INTRODUCTION

White shirts, black coats and well-ironed ties are typical stereotypes representing
the rich and elite, crimes perpetrated by these kinds of people are known as
white-collar crime. While such crimes tend to be non-violent, the harm they can
do to society cannot be undermined. The most influential criminologist of the 20 th
century and also a sociologist, Edwin Hardin Sutherland, for the first time in 1939,
defined white collar crimes as “crimes committed by people who enjoy the high
social status, great repute, and respectability in their occupation”.
The five attributes of the given definition are:
•It is a crime.
•That is committed by an important person of the company.
•Who enjoys a high social status in the company.
•And has committed it in the course of his profession or occupation.
•There may be a violation of trust.
Edwin Sutherland stated that white crime could harm society more than other
normal offences mainly because of the financial losses that the public would incur
in fact, white-collar crimes can be traced back to the 15 th century in the UK and
later also in the US during the civil war which allowed large monopolies to take
over which led to the enforcement of Anti-trust laws to protect the consumers
and allow fair competition.

• What is White Collar Crime?

The term “white collar crime” was coined by the American criminologist and
sociologist Edwin Hardin Sutherland during the 1930s.
Crimes to fulfil a financial motive, although non-violent, fall under white-collar
crimes. Miscreants who commit this crime are usually rich, educated and belong
to high social status. The most common cases of white-collar crimes are money
laundering, tax evasion, embezzlement, insurance fraud, identity theft and
securities fraud. Such criminal activities feature the use of concealment and
deceit to commit fraud or gain a corporate advantage.
White-collar crimes are frequently growing in third-world countries due to the
disparity in economic standings. Although non-violent, white-collar criminals do
more harm to society than most other forms of crime.

• CLASSIFICATION OF WHITE-COLLAR CRIMES:

White-Collor crimes are classified into three categories. They are given below:-
•Personal Crimes : A personal crime is committed by person who is operating on
an individual for personal financial gains in business.
•Business crimes: A business crime is committed in business for financial gain in
business context.

• EXAMPLES OF WHITE-COLLAR CRIMES

Following are the examples of White-collor crimes:-
• Tax evasions.
• Credit and frauds.
• Bank and postal frauds.
• Frauds of social security welfare.
• Insurance frauds.
• Embezzlement of self-dealing business.
• Fraud against government.
• Food and drugs violations.
• Malpractices in medical profession.
• Illicit liquor sale, narcotic drugs etc.
• Charity and religious endowment frauds.
• Crimes by lawyers, fake claims etc.
• Bribery and graft by public servant.
• Hoardings, black-marketing, adulteration.
• Smuggling.
• International crimes.
• Human organ racket.

• TYPES OF WHITE-COLLAR CRIME:-

There are four types of white-collor crimes and I am also taking the help of
examples to explain all the types.
These are as follows:-
• Fraud: Fraud is also called cheating. Fraud is committed by misrepresenting
facts in order to gain something in return. Fraud is done by misrepresenting facts
through words and actions for financial gains. This action results in a financial
injury.
For Example:-
Joseph responded to an ad about an apartment for rent. He met with the
supposed landlord toured the apartment, and agreed to rent the apartment by
signing a lease. Joseph paid the security deposited first month’s rent up front. The
next week, Joseph went to the apartment to pick up the key, and learned that
someone else occupied the Residence. After doing some investigation, Joseph
learned that the apartment was not for rent at all, but that the man he met with
and gave the money to be not the property owner. In this example of White-
collor crimes, the man who posed as the owner to swindle money out of a
prospective tenant has committed fraud.
• Extortion: Extortion means that obtaining money or property by threat to a
victim’s property or loved ones, false claim of right. It is a direct threat to harm
the victim is usually treated as the crime of robbery. It is obtaining benefit
through coercion.
For Example:-
X is the person that is threatening to publish the defamation concerning the
person Z. X will not go ahead with this unless and until Z does not give him the
money. Thus X, includes Z to give him the money. So, in this case it is said that X
has committed the extortion.
• Bribery: It is defined as the offering, giving, receiving or soliciting of any item of
value to influence the actions of an official or other person in f a public or legal
duty. A bribe is an illegal or unethical gift bestowed to influence the recipient’s
conduct. It may be money, goods, property etc.
• Insider trading: It is also a type of fraud. It is against the law if a securities
transaction, which is the sale or purchase of stocks is engaged in by a person or
small group of people, inside the company, who have special knowledge not
available to others.
For Example:-
Jeff works for a private company that is working on a device that can detect
certain serious heart problems. One day, while at work, Jeff receives an email that
was intended for his boss. The email stated that the device would be released on
a certain day, which had not been announced to the public. Jeff immediately calls
family and friends, telling them to buy company stock right way. By time the
product is released, which immediately raises stocks values, the company’s stocks
have already been bought out. In this example of White-collor crimes, Jeff used
“insider information” to give his friends and family an edge, enabling them to
obtain company stocks at the previously low rate.
• CAUSES OF WHITE-COLLAR CRIMES:
• White-collor crimes has to be placed on the same footing as ‘mass
disobedience’ of laws in a climate of Public opinion, which looks upon business
practices as necessary for successful performance even if they are illegal. The
result is ‘mass neutralization’ of law and order which gives rise to a group norm
which approves White-collor crimes as ‘normal response’.
• As per the Law Commission’s report. “The inability of all sections to appreciate
in full the need (of high standard of ethical behavior) results in the emergence
and growth of white-collared and economic crimes renders enforcement of law,
more difficult.
• The economic growth and industrial progress throughout the globe is one of the
most important causes for the rise in White-collor crimes.
• Criminal law administrators and judges are also allegedly sympathetic towards
White-collor criminals which result in their going scot free.
• White-collor criminals are tactful, intelligent and stable under the cover of high-
social status.

• IMPLICATIONS OF WHITE-COLLAR CRIMES:-

The modern society said to the White-collor crimes as an unethical business

practice and nit as crime. The implications of White-collor crimes are as follows:-
• Social Damages:
It creates general community disturbances. It destroy morale and promote social
economic disorganization. It is also the violation of trust. Such White-collor crimes
cause damages to social relations at a large scale.
• Financial Loss To The Public: The White-collor crimes cause the financial loss to
the public and society too. The White-collor crimes cause the financial loss
through robberies and burglaries etc.

• Why is White Collar Crimes in India on the Rise?

White-collar crime cases are rampantly growing in India because of the major
disparity between social classes. Also, poverty, lack of awareness and gullibility
play factors promoting white-collar crimes in India in many instances.
The following are a few reasons contributing to the growth of white-collar crime
in India.
• Lack of Strict Laws
It would be wrong to state that India has no laws to monitor financial fraud.
However, due to the lack of amendments, many perpetrators can successfully
exploit the loopholes in these laws. Secondly, as the internet is the most popular
medium of monetary transactions today, many white-collar crimes happen
through it. However, due to weak cyber laws, it becomes tough to track down
these perpetrators. This contributes to an advantage for the criminals to exploit.
• Greed
The fact that a person of high social standing commits a white-collar crime implies
how greed drives a man. The want for more wealth to shine better than their
competitors or escape taxes tempts a person more than anything.
• Lack of Awareness Among the General Population
Most often, commoners who fall prey to scams do not know where to report
them. Also, they choose silence over taking action whenever a big corporation or
bank is involved in such cases. This boosts the confidence of these scammers, and
they go on innovating new ways to fool the general mass. Thus, we can say the
lack of knowledge amongst the general masses plays vital role in the high increase
of white-collar crimes.
• Rush for Power
In today’s rat race world, we tend to materialise Charles Darwin’s survival of the
fittest theory. We try to beat our peers and competitors in our daily endeavours.
This competition escalates as we move up the social ladder of wealth and
hierarchy. White-collar crimes become a shortcut to winning more power and
wealth over their competitors in no time.
• Biased Law
Very often, we hear cases about white-collar criminals easily escaping Indian laws.
This happens mostly with influential people like political leaders or business
tycoons. They tend to tweak rules to their favour with corrupt means. The police
also, under their influence, allegedly put less pressure on investigations and
protected them from the general mass. This influence over law and order is an
upper hand to escape white-collar crime easily. This is also the very reason why
many people hesitate to report a complaint against such large
organisations. This also reflects the citizens’ loss of faith in law and order today.
• MEASURES TO CONTROL WHITE-COLLAR CRIMES:-
White-collor crimes are bound to multiply in large proportion. Control of these
crimes is a crucial problem for the criminal justice administration in this country.
Some of the measures for combating white-collor criminality may be stated as
follows:-
• Creating public awareness against these crimes through the media of press,
platform and other audio visual aids. Intensive legal literacy programmers may
perhaps help in reducing the incidence of white-collor criminality to a
considerable extent.
• Special tribunals should be constituted with power to award sentence of
imprisonment up to ten years for White-collor criminals.
• A separate chapter on white-collor crime and socio-economic crimes should be
incorporated in the Indian Penal Code by amending the code so that white-collor
criminals who are convicted by the court do not escape punishment because of
their high social status.
• There is an urgent need for a National Crime Commission which may squarely
tackle the problem of crime and criminality in all its faces.
• Above all, public vigilance seems to be the cornerstone of anti- white-collor
crime strategy. Unless white-Collor crime become abhorrent to public mind, it will
not be possible to contain this growing menace.

• PENALTIES AND PUNISHMENTS OF WHITE-COLLAR CRIMES:-

The criminal’s penalties for white-collor crime vary greatly, depending on the
crime committed, and the circumstances surrounding the case. Most individuals
facing criminal charges for a white-collor crime have never faced the criminal
justice system, and the process is frightening. Typically, penalties for white-collor
crime include any combination of imprisonment, restitution, fines, probation and
community service. As a result of the act, penalties for white-collor crime
involving wire or mail fraud increased. The civil suit will be filed for financial losses
to get the compensation for that.

• Some famous cases of White Collar Crimes :

1. Gautam Adani
Adani Pulling the Largest Con in Corporate History: As Unfolded by Hindenberg -
On 24th January when the whole nation was celebrating Naatu Naatu’s Oscar
nomination, there popped up a report which not only attacked the reputation of
India’s richest man but also made us all think about the dark side of the corporate
world. Following the release of the report, Gautam Adani has lost his leading
position in the list of world’s richest individuals. The 106 page long report was
released by the US-based financial research company- Hindenburg Research and
highlighted the ugly truth about the Indian conglomerate. This is not the first time
that corporate fraud has hit the Indian landscape. In the past, there have been
many instances where malpractices like Corporate Fraud, Financial Scams, Tax
Evasion, etc. became a hurdle in the growth of businesses all over the nation and
adversely impacted the economy.
Allegations Made by Hindenburg on Adani:
The various allegations made by Hindenburg Report can be listed as follows-
• Stock Price Manipulation
• Accounting Fraud
• Corruption
• Money Laundering
• Setting Up Offshore Dummy Accounts
• Tax Evasion

1. Harshad Mehta Scam

Also called The Bull, Harshad Mehta was a popular figure in the Bombay Stock
Exchange during the 1990s. He used to take huge loans from banks and buy scrips
paying very high prices. This led to the creation of a false market. By misusing his
reputation as the Bull to manipulate stock prices, he caused a rise in share prices.
He also misused money from banks to invest in the stock market. This act became
his nemesis as it fell under money laundering. In this way, he made Rs.5000 crore
until journalist Sucheta Dalal exposed his scam. After the Harshad Mehta Scam
came to light, the Indian stock market experienced its worst crash. After this
incident, SEBI brought in various changes in their rules and regulations to prevent
such scams.

2. Saradha Chit Fund

The Ponzi scheme by Saradha Group, an umbrella group of 200+ companies,
resulted in the Sharada scam, a major financial scandal. The group of companies
ran a Chit fund scheme, which collected Rs. 200 billion from depositors, many of
whom belonged to low-income families. They further promised to return their
investment in the form of cash or real estate. CBI took over this case from the
Supreme Court as its narrative included international money laundering and the
involvement of major political parties.

4. Ketan Parekh Security Scam

Parekh was a trainee in Harshad Mehta’s Grow More Company when he started
his career. Ketan Parekh was accused of stock manipulation and circular trading
during 1999-2001. He used to borrow lump sum money from banks like
Madhavpura Mercantile Cooperative Bank and Global Trust Bank. Furthermore,
he invested this amount in a host of K-10 stocks. When this scandal came to light,
the scandal amount was reported to be Rs. 1520 crore. He stayed in prison for a
year. The Bombay Stock Exchange banned him till 2017. After the Harshad Mehta
Scandal, the Ketan Parekh scam continues to haunt the Bombay Stock Exchange.
Parekh was not just a backstage player. He was also engaged in insider and
circular trading.
 3. Punjab National Bank Scam
The head of this scandal was Nirav Modi, India’s 85th richest man and a renowned
jewellery maker. Nirav Modi and companies conspired with Punjab National
Bank’s officials to get letters of undertakings to help fund buyers with credit from
an overseas bank. Investigators discovered two officials of PNB issued these
financial instruments illegally to Modi’s firms. As a result, Punjab National Bank
faced a loss of $1.8 billion. The PNB Scam is still one of the biggest frauds in the
history of India’s banking sector.

CONCLUSION
White-collar crime is a serious issue that impacts society deeply to the core. As it
includes financial damage, white-collar crimes tend to increase social class
divisions. This results in more people making harmful decisions to earn more
power and money, thereby resulting in an increase in corruption.

Refrences:
• learningroutes.in
• https:/navi.com/blog/white-collar-crime
• White-Collar Crimes by Kritika Oberoi, Royal College of Law, Ghaziabad Uttar
Pradesh, India.
• www.ijlmh.com