Also, street criminals have a greater chance of getting caught in their wrongdoings versus white-collar criminals. Those who commit white collar crime make their decisions based on the philosophy or idea that their actions have low risk and a high reward. We face a dilemma in the United States because white-collar criminals are treated with minimal, inequitable punishment due to their social status, whereas the street criminals are treated with the correct, impartial punishment.

White Collar Crime By Edwin Sutherland Essay

White Collar Crime by Edwin Sutherland, published in 1949, is a study in the theory of criminal behaviour. Sutherland states that this book is an attempt to reform the theory of criminal behaviour only, not to reform anything else. And although it may include implications for social reforms, this is not the objective of the book. Sutherland define white collar crime as ‘a crime committed by a person of respectability and high social status in the course of his occupation’ (pp. 9). He adds that it excludes many crimes of the upper class, such as murder, intoxication, and adultery, because these are not usually part of their occupational procedures. He goes on to describe white collar crime as being similar to juvenile delinquency in the sense of the stigma generated from each crime. In both of these crimes the procedures of criminal law are altered so as not to attach stigma to the offenders. Finally, Sutherland writes that crimes are committed across all social classes, not just people in lower classes or living in poverty, contrary to popular belief at the time of publication.

Related Topics

  • Federal Bureau of Investigation
  • Criminal justice
  • Criminology

White Collar Crime Argumentative Essay Example

White Collar Crime Argumentative Essay Example

  • Pages: 9 (2205 words)
  • Published: September 3, 2017
  • Type: Essay

A white-collar crime refers to crimes committed by business people, entrepreneurs, professionals, or public officials. It was a term first coined by Edwin Sutherland who defined the term as "crime committed by a person of respectability and high social status in the course of his occupation" (Sutherland 1974) and was the first to bring attention to the matter. White-collar crimes are different then street crimes because they are through deception and not force or violence.There has been much debate as to what qualifies as a white-collar crime, the term today generally describes a variety of non-violent crimes usually committed in commercial situations for financial, organisational or personal gain. Many white-collar crimes are especially difficult to prosecute because the perpetrators are sophisticated criminals who have attempted to conceal their activities through a series of complex tr

ansactions. (Bologna 1984).

For most individuals, white-collar crime is not viewed as a crime at all, because of its non-violent nature.Violent crime has an immediate and obvious impact on its victims, which raises the attention of the public, whereas white-collar crime frequently goes undetected or is viewed as a bending of the rules (Geis, 1982). White-collar crime; however, can have more of an impact than violent crimes. The victim of a violent crime can recover were as the victim of fraud for example can have endless impact. Bribery, computer crime, abuse of power, false statements, fraud, obstruction of justice, racketeering and tax crimes are all white collar crimes.

There are a number of characteristics of white collar crimes.Only some of these characteristics make the defining of whether something is criminal or not difficult. White collar crime is often open to endless

discussion and debate. Three case study materials of train crashes which took place at Hatfield, Paddington and Potters Bar will be analysed and explored in order to consider how far each of them should be seen as examples of white collar crime? In order to successfully answer this question, each individual crash will be explored to see what characteristics are evident which may have direct links to white collar crimes.The Ladbroke Grove train crash occurred at 08.

11 BST on Tuesday, 5 November. The crash near Paddington stations immediate cause was due to the train going through a red signal and having a collision with an oncoming train. Factors brought out in this case were that the driver did not have sufficient training and there was an evident communication barrier which resulted in the train going through the red light. This resulted in the death of thirty-one people including both drivers. Hundreds were also injured.The Potters Bar train crashes immediate cause was the result of the train tracks not being aligned correctly due to nuts and bolts being missing from the track, other parts were also in poor condition.

In effect, this caused the points to fail catastrophically and the train to derail. This incident caused the loss of seven deaths. The Hatfield train crash was a result of a track defect. A specific type of metal fatigue is thought to be the most likely cause. This caused the train track to disintegrate beneath the train.

Four people were killed and more than thirty were injured.These are three harmful incidents which have taken place. They have resulted in quite dramatic consequences of the loss of

lives. I will now explore all the underlying reasons and actions in each of the train crashes in order to answer the question of whether the actions in each case is a result of white collar crime or not.

To do this I will look into each individual party that may or may not have had a part to play in the causes of the accidents. This will in effect help me to judge and consider whether the roles of the individuals have any specific links to the characteristics of white collar crimes.It may be considered that each of the three crimes were solely down to negligence which may be perceived as an act of involuntary manslaughter due to a loss of responsibility. If this is the case then the Crime would be corporate crime as its accidental rather than with intent. White Collar crime differs slightly from Corporate crime in the sense that White Collar crime is likely to be crime against the corporation, whereas, corporate Crime is crime committed by the corporation. From a Right Wing perspective the crashes are all unfortunate accidents which have led to horrendous circumstances.

It seems they are crimes of fate and chance rather than deliberate. The concern portrayed is that we perhaps should not always look for someone to blame for all loss of lives. This view can be argued in terms of the roles people and companies have played which, may have had something to do with the causation of the crashes. In Ladbroke Grove for instance, it is evident that the company was behind the crash. This is due to the lack of training of the

driver of the train at the time.

It is clear that the incident was mainly due to bad training. The company itself was indeed behind this.This may be a result of the increased pressures in costs that railway companies are faced with. In these companies competition is a huge factor and all companies are trying to make a profit. From a radical perspective, this may encourage companies to cut corners in order to meet target profits.

One of the corners that may have been cut or neglected for cost purposes in this case is the training of staff. This is how we may explain the consequences. This draws my attention to the complications that arise when a lot of people have an input in the cause of the accidents.It is much harder to perceive whose criminality resulted in the crashes. There are a numbers of players whose direct actions have a part in the incidents that have happened.

If the crashes are indeed White Collar crimes then whose criminality is it? In Potters Bar, the crash was due to poor maintenance as nuts and bolts were missing. This is someone's criminality but whose? The tracks have clearly not been perfected resulting in a loss of life. Railway companies contract out to private companies such as Thames and Railtracks who carry out track inspections and maintenance.There's a lot of input from different directions, this results in a huge confusion of responsibility and accountability. Systematic problems therefore arise, it can be seen that the train companies are not responsible due to companies like Railtracks who are supposedly maintaining tracks and points are over and over again not

doing very well and getting reprimanded.

There is a behaviour that keeps repeating itself which shows an element of criminality on their behalf. In Ladbroke Grove, there are also a number of people who may be perceived to have a shared responsibility in the crashes.The driver went through red light, there was poor communication with the man at signal box and there is a pre history to it all in terms of the training received by the driver. They are all contributing which adds to the confusion of whether is it a crime or an accident which questions the legality issues. White collar crime is often complicated because the crime is not often the product of one person or the reason why organisations deliberately do things, in terms of the three train crashes; it varyingly can be argued that the outcomes are from a whole range of decisions and weaknesses at different points.

The characteristics of white collar crime which is evident in these events are due to the nature and the possible criminals involved. They are all companies and employees about their business, they are where they should be, if driving the train or giving signals. This is there role and position in the company. The degree of harm is death and injury and the crimes may have been avoided.

Bosh argues that all the emphasis in criminology tends to be on the conviction of crime.There is a blind eye towards the area of capitalism and the media largely concentrates on these individual little criminal events and not on the huge harm being caused elsewhere. (Bosh) Clearly these are examples of the tremendous harm which

can be caused by these events. There are a number of incidents which draws upon issues of white collar crime. The crashes are not criminal events which are often easy to spot or judge.

In Hatfield, there was a rail fatigue which is now being appreciated throughout Europe. Scientific knowledge is needed to understand the error or the accidents of the crashes.They are all clearly intense crimes, but to what extent should there be any form of identifiably of a decision maker. The law at the moment states that if a company is to be done for corporate manslaughter a senior director manager needs to be identified as being guilty of manslaughter of his or herself. This means they have made key decisions which have led to the criminal situation.

This is usually difficult and is virtually impossible to prove. The government is currently analysing in order to make changes. It looks at failure in senior management. In Ladbroke, this is the case due to poor training and a poor mapping system.Enough is going on in this case to argue that under future law the company might be guilty of corporate manslaughter. When looking at the nature of policing and punishment, these crashes have issues such as health and safety, which is an important area which needs to be looked at.

This gives the impression that maybe the crimes are more corporate based rather than white collar. This is due to the crimes being committed by the corporation but not against the corporation in the terms of fraud. These crimes are complex organisational, technical events, which in terms in specialism, culture and expectations the police

often cannot deal with.When dealing with white collar crimes, in these major incidents a problem which needs to be looked at is why there were three crashes and not one. Is it due to the government having decided not to spend any money on trains? We as individuals have previously voted for conservative government who have wanted to cut spending reduce taxation. Under that not spending so much on our infrastructure, the consequence of all of that has been these crashes and we should not maybe blame the companies but blame something beyond.

We as a country have chosen to prioritise low taxes and public spending.That has been our values and that has had implications for other things like railway tracking. After train crashes there is a sense of moral panic. Trains almost came to a holt after these incidents.

As the public when it comes to trains we want safety but also want speed. Therefore it is hard to determine where we strike the balance. There is a sense of ambiguity; it is difficult to come to a conclusion because characteristics of white collar crimes are debatable. The judgement where I stand is that the three crashes looked at are criminal offences but not where someone needs to be punished in the sense of prosecution.All three train crashes were to a large degree accidental. The crashes were not due to intent but are all forms of accidents and it was not a crime of intent in order to enclose personal, organisational or financial gain.

There were a number of people and companies at fault in the leading up to the crashes. Work had not

been done sufficiently, tracks had not been inspected to a current standard and silly mistakes such as nuts and bolts were missing had taken place. As discussed, it is hard to determine who should be punished for the crashes as there has been input from a wide area.It is also clear that there are many underlying reasons behind the faults that led to the crashes. When taking a legal perspective the offences cannot be a direct action of corporate manslaughter as a senior manager director has not been held responsible for making a key decision which has directly led to the crashes under this current law. Therefore a prosecution cannot be made for this.

When taking a global perspective at the situation as a whole. It is clear that train company's are under increased pressure to perform. They are also in competition with other companies in terms of speed, efficiency and profits.This may be the reason for the corners that have been cut, which have been done to satisfy the businesses needs and to please members of the general public who want fast, but cheap transportation. This brings me to the conclusion that the crashes are not immediate forms of White Collar crimes again because the intent to harm these people was not there. The crashes are based on accidents.

Yes, they could have been prevented if a little more effort and guidance was put into the training of staff and the inspections carried out but I do not think that punishment in terms of prosecution is the answer to these incidents.

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Research Paper

White-collar crime research paper.

essay on white collar crime

This sample White-Collar Crime Research Paper is published for educational and informational purposes only. Like other free research paper examples, it is not a custom research paper. If you need help writing your assignment, please use our custom writing services and buy a paper on any of the criminal justice research paper topics .  This sample research paper on white-collar crime features: 6600+ words (23 pages), an outline, APA format in-text citations, and a bibliography with 22 sources.

I. Introduction

Ii. definition and costs of white-collar crime, iii. characteristics and techniques of white-collar crime, iv. the problem of controlling white-collar crime, v. types of white-collar crime, a. antitrust violations, b. securities violations, c. consumer fraud, d. health care fraud, e. environmental crime, vi. conclusion.

White-collar crime is a generic term that refers to a broad range of illegal acts committed by seemingly respectable people in business settings as part of their occupational roles. There are many different types of white-collar crime, ranging from antitrust offenses to environmental violations to health care frauds and beyond. These types of crime are important because they impose enormous financial, physical, and social harms on individuals, communities, and society in general. Because of their special characteristics and the techniques by which they are committed, they pose significant problems for law enforcement and regulatory agencies interested in controlling them. Evidence suggests that white-collar crime is pervasive, widespread, and growing.

This research paper begins with a brief discussion of the history of the concept of white-collar crime in the discipline of criminology. The nature and extent of the harms imposed by white-collar crime are then detailed. Next, the characteristics and techniques of white-collar offending are described, and the problems that these features create for societal efforts to reduce white-collar crime are outlined. This section is followed by a summary of some of the major forms of white-collar crime. Finally, the research paper concludes by identifying recent social and economic developments that are likely to ensure that white-collar crime will maintain its status as a major social problem well into the future.

The phrase “white-collar crime” was coined by the eminent American sociologist Edwin H. Sutherland, in the late 1930s. At the time that Sutherland was writing, most criminologists thought that crime was concentrated among the urban poor and caused by the disadvantages and pathologies associated with poverty. Sutherland disagreed and argued strenuously that respectable people from the upper social classes committed a great deal of harmful criminal acts in the course of their occupations and in the furtherance of their economic and business interests. According to Sutherland (1949), upper-class criminality was ignored by the government and the general public because the perpetrators did not fit the common stereotype of the criminal. His work was aimed at reforming criminological theory by bringing this neglected form of criminality into the realm of scientific and public discourse.

There are two main approaches to defining white-collar crime: offender-based versus offense-based. Sutherland (1940) defined white-collar crime as a crime committed by a person of respectability and high social status in the course of his occupation. This definition is the most well-known and influential example of what has been called the offender-based approach to defining white-collar crime. Offender-based definitions emphasize as an essential characteristic of white-collar crime the high social status, power, and respectability of the actor. Another approach to defining white-collar crime focuses more on the characteristics of the offense rather than the actor. The most well-known offense-based definition was proposed by Herbert Edelhertz in 1970. Edelhertz defined white-collar crime as an illegal act or series of illegal acts committed by nonphysical means and by concealment or guile to obtain money or property, to avoid the payment or loss of money or property, or to obtain business or personal advantage. For offense-based definitions, what distinguishes white-collar crimes from other types of crime is the manner in which they are committed rather than the characteristics of the person who commits them.

Regardless of how it is defined, white-collar crime is widely acknowledged to cause tremendous financial, physical, and social harms. The amount of money lost to white-collar crime annually is impossible to establish with any precision, but it clearly exceeds the losses due to ordinary street crime. For example, according to the Federal Bureau of Investigation (FBI, 2007), in 2006 traditional property crimes such as larceny, burglary, auto theft, and robbery accounted for an estimated $17.6 billion in losses. By comparison, the FBI estimates annual losses due to white-collar crime at $300 billion.

Although typically thought of as a financial crime, certain types of white-collar crime can have physical effects as well. These include violations of workplace safety laws, the manufacture and distribution of unsafe consumer products, and violation of environmental laws and regulations. Between 1982 and 2002, over 2,000 American workers died as a result of willful violations of safety laws by employers. It is estimated that hundreds of thousands more are injured by such violations. The victims of occupationally related diseases also run into the hundreds of thousands annually. In addition, consumers suffer physically as a result of dangerous products, including most notably toys, food, pharmaceuticals, and medical equipment. The exact number of deaths and injuries caused by dangerous or defective products that can be attributed to lawbreaking by corporations is impossible to determine with any precision. Nevertheless, criminal cases involving some of the largest and most well-known corporations in the world occur regularly. In addition, the physical effects of white-collar crime extend beyond workers and consumers to society in general in the form of violations of environmental protection laws.

Like ordinary street crime, white-collar crime also has social or moral costs that extend beyond its affects on individual victims. Many scholars believe that white-collar crime damages the moral climate in society by undermining people’s faith in the legitimacy and fairness of business and government. White-collar crime is thought to create distrust and to undermine public confidence in the morality of big business. By disregarding the rules of free and open competition, business organizations that engage in white-collar crime gain unfair advantage over their law-abiding competitors. The ability of the market to reduce the costs of goods and services and to improve efficiency through competition is thereby threatened. Thus, white-collar criminal behavior harms the American economy and free enterprise system. The moral and social costs of white-collar crime may extend to political institutions. White-collar crime scholars from Sutherland on have speculated that publicity about white-collar crimes committed by big businesses can delegitimate the government, especially when it appears that corporations and their executives receive special treatment in the justice system. Finally, publicity about white-collar crime also may serve as a justification for other sorts of crime and deviance.

White-collar crime can be found in all types of businesses, industries, occupations, and professions. Hence, it comes in a large variety of forms and styles. All white-collar crimes, however, share certain characteristics and are committed using particular techniques. These characteristics and techniques distinguish white-collar crimes from most forms of traditional street crime. Three characteristics of white-collar crime are particularly important: (1) The offender has legitimate access to the target or victim of the crime on the basis of an occupational position; (2) the offender is spatially separated from the victim; and (3) the offender’s actions have a superficial appearance of legality.

Legitimate access means that white-collar offenders do not have to solve a problem that most predatory offenders confront—the problem of getting close to the target. For example, before a burglar can steal something from a home, he or she must first gain access to the home by somehow entering it. This is usually done by using force to break in a door or window. Breaking in creates additional risk of exposure for the offender. White-collar offenders, on the other hand, are not exposed to this additional risk because their occupational roles give them legitimate access to the targets of their crimes. For example, because of their occupational positions, bank employees have legitimate access to other people’s money and can embezzle it without breaking into their homes or physically confronting them on the street. Similarly, in many other forms of white-collar crime such as securities violations, antitrust violations, and health care frauds, the perpetrators take advantage of their occupational roles to get access to the targets of their crime.

In many white-collar crimes, the offenders never directly confront or come in contact with their victims. Rather, they are spatially separated from victims. Consider, for example, the antitrust violation of price fixing. Illegal price fixing occurs when competitors in an industry get together and collude to set prices for their products or services, as opposed to having prices determined by free and open competition in the marketplace. The victims of price fixing often are members of the general public, who have to pay more for goods and services than they would if prices were set by competition. The victims are never contacted directly by the perpetrators.

Perhaps the most troublesome aspect of white-collar crime is the superficial appearance of legitimacy. When a burglar breaks into a home, or an auto thief steals a vehicle, or any of the other traditional street crimes occurs, the fact that a crime has occurred is obvious. The offender’s actions leave visible traces of the crime (e.g., the broken door and missing television), and the offender’s actions can clearly be recognized as illegal by observers. In the case of the vast majority of white-collar crimes, however, the offender’s actions are not obviously illegal. Indeed, at first glance they look entirely legitimate, and the fact that a crime may have occurred is not obvious. For example, a common form of health care fraud engaged in by physicians is billing insurance providers for services that were not rendered to patients. To commit the crime, the physician simply submits a form to the insurance provider, often either the federal Medicare or Medicaid program, in which he or she claims to have administered some service to a patient that in reality was never provided. If the fraudulent claim is not detected and the physician is paid by the insurance provider, then the crime of health care fraud has occurred. Since literally millions of such forms are submitted legally every day, on the surface nothing is obviously out of the ordinary or untoward about the physician’s actions. Indeed, the physician’s behavior looks perfectly normal and legitimate.

Taken together, the characteristics of white-collar crime— legitimate access, spatial separation, and appearance of legitimacy—raise special problems for its control by the criminal justice system. The most notable problem is that of detection. Most ordinary street crimes are detected by their victims, who can then report the incident to the police. However, in the case of white-collar crime, victims may be wholly unaware that they have been victimized. Hence, no crime may ever be reported to the police. Because discovery is problematic, it is difficult to estimate the magnitude of the white-collar crime problem and hence to make decisions regarding how to allocate resources toward its control.

A second control problem raised by white-collar crime involves assigning responsibility for the offense. Many white-collar crimes occur in organizational or corporate settings and are the result of collective actions taken by groups of people. In these cases, it is often difficult to identify the individual or individuals who should be held accountable for the illegal activity. Because it may not be clear who is responsible for a particular offense, prosecutors often are reluctant to bring such cases to trial.

Related to the problems of detection and accountability is the difficulty of securing convictions in court. Because white-collar crimes are often complex and embedded in legitimate business routines, it can be difficult for prosecutors to prove beyond a reasonable doubt that an individual is guilty of an offense. The major obstacle is proving that the offender knowingly intended to violate the law. For example, in the health care fraud example discussed above, the physician submits a fraudulent claim for reimbursement for services rendered. Even if it can be shown that the claim is not accurate, the physician may still be able to argue successfully in court that he or she did not intend to submit a false claim. Rather, the fraudulent claim was simply a mistake or accident and not an intentional act. The denial of criminal intent is a very common feature of white-collar trials.

Convictions are also difficult to secure in white-collar cases, because the defendants typically have access to strong defense counsel. Unlike ordinary street offenders, white-collar offenders often can afford to hire the very best defense lawyers. White-collar defense attorneys work hard to control the prosecutor’s access to information and evidence related to the alleged crime. For example, to demonstrate that a crime has occurred in a business setting, prosecutors often need access to company records and files. Defense attorneys can file motions and objections to attempts by prosecutors to secure search warrants. Although these motions are not always successful, they can make the prosecutor’s job more difficult and time consuming. The strategy of information control can make it difficult for prosecutors to build successful cases in court.

For the reasons discussed above, investigating and prosecuting white-collar crime cases is often very expensive and time consuming. These constraints limit the effectiveness of the criminal justice system as a means of controlling white-collar crime. Local law enforcement agencies have multiple and competing demands on their time and resources. They are under constant pressure to respond to gang-related, drug, and violent crimes. Not surprisingly, in this context, white-collar crimes are considered less important, and accordingly given lower priority when decisions are made regarding which cases to pursue. Although state and federal law enforcement agencies do not suffer from the same resource constraints as local agencies, they too are limited in their ability to respond to white-collar crime.

Criminal justice agencies operate under legal constraints that can make it difficult to use the criminal law successfully against white-collar offenders. Legal constraints refer to features of the law that make it more or less difficult for law enforcers to use. For example, the standard of proof in criminal court is very high, as the defendant’s guilt must be proved beyond a reasonable doubt. Because of their complexity, proving guilt beyond a reasonable doubt in white-collar cases is often difficult. Other legal constraints such as the right to be free from unreasonable searches and seizures and the privilege against self-incrimination also complicate the efforts of law enforcers to bring the guilty to justice.

essay on white collar crime

For all of the reasons outlined above, most scholars agree that while the criminal justice system is an important component of white-collar crime control, it should not be the first line of defense. Rather, regulatory controls are considered to be more effective and efficient. The regulatory system holds three distinct advantages over the criminal justice system as a means of controlling white-collar and corporate crime: (1) specialized expertise, (2) greater investigative powers, and (3) more flexibility and discretion.

When they are established, regulatory agencies are given a mandate to look at problems in specific areas. For example, the Food and Drug Administration (FDA) is supposed to regulate the safety and quality of foods and drugs. The Environmental Protection Agency (EPA) looks after the environment, while the Securities and Exchange Commission (SEC) keeps track of activities in the securities industry. Because regulatory agencies are focused on specific problems and subject areas, agency personnel can develop specialized expertise. This expertise can help them see problems and envision solutions more easily than law enforcement agencies can.

As noted above, the police and other law enforcement investigative agencies operate under strict legal constraints. They typically cannot act until there is evidence that a crime has been committed and that a particular person or organization is involved. Regulatory agencies operate under fewer legal constraints, and in many cases they are given explicit authority to enter premises and to ask for information from business organizations. Hence, in theory, they can learn about potential problems before they happen rather than after the fact, and they can act proactively rather than reactively.

Finally, regulatory agencies also have more flexibility and discretion in the fashioning of their responses to corporate wrongdoing. The criminal justice system is, for the most part, restricted to applying the criminal law as it is enacted by legislative bodies. Regulatory agencies can work with businesses to create innovative solutions to problems.

However, there are disadvantages to overreliance on regulation. A significant problem is agency capture. By design and necessity, regulatory agencies must work closely with regulated industries. Agencies routinely ask for industry input on the development and implementation of rules. Regulatory inspectors also meet regularly with the people they regulate as they go about enforcing the rules. Hence, there is always the possibility that regulatory agencies will be “captured” by the regulated industry and begin to act more in the interests of the industry rather than the interests of the general public.

Another problem with regulation as a means of controlling corporate misbehavior is that the sanctions imposed by regulatory agencies are not nearly as powerful or threatening as those imposed by the criminal justice system. Regulatory agencies can impose large fines on violators. Yet, no matter how big the fine is, it does not carry the social stigma of criminal penalties. Hence, critics of the regulatory system argue that regulation doesn’t really deter wrongdoing. They argue that regulated businesses look at fines and other regulatory penalties as simply a cost of doing business.

Finally, there is the problem of regulatory unreasonableness. In theory, regulatory agencies are supposed to work to protect the public interest and to prevent harmful situations from developing in the first place. For example, it makes sense to establish rules to protect workers and to lower the risk that they will be made ill, injured, or killed on the job. But some agencies become more focused on enforcing the rules and less on preventing problems. If carried to an extreme, this tendency can lead to regulatory unreasonableness, in which the rules are enforced in a narrow-minded and legalistic fashion simply because they are the rules. The broader goal of preventing harm sometimes gets lost in the zeal to enforce the rules.

White-collar crime comes in a variety of forms and can be found in every industry, profession, and occupation. In this section, five major forms of white-collar crime are defined and described: antitrust violations, securities violations, consumer fraud, health care fraud, and environmental offenses.

Antitrust violation can be divided into two broad groups: restrictive trade agreements, and monopolies or monopolistic practices. Restrictive trade agreements involve an illegal agreement or understanding between competitors in an industry to restrict how the industry works. Two examples of restrictive trade agreements are price fixing and market sharing or division. Price fixing refers to agreements between competitors to set prices at a certain level. For example, if milk producers get together and agree among themselves to charge schools a set price for the milk used in school lunch programs, that is price fixing. Market sharing occurs when competitors get together and divide up an area, so that only one of them operates in any one area at a time. For example, two paving contractors might divide up a town so that one takes the east side and the other the west side of town. These sorts of agreements are illegal because they restrain trade. In these examples, the prices for these goods and services (milk and paving) are not being set by open competition in the marketplace, as they should be in a free market economy. Rather, prices are being set by collusion between or among competitors.

Monopolies and monopolistic practices involve unfair attempts to corner a market or to drive out competitors from a marketplace. A monopoly is said to exist if one company controls an entire market, but a company can have monopolistic control even though it has competitors if it controls a large enough share of a market. Microsoft’s Windows operating system, for example, was declared a monopoly even though there are other operating systems available. The other systems have such a small market share and Windows has such a large share that it effectively controls the market.

There are two main techniques of monopolistic practices. The first is to use predatory pricing, which occurs when a company sets a price for its products or services that is economically unfeasible in order to drive competitors out of business. A second technique is for a company to pressure or control other companies that supply or deal with competitors so as to put them at a competitive disadvantage. Microsoft was accused of doing this with computer manufactures. It forced computer manufactures who wanted to preload their machines with the Windows operating system to agree not to install software from some rival companies when selling computers to the public. In effect, this destroyed the market for rival software companies.

A security is evidence of ownership, creditorship, or debt. It is a piece of paper, or an account number, or something that indicates that someone has a financial interest or stake in an economic undertaking. For example, stocks, bonds, shares in a mutual fund, promissory notes, and U.S. government savings bonds are all securities. Publicly traded securities are bought and sold on exchanges, such as the New York Stock Exchange.

There are five major types of security offenses. Misrepresentation involves lying about the value or condition of a security. Stock manipulation occurs when an individual or a group of individuals attempts to artificially manipulate the price of a security. Misappropriation is an offense committed by brokers or other financial advisors who take money that their clients have given them to invest and misappropriate it for their own use. Insider trading is perhaps the most publicized security offense. It arises when people trade on the basis of inside, nonpublic information. It is illegal for insiders to buy or sell stock on the basis of information that is not available to the public. Finally, in an investment scheme, the perpetrator tricks people into investing money in an undertaking or security by falsely promising investors that they will receive a high rate of return on their investment. In reality, the undertaking has little or no chance of paying off, and the perpetrator simply makes off with the investors’ money.

Consumer fraud is one of the most common forms of white-collar crime. It involves the use of deceit or deception in the marketing and selling of goods or services. This offense usually involves the deliberate use of false, deceptive, or misleading statements about the cost, quality, or effectiveness of a product or service. Consumer fraud offenders are drawn from all types of businesses and represent a continuum of size and complexity. Fraud against consumers has been perpetrated by offenders ranging from fly-by-night con artists to major multinational corporations, such as Sears and K-Mart. Fraud also occurs in businesses that fall between these two extremes, including local “legitimate” businesses that may on occasion resort to fraud in order to make extra profit or to avoid going out of business.

The following are seven of the more common forms of consumer fraud:

  • Mislabeled products and misleading advertising . Many consumer products come with labels that purport to tell about the ingredients in a product or about its performance or efficiency—for example, prepared foods, computers, water heaters, furnaces, and a host of other products. One way to sell cheap or shoddy products is to put inaccurate or misleading information on the label to make them seem better or more attractive than they really are. Misleading advertising is another way to influence buying decisions. For example, food manufacturers may make questionable claims about the nutritional or heath value of their products.
  • Real estate fraud . Real estate fraud involves lying or being deceptive about the condition of real property, things such as land, houses, and buildings.
  • Free prize scams . In these types of scams, people are told that they have won a valuable free prize, but in order to collect it they must send in money or make a phone call. The money that is sent in will greatly exceed the value of the prize, or the victim will be charged for the phone call at a rate that greatly exceeds the value of the prize.
  • Bait-and-switch advertising . Popular with “legitimate” retail businesses, this fraud involves advertising some well-known product, such as a TV or major appliance, at a ridiculously low price. However, when consumers come to the store, they are told that the item is sold out or temporarily out of stock and then are steered toward other more expensive products that are available.
  • Repair frauds . Repair frauds typically involve big-ticket items such as homes, automobiles, or major appliances (dishwashers, washing machines, furnaces, and the like). The fraud involves either doing unnecessary repairs or doing substandard work and then charging the victim full price.
  • Charity and advocacy frauds . Charity frauds appeal to the emotions. The victims think they are donating money or goods to help a worthy cause, when in reality the money is kept by those who collected it. Advocacy frauds are slightly different in that the offender promises to advocate for the victim with some other governmental body, such as the U.S. Congress or a state legislature. The offender promises to see that the victim’s interests are protected on Capitol Hill or at the state capitol. However, in reality, like charity frauds, little or none of the money is actually used to promote these ends. Rather, it finances the lifestyles of the so-called advocates.
  • Advance-fee swindles . Anytime someone is asked to pay in advance for a service or product, he or she is vulnerable to an advance-fee swindle. Typically, in these swindles someone promises to do something for the victim, but the offender asks the victim to pay first and then the offender never delivers on the promise. Often, the promised service is one where it may be difficult to confirm one way or the other whether the service was provided. For example, advance-fee swindles may involve such services as finding housing, or educational loans, or employment. In these cases, the swindler promises to help the victim find an apartment, or a college loan, or a new job in return for a fee. The victim pays the fee, but does not get what he or she wanted in return. The swindler claims to be working for the victims but really is just taking their money.

Health care fraud involves fraud against health care insurers and government programs such as Medicare and Medicaid. These two programs are particularly ripe for fraud because of their size and complexity. They process literally billions of dollars worth of claims annually.Although the exact cost of health care fraud is unknown, it is estimated to be in the hundreds of billions of dollars per year. Health care fraud can be committed by any person or organization in the health care industry who is involved with the provision of health care services to patients, including physicians, mental health professionals, hospitals, nursing homes, equipment suppliers, and pharmaceutical companies, as well as many others. Because physicians deal most directly with patients, their involvement in fraud is particularly serious. The following are three common forms of health care fraud involving physicians:

  • Unnecessary procedures . Because most people know very little about their bodies and the various problems they can have, they rely on the expertise of physicians. Physicians are supposed to provide treatment based on their best assessment of the patient’s medical needs. Some physicians, however, make decisions based not on the medical needs of patients but rather on their financial goals. Physicians may recommend that patients undergo unnecessary procedures, ranging from relatively simple but unnecessary tests to life-threatening surgery. So-called “Medicaid mills” make a business out of providing unnecessary procedures. These operations often are run in low-income neighborhoods. A group of unscrupulous doctors sets up a shop and recruits low-income patients—drug addicts, alcoholics, homeless people, and so forth. The patients are paid a small fee, are run through a battery of unnecessary tests, and then the federal government is billed for the cost of the tests.
  • Fee splitting . Most general practitioners cannot handle serious illnesses or medical conditions. When confronted with these types of cases, they often refer patients to specialists. To the extent that referrals are made on the basis of the physician’s medical judgment, that is appropriate. But sometimes, physicians make referrals because they have a financial arrangement with a particular specialist. In return for referring patients to the specialist, the general practitioner gets a kickback in the form of a cut of the specialist’s fee.
  • Fraudulent billing . Probably the most common type of fraud is fraudulent billing. This can be accomplished in a variety of different ways, but basically it involves submitting claims for reimbursement for services that were never really provided. For example, a physician may submit a claim saying that he or she performed some medical service for a patient when the service really was not provided, or when the service that was provided was somehow less than the physician is claiming.

There is no clear, widely accepted definition of the term environmental crime. Implicitly, it is defined as any violations of local, state, or federal “environmental laws.” Environmental laws seek to protect the quality of the air, water, and soil by regulating both harmful additions to the environment (water, air, and soil pollution) and harmful subtractions from the environment (destruction of habitats).

Environmental crime comes in a variety of forms and sizes. Offenders may be homeowners who dump leftover paint into a city sewer system in violation of local ordinances, or they may be multinational corporations that manufacture, ship, and dispose of hazardous materials under conditions that are criminally negligent and morally outrageous.

Because different types of environmental crimes are associated with different industries and businesses, the nature of environmental crime in a community tends to reflect local economic activity. Certain types of environmental crime problems, however, are widespread. A study of local law enforcement responses to environmental crime concluded that illegal waste tire disposal, improper disposal of furniture stripping and electroplating waste, used motor oil disposal, and hazardous wastes dumped into streams and rivers, are found in nearly all communities (Rosoff, Pontell, &Tillman, 2006). Along with these generic forms of environmental crime, some communities suffer unique problems as a result of their particular mix of local industries and businesses. For example, in some rural communities, most of the local environmental problems may be caused by one particular business, such as a tannery or textile manufacturer. The states of Maine and New Jersey both have problems with illegal disposal of hazardous waste, but the type of waste is specific to each state. In Maine, waste cases tend to involve the textile, wood, and fishing industries. In New Jersey, on the other hand, they involve the chemical and petrochemical industries.

In a strictly legal sense, what counts as environmental crime varies a great deal across jurisdictions. Statutory inconsistencies and the lack of uniform codification in state environmental laws pose difficulties for prosecutors and investigators. At the same time, they create opportunities for environmental offenders, who can evade prosecution merely by moving their operations to jurisdictions that are legally more “user-friendly” from the offender’s point of view.

One of the most important types of environmental crime is the illegal disposal of hazardous waste materials. In recent years, research suggests that environmental criminals have become more sophisticated. Rather than simply dumping hazardous waste in some isolated area late at night (often called “midnight dumping”), today’s more sophisticated environmental criminal may forge a waste transportation manifest or bribe public officials to look the other way. Other techniques involve mixing hazardous waste with nonhazardous waste, known as “cocktailing”; mislabeling drums, or disposing of the waste on the generator’s own property. Cocktailing is particularly common in the oil industry when dumping used oil.

Although offenses similar to what is referred to as white-collar crime have been around for centuries, it is likely that white-collar crime will become even more prevalent in the future than it is now or was in the past. Social and technological changes have made white-collar crime opportunities more available to a broader range of people than ever before. The important changes include (a) a rise in white-collar– type jobs, (b) the growth in state largesse, (c) an increase in trust relationships, (d) economic globalization, (e) the revolution in financial services, and (f) the rise of the Internet as a means of communication and business.

In modern postindustrial economies, more people have access to the tools of white-collar crime because they work in offices with forms and files and computers. These paper and electronic documents can be manipulated and altered so as to create a false impression of reality and permit employees to have illegal access to financial and other resources. In addition, more and more white-collar employees find themselves in jobs that are somehow connected to banking or financial services. The potential to engage in fraud is therefore great.

Opportunities to engage in fraud have also been expanded by the growth in programs associated with the welfare state, including Social Security, Medicare, and Medicaid, as well as a host of other less well-known programs such as the Federal Crop Insurance Program. All of these programs distribute enormous amounts of money to literally millions of applicants annually. They all depend on written materials and all are open to the possibility of fraudulent applications.

There is another change in the social organization of work and the economy that has increased opportunities for white-collar crime—the rise in trust relationships involving agents and principals. A trust relationship is one in which someone (called the principal) depends on someone else (called the agent) to manage assets or provide specialized services. For example, contributors to a pension fund are in a trust relationship with the pension fund managers, in that the contributors have to trust that the managers will manage the fund’s assets in a financially prudent manner. Similarly, someone who goes to a doctor is in a trust relationship with the doctor in that the person has to trust that the doctor will treat him or her according to what is in the person’s best medical interests. In the modern world, people increasingly find themselves in trust relationships in which they have to depend on others to do things for them that they cannot do for themselves. Trust relationships raise two main problems for the people who must rely on them. First, it is often difficult for principals to monitor and evaluate agents because of the complexity or hidden nature of the services that agents provide. In effect, principals often do not know whether agents really are doing the right thing for them. Second, agents have their own financial interests that may conflict with those of the principals whom they are supposed to be serving. Taken together, these two features of trust relationships mean that agents often have the motivation and means to take advantage of others.

The increasing number and complexity of political-economic ties that cross national borders have been a boon to white-collar criminals. This globalization of the economy has made it easier for potential offenders to contact victims, orchestrate complex criminal fraud schemes, and avoid detection and punishment by governments. Companies can be set up in one place to victimize individuals, businesses, and governments in other places. For example, some foreign companies have attempted to take advantage of changes in trade regulations in the United States that benefited North American manufacturers. These new regulations followed the passage of the North American Free Trade Agreement (NAFTA). To take advantage of the new regulations, foreign companies would mislabel their products as being manufactured in North America. Opportunities to engage in these sorts of frauds are plentiful today, because most global business transactions are not conducted via face-to-face meetings. Rather, they are conducted by means of telephone, fax, email, and other forms of electronic exchange. All of these impersonal modes of communication create abundant opportunities for fraud and deception.

Since the 1980s, the financial services sector of many national economies, including that of the United States, has exploded in size and democratized in scope. Insurance, consumer credit, mutual funds, and other securities, once available only to the wealthy, are now offered to middle- and lower-income individuals. Vast amounts of money flow between individuals and institutions in electronic funds transfers. The temptation and opportunity to engage in fraud are ever present.

Many, if not all, of the social and economic developments outlined above have been made possible as a result of technological changes. The effects of the emergence of the personal computer, network servers, and the Internet as the standard means of information storage, manipulation, and communication can hardly be overstated. Money and information flow faster now than ever before. More and more transactions take place anonymously rather than through face-to-face contact. In this environment, opportunities to engage in fraud and deception abound, and white-collar crime flourishes.

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White Collar Crime Essay

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Law Enforcement: White-Collar and Corporate Crimes Essay

White-collar crime as described by Edward Sutherland from the interactionist school of thought is crimes committed by people of high social status and class. It includes crimes such as fraud, embezzlement, bankruptcy fraud, insider dealing, public corruption, identity theft, pension fund crime, occupational crime, and the likes of all those activities that are done by people of high standards and education. These crimes are usually done through computers or by means of paper. They account for around $300b in losses as stated by the FBI. It is also a fact that these crimes largely go undetected and are therefore a huge threat to the sustenance of economic growth in any country.

White-collar crimes are essentially based individually. They are hard to catch but when they are it is often seen that their punishment is far less than what petty criminals get for stealing a mere television set. Often their payoffs are greater than the hard time they have to face with the law enforcement agencies. Furthermore, the exact extent of their victims is hard to diffuse. Essentially white-collar criminals are motivated to carry out various acts of fraud because of greed or their current economical positions.

There is hardly any difference between them and petty street criminals as both are after the same thing sustenance, the only difference perhaps lies in the fact that white-collar criminals are more sophisticated in their means of carrying out crimes and are not easily caught whilst the petty street criminal has to face the consequences. (Keel, 2008)

Professional crime is different from corporate crime in the sense that it is carried out for the benefit of the individual alone and not for the corporation as a whole and almost always the victim is the client alone. So there is a direct link with the client. However, when it comes to corporate crime the victim cannot be easily identified as the victims are society as a whole, the employees, the shareholders, the customers, etc (Keel, 2008)

Corporate crimes are those that are committed by business entities or by individuals who can be identified with the business corporation. They are responsible for huge losses and their victims are infallibly the public at large. When it comes to the impact of these crimes clearly the winner is atrocities committed by big corporations. Such is the case of the pharmaceuticals company and the incident of the poison cyanide that killed several people and impaired several more. Incidentally, people are more hateful towards corporate crimes as opposed to professional crimes. They would rather see severe consequences for big business entities than individuals and rightly so as the losses and damage were done by big companies Enron which is a case in point have long-lasting effects and unnerving results. (Erman, 2005)

Unlike white-collar crime, a corporate crime includes a wide range of misbehavior at the corporate level most of which is serious in nature. It includes giving false statements of assets thus deceiving and manipulating potential investors, occupational safety health hazards, exploitation of labor, misleading advertisements, formation of illegal monopolies, environmental as well as moral degradation, corrupting people, and bribing them all for the purpose of corporate benefits.

Thus we can understand from this that corporate crime has bigger fish to catch and it does not focus solely on individual benefits such as in the case of white-collar crimes but focuses on the attainment of profits that can prove fruitful for the entire company.

Corporate offenses are hard to study as one must have knowledge of not only criminal law but civil and administrative laws as well. Furthermore, a lot more funds are required to study this area of concern as opposed to white-collar crime. Even though corporate crimes have a far-fetched effect on society as compared to conventional professional crimes they are usually not given much media coverage. In fact, the last time such mega coverage was given to acts of corruption by corporations was when the Enron case became highly publicized in the early 2000s. (Clinard and Yeager, 2005)

The most striking difference between the two lies in the resultant impacts. As mentioned before professional crimes have impacts at an individual level but the damage done by corporations is massive. They sell faulty products to millions of their consumers, they collude with one another and keep prices outrageously high thus stealing from consumers, they give false information on their asset holdings and this leads to the defrauding of thousands of investors and pensioners. Similarly, unsafe working conditions put the lives of millions of workers in danger, and have workplace hazards have resulted in the death of millions of workers. (Clinard and Yeager, 2005)

More importantly when it comes to calculating the cost of corporate crimes and those committed by professionals corporate crime far exceeds the amount as compared to the latter. In fact, the cost of corporate crime far exceeds the cost of all kinds of crimes put together such as burglaries, thefts, arsons, and robberies. When corporate crimes do come in court they almost always get away because they have enough resources to fight any case against them whereas a mere white-collar professional is hard to let off the hook.

Furthermore, corporations or corporate officials cannot be stigmatized as criminals and they hardly come in that domain anyway. At a professional level, the story is a little different. Since they are the sole perpetrators of a specific crime they have to bear the stigmatized label of criminal and undertake a heavier penalty. (Clinard and Yeager, 2005)

Corporate crime is more efficient when it comes to undertaking bribery and corruption is more rampant in this case as compared to white-collar crimes. It takes into account window-dressing which although may not be a crime but can still be misleading as it does not take into account the principle of prudence. Furthermore, misinterpretations and deliberate miscalculations in the accountancy department also lead to fraud. (Clinard and Yeager, 2005)

Lastly, the level of power and influence between a corporation and an individual professional is massive. This great difference explains why crimes conducted on behalf of or by corporations are not easily penalized as opposed to those that are carried out by white-collar professionals.

David Erman, 2005, responses to corporate versus individual wrongdoing. Web.

Marshall B Clinard, Peter C. Yeager. Corporate Crime, 2005. Web.

Robert O Keel, White Collar Crime, 2008. Web.

White Collar Crime. Web.

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White - collar crime essay

Updated 08 May 2023

Subject Corporations

Downloads 42

Category Crime ,  Business

Topic White Collar Crime ,  Criminal Behavior ,  Company

White-collar crime is not a legally recognized illegal behavior. Yet, it encompasses a wide range of illicit behaviors, including cheating, lying, and stealing, according to the FBI Website. The reason for persons who commit these crimes is monetary; to obtain or avoid parting with property, money, or services, or to gain a business or personal advantage (FBI, 2017, para.1). Yet, this malice is devoid of violence or physical force (Gaines & Miller, 2015, p.427).

People who commit white-collar crimes claim that they are victimless offenses, but this is not the case. A single scam can bring down a company, wreck families by taking away their savings, or lead to the loss of billions of dollars for investors. Moreover, the fraud schemes that take place today are more sophisticated than they were (FBI, 2017, para.2). Some of the significant white-collar threats that the Federal Bureau of Investigation is facing today include money laundering, as well as commodities and Securities Fraud.

Money laundering is the process where criminals hide or mask their proceeds to make them appear as having come from sources that are legitimate. Notably, it helps perpetrators to conceal and acquire wealth, evade taxes, avoid prosecution, further fund their malicious activities, and increase the profits they make through reinvestment. Also, it undermines the stability and integrity of financial systems and institutions, contorts international capital flows, and demoralize foreign investment (FBI, 2017, p.17).

Moreover, the continuing global capital markets integration has created unparalleled opportunities for businesses in the U.S. to get capital and portfolio diversification for investors. As a result, Americans prefer to invest in the commodity markets and U.S. securities. Such developments have led to an adjacent increase in the amount of misconduct and fraud witnessed in these markets. The establishment of complex vehicles of investment and the overwhelming rise in the total amount of money invested has created more tremendous opportunities for businesses and individuals to execute fraudulent investment schemes (FBI, 2017, p.19).

Relevant facts

Investment fraud

They are schemes that involve the purported or illegal sale of financial instruments. A typical scam scheme offers no or low-risk investments, returns are guaranteed, complex strategies, returns are overly consistent, and securities are not registered. A good example of an investment fraud is the Ponzi schemes and pyramid schemes (FBI, 2017, p.20). Ponzi schemes entail the payment of manipulated returns to existing investors from funds provided by new investors. Pyramid schemes, on the other end, are Ponzi schemes where the new investors' money is paid to earlier shareholders in addition to the commissions they receive for recruits. Pyramid schemes tend to be concealed under multi-level programs of marketing (FBI, 2017, p.20).

Virtual Currency

The European Central Bank (ECB) report of 2012 described virtual currency (VC) as a kind of unsupervised digital money, given and habitually controlled by the developers (Bugeja, 2014, para.2). VCs are accepted and used among people of a specific virtual community. Virtual currency is different from electronic money in that the currency in use does not have a physical counterpart with the status of a legal tender. The FinCEN (Financial Crimes Enforcement Network) in the US states that people operate the VC world as Exchangers, Users, or Administrators. Exchangers are people who manage the business of converting VCs for real or other VCs while Administrators have the power to issue, redeem or withdraw the VCs. Lastly, users purchase or buy the VCs (Bugeja, 2014, para.3).

VCs assume several forms. The most commonly used are cryptocurrencies such as Bitcoin modeled to act as government -issued cash substitute (Carlisle, 2017, p.1). The motivation for individuals to use virtual currencies is varied. There will always be marginalized persons in any community who for their reasons, fail to trust the administration or government in the places where they live (Law & Austen, 2015, p.1).

Moreover, such people are nervous and distrust the large corporations' data mining and collection. For this category of individuals, an anonymous online payment and one that is beyond the control of those they do not trust is attractive. Additionally, for people with criminal motive, virtual currencies provide an excellent opportunity to make use of money in a pseudo-anonymous way to execute illegal activities (Law & Austen, 2015, p.1).

The history of bitcoin depicts the complexity of issues of financial crime that surround the VCs. In October 2008, an individual who is not known, using the nickname Satoshi Nakamoto, wrote a paper online introducing the bitcoin idea. The Satoshi's proposal offered a complete 'peer-to-peer network of payment where users would directly trade the currency without the participation or interference of any financial sector intermediary or government or third party administrator. Therefore, the bitcoin network has a similarity to an open website platform such as Wikipedia. Bitcoin does not depend on a central authority but on the active engagement of its users to maintain it (Carlisle, 2017, p.1).

Role played by Virtual Currencies in White Collar Crimes

From the perspective of the Law Enforcement, the problem of virtual currency is that there is no outlined way to determine whether online accounts for bitcoin are registered using the actual name of the user (Cohn, 2014, para. 11). Therefore, bitcoin is attractive for people who want to take part in the white-collar crime. For instance, it is easy to avoid paying taxes for transactions made with bitcoin. Also, virtual currencies are well modeled to facilitate money laundering by converting the illegally obtained funds into bitcoins (Gaines & Miller, 2015, p.427).

Further, as technology advances, crimes change. Money laundering is not immune to the way we do business regarding the making of alternative currencies that can get processed without passing through recognized financial organizations such as credit card companies and banks. The problem is, as virtual currencies such as Bitcoin alter the way cross-border business is operated, they may also change the way money laundering is viewed in the legal regulations (Spatz, 2017, para. 2).

Consequently, since the introduction of Bitcoin, there has been a rising concern by the law enforcement about its use in concealing illegal activities and on the black market. The bitcoin is favorable because it is anonymous in exchange. Additionally, the U.S. has struggled to find out exactly how laws apply to Bitcoin since several legitimate enterprises accept it. Hence, to be able to fight the vague nature of crimes committed using bitcoins, the lawmakers in Florida are proposing a bill that will include virtual currencies in the money laundering statute of the state (Spatz, 2017, para.6).

The statute would mean that the people involved in the hiding and transfer or use of illegally obtained Bitcoins can get prosecuted as money launderers. As such, this will be very helpful because as it is, money launders are continually getting away with crimes. Additionally, if the law was to get passed to include Bitcoin as a currency, then the illegal transactions can be considered as laundered. However, prosecutors would still have to prove that the defendant intended to hide dirty currency using an array of operations in the same way that money launderers are prosecuted for traditional currencies laundering (Spatz 2017, para.6).

The success of bitcoin as a technological feat, despite being impressive, hastily led to a controversy. The first huge incident was the US law enforcement Silk Road crackdown. The black market Website, well known as Silk Road would not have been developed without the virtual currency (bitcoin). U.S. Attorney, Richard Zabel, argued that instead of the need for hard cash, users could buy illegal drugs from any place in the world with just a push of the button. However, Bitcoin is not inherently illegal; it is purchased and sold online, and it is accepted by legitimate Internet Businesses such as Overstock.com (Gaines & Miller, 2015, p. 427; Dhillon, 2016, P.4).

Securities fraud

Recently, a former e-currency banker pleaded not guilty to criminal charges in a federal district court. The e-banker was charged with two criminal charges: one securities fraud count and one wire fraud count. The e-banker managed the now-defunct virtual hedge fund known as Bitcoin Savings & Trust. According to the charges presented in court, he managed a Ponzi scheme in 2011 and 2012 with the use of bitcoins as currency. The accused e-banker had made promises of large payouts to investors who ventured into Bitcoin Savings & trust, but he was paying the earlier investors using funds invested by the new investors. The charges state that approximately half of the investors lost a part of their investment (Petersen, 2015, para.5).

The legality of the Virtual Currencies

However, in spite of all the opportunities for the success of white collar crimes that the Bitcoin has created, the court ruled that selling Bitcoin is money laundry and that selling criminals Bitcoin is not a crime. In the Florida v. Espinoza court case, the Miami court dismissed the charges filed against a Bitcoin exchanger. The bitcoin exchanger was arrested after accepting to sell bitcoins to an undercover detective pretending to need them for the purchase of stolen credit cards. The court argued that just selling bitcoins to a person who intends to use them for a criminal purpose, even if the intent is clear at the time of the sale, is not enough evidence for a charge in money laundering (Latham & Watkins 2002, p.1).

Alternative courses of action

Alternatives to the problem

Therefore, to curb money laundering and secure investors from fraud, economists believe that there is the need for some regulations to form cryptocurrencies. However, those that should most probably be regulated are digital coins that at times act like securities but do not get subjected to any of the strict mainstream regulations. In late July, the Securities and Exchange Commission released a report for investigation, stating that companies with plans to use block chain-enabled ways or distributed ledger to acquire capital, ought to take the right stages to abide by the federal securities laws of the U.S (Choudhury, 2017, para. 19).

Moreover, Singapore's MAS made it clear that it would regulate the digital tokens sale in the city-state if they include products regulated by the Singapore's futures and securities regulation. The regulatory oversight for ICOs would witness net benefits. Additionally, most economists agree that having proper rules will help to protect investors just like they are safeguarded in the securities market (Choudhury, 2017, p.22).


A common criticism for such regulation is that it will remove or reduce privacy layers, which goes against one of the core reasons behind the introduction of cryptocurrencies. Users of the virtual money are convinced that the tangible coins are corrupted by banks and the central government's heavy-handed intervention. Cryptocurrencies are designed to be decentralized and anonymous, meaning that decisions that affect them are not centrally dictated. However, investor protector favors regulation. The problem is it may be complex to reconcile the two perspectives. Moreover, cryptocurrencies is a new technology though many regulators still do not completely understand this growing industry. Further, implementing policies that are poorly planned may cause more harm than good to the cryptocurrency technology (Choudhury, 2017, p.31).

Cryptocurrencies pose significant challenges to regulators. However, one should not be in a hurry to regulate bitcoin without entirely comprehending the implication of blockchain technology, especially the impact they have towards competition, innovation, and regulation. Given the temporary state of blockchain technologies, the law needs to be elaborated with caution and using an informed way to help stop precautionary measures from curtailing new technologies in the future. Additionally, to draft a sound framework for regulation, policymakers should account for the general-purpose and horizontal nature of the blockchain adequately (Filippi, 2016, para.16).

New questions

Up to this point, it is essential to ask ourselves some questions

Based on the above and other existing literature, do white-collar crimes qualify as unlawful acts?

Can a plaintiff use fact defense to hold a perpetrator of such a crime culpable?

Will the inhibition of virtual currency reduce the current rates of money laundering?

Bugeja, D. (2014, February 17). Virtual Currencies: A New Reality in the fight against Money Laundering. Retrieved December 17, 2017, from BLL Portal: https://www.brightlinelaw.co.uk/White-Collar-Crime-Portal/virtual-currencies-money-laundering.html

Carlisle, D. (2017). Virtual Currencies and Financial Crime: Challenges and Opportunities. London: RUSI.

Choudhury, S. R. (2017, August 5). It's a perfect time to be the money launderer, and you can thank cryptocurrencies. Retrieved December 14, 2017, from CNBC: https://www.cnbc.com/2017/08/04/icos-may-be-seen-as-securities-by-u-s-and-Singapore-regulators.html

Cohn, S. (2014, April 23). Financial fraud in 25 years: A Virtual Madoff at lightning speed. Retrieved December 13, 2017, from CNBC: https://www.cnbc.com/2014/04/22/financial-fraud-in-25-years-a-virtual-Madoff-at-lightning-speed.html

Dhillon, G. (2016). Money Laundering and Technology Enabled Crime: A Cultural Analysis. San Diego: Virginia Commonwealth University.

FBI. (2017). White - Collar Crime. Retrieved December 13, 2017, from What we Investigate: https://www.fbi.gov/investigate/white-collar-crime

Filippi, P. D. (2016, January 3). We must regulate Bitcoin. The problem is, we don't understand it. Retrieved December 14, 2017, from WIRED: https://www.wired.com/2016/03/must-understand-bitcoin-regulate/

Gaines, L. K., & Miller, R. L. (2015). Criminal Justice in Action, The Core. Boston: Cengage Learning.

Latham, & Watkins. (2002). Virtual Currencies: Court Rules that Selling Bitcoin is not Money Transmitting and Selling Bitcoin to Criminals is not a Crime. White Collar Defense & Investigations Practice.

Law, K., & Austen, J. (2015). Virtual Currencies and their potential role in the cyber crime. Royal Holloway, 1-6.

Petersen, H. D. (2015, April 10). White Collar Crime trial underway for former bitcoin tycoon. Retrieved December 13, 2017, from Hymel Davis & Petersen: http://www.hymeldavis.com/blog/2015/04/white-collar-crime-trial-underway-for-former-bitcoin-tycoon.shtml

Spatz, R. (2017, April 26). Is Bitcoin Virtual Currency included in Florida Money Laundering Laws? Retrieved December 13, 2017, from White Collar Crime Attorney: http://www.spatzlawfirm.com/blog/2017/04/is-bitcoin-virtual-currency-included-in-florida-money-laundering-laws.shtml

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