White Collar Crimes

• Socio-economic crimes, privileged class deviance, white

collar crimes
• Affect the economic policy as well as social fabric of the
country—by weakening institutions
• Defined by Edwin Sutherland as “crime committed by a
person of respectability and high social status in the course
of his occupation”.
• Later refined: a white-collar criminal is “a person of the upper
socio-economic class who violates the criminal law in the
course of his occupational or professional activities.”
• More dangerous to society because financial losses are
higher and there is damage to the public morale.
• Financial loss is less important than damage to social
relations—it creates distrust and produces disorganisation at
a large scale.
Traditional Crimes v. White Collar
Crimes
• Mala in se: wrong in itself • Mala prohibitum: prohibited by law
• Mens rea and presumption of • Strict liability and reversal of
innocence burden of proof
• Investigated by police, tried in • Investigated by specialised
agencies, could have special courts
normal courts
• Implementing agencies may have
• Implementing agency treats softer attitude
accused as a criminal
• Scope: affect larger number of
• Scope: individual targets people and wider consequences
• Social sensitivity, well-defined • Social disorganisation, lack of
victim, public outcry is more due victim, public outcry is less due to
to the specific threat caveat emptor
• Multiple motives • Main motive: greed
 Types of white collar
crimes
• Frauds in business—sale of bonds, investments
• Adulteration of food and drugs, misleading advertisements
• Malpractices in medical profession: illegal sale of narcotics,
abortion, fraudulent reports and testimonies, unnecessary
treatment, fake specialists etc
• Crimes by lawyers: guiding criminal/quasi-criminal activities
of corporations, fake claims, twisting of testimony etc
• Trusts, cartels, combines, syndicates: anti-competitive
practices, interference with freedom of trade, deterring
honest business and consumer
• Bribery and graft by public officers
• **Overarching purpose: unlawful behaviour for furtherance
of financial or strategic interests of legitimate callings
 Criticism of Sutherland’s definition
• Person found guilty of violation of a criminal law provision by a court of law =
criminal. White-collar crimes, being handled by tribunals/commissions cannot
result in criminal conviction in legal sense. Fear of overcriminalisation
• Criminal procedure prescribes set guidelines with safeguards for the offender.
WCC: burden of proof reversed, mens rea not required. Counter: requirements
for legality—element of harm and conviction under penal statute. “An
unlawful act being punishable is more important than whether it is punished.”
• Sociological argument: offenders do not see themselves as criminals, nor are
seen as such by the society. Contention that legal offences of corporate
executives are not crimes because they do not perceive their activities as
criminal is untenable. Perception by a perpetrator has no bearing on a
statute.
• Acts not committed in the course of occupation or violators are not
necessarily of upper strata: definition now covers more offences than were
contemplated by Sutherland.
Growth of white collar criminality
• Coincidence with progress in economic and industrial fields:
most WCC directly or indirectly connected with production and
distribution of wealth.
• Industrial revolution: move from ownership of tangible assets to
intangible assets and invisible powers and rights—shares
trademarks etc…concentration of economic and political power
and monopolisation
• Two World Wars: traditional mores and ethical restraints were
affected due to scarcity of things and mounting demands.
• Technological and scientific development: rise of “mass society”
and a small controlling elite, monopolies, managerial class and
intricate institutional mechanisms.
Indian Scenario
• Independence and rise of welfare state—government
control over means of production and distribution of
goods and services: fertile ground for WCC.
• Five-Year Plans and huge expenditures on part of the
government.
• Government control over resources and society infested
with chronic shortages, corruption and endemic
inefficiency in administration.
• That is not to say development did not take place, but it
earmarked a large chunk of those resources to be
pocketed by corrupt officials.
Anti-WCC laws—problems with
enforcement
• Preferential treatment of white collar offenders: violations are
complex and need expert assessment, public agencies can’t
represent or are controlled by the elite, unorganised resentment,
relatively new and specialised regulations, lack of technical
knowledge
• Members of community themselves contribute. “Victims” of crimes
also share the blame—demand for illegal goods and services.
• Inadequate punishments, judicial attitude (Hoskot, Mohd. Yakub)
• Peculiar problems of detection, investigation, prosecution and trial
• Forum of trial—dispensing with ordinary criminal procedures, lack
of immunity from influence
• Argument for doing away with protective provisions, presumptions
etc…problem of slippery slope, arbitrariness and overciminalisation
 Theories of white collar crime
• Labelling theory: white collar criminal labelled different from a typical
criminal. Social perception- non-threatening, impersonal
• Deterrence theory: differential punishment and understanding recidivism
• Conflict theory: those in social power will use that power to further their
own wants and needs, allowing the powerful to control the powerless
• General strain theory: Several strains explain WCC, like blockage of
economic goals, experience of economic problems, inability to achieve
status goals etc. Whether these strains result in white-collar crime,
however, is said to be influenced by such things as coping skills and
resources, social support, opportunities for white-collar crime, social
control, the perceived costs and benefits of white-collar crime, and
association with criminal others.
• Organisational opportunity theory: rationalisation on the basis that
“everyone in the business does it”. Some practices represent “normal”
business procedures, passed on as part of occupational subculture and is
part of learnt behaviour by new entrants