WHITE COLLAR CRIME

1. Introduction

White-collar crime is a type of non-violent crime where money is usually the driving force. Typically, white-collar criminals hold a position of authority and/or prestige in their profession, one that entails compensation significantly above average.[1]

2. History

The term "white-collar crime" was initially used in 1949 by sociologist Edwin Sutherland, who described it as a crime carried out while a person of high social standing and reputation was employed. In the past, blue-collar workers wore blue shirts and worked in factories, mills, and plants, while white-collar workers held nonlabouring office positions.
Prominent figures found guilty of white-collar offenses include Bernie Madoff, Michael Milken, Ivan Boesky, and Bernard Ebbers. They have committed securities fraud, accounting scandals, insider trading, and Ponzi schemes, among other crimes.The internet is enabling a plethora of new white-collar crimes, such as the so-called Nigerian scams, in whichfictitious emails ask for assistance in sending a sizeable sum of money to a criminal organization. White-collar crimes that are frequently committed include identity theft and insurance fraud.[2]

3. Common characteristics

Despite the wide range of white-collar crimes, most of them share a few traits. First, they entail the unlawful acquisition of funds, property, or services through the use of deceit and concealment as opposed to the use of force or violence. For example, a defendant convicted of fabricating information to secure a government contract would be classified as a white-collar criminal.Next, the abuse of authority and trust positions is a common feature of white-collar crimes. Such misuse of power occurs when public servants solicit and accept bribes, or when business executives set prices to force rivals out of business. Detecting white-collar crime can be more challenging than detecting other forms of crime, partly due to the fact that victims may not immediately notice losses and partly because the crimes may entail intricate plans and cover-ups. Co-conspirators must often act in concert in order to commit many white-collar crimes. An escrow officer, a buyer, an appraiser, and a bank officer, for instance, may have knowingly participated in a real estate fraud case, signing fictitious documents in order to commit fraud for their own benefit.The most prevalent kind of white-collar crime is fraud, which is when someone deceives someone into giving them money or services. Whether the defendant intended to deceive the victims or simply failed in an honest business venture is usually the key question in these cases. Telemarketing schemes that fabricate information about the benefits, conditions, or applications of the products or services being sold are among the most prevalent forms of fraud.[3]

4. Famous white-Collar case

Bernie Madoff Ponzi Scheme

One of this century's most well-known white-collar crimes is that of Bernie Madoff. In terms of monetary value, it is undoubtedly one of the biggest.After a protracted investigation, Bernie operated a Ponzi scheme from approximately
1991 until his eventual arrest in December 2008. It is estimated that he conned thousands of investors out of roughly $65 billion during this time.In essence, a Ponzi scheme is a type of fraud in which the operator entices investors
to part with their money by promising them large returns.Using the money from other investors, they can compensate investors who file complaints or request an early refund. But ultimately, they don't invest the funds and end up in a position where they cant pay everyone back.It's a white-collar crime that occurs frequently. The length of time Berne had been operating his scam and the extent of his deception were what made his situation unique.Given the seriousness of his crimes, Bernie Madoff was given the maximum sentence of 150 years in federal prison.

Indian framework pertaining to white-collar crime

The PMLA, POCA, and CA are the three main pieces of white-collar crime legislation that make up the Indian regulatory framework, though other laws may also have consequences for white-collar crimes. Regular amendments have been made tothese laws, and Indian courts are still refining the jurisprudence that results from them.The POCA, which forbids actual or attempted "promise" or acceptance of any "undue advantage" for carrying out any public duty dishonestly or improperly, is the primary anti-corruption law in India. The law also addresses situations in which a person encourages or directs another public servant to engage in these offenses. In the context of the POCA, "undue advantage" refers to any form of satisfaction and is not limited to bribes in the form of cash or cash equivalents gifts, favours and any form of quid pro quo in a manner that amounts to corruption.Primarily, the POCA protects employees of the state. Public servants are generally understood to be any person employed by the government or receiving compensation for carrying out official duties.

In its 2016 ruling in CBI v. Ramesh Gelli, the Supreme Court of India defined "public servants" to include trustees of charitable trusts set up to run these deemed universities as well as employees of private banks and deemed universities. The Supreme Court has expanded the scope of the POCA to include physicians and staff employed by private hospitals.

The POCA now includes commercial organizations, thanks to the Prevention of Corruption (Amendment) Act of 2018. Because of this, the law views corporate organizations' payment of bribes through their agents and other third parties as a specific offence under the POCA.The PMLA aims to stop money laundering and gives the Indian government the
power to seize any assets or income obtained through unlawful means. The PMLA's purview includes outlawing and punishing money laundering, controlling the freezing or seizure of assets obtained unlawfully, and outlining the process for resolving offenses connected to money laundering.

The Indian Penal Code, 1860 (IPC) and the Indian Contract Act, 1872, are two laws that address various fraud-related offenses; however, the main piece of legislation governing the corporate sector in India is the Companies Act (CA), which defines corporate fraud and gives the Serious Fraud Investigation Office the authority to look into claims of fraudulent activity involving companies and their officers. According to the Companies Act, fraud is any attempt by an individual to gain undue advantage from, and significantly disadvantage the interests of, the company in question.[4]

5. Conclusion

Even though they don't involve violence, white collar crimes are nonetheless grave offenses with significant consequences. They have the power to destabilize economies, wreak havoc on market competition, erode public confidence in institutions, and result in enormous financial losses. Notable incidents like the Enron crisis and the Ponzi scheme run by Bernie Madoff serve as glaring reminders of the devastation that these crimes can cause.Consider pursuing additional education in this area if you would like to be involved in combating white collar crime and making society safer and more equitable. Get in touch with National University right now to find out more about their Doctor of
Criminal Justice program, available specializations, and how they can support you in achieving your professional objectives. You can begin your path to becoming an authority on thwarting white collar crimes.

6. Citation

1. Introduction available athttps://corporatefinanceinstitute.com/resources/esg/white-collar-crime/ (Last visited on 9 December at 10:00 am)
2. History available at https://www.investopedia.com/terms/w/white-collarcrime.asp (Last visited on 11 December at 7:00 am)
3. Common characteristics available at https://www.britannica.com/topic/whitecollar-crime (Last visited on 11 December at 12:37pm)
4. white-Collar case available at https://www.lexology.com/library/detail.aspx?g=a815f6b0-048e-4d93 ba3d28023e6f057f (Last visited on 11 December at 2:37 pm