Open Access Research Article
WHITE COLLAR CRIMES IN INDIA BY: RUTVIJ RAJESH YEWALE
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WHITE COLLAR CRIMES IN INDIA
AUTHORED
BY: RUTVIJ RAJESH YEWALE
Roll No. 29
Progressive
Education Society’s Modern Law College Ganeshkhind Pune
ABSTRACT
White collar crimes are the crimes which cause a harm to the economy of
the country as a whole. It threatens the country’s economy
by bank frauds, economic thefts,
evasion of tax etc.
It not only affects the financial status
of a country or a person but It
has also a negative impact on the society. The various
crimes such as bribery, corruption, money laundering has affected society in a negative way.
There is no proper definition of White collar crime in Indian laws. These
socio-economic crimes should not be taken leniently by the government.
Punishment regarding White collar crime should be stricter as harsh punishment
can prevent these crimes to a great extent. If the crime is very heinous the
punishment might also be extended to life imprisonment.
INTRODUCTION AND MEANING
With the advancement in science and technology there are certain
anti-social activities which the person of upper class carries on their
occupation or business. These anti-social activities are termed as White-Collar Crime. White Collar Crime has become a political issue as it affects
key areas of contemporary life. The harmful
activities on the part of upper class have endanger the safety of workers,
consumers and passengers and have a wide impact
on public health
and the environment.1
These harmful activities are subject to criminal law and criminal justice
but they are not regarded as crime in
the same way as murder, robbery
or assault. This was the main
issue that was raised while studying
white collar crime. The existence of white- collar crime questions the way in
which crime is defined and treated by criminal justice agencies.
1 https://www.legalserviceindia.com/legal/article-7541-white-collar-crimes-and-contribution-of-professor- sutherland-in-the-development-of-the-white-collar-
crimes.html#:~:text=With%20the%20advancement%20in%20science,key%20areas%20of%20contemporary%2
0life.
White collar crime encompasses a wide range of harmful activities which
are not widely regarded as criminal, raising questions of how it can be
compared with other crimes. The analysis of white-
collar crime move beyond the traditional concerns
of criminology into wide
areas of financial regulation, occupational health, consumer affairs and food
regulation.
Historical Background of White-Collar Crime
Carrier case was the first case of white- collar
crimes which was documented in the year 1473
in England. In this particular case, the agent was entrusted with the
responsibility of the principal to transport wool from one place to another.
The agent was found guilty of stealing some of wool.
The English court after this case adopted the doctrine of breaking the
bulk which means that the bailee who was given the possession of goods tried to break it open and misappropriate the content. In the year 1907 Edward A. Ross was the first to report
upon the Sins of the Criminoid
in his classical Article in the Atlantic monthly in 1907.2
Albert Morris was the first to discuss
the abuses of the Criminal
of the upper world in the form of book.3
In his treatise on criminology (1935) he defined criminals of upper class as:
That numerous but never clearly
defined group of criminals whose social position, intelligence and criminal technique permit them to move among
their fellow citizens virtually immune to recognition and prosecution as
criminals.
The most influential criminologist and sociologist of the 20th Century,
Edwin Hardin Sutherland in the year 1939 first coined the term White Collar
Crime and worked upon the concept of white-
collar crime throughout his career. Sutherland had not only defined the term
white collar crime but he had also given his opinion that the criminals who are
committing these white collar crime should be differentiated as there are
differences between the person belonging to the lower socio-economic status who
are committing crimes by violating the regular penal code or violating special
trade regulation which are applicable to them or the
2 https://blog.ipleaders.in/white-collar-crimes/
person who are belonging
to high social
economic status and violating the provision of regular
penal code in such a way which are not connected with their occupation and who
are committing white collar crime.
Definition of White-Collar Crime
Edwin Sutherland defined White Collar
Crime as:
Crime which is committed by a person
who is having high social status and also having respectability which is acquired
by him in the course of his occupation.4
Hartung defined White Collar Crime as:
A violation of law regulating business which is committed for a firm by the firm or its agent in
the conduct of its business.
Herbert Edelhertz defined White Collar Crime as:
An act which is illegal or series of illegal act which is committed by using such means which are non- physical and these acts are done for the purpose of concealment or guide for obtaining
money or for the purpose of avoiding the payment of loss in respect of money or
property or for the purpose
of obtaining any business and in some cases the purpose is personal advantage.5
Contribution of Sutherland Towards
White Collar Crime
Edwin
Sutherland defined White Collar Crime as, Crime which is committed by a person
who is having high social status and also having respectability which is
acquired by him in the course of his occupation Sutherland definition of White-
Collar Crime is therefore built upon three overlapping circles of misbehavior.
The first circle represents any crime committed by a person of high
status. The second circle represents the crime committed by a person having
respectability. The third circle represents the crime committed in the course
of occupation.
White- collar crime not only respectable but feasible. He stated the
problem clearly and succinctly. He spearheaded the systematic study of the
phenomenon. He articulated a distinctive theoretical concept
of white-collar crime
and provided an operational definition and supported his thesis with empirical
data based upon legal and administrative violations of 70
4 https://www.legalserviceindia.com/legal/article-7541-white-collar-crimes-and-contribution-of-professor- sutherland-in-the-development-of-the-white-collar-crimes.html#google_vignette
Sutherland concept of white- collar crime has put forward the kind of
crime committed by powerful and influential members of the elite society
Sutherland pointed out that White-Collar Crime was more dangerous to the society
than crimes committed by the
members of the lower class because the financial loss were higher and damage is
inflicted on public moral.
Sutherland also elaborated the reasons why such crime went unpunished because of their
social status and principally due to difference in their social
position.6
White Collar criminality is real criminality, being in
all cases in violation of the criminal
law
White Collar criminality differs from lower-
class criminality principally in an implementation of the criminal law which
segregates white collar criminals administratively from other criminals.
The theories of criminologist that crime is due to poverty, psychopathic
and sociopathic conditions are invalid because first they are derived from
samples which are grossly biased with respect to socio-economic status; second,
they do not apply to white collar crime criminals; and third they do not even explain
the criminality of the lower
class since the factors
are not related to a general process characteristic of all criminality.
A theory of criminal behavior
which will explain
both white collar
criminality and lower-class criminality is needed.
A hypothesis of this nature is suggested in terms of differential
association and social disorganization.
Sutherland impact was great and unmistaken. He reoriented the thinking of
a generation of criminologists and others
to come. He provided personal
leadership in theory
development and research
verification. He inspired others to follow his example. He raised controversial
issues and sharpened debates
over existing theories
and research of crime and delinquencies. Largely because of his influence the period
between 1940 and 1960 was described as the classical period in the research and
study of white-collar crimes.
6 https://study.com/academy/lesson/edwin-sutherland-the-study-of-white-collar-crime.html
Greed, competition and lack of proper laws to prevent
such crimes are the major
reasons behind the growth of
white collar crimes in India.7
Greed
The father of modern political philosophy, Machiavelli, strongly believed
that men by nature are greedy. He said that a man can sooner
and easily forget the death of his father than the loss of
his inheritance. The same is true in the case of commission of white collar
crimes. Why will a man of high social status and
importance, who is financially secure, commit such crimes if not out of greed?
Easy, swift and prolong effect
The rapid growing
technology, business, and political pressure
has introduced the criminals to newer
ways of committing white collar crimes.
Technology has also made it easier and swifter
to inflict harm or cause loss to the other person. Also, the cost of such
crimes is much more than other crimes
like murder, robbery
or burglary, and so the victim would
take time to recover
from it. This would cut down the competition.
Competition
Herbert Spencer after reading ‘On the Origin of Species’ by Darwin,
coined a phrase that evolution means ‘survival of the fittest’. This implies
that there will always be a competition between the species, and the best
person to adapt himself to the circumstances and conditions should survive.
Lack of stringent
laws
Since most of these crimes are facilitated by the internet and digital
methods of transfer payments, laws seem reluctant to pursue these cases as
investigating and tracking becomes a difficult and complicated job. Why it
becomes difficult to track it is because they are usually committed in the
privacy of a home or office thereby providing no eyewitness for it.
7 https://blog.ipleaders.in/white-collar-crimes/
With modern technology ease of business is one of its expectations, in a
sense, it also applies to white-collar crimes which have allowed them to reach out to a larger
number of people
and commit large scale crimes without being noticed by the law. Many
have fallen victim to different scams such as the credit card scam, moreover, the pandemic opened
up a new market for them
by exploiting the medical field and creating a black market for Covid
medications such as “Remdesivir” and over a hundred cases were lodged against
the illegal sales and use of this medicine
and in most cases, the Doctors and Hospital staff were involved. The need and greed of people have driven them to the extent of exploiting any possible field. It doesn’t stop there the development in technology is so rapid that people can acquire nuclear
weapons with a click of a button, this was the case in Mumbai when
authorise seized two people acquiring 7kgs of natural uranium which is highly radioactive and dangerous to human life.
This makes us question the level of threat that these cartels
and organizations impose
on the nation and the level of sophistication these crimes
have reached for the personal gains of their lives.
Lack of awareness
The nature of white collar crimes is different from the conventional
nature of crimes. Most people are not aware of it and fail to understand that they are the worst victims of crime. People who are victims of these crimes
fail to comprehend the notion of the crime and understand the exact offence which has been committed and whom to approach
or lodge a complaint against because most
of the time it involves a large
corporation and there may be little or no
evidence to essentially produce a criminal and in certain crimes such as scam
or fraud people may not even realise that they have fallen victim
to a crime such as a bank fraud where yearly there
are over thousand cases registered. And in a scam, such as a double-dip
scam the victim may fall prey again
because the information of the victim is stored and passed on to another
scammer. Especially in metropolitan cities these cases are rising but we lack
the awareness to become victims of such crimes, a wider reach is required
and awareness campaigns by the government may help people understand the severity of these crimes
and the loopholes these
criminals use and may help reduce the
rate of white-collar crimes in future.
Competition
We live in a fast pace world where only the fittest can survive and it
has grown to such an extent that crimes are committed
for survival especially belonging to the lower socio-economic classes their work environment is poorly designed
and they are often underpaid
so in order to
Necessity
People also commit white collar
crimes to meet their own needs and the
needs of their family.
But the most important thing that the people of high social status want to feed
their ego.
Common Types Of White Collar Crime In India:
1) ? Bank Fraud: Fraud is a
crime committed with an intention to deceive and gain undue advantage. Bank
Fraud is a fraud committed on the banks. It is committed by the fraudulent
companies by making fake representations. It is also related to the
manipulation of the negotiable instruments like cheque bouncing, securities,
bank deposits etc. Bank fraud is concerned to the public at large because there
is a relation of trust between the banks and the public. It is the most common
type of white collar crime and also a corporate crime. It harms public as well
as the government of the country.
2) Bribery: Bribery is also a very
common type of white collar crime. By bribery we means giving money or some
goods to the person at a high position in return of a favor. In simple words bribery
is when one man gives money to the other which is in authority. It is done for
the purpose of insisting him to do something or to prevent
him from doing something. It is the most common income of most of the
public officials of our country.
3) Cybercrime: Cybercrime is the biggest cause leading to these type of crime
in India. It is the latest problem prevailing in the cyber
world. Cybercrime is the crime which is related to ‘computer networks’. With
the rapid increase of advancement of technology there is also a rapid increase
in the crime related to the technology. Cybercrime involves the persons who are
expert in computer related technology. And it is committed against the victim
directly or indirectly to cause a harm to his reputation or to harm in physical
or mental way using internet, networks and other
technological sources.
Cybercrime threatens the nations as well as the person’s security and
financial status. Cybercrime can cause huge financial
loss to the country. Not only the financial loss but it can
# Hacking,
# Child pornography,
# Copyright infringement, # Cyber terrorism,
# Cyber stalking are some of common examples of cybercrime.
4) Money Laundering: Money laundering is a crime in which
the criminals disguise
the identity of the money. In
this crime, criminals try to hide
the original ownership of the money and
the place where they obtained that money by illegal
means. Laundering is done with the
intention of making that money came from legal sources. In simple words money
laundering means to show the illegitimate money as legal money. For instance if a person
obtain money from black
marketing, trafficking of illegal goods the money will be considered ‘dirty’
and he cannot deposit into the banks as it may seem suspicious if he directly
deposit money into the financial institutions because
he had to create statements and records stating
that where the money came from. Money laundering involves three
steps:
# Firstly, the
owner of the money obtain the money
from some illegal means and deposit into the bank by some way.
# Then through multiple
transactions the transfer
of money is being done. # Lastly, they return the money
into banks to make it legitimate.
5) Tax Evasion: Tax evasion is committed
with an intention to conceal one’s actual taxable income and one’s original
position to the authorities. This concealment of income is done to reduce the tax
liability in the eyes of government. In simple words it means
to hide the money obtained
from the illegal means in order to reduce one’s liability to pay tax and to
show low income to the tax authorities. Tax evasion has a negative
impact on the social values
as it
6) ? Identity Theft: Identity
theft is one of the easiest type of crime these days. Due to advancement of
technology it is very easy to access personal information of anyone. Identity
theft is the crime in which the criminal access
unauthorized information such as name, address,
phone number etc. and use this information to gain money. In simple words
identity theft is committed by using some other person identity to commit fraud
or to gain money by illegal means.
White Collar Crime In Different
Professions:
1) In Medical And Health:
# Making of false medical certificates by the doctors.
# Fake and
intended prolong the treatment in order to increases the bills.
# Sex discrimination of the child by the doctors on the compulsion of the patient
to gain money. # Delaying of time by doctors to increase the amount of
money in the bills.
# Sale of
sample medicines which are not
allowed to the chemists.
2) In Legal Profession:
# Fabrication of forged documents.
# Threatening the witnesses of the
other party.
# Violation of ethical standard of legal profession to gain money.
3) In Education:
# Collecting huge sums of money in the name of donations by students in
order to give them admission.
# Merit
based admission is replaced
by donations.
# Collect
huge amount of money
in the name of government grants.9
8 https://corporatefinanceinstitute.com/resources/esg/white-collar-crime/
9 https://blog.ipleaders.in/white-collar-crimes/#White_collar_crime_in_other_professions
Legislations Against The White Collar
Crime In India:
Government has made various
legislation for identifying white collar crime.
These legislation contains
punishment regarding these crimes.
# Companies Act,
1960. # Income Tax Act,
1961.
# Indian
Penal Code, 1860. # Commodities Act, 1955.
# Prevention of corruption Act, 1988.
# Negotiable Instrument Act,
# Prevention of money laundering Act, 2002. # IT Act,
2005.
# Imports and Exports
(Control) Act, 1950.
Sutherland's Legacy
The cumulative effect of Sutherland's contribution has given earth
breaking concept to white collar crimes with defined body, substantive content
and renewed focus to gather the momentum.
Sutherland's concept of White- Collar Crime provided
conceptual tools, theoretical foundations and database for later
researchers to build upon. Thus, Sutherland's legacy by virtue of his pioneer
quality set the tone, pace, texture, direction
of later research
and debate in the field.
Criticism of Sutherland's Definition Of White- Collar
Crime
Sutherland definition of White- collar
crime:
A crime committed by person of respectability and high social status in
the course of his occupation was fraught
with objective ambiguity and has not given subjective value judgement. The
term respectability and high social status was not capable of precise
definition and is subjected to much less objective measurements.
While some scholars criticized Sutherland's definition because the
definition has included deviant behaviour and has covered a broad range of
diverse and inconsistent behaviours that did not considered them as criminals.10
Conclusion
It is clear from the above discussion that white- collar crime are
different from the other type of offences as these offences
cause harm in a greater
magnitude if compared
to the magnitude of the traditional crime and these offences
do not represent the cases
of positive aggression or the cases of invasion, though these offences
generally do not create a direct or immediate injury but actually they create
such type of great danger which may hamper
the economic growth of the country.11
After discussing the ambit of white-collar crime and contribution of Sutherland towards
White Collar Crime there
is a need for the establishment of some special
courts that would particularly
and exclusively deal with these types of offences and there should be effective
and speedy disposal of these types of cases so that the offender cannot
get away from the purview
of justice.
While concluding it is pertinent to note that in India there are several
problems of ill nourishment, corruption, poverty, illiteracy and exploitation
that are coming in the way of economic development of the country. If white-
collar crimes continue to harm the economic development of the country then we
will not be able to develop as whole.
White collar crimes are the crimes which cause a harm to the economy of
the country as a whole. It threatens the country’s economy
by bank frauds, economic thefts,
evasion of tax etc.
It not only affects the financial status
of a country or a person but It
has also a negative impact on the society. The various
crimes such as bribery, corruption, money laundering has affected society in a negative way.
10 https://www.legalserviceindia.com/legal/article-7541-white-collar-crimes-and-contribution-of-professor-
sutherland-in-the-development-of-the-white-collarcrimes
11 https://blog.ipleaders.in/white-collar-crimes/
Article Information
WHITE COLLAR CRIMES IN INDIA BY: RUTVIJ RAJESH YEWALE
Authors: RUTVIJ RAJESH YEWALE
- Journal IJLRA
- ISSN 2582-6433
- Published 2024/04/27
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
- Access Open Access
- License CC 4.0
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