White Collar Crimes: A Brief Study


White collar crime is common in almost all professions and occupations in our society. The problem is quite acute, both in terms of the variety and extent of white collar crime. The Santhanam Commission in its final report gave an evocative picture of the economic crimes committed by respectable people such as businessmen, industrialists, contractors and suppliers as well as government officials perpetrated by corruption.

White-collar crimes are common in Indian trade and profiteering in black marketing. Violation of foreign exchange regulations (FERA) and import and export laws are often used to generate huge profits. In addition, the adulteration of food products, consumable drugs causing irreparable damage to public health is another common white-collar crime in India. The complexity of tax laws in India has allowed and built sufficient scope for taxpayers to evade taxes. Avoiding paying tax refers to the failure to pay the amount of tax due and to be paid, tax evasion means organizing the distribution of one's income in a way that is not legally responsible and fiscally legal. In the medical profession, the most common white-collar crimes are: illegal abortions, forging medical certificates and many cases of unnecessarily prolonged treatment. In common legal and professional offenses lawyers perform advising on organized crime, helping with false statements, hiring professional witnesses, fabricating fake evidence, and more. In the engineering profession, the tactful treatment of contractors and suppliers, the handling of substandard work and materials, and the maintenance of false records are examples of white-collar crime.

White Collar Crime: The Concept and Definition

Sutherland defines white-collar crime as "a crime committed by a class of high-status and respectable person in the course of his or her career.

The Dutch Marxist, Willem Bonger, in his work Criminality and Economic Conditions (1916), was the first to develop a theory of crime which incorporated both "crime in the streets" and "crime in the suites". Bonger argument is that capitalism has "developed selfishness at the expense of altruism." Bonger believes that the harsh conditions suffered by the working class under capitalism will lead to criminal attitudes. Bonger view’s that poverty leads to crime. Edwin Sutherland in his speech delivered at the American Sociological Association in 1939 stated that "White Collar Criminals" contemptuously attributed traditional crime theories to poverty, broken families, and restless personalities. He pointed out that many criminals in the business world are far from being poor or faced poverty and some of are even from happy and strong mentality family.

Nature of White-Collar Crime

White-Collar Crimes are entirely different from ordinary or conventional types of crimes in several aspects:

(1) White-collar offenders are unlikely to be teenagers, and they are also unlikely to be women or poor, because they generally do not fulfill the professional roles required for white-collar crimes.

(2) Greed can be the main possible factor in white collar crime. Aristotle's philosophy explains the nature of white-collar crime that, "the greatest crime of is caused by excess rather than necessity."

(3) Due to the excessive power of the offender, a small number of unrepresentative crimes were discovered and were officially recorded.

(4) Victims of white-collar crime rarely realize they have been victimized. Sutherland stated that the community's attitude towards white-collar offenders is tolerant.

(5) White-collar offenders have the ability to create the impression of confusing responsibility and illegal behaviour. Scapegoats are easy to find, and the actual beneficiaries of crimes are rarely caught.

(6) The tentacles of white-collar crime are often scattered among the bosses in the power circle.

(7) The investigation and enquiry of white-collar crime requires well-trained professionals, and these professionals can never be used, resulting in ineffective investigation and prosecution.

(8) White-collar crime scandals often produce substantial prevention.

(9) White collar crimes are both a civil and a criminal offense. They need to solve on both sides. The civil nature of the crime is handled by the regulatory agency in the corresponding area, while the criminal part is handled by the police and other law enforcement agencies.

(10) There are deep class prejudices in the routine enforcement of the law against white collar offenders. Most white collar criminals remain unpunished.

Types of White Collar Crime:

The White Collar Crimes can be easily understood under following heads:

Bank fraud: It is considered to be a criminal act with the intention of deceiving and obtaining illegitimate profits. Bank fraud is fraud against banks. It is implemented by fraudulent companies making false statements. It is also related to the handling of negotiable instruments such as checks, securities and bank deposits. Bank fraud is a concern of the general public because of the trust relationship between banks and the public. This is the most common type of white-collar crime, and it is also called a corporate crime. It incapacitates the public and the national government.

Bribery: Bribery is also a very common white-collar crime. Bribery refers to offering money or goods to people of high status in exchange for favours. In short, bribery is when one person offers money to another person who is powerful. The purpose of this is to urge you to do something or to prevent you from doing something. It is the most common income of the majority of public officials in our country.

Cybercrime: Cybercrime is the main cause of such crimes in India. This is the latest common problem in the online world. Cybercrime is a crime related to computer networks. With the rapid increase in technological progress, technology-related crimes are also increasing rapidly. Cybercrime involves experts specially in computer field and cause direct or indirect damage to the reputation of the victim or physical or mental damage through the Internet or other technical sources. Cybercrime threatens the security and financial situation of the country and their people. Cybercrime has brought huge economic losses to the country. It has not only caused financial loss, but also threatens a person's privacy. Disclosure of confidential information can cause privacy problems. Furthermore, cybercrimes against women are on the rise. Through the use of telecommunications networks, there are more and more cases of mobile phone network tracing involving sending obscene information and images to women.

Money laundering: Money laundering is a crime in which criminals impersonate the identity of money. In this case, the criminals tried to conceal the original attribution of the money and the place where the money was illegally obtained. The purpose of money laundering is to make the money come from a legal source. Simply, money laundering is the display of illegal funds as legitimate funds. For example, if someone gets money from black market and illegal trade in goods, then the money will be considered dirty and you cannot deposit it in the bank, because if you deposit the money directly in a financial institution than it may be seems suspicious because the reports and records have to be created and explain the source of money. Money laundering includes three steps:

  1. First, the owner of the money obtains the money through some illegal means and deposits it in the bank in some way.

  2. Then, remit money through multiple transactions.

  3. Finally, they returned the money to the bank to legalize it.

Tax evasion: The purpose of tax evasion is to conceal the actual taxable income and original situation from the authorities. This concealment of income is to reduce the tax liability in the eyes of the government. Simply, it is to hide the illegally obtained money in order to reduce the tax liability and show low income to tax authorities. Tax evasion has a negative impact on social values ​​because it depresses honest taxpayers. They may also want to evade tax and give economic power to a few people who are not worthy.

Identity theft: Identity theft is one of the simplest types of crime today. Due to advances in technology, it is very easy to access anyone's personal information. Identity theft is a crime in which criminals gain unauthorized access to information such as names, addresses, and phone numbers and use this information to make money. In simple terms, identity theft is the use of someone else’s identity to commit fraud or to make money through illegal means.

White-Collar Crime in India

With the advancement of commerce and technology, white collar crime has become a global phenomenon. Like any other country, India is also a victim of white collar crime. The reason for the sharp increase in white collar crime in recent decades is the rapid economic and industrial growth of this developing country.

One of the biggest damages caused in recent times is the mysterious disappearance of the company, out of the 5,651 companies listed on the Bombay Stock Exchange, 2,750 have been disappeared. This means that one out of two companies enters in the stock market to raise millions of rupees from investors and after robbing them, they escape. Even "Home Trade" came up with big publicity stunts, but they escaped after raising the fund. Approximately near about 11 million investors invested Rs. 10,000 Crore for these 2,750 companies. We have the Securities and Exchange Commission of India, the Reserve Bank of India and the Department of Commercial Affairs to monitor the stock exchange transactions, but no one has recorded the whereabouts of these 2750 strange companies whose trading has been suspended. White-collar crime in Indian companies has “increased significantly” in the past two years, partly because the economic recession has put pressure on employees to reach targets, according to the Indian Fraud Investigation.

The nature of violations is diverse, with bribery and corruption accounting for 83% of cases. A large part of fraud is also related to cybercrime (71%) and asset transfer (65%). According to the survey, the industries most affected are financial services (33%) and information and entertainment (17%).