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WHITE COLLAR CRIMES

Updated: Feb 20, 2022

Written by: Kethana Tamminaina



INTRODUCTION


White Collar Crimes are those performed by someone with a high social-economic status over the course of his or her professional career. It’s a kind of crime that is undertaken by highly professional persons or individuals concerned within the business (either directly or indirectly).


White-Collar Crime is described as a criminal act committed with the purpose of achieving an unlawful objective through violent means in order to gain money or obtain wrongful gains[1] or to avoid payment of legal dues or to retain capital or property either movable or immovable in a wrongful manner. It is often referred to as socio-economic offences.


With the growth of the commercial and IT sectors in our country, white collar crime is on the rise. Professional crime has taken on new dimensions as a result of recent technological advancements. India's rapid economic growth, fuelled by industrialization, globalization, and the increasing impact of market forces on the economy, has created a plethora of opportunities for white collar crime. White Collar Crime is prevalent in almost all professions including legal, engineering, medical, and educational institutions.

MEANING AND DEFINITION OF WHITE-COLLAR CRIMES


In simple words, a crime committed by the people employed in white-collar jobs is called a white-collar crime, and persons who commit white-collar crimes are called white-collar criminals. White-Collar Crime belongs to the upper socio-economic class of people or elite class of society who violate the legal provisions of the criminal law while providing their professional services to society at large. For example, misrepresentation through fraudulent advertisements in order to boost sales, infringement of copyrights etc.


Thus, the following are included in the definition of white-collar crime:


● It is a socio-economic offence

● It is the one which is committed in the course of an individual's career or occupation by a person of high respectability in society, and

● It is usually called a breach of trust.


SUTHERLAND’S DEFINITION OF WHITE-COLLAR CRIME


In a speech to the American Sociological Society in 1949, Professor Sutherland introduced his idea of "white-collar crime”. According to him, “When a person of respectability and high social standing commits an act that is almost a felony in the course of his legal occupation, it is a white-collar crime”. But, later on, he added a refinement to his own definition and gave a modified definition of white-collar crime, defining white-collar criminals as individuals belonging to the upper socio-economic class who breach the criminal law in the course of occupational or professional activities.

According to Sutherland, white-collar crimes are increasing due to three reasons:

→ The judges, legislators, and commission – members belong to the same social class to which white-collar criminals belong

→ The trend of not punishing the offenders

→ Unorganized and ineffective resentment of exploitation by white-collar criminals.


CRITICISM OF SUTHERLAND’S VIEWS ON WHITE-COLLAR CRIME


Sutherland’ definition of white-collar crime has been criticised by many jurists. Coleman and Moynihan have criticized and stated that there are no precise and definite criteria for determining persons who can be specified as ‘person of respectability and status’. They also claimed that the element of “high status” as used in the definition of white-collar crime leads to confusion. And, therefore Sutherland’s work does not give a crystal clear description of white collar crime. Even some critics have also suggested that such offences be termed as occupational crimes rather than white-collar crimes because the element in the definition of white-collar crime is the type of crime and the circumstances under which it is committed but not socio-economic status of individuals.[2]


CLASSIFICATION OF WHITE-COLLAR CRIMES


Ad hoc crimes:- They are also called personal crimes as in this category, the offender pursues his own personal goal without having any face-to-face contact with the victim. For example: hacking on computers, credit- card frauds, tax evasion, etc.

Breach of Trust:- This form of crime involves a breach of trust bestowed on the perpetrator by an individual or organization.

Insider Trading:- It is the process by which someone uses confidential data to buy and sell shares in publicly held corporations.

Bank Fraud:- It is described as engaging in fraudulent activities aimed at defrauding a bank or acquiring assets owned by financial or non-financial institutions.

Bribery[3]:- Bribery is identified as the illegal offering of money, goods, or other gifts to government officials in order to exert control over their actions or compel them to function in accordance with the giver's wishes.

Computer Fraud:- Computer fraud is becoming more widespread these days. It has developed in parallel with technological development. It may also refer to cybercrime. Examples of such frauds include hacking or stealing another person's data without his or her permission.

Embezzlement[4]:- Embezzlement means when an individual unlawfully obtains another's property by real or threatened force or coercion. It can also be called a criminal breach of trust.

Extortion[5]:- When someone illegally obtains someone’s property by means of threatening or obtains any property by unlawful means or in a dishonest manner.

Tax Evasion:- The complex tax law system in India has provided enough opportunity for taxpayers to escape paying taxes. Tax evasion is popular among high-status individuals such as lawyers, surgeons, merchants, businessmen, engineers, and so on.

Corruption:- It is deceptive or fraudulent behaviour by those in positions of authority, usually involving bribery. Corruption is a criminal offense that is governed by the Prevention of Corruption Act. Corruption cases involving public servants often cause delays in the investigation.


CONTRIBUTING FACTORS OF WHITE-COLLAR CRIMES


In India, the changing socioeconomic concept of society, combined with increased wealth and prosperity, has created opportunities for such crimes. White-collar crime has increased significantly as a result of recent scientific and technological advances, as well as monopolistic trade and business practices. In recent decades, a modern form of computer-dominated white-collar crime known as cybercrime has developed at an exponential rate. Cybercrime has been a key cause of concern and a danger to law enforcement agencies around the world. The following are the main factors of white-collar crime:


● Legislators and law enforcers are both members of the same category or class as occupational criminals.

● Less effort from law and administrations, favourable laws, less impact on individuals.

● The growth of white-collar crime in many countries has paralleled those countries' economic and technological development.[6]


It is both surprising and hardening to learn that the mechanism of white-collar crime is divided into two parts: (i) direct and (ii) indirect, both of which are linked to production and distribution of wealth.


WHITE-COLLAR CRIME IN CERTAIN PROFESSION


Some professions involve the technical knowledge and skills which provide enough and adequate opportunities for the scope of white-collar criminality. These professions include the medical field, legal practice, engineering, and private educational institutions.


Medical Field:- White-collar fraud committed by medical professionals in this sector includes the issuing of fraudulent medical certificates, assisting in illicit abortions, and supplying medications and medication to patients or chemists.

Engineering:- Some white-collar crimes in the field of engineering include using wrong and cheap materials with substandard for the construction of buildings, roads, canals, dams, etc. resulting in danger for the safety of the public at a large scale.

Educational Institutions:- The governing bodies of educational institutions are also now involved in white-collar crime. Cases on Educational Institution have increased. The activities involved in white-collar crimes in this area include:- false recruitment, wrong and misleading prospectus, termination of services, problems in pay – scale, unfair transfer in government schools and universities, etc.

Legal Profession:-The white-collar crime in the field of law is fairly widespread. Legal professional ethics are widely followed by members of the legal fraternity. Advising organized traffickers, assisting with false lawsuits, and fabricating false facts are the most common civil and technical violations committed by lawyers and legal consultants.


The incidences of white-collar crime are also very high among some other professionals like advertisers, property advisors, Chartered Accountants and Company Secretaries and management consultants, etc.


LAWS AND ACTS PREVENTING WHITE-COLLAR CRIME

● Prevention of Corruption Act, 1988

● Prevention of Money Laundering Act, 2002

● Negotiable Instrument Act, 1881

● Companies Act, 2013

● Essential Commodity Act, 1955

● IT Act, 2005.

● Information Technology Act, 2002

● Industrial (Development and Regulation ) Act, 1951

● Fugitive Economic Offender’s Bill, 2017

● Imports and Exports (Control) Act, 1950.


CONCLUSION


The advancement of science and technology in recent decades has given rise to a new form of criminality known as "white-collar crime." It is a socioeconomic offense, and the economy suffers greatly as a result. The person who commits these types of crimes is called a socio-economic offender. The term white-collar is not defined in criminal law but although a certain form of white-collar crime is defined in the Indian Penal Code. These forms of crime have been linked with white-collar crime. The provision for white-collar crime also addresses the penalties and fines associated with the essence of the crime. Many scams in the form of white-collar crimes have been witnessed in India in recent years.

To curb this form of crime, the Indian government has implemented a range of initiatives. Acts such as the Prevention of Corruption Act of 1988, the Prevention of Money Laundering Act of 2002, and the Essential Commodity Act of 1955 assist the government in penalizing such offenses. The Economic Offender's Bill, 2017, is a new bill pending in Parliament that is an initiative of the NDA government to have control over economic perpetrators who flee to other countries to avoid criminal liability. To regulate the problem of white-collar crimes in India, the above-mentioned acts (or any other relevant act that prevents white-collar crimes) should be harmoniously interpreted in such a strict manner, along with legal provisions of the Indian Penal Code, 1860.

[1] Section 23 of Indian Penal Code(45 of 1860) [2] Prof. N.V. Paranjape, Criminology & Penology with Victimology, 148, (Central Law Publication, 17th edition, 2017). [3] Section 171B of Indian Penal Code( 45 of 1860) [4] Section 405 of Indian Penal Code( 45 of 1860) [5] Section 383 of Indian Penal Code( 45 of 1860) [6] Ahmad Siddiques, Criminology and Penology, 445, (Eastern Book Company, 16th Edition, 2011).

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