Zero Tolerance for White Collar Crime: Enforcing Strict Laws and Ethical Work Culture Can Do Wonders

From countries on either sides of Atlantic to ones along the Red Sea, Pacific, Mediterranean, Arabian Sea and Indian Ocean the single most overwhelming factor that has exposed the man’s negative, amoral character is his insatiable ‘GREED’. The same greed also propels him to commit the most abrasive and shameful of white collar crimes today.

According to Federal Bureau of Investigation (FBI) every year the US suffers a loss of nearly $300 billion to white collar crimes, without being able to do much to deal with such a massive drain of national resource.

What’s so white about ‘White Collar’ crime?

No white, actually, it’s all dark! White Collar crimes include: corruption, fraud, theft, and manipulation. Edelhertz defines it as “an illegal act or series of illegal acts committed by non-physical means and by concealment or guile, to obtain money or property, to avoid the payment or loss of money or property, or to obtain business or personal advantage”.

As the prefix ‘white’ would suggest, despite it being white collar as against normal more visible crimes, it is seldom seen to be perpetrated. Thus more often than not to try and bring perpetrators of while collar crimes to book amounts to engaging in futile shadow boxing.

First of all these are crimes more fraudulent in nature. In most cases such crimes take longer to come to light, may be through an account audit, or an accidental unveiling of anomalies in accounts, etc or a disclosure by a whistle-blower.

624824_45008466FBI lists White Collar crimes

The Federal of Bureau of Investigation (FBI) has enlisted the following as white collar crimes:

  • Internal Fraud
  • Credit Card Fraud
  • Phone and Telemarketing Fraud
  • Larceny
  • Consumer and Commercial Fraud (unlawful acts by company executive or employees)
  • Embezzlement (misuse of funds)
  • Extortion
  • Bribery
  • Insider Trading

Is problem too deep rooted?

Yes, that’s right! White collar crimes are reflective of particular behavioural trends in a prevailing society at a given geographical location. A study by KPMG in 2009 underlined the extremely difficult task of identifying a fraudulent character. The difficulty further arises from the fact that such crimes cut across age, income and organization barriers. It was further found that fraudsters were in the age bracket of 26 to 40 years.

Crime theories: Managerial and Organisational

  • The organisational theories entail that potential criminals have no other option but to join the criminal outfit if they choose to commit a crime.
  • The managerial theories entail some criminal outfits being run as a family business involving one principal and numerous agents. This makes it difficult to identify and punish the main culprit till one agent is first detected.

Integrity under a cloud!

The International Journal of Business, Management and Social Sciences in an article entitled ‘White collar crime: a statistical study on its common causes’ quoting Ilter, Romney and others says, “many researchers found the three main causes of white-collar crime as opportunities to commit crime, situational pressures on the individuals, and issues pertaining to integrity.”

Factors like increased incentives, pressure to commit fraud, fear of losing jobs have a direct bearing on mounting difficulties in meeting the financial targets of company. This has been the finding of survey by PricewaterhouseCoopers in Asia Pacific, America, Africa and Europe.

Factors contributing to crime

  • The incidents of white-collar crimes are also blamed on ‘poor internal controls’. In their respective studies KPMG Australia, Singapore and Thailand say that inadequate cash security practices, inadequate supervision of staff, internal auditing failures, failure to verify identification evidence and inadequate purchasing/procurement controls are the five main reasons contributing to white collar crimes in Malaysia.
  • Some experts also find collusion between managers and employees to be a key motive for indulging in white-collar crime.
  • People in the age bracket of 26-40 are most likely to end up being fraudsters
  • Peer influence and non-payment of bonuses are found to be the least- common cause of white-collar crime.

How to tame white-collar criminals?

  • Companies are being advised to follow good governance structure, internal control to deny fraudsters any opportunities to indulge in crime
  • In order to bag that lucrative contract, some companies also take recourse to bribing. Others follow suit. Formulate norms for a no-bribe culture in office
  • Companies are suggested to follow good hiring practices to help prevent fraud to some extent.
  • Discourage poor ethical practices with the sole profit motive at work places

Crime and punishment for white-collar crime

In the US punishment for indulging in white collar crimes includes imposition of penalties and imprisonment up to 1-30 years.

Penalties may be lessened if the defendant takes responsibility for the crime and helps authorities investigate the matter.

Penalties include:


Home detention

Community confinement

Paying cost of prosecution


Supervised release

A stitch in time saves 10!

That’s right! Cost of computer crime more than bank robbery! Surprised? But this is a fact. According to recent FBI figures the average take of an armed bank robbery is $3,177. As per the Data Processing Management Association the loss due to computer crime amounts to over $500,000.

So, what’s need of the hour?

  • Strict anti-white collar crime laws enforcement by police
  • Police training to deal with white collar fraud
  • Make fraud and white collar crime a priority for police department
  • Police needs to be adequately funded to combat white collar crimes

About the author: Daljit Rakkar graduated from the San Joaquin College of Law in May 2010 and was then admitted to the California State Bar and the United States District Court. His office has handled many cases in the Superior Courts of Fresno, Madera, Kings, Kern, Merced and Mariposa Counties, as well as the United States District Court. He’s also maintained an exemplary record with the California State Bar Association. If you ever need a defense lawyer for criminal charges, Mr. Rakkar’s vast experience and legal know-how can help you make it through the process. Email him at or visit for details.

Image credit: Penny Matthews

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