What Are White Collar Crimes?

What Are White Collar Crimes?

Most defendants facing white collar criminal charges have never been in trouble with the law. They may also be unfamiliar with what white collar charges entail and how serious the potential consequences can be.

This article answers these questions and provides a brief overview of the most common white collar crimes. However, if you suspect that you may be the target of an investigation, it is imperative to consult with a white collar crime attorney as soon as possible.

The term “white collar crime” dates back to 1939 when criminologist Edwin Sutherland first used it to refer to nonviolent crimes committed by business or government professionals. The Department of Justice currently defines white-collar crimes as “any violation of law committed through non-violent means, involving lies, omissions, deceit, misrepresentation, or violation of a position of trust, by an individual or organization for personal or organizational benefit.”

White collar offenses can include both individual crimes and corporate crimes. In both cases, offenses often involve the use of deception to procure financial gain. Examples include money laundering, tax evasion, insider trading, market manipulation, kickbacks, bribery, and embezzlement.

White collar crimes are investigated by numerous state and federal law enforcement agencies. Federal agencies that investigate white collar crimes include the Federal Bureau of Investigation (FBI), the Securities and Exchange Commission (SEC), the Internal Revenue Service (IRS), the U.S. Postal Inspection Service (USPIS), the Commodity Futures Trading Commission (CFTC), and the Treasury Department’s Financial Crimes Enforcement Network (FinCEN).

Investigations are often complex and lengthy as they require regulatory and law enforcement agencies to separate allegedly criminal misconduct conduct from legal business activities. Investigators may rely on a wide range of tools to root out alleged illicit activity, including whistleblower reports, financial analysis, forensic accounting, and data analytics. If convicted, white-collar criminals can face severe penalties, including monetary fines, imprisonment, and restitution to victims.

White collar crime can take a variety of forms. Below are some of the most common offenses:

• Bribery: Bribery occurs when money, a favor, or something else of value is promised to, given to, or taken from an individual or corporation in an attempt to sway his or their views, opinions, or decisions. 
• Embezzlement: Embezzlement involves misappropriating money or property that was entrusted to one’s care.
• Financial fraud: Financial fraud involves acts that intentionally deceive the victim by misrepresenting, concealing, or omitting facts about promised goods, services, or other benefits and consequences that are nonexistent, unnecessary, never intended to be provided, or deliberately distorted for monetary gain.
• Health care fraud: Health care fraud occurs when medical providers, patients, and others intentionally deceive the health care system to receive unlawful benefits or payments.
• Insurance fraud: Insurance fraud involves making a false claim or misrepresentation to an insurance provider for financial gain.
• Intellectual property theft: IP theft involves misappropriating ideas, inventions, and creative expressions through deception or fraud for business or personal advantage. Criminal intellectual property theft offenses include copyright and trademark infringement and theft of trade secrets. 
• Money laundering: Money laundering involves hiding the illegal source of money by passing it through numerous transactions, a process often referred to as “washing.”
• Mortgage fraud: Mortgage fraud involves making false statements or misrepresentations to obtain a mortgage loan from a lender.
• Securities fraud: Securities fraud can take a variety of forms but generally involves misrepresenting information that investors rely on to make decisions. Examples include insider trading, high-yield investment fraud, Ponzi schemes, pyramid schemes, and late-day trading.
• Tax fraud: Tax fraud is defined as an intentional wrongdoing, on the part of a taxpayer, with the specific purpose of evading a tax known or believed to be owing.

Criminal investigations and indictments can be devasting for individuals and corporations, resulting in steep monetary penalties, reputational harm, and even jail time. Because white collar investigations tend to sweep up both alleged wrongdoers and innocent bystanders, knowing the answer to “what are white collar crimes” can help you avoid a costly, and potentially career-ending, criminal investigation. If you suspect that you or your business may be the subject of a criminal investigation, it is imperative to contact an experienced white collar crime attorney as soon as possible and certainly before meeting with law enforcement agents. The attorneys of Scarinci Hollenbeck’s White Collar Defense and Investigations Practice Group have successfully defended a diverse array of businesses, along with their owners, executives, and boards, against white collar charges. No matter how serious the charges, our team works quickly to identify potential criminal liability and identify the best legal strategies to minimize the repercussions.