All About White Collar Crimes


In 20th century the rapid growth of the countries and the boost in their infrastructure has also increased the quantity, quality and quantum of crimes in modernized world were even laws abiding are quite stringent. One of such modernized crimes is white collar crimes White-collar crime was defined by Edwin Sutherland as a “crime committed by a person of respectability and high social status in the course of his occupation.” Since this term was coined by Sutherland in 1939 during his speech for American Sociological Society, debates have risen as to what particular crimes will be considered as white collar crimes. Some of the most common activities discovered under white collar crimes include antitrust violations, different types of fraud (computer and Internet, credit card, bankruptcy, mail, financial and healthcare frauds), insider trading and environmental law violations, public corruption and money laundering. In the modern judicial systems, such crimes are deal with severe sentences such as house arrest, fines and financial penalties, sentences of up to 30 years, and offenders of economic crimes can be sentenced as much as that of offenders for violent street crime. The sentencing guidelines are particularly applied by computing the effects or loss caused by the fraudulent acts. As per the report of Federal Bureau of Investigation, it is been recorded that white collar crimes amounting $300 billion every year in USA.


White collar crimes are not the by-products of modern time. In fact the earliest documented case of white-collar crime law dates back to 15th century England. The law, enacted in 1473, was a response to embezzlement or larceny in what’s known as the Carrier’s Case, a situation where the agent entrusted to transport wool attempted to steal some of it for himself [source: Salinger].However, white-collar crime didn’t garner much public attention until it became more widespread after the Industrial Revolution in Western industrial societies. As companies rose in power, they were able to squelch competitors and then implement monopolistic policies without fear of being outsold by other companies. The public became furious when they had to pay outrageously high prices for something that was previously cheap, for no reason other than corporate greed. But, under the law, manufacturers weren’t doing anything wrong — it was perfectly legal. However, popular opinion held that this was corruption that should be illegal and warranted government intervention. Political movements rallied for laws to prevent monopolistic practices. Industrialized countries like England had a history of penalties. Early White Collar Crime in America. In the United States, white collar crimes became a significant problem in society like .The concept of White Collar Crimes found its place in criminology for the first time in 1941.

Also Read – White-Collar Crime In India – Detail Analysis


Most white collar crimes being non-violent and With the rapid development in computer, technology, such crimes can be found in many forms. For example: anti-trust violations, fraud, identity theft, and so on.

1. Anti-trust violation:

It means violation of laws designed to protect trade and commerce from abusive practices such as price fixing, restraints, price discrimination, and monopolization. Anti-trust law as a set of rules meant to preserve the competitive process and to ensure that the commodities needed by the consumers are available at their satisfaction. It basically protects the competitive integrity of the market. It limits the decision making and intervention of the government within free trade. Hence, it is also called as “Magna Carta of free enterprise.

2. Tax non-compliance:

Tax non-compliance includes a range of activities that are unfavorable to the government’s tax system. For example: tax avoidance: which is tax reduction by legal means. And tax evasion: which is the criminal non-payment of tax liabilities. The term tax non-compliance can be used to describe different tax crimes.

3. Money laundering:

Money laundering refers to complex sequence of bank transfers or commercial transaction comprising of financial scheme with the motive of concealing the identity, source, and destination of the money obtained through illegitimate business, this overall process returns the money to the launderer in an indirect, obscure and sometimes untraceable way, the money launderer keeps the account abroad along with his money without being noticed by his or her country.

4. Public corruption and bribery:

Public corruption involves a breach of public trust/abuse of position by any government officials and their private sector accomplices. Parliament of India has enacted [prevention of corruption act 1988 to tackle corruption.  Also recently India has appointed judge-retired of Supreme Court justice Pinakichandre Ghose as its first Lok pal.bribery occurs when a government official whether elected, appointed or hired violates law when he/she asks, demands, solicits, accepts or agrees to receive anything of value in return for being influenced in the performance of their official duties.

5. Insider trading:-

Insider trading can be defined as “buying or selling a security, in breach of a fiduciary duty or other relationship of trust and confidence, on the basis of material, non-public information about the security..

6. Health care and insurance fraud:

Health care fraud is a form of white collar crime that may be committed by health care providers, consumers, companies providing medical supplies or services, and health care organizations. There are many different types of illegal and unethical schemes that constitute health care fraud.

7. Environmental crimes:

Environmental law violations are forms of white-collar crime. In the course of doing business, corporations sometimes take actions — like dumping toxic waste — that harm environmental conditions for local residents or wildlife. Businesses and executives, however, might do it anyway and cover it up to avoid paying the costs of obeying safe environmental practices.


Assessing the impact of white-collar crime is complicated. Most accounts of organizational crime and corruption focus on its economic costs rather than psychological and social repercussions. Since white collar crimes affect the society at large they are also known as socioeconomic crimes. Most white collar crimes are non-violent; hence their morality is debated in comparison with murder, burglary and rapes, where there is bodily injury.

Following are some of the significant effects of the white collar crimes:

1. Effects on individuals:

Individuals may lose most of their life savings or retirement funds to white-collar criminals. They may have to pay higher taxes or prices because of the residual effects of crime. Individuals lose the benefits of higher-standard of living and other social goods as public funds are shifted to fighting crime. Some individuals may be inconvenienced by tighter regulatory and security measures that are established once the government clamps down on certain crimes.

2. Effects on organizations:

When an organization is damaged by a white-collar crime, it may be forced to raise prices, lose its competitive advantage, fire employees, terminate business relationships, downsize operations, or go out of business. A defunct organization’s clients and customers may be hurt because they are forced to purchase products and services from other firms at higher prices or on less-advantageous terms. Even when the organization avoids bankruptcy and remains intact, the publicity generated by a white-collar crime usually causes key financial measures and the price of a company’s stock to decline, causing a loss of wealth for investors.

3. Effects on the society:

White collar crimes are harmful to the society for those people who should be cited as a moral example and who must behave responsibly are one committing such crimes. The society thus becomes polluted. People lose their faith on the corporate world and governmental agencies. They become reluctant to participate in financial markets. They view health professionals with distrust. Finally, crime and corruption by high-profile politicians and executives sends a message that corruption is acceptable in the routine activities of daily life.


Corruption, fraud, and bribery are some of the most common white collar crimes in India. According to an article published by business standard titled,” Changing Dynamics of white collar crime in India”

Statistics showed that 4,000 crores worth of trading were carried out using fake or duplicate PAN cards. Maharashtra showed a rapid increase in the number of online cases with 999 cases being registered. Advancement in commerce and technology has invited unprecedented growth in one of the types of white collar crimes, known as cybercrime. Cybercrimes are increasing because there is only a little risk of being caught or apprehended. India’s rank on Transparency International’s corruption perception index (CPI) has improved over the years.

In 2014, India was ranked 85th which subsequently improved to 76th position in 2015 because of several measures to tackle white collar crimes. In 2018, as per the report of The Economic Times, India was placed at 78th position, showing an improvement of three points from 2017, out of the list of 180 countries.

India is a developing country and white collar crimes are becoming a major cause for its under development along with poverty, health, etc.

Reasons for the growth of white collar crimes in India

  1. Greed
  2. Easy, swift and prolong effect
  3. Competition
  4. Lack of stringent laws
  5. Lack of awareness
  6. Necessity

White-collar crime in the legal profession

Legal practitioners often for money or other services by their clients, present false evidence, fake witnesses in the court. A legal practitioner with the ministerial support involves in wrongful practices and violates all their ethical standards for some amount of money. Manipulating evidences and faking witnesses by bringing in professional witnesses, gives the case another turn, because of which many times the real accused is left free and the innocent is sent behind the bars. It was in 2006 when D.K. Gandhi, a resident of Delhi filed a case against the wrong practices of his lawyer. Gandhi had appointed the lawyer for a certain amount of money. The lawyer was supposed to dispose of the case as early as was possible. The case was settled in the first hearing itself and Gandhi was to receive the compensation amount. However, the lawyer refrained from giving the amount to is client, Mr. Gandhi, unless an extra sum of 5,000 rupees was paid to him. So in the case of D.K. Gandhi v. M. Mathias, when referring to the Supreme Court had said in Jacob Mathew v. State of Punjab, held the appeal and left the matter to be decided by the State Commission based upon the law. In the case of Jacob Mathews, the Supreme Court had said that: in law of negligence, the professionals from different professions like, legal, medical, or architecture, or any other would be held liable for negligence in practicing their profession if that either of the two given conditions are satisfied: a. He did not have the required skill that was needed to be professed and, b. Even if he has the required skills to be professed, he did not exercise the same.

Legislation against white collar crime in India

There are several provision that exists for identifying white collar crime. Government in order to ensure that the criminal committing white collar crime be punished has brought in the following legislations-

  1. The Companies Act, 1960
  2. The Income Tax Act, 1961
  3. Indian Penal Code, 1860
  4. The Commodities Act, 1955
  5. The Prevention of Corruption Act, 1988
  6. The Negotiable Instrument Act, 1881
  7. The Prevention of Money laundering Act, 2002
  8. The Information Technology Act, 2005
  9. The Imports and Exports (control) Act, 1950
  10. The Special Court (Trial of offences relation to Transactions in Securities) Act, 1992
  11. The Central Vigilance Commission Act, 2003

Top White Collar Crime Cases in India

  1. SEBI v. Burman Plantation and Others
  2. Abhay Singh Chautala v. C.B.I.
  3. Binod Kumar v. State of Jharkhand & Others

This article is authored by Shrikant Rathi & Rushikesh Ghadge, student of BA.LL.B at Government Law College, Mumbai.

Also Read – Concept of White Collar Crimes

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