What is White Collar Crime?
White collar crime tends to refer to crimes committed at a business by a businessman or woman. Such crimes might include embezzlement or fraud. Criminology expert and sociologist Edwin Sutherland came up with the term in a 1939 speech. He posited that people are more likely to commit crimes when they are surrounded by criminal behavior of others. This philosophy relates to punishment of white collar crime by the US justice system. This type of criminal is sometimes considered less likely to commit another crime, and punishment may be softer than for crimes involving violence.
Today, the definition may also refer to the socio-economic status of the person committing the crime. A person from the middle or upper classes commits a white collar crime simply because of his origin. However, if the crime is violent in nature, it would likely not be described using this term.
Most people believe that white collar crime is a less punishable offense, than a mugging where violence is threatened or a similar crime. However, crimes like embezzlement, the stealing of company funds, may ultimately harm more people. If the money cannot be recovered, a criminal might technically steal all the savings of people who depend upon those savings in order to live. This criminal has caused more damage by his actions than the mugger, but the mugger may be more likely to receive a stiffer sentence.
Since white collar crime tends to occur among those of higher socio-economic standing, an advantage is gained. Most people can afford a better lawyer to argue in their defense. Those of lower socio-economic standing are not likely to be able to afford a private lawyer and must rely on public defense attorneys. It has been statistically shown that most clients fare better with a private lawyer.
Generally, a white collar criminal also has the advantage of being housed in a minimum-security prison. Such an environment offers greater freedom and is generally considered a safer environment than maximum-security prisons. Thus this type of crime is often not considered with the same gravity as other offenses, even when a person has damaged the lives of others beyond repair.
Another white collar criminal case which involved defrauding investors was the Bernie Maddoff case.
Bernie Maddoff developed a billion dollar empire by defrauding his investors who chose to invest with him.
He would offer what appeared to be legitimate statements of above average earnings which would entice people to invest even more with him.
Like the Enron case, people lost their life savings and Bernie Maddoff was sentenced to over 100 years in prison because the fraud claims were so egregious. No white collar crime attorney was going to be able to help him.
I heard about that. For example, the CFO of Crazy Eddie, the defunct electronics chain in New York City now helps the feds find all sorts of white collar criminals.
The thinking here is that a criminal mind understands a criminal mind much better than law enforcement.
The problem he says is with the auditing procedures. Many laws like the Dodd-Frank act are allowing small companies to skip forming internal control audits which can allow fraud to develop.
He recently claimed that Overstock.com was not adhering to general accounting practices and misled people on the financial health of the company. In fact Patrick Byrne, the CEO dumped his stock before the stock price plummeted which is another classic example of insider trading.
Many of these employees lost their life savings because much of their retirement savings was offered in company stock.
There was not a white collar attorney that could save the executives at Enron. These white collar workers all were sentenced to significant jail time.
Sometimes white collar employment involves helping the F.B.I and the Security and Exchange Commissions to seek out other white collar criminals.
People convicted of this crime sometimes help the federal government profile other white collar fraud and embezzlement cases due to their past experiences.
This is usually after they have served their sentence or have gotten their sentence reduced due to the cooperation.
White collar cases usually involve significant amounts of fraud and insider trading. Usually a company’s top executives might know that the company is failing financially but not disclose this information and tell the rest of the employees and the general public that the company has a healthy bottom line.
At the same time these executives sell their shares of stock when the price is still high because the adverse information is only known by a select few who choose to keep the information a secret.
When they cash out their significant shares of stock the stock price takes a huge tumble and eventually the stock is worthless.
This is the form of white collar fraud that occurred at Enron. The executives at Enron overstated the company’s financial position in order to raise the stock price.
They even encouraged employees to invest money in the company when they hid the severe financial problems from the public including their very own employees.
What is it called when a person is making DVD movies off his computer and reselling them. I mean he has 1000 plus movies to choose from.
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