WHITE COLLAR CRIMES IN THE CYBER WORLD -AN ANALYSIS BY: PRABHJOT KUMARI
WHITE
COLLAR CRIMES IN THE CYBER WORLD
-AN
ANALYSIS
AUTHORED BY:
PRABHJOT KUMARI*
Abstract
The weaponisation of technology
reached heights these days which is leading towards the commission of number of
crimes. White collar crime is one of those crimes which is in the limelight in
present scenario. Dynamicity in the concept of crime from the ancient times to
till date demands the apt stack of some rules and regulations which will help
in curbing such devastative crimes. The crime which requires no physical force
but still emerging as antagonistic factor towards the society. The mind game is
all that is happening under the blanket of technology. Money laundering, banking
frauds, copyright infringement, trade secret thefts etc. are the common examples
of white collar crimes Despite the settled laws and legislations these crimes
are very common in news highlights everyday. The need of the hour is to revisit
these legislations and to come up with something which will have a greater
impact on perpetrators.
Keywords: Crime, Cyber Crime, White
Collar Crime
Introduction
Cyber. It is the inevitable prefix
that currently defines our world. From people's privacy to interstate relations,
the word "cyber" dominates headlines and discussions – so much so
that we risk becoming paralyzed by the magnitude of the problems we face.
Despite many remaining questions about the future of cybersecurity and
governance, we must keep in mind that international cooperation is a key
element in addressing the growing threats of cybercrime. Online exploitation
and abuse of girls and boys; black cyber markets for the buying and selling of
illegal drugs and firearms; Ransomware attacks and human traffickers are using
social networks to attract victims. The unprecedented scope of cyber crime – crossing
borders into our homes, schools, businesses, hospitals and other critical
service providers – only amplifies the threats.[1]
Keeping people online more secure is
a huge task and no entity or government has the perfect solution. Nevertheless,
much can be done to intensify prevention and improve the response to
cybercrimes, for example:. Build capacities, mainly law enforcement to cover
possible legal gaps, particularly in developing countries;. And strengthen
international cooperation and dialogue - between governments and the United
Nations, as well as with other international and regional organizations, INTERPOL,
business and civil society. Crimes related to cybercrime, such as the spread of
malware, ransom ware, and hacking, the use of other programs for financial data
theft, online child sexual exploitation and abuse, all have something in common
beyond the term "cyber ": all are crimes. Police, prosecutors, and
judges need to understand these crimes and must have the appropriate tools to
enable them to investigate and prosecute offenders as well as protect victims.
They must also be able to process and prosecute cases.[2]
The development
of criminology has provided various theories regarding criminal behavior and
the reasons why crimes occur. One such theory was the rational choice theory
where a person commits a crime because of his circumstances. These situation-based
theories focus more on the social and economic determinants of crime, such as
family background and wealth levels. But this idea was criticized by
criminologist and sociologist Edwin H. Sutherland when he introduced and
popularized the term "white-collar crime" in the year 1939. He
defined the term as a crime committed by a person of respectable and high
social status. His job or business course. These crimes are committed by
unethical people in the desire to get maximum profit from their business, job
or profession. These crimes are mainly committed for financial purposes.
Examples of white collar crimes are bank fraud, blackmail, bribery, cellular
phone fraud, computer fraud, counterfeiting, credit card fraud, money schemes,
fraudulent employment placement rackets, counterfeiting, health care fraud,
etc. White collar crimes have developed their own dimension with time. The
major change in this category of crime happened when the invention of
technology blessed us with the Internet. The rise of the Internet has given
rise to various computer crimes or cyber crimes. This leads to a mix of white
collar crimes and cyber crimes.[3]
Characteristics
of common white collar crimes
When it comes to white collar
crimes, fraud is by far the most prevalent. To commit fraud, someone must
knowingly make a false statement or omit relevant information. Trusting that deception
results in one losing money. Common types of deception include:
2.
Bankruptcy
scams involve unlawful debtor harassment, creditor fraud, and asset
concealment.
3.
Accepting
bribes in the health care industry, or charging for services not provided or
unnecessary equipment or personnel. All sectors of the healthcare industry are
vulnerable to these types of scams. This includes clinics, nursing homes,
pharmacists, laboratories, mental institutions, emergency services, physicians'
offices and even patients' residences.
4.
Telephone
solicitation (or "telemarketing") is a form of fraud where potential
victims are contacted primarily through the use of the telephone.
5.
Using
another person's credit card details to make illegal transactions is known as
credit card theft.
6.
Insurance
evasion refers to the practice of making exaggerated or fictitious claims
against an insurer.
7.
Use
of the postal system for fraudulent purposes
8.
Public
housing, agricultural programs, military procurement, educational programs, and
other government activities are all vulnerable to government fraud, which can
take many forms, such as bribery in contracts, collusion between contractors,
false invoices, misverification of standard parts. of, and replacement of
counterfeit parts.
9. Commercial credit fraud,
counterfeit checks, counterfeit movable instruments, mortgage fraud,
verification and fake applications are all examples of financial fraud. Ponzi schemes and theft from
investment funds are examples of stock scams.
10. Manufacture of counterfeit
currency and production of counterfeit luxury goods are examples of
counterfeiting.[4]
Most crimes on the Internet
are white collar crimes because they do not involve any violence and are only
financially motivated. Before the Internet era, these crimes were beyond the scope of
computers only but now they are occurring at a wider pace through the Internet
and the Internet world. Any crime committed on the internet is called cyber crime. White-collar, cyber crimes
appear innocent because there is a lack of violence and they do not occur on
the streets. The
laws for these crimes have increased their dimensions and we are making more
stringent laws for these white collar, cyber crimes. Many white collar crimes occur
every day on the Internet.[5]
Reasons for the increase
of white collar crimes in India The main reasons for the increase in white
collar crimes in India are greed, rivalry and lack of adequate laws to prevent
such crimes.
1.
Greed: Machiavelli,
considered the founder of modern political philosophy, was adamant that people
are greedy by nature. He claimed that a man could more quickly and easily forget his
father's demise than lose his inheritance. The same is true when white collar crimes are
committed.
2.
Easy, long and fast effect:
The pressures of business, politics and rapidly increasing technology have
given criminals access to new ways of committing white-collar crimes. Thanks to technology, it can
now be faster and easier for a person to be harmed or lose something.
3.
Competition: After
reading Charles Darwin's "On the Origin of Species", Herbert Spencer
coined the expression "survival of the fittest" to describe how
evolution works. This
shows that there will always be competition between species, and the best
survivor will be the one that can best adapt to the environment.
4.
Lack of strict laws:
Law enforcement appears reluctant to pursue these cases as investigating and
tracking these crimes becomes a challenging and complex task, as most of these
crimes are made possible through the internet and digital methods of transfer
payments.
5. Modern technology: One of
the expectations of modern technology is ease of doing business. In a way, this expectation
also applies to white-collar crimes, making it possible for them to reach more
people and commit crimes on a larger scale without attracting the attention of
the law.[6]
Major White Collar Cyber Crimes
In India
1. Computer
Intrusion (Hacking): This is one of the white collar crimes, cyber crimes
that occur instantly over the internet. Hacking is a term generally defined as
accessing a computer or the Internet without proper authorization. Hacking is
the manipulation of the internal workings of information technology. Hackers
attack user's private information for financial gain and monetary gain. The act
of hacking also has other purposes such as someone accessing their family's
email account, technically they would be account hackers. Sections 65 and 66 of
the IT Act in India deal with the act of hacking, while Section 70 of the Act
defines the punishment for it. Hacking includes various activities as per law
such as introducing malicious software, destroying information, downloading
copies, interference, unauthorized access to information. The revolutionary
case in the field of hacking was the case of September 1999 when some hackers
broke into the website of NASDAQ and American Stock Exchange. The case has been
called a "bold electronic insult to the world's financial markets."
The crime of hacking creates a cycle of crimes, if it is committed with the
intention of committing further crimes, parallel to those crimes are the crimes
of theft, cheating, forgery, etc. There are various forms of hacking such as
disruption of information systems, execution of malicious software that
modifies or destroys data for example "I Love You, Melissa" a virus
which was a controversy in 1999 after it shut down the internet for a few days
and Other similar "Trojan Horses".[7]
2.
Cyber/Internet Fraud
Another type of
white collar crime on the Internet is cyber fraud which occurs when someone
intercepts/hacks another person's computer to access personal information which
mainly includes credit card information, social security numbers and other bank
accounts. Information
is included. Like
cyber hacking, fraud is also unknown. Online auction fraud is also a crime that a
person may commit unknowingly, or may be unaware of the serious consequences. Another category in the list
of frauds is wire fraud which occurs through email, text, fax, etc. This involves interstate
communications and is illegal. This can be against both the individual or the
corporation. The
banking and financial sector is a fraud against the corporation. In India, we
do not have any direct law for cyber fraud except fraud related to e-commerce
under Section 44 of the IT Act, which is also not a criminal liability. But, as IPC Section 25 (Fraud Act), Sections 415 and
416 (Fraud by Impersonation) and Sections 417 to 420 (Serious Fraud) can deal
with internet fraud, it comes under IPC Section 415 i.e. “Fraud”. Debate over the word
"fraud". The act of cyber fraud can also be dealt with in IT Act
Section 71 i.e. penalty for misrepresentation.[8]
3.
Identity theft
This white collar
cyber crime deals with data theft or data related crimes. This happens when one's
identity is taken over by another. Identity theft takes different forms such as
IP spoofing, page jacking, cross-site scripting, etc. IP spoofing involves a person
impersonating a victim's computer to access privileged protocols without
authorization, this is done with the help of software. Page jacking is the
copying of a website so that the user lands on another site, thinking it is a
different site. This
is done by reprogramming the logo or link of that particular site. Cross-site
crossing forces a user's computer to send restricted information without that
user/owner's permission. These identity thefts are primarily committed to gain
financial or information-based gain. These white-collar crimes occur instantly on the
Internet without our knowledge. The largest case of identity theft occurred in
January 2009, when a man named Albert Gonzalez was arrested for launching a
global scheme to steal data from 130 million credit and debit cards by hacking
7 major companies. He
is one of America's most notorious cyber criminals. Crime boss. In India, data
theft falls under Section 66 of the IT Act before the 2008 amendment. But after amendment, new offenses
have been introduced in Sections 66A to 66D in the IT Act. In Gurgaon, India, only 70
cases of identity theft and fake social networking profiles have been reported
so far in 2012.[9]
4. Phishing
This is done
primarily for financial gain by electronically impersonating someone else. This can be done by using
someone's login information to gain access to personal information, or by using
or cloning someone else's digital signature in electronic contracts without
authorization. Mobile
SIM cards are made so that an account can be created using someone else's
information. The most revolutionary identity theft was committed by an Indian
married couple in America, Amar Singh and Neha Punjabi Singh. They have scammed $13 million
by skimming credit cards and phishing through the internet. Identities extracted online
have been sold to different people for stays in 5-star hotels or hiring
expensive cars or private jets. A shopping market has been created for the sale
of these identities at discounted prices. There are mainly 3 types of fishing –
dragnet method, rod and reel method and lobster pot method. A recent trend of
phishing has emerged in the name of vishing. This is called voice phishing,
where someone will call you and deceive you by pretending to be from a bank and
then extracting detailed account information. These calls are linked to the
fraud control department. This is a very disturbing and complex system of
phishing where a person gives away his/her information without knowing and then
has to suffer huge financial and financial losses.[10]
5.
Copyright theft
This is one of the
most common and frequent white collar crimes that occur online. From time to time people
distribute, download, and share copyrighted data on the Internet. The most widely used copyright
data download hub is Torrent. This activity attracts intellectual property laws
that can include everything from trade secrets, music, movies, and more. This is a widespread issue
with millions of criminals worldwide, with law enforcement facing pressure from
media companies to crack down on piracy criminals.[11]
The top most white
collar crimes are as follows:
1.
Securities Fraud by Harshad Mehta (1988-1995)
From 1988 to 1995, Indian stockbroker Harshad Mehta masterminded a significant
securities fraud. Mehta
exploited loopholes in the banking system to manipulate stock prices to make
illegal profits. They
artificially inflated the value of some shares by buying shares with borrowed
money and simultaneously selling them at higher prices, a practice known as
circular trading. This
inflated stock prices by creating fake demand. Due to Mehta's actions, the
stock market witnessed a boom and reached record highs. However, journalist Sucheta
Dalal exposed the fraud, causing the market to collapse. When Mehta was detained in
1992, he was charged with forgery, fraud and breach of trust. [12]
2.
2G Scam The 2G scam, one of India's largest
corruption scandals, relates to irregularities in the distribution of licenses
for 2G spectrum used for mobile phone services. This happened between 2007 and
2008, while A. Raja
was the Communications Minister at that time. The scheme involved charging
low fees for licenses and favoritism while granting them, resulting in huge
losses to the government exchequer. The Comptroller and Auditor General (CAG) had
estimated the loss to be around Rs. 1.76 trillion, or about $39 billion. The scandal sparked public
outrage, inquiries and ensuing legal actions. Several people, including
government officials and corporate executives, were accused of participating in
conspiracy and corruption.[13]
A
Contributing Factor – The Internet
Along
with the explosion of the Internet and ever-expanding technology has also come
a rise in "cyber crime" – which includes myriad online fraud schemes
and various forms of "phishing" for people's personal information. The crime of identity theft. Cyber crime
is basically any crime that is committed with the aid of computer technology.
It's hard to keep in mind that the term "hacking" – where a computer
criminal breaks into a large database, such as a retail store's credit card
records, to steal both identifying information and money – did not even exist
in mainstream culture. 30 years ago. Furthermore,
many people consider the terms "phishing," "email scam" and
the ubiquitous "cyber crime" to be foreign. Computers gave us tools and capabilities that did not even exist
before. However, "progress" always comes
with a price - and the price tag for our computerized and cell phone-connected
world is a whole new category of crimes that, like computers and cell phones,
did not exist until the advent of the new Were not.
Technology has made such crimes possible.
Measures to Control White Collar Cyber
Crimes
Although
with the passage of time and improvement in technology, easy and user-friendly methods
have been provided to the consumers for their daily activities but at the same
time it has given rise to the harsh world of security threats by various
information technology agencies like hackers, crackers etc. Methods have been introduced to curb such destructive activities
to achieve the main objectives of the technology to provide some sense of
security to the users. Some of the basic key measures
used to curb cyber crimes are as follows:
1.
Encryption: It is considered an important tool to protect data in
transit. By
this method plain text (readable) can be converted into cipher text (coded
language) and the data recipient can decrypt it by converting it back into
plain text again using the private key. This way no one except the recipient who has the
private key to decrypt the data can gain access to the sensitive information.
2.
Synchronized Passwords: These are password schemes, which are used
to change passwords on user and host tokens. The password on the
synchronized card changes every 30-60 seconds making it valid only once for a
log-on session. Signature,
voice, fingerprint recognition or retina and biometric recognition etc. are
other useful methods introduced to generate passwords and pass phrases.
3.
Firewall: It creates a wall between the system and potential
intruders to protect classified documents from being leaked or accessed. This will only allow data to
flow into the computer that has been recognized and verified by one's system. It allows access to the system
only to people already registered on the computer.
4.
Digital signatures: These are created through cryptography by
applying algorithms. It has major use in the banking business where customer signatures are
identified using this method before banks enter into large transactions.[14]
Preventive Measures
Prevention is
always better than cure. Therefore, it is always better
to be careful while using the net. Shailesh Kumar
Zarkar, technical advisor and network security consultant, Mumbai Police Cyber
Crime Cell, advocates the 5P mantra for online security: Precaution,
Prevention, Protect, Preserve and Persistence. “Take
security seriously,” he says. "If you protect
your customer's data, your employee's privacy, and your company, you are doing
your part in the larger scheme of regulating and enforcing rules on the Net
through our community." A citizen should keep
the following things in mind-
1.
Avoid disclosing any information related to yourself to prevent
cyber stalking.
2.
Always avoid sending photos online especially to strangers and chat
friends as there have been incidents of misuse of photos.
3.
Always use latest and updated antivirus software to avoid virus
attacks.
4.
Always keep a backup of the volume so that there is no data loss in
case of virus contamination
5.
To avoid fraud, never send your credit card number to any site that
is not secure.
6.
Always keep an eye on the sites your children are accessing to
prevent any kind of harassment or perversion among children.
7.
It is better to use a security program that gives control over
cookies and the information sent back to the site because leaving cookies
unchecked can prove fatal.
8.
Web site owners should monitor traffic and check for any
irregularities on the site. This can be achieved by deploying host-based
intrusion detection tools on servers.
9.
Using a firewall can be beneficial.
10.
Web servers running public sites should be physically separated and
protected from the internal corporate network.[15]
Conclusion
White collar crimes are
generally committed by high profile persons who have reached a level where they
are confident about not getting caught or by marginalized group of persons who
have no resources to live a peaceful and happy life in this modern world. The
need of the hour is to take strict measures to curb such antagonistic activities
in our society. This is only possible with strict and apt law enforcement. Law
enforcement agencies should come up with supportive hands to help those who got
defrauded and to punish those who committed such activities.
*Assistant Professor of Law,
Department of Laws, Guru Nanak Dev University, Regional Campus Gurdaspur,
Punjab
[1] ARTICLE:
Acting to stop cybercrime (unodc.org) accessed on 02-11-2023
[2] ibid
[3] White Collar
Crime in Cyber Crime - iPleaders accessed on 06-11-2023
[4] Gupta Himanshu Volume 25, March
2023 ISSN 2581-5504 www.penacclaims.com Page “White Collar Crime and India-Legal
Insight”
[5] White Collar
Crime in Cyber Crime - iPleaders accessed on 06-11-2023
[6] White-Collar
Crime in India Overview, Types, Reasons (vakilsearch.com) accessed on
07-11-2023
[7] White Collar
Crime in Cyber Crime - iPleaders accessed on 07-11-2023
[8] ibid
[9] White Collar
Crime in Cyber Crime - iPleaders accessed on 07-11-2023
[10] ibid
[11] White Collar
Crime in Cyber Crime - iPleaders accessed on 07-11-2023
[12] The
Law Advice - Articles - White-collar crimes in India accessed on 07-11-2023
[13] ibid
[14] White
Collar Crimes - cyber crimes (legalservicesindia.com) accessed on
07-11-2023
[15] White
Collar Crimes - cyber crimes (legalservicesindia.com) accessed on
07-11-2023