- INTRODUCTION
The prevention and the enforcement of white collar crime has been a challenge for the regulators world wide. As a substantial amount of insider trading cases happen to be white collar crimes, a specific approach to its enforcement as a white collar crime will contribute significant value.
There is no statutory definition for the term “white collar crime.” The term “white collar crime” was first used in 1939 by a noted criminologist, Edwin Sutherland, in a presidential address to the American Sociological Association and explained it as “a crime committed by a person of respectability and high social status in the course of his occupation”[1]. In 1989, the FBI explained white collar crime as “those illegal acts which are characterized by deceit, concealment, or violation of trust and which are not dependent upon the application or threat of physical force or violence. Individuals and organizations commit these acts to obtain money, property, or services; to avoid the payment or loss of money or services; or to secure personal or business advantage.” A significant formulation of what constitutes ‘white collar crimes’ has been offered by the U.S. Department of Justice, Bureau of Justice Statistics, which defines white collar crime as:
[n]on-violent crime for financial gain committed by means of deception by persons whose occupational status is entrepreneurial, professional or semi- professional and utilizing their special occupational skills and opportunities; also, non-violent crimes for financial gain utilizing deception and committed by anyone having special technical and professional knowledge of business and government, irrespective of the person’s occupation.
Sutherland has distinguished the perpetrators of white collar crimes and blue-collar crimes i.e., crimes such as robbery, burglary, and murder. He says that those who indulge in blue-collar crimes are typically street criminals. The acts of commission or omission in such crimes have no connection to their occupation. Contrary to the ordinary crimes, individuals of higher economic and social status committed the white-collar crimes and such crimes were linked to their socially respected professions. White collar crimes involve sophistication and the criminals who perpetrate them have specialized knowledge that allows them to commit complex transactions that are often difficult to identify.
Although the white collar criminals inflict more harm on the society, the fact is that very few amongst the white collar criminals have been convicted. The law enforcement authorities are unable to easily prevent or catch the white-collar criminals. The criminal justice system existing in various countries appear to treat the white-collar offenders with more lenience and with less consistency than the street criminals.
The term “white collar crime” appears in very few obscure criminal statutes and the question whether an offense should be considered as a white collar crime is one that has arisen in fewer cases. The term has appeared in the recently enacted U.S. legislation on corporate governance, the SOX, one of the most important pieces of federal criminal law relating to the companies.
[1]The term was first used by noted Criminologist Edwin Sutherland, , in a presidentialaddress to the American Sociological Association, Stuart P Green, The Concept of WhiteCollar Crime in Lawand Legal Theory, 8:1Buff L.R.1(2005)