Too many Crooks spoil the Broth – The Menace of White Collar Crimes

White Collar Crimes

Persons of a noble profession, eminent practitioners, industrial capitalists, evil hoarders, the speculators, the profiteers, the black marketeers and visionaries of the idealistic world, however worthy and influential they may be, just to accumulate more and more money through crooked means, tend to bring a blot upon the society and become the worst enemy of the nation. They should be dealt with sternly. A well-distinguished criminologist and sociologist Sir E.H Sutherland, in 1939 remarkably depicts white-collar crimes as those crimes committed by the people belonging from the higher strata of the society, respectable, esteemed, and admired in their noble profession. 

In a general context, white-collar crime can be defined as those crimes committed by the people belonging to the higher social status of the society, carrying malice/ill will and causing the breach of trust during the course of their profession or business. These crimes are generally committed in complex and large institutions. The persons involved in such crimes tend to have vivid knowledge in the global fields of finance management, engineering, medicine, information technology, etc., white-collar criminals are such organized criminals who are often engaged in unlawful activities viz fake employment placement rackets, black marketing, medical deviant activities, tax evasion, cybercrime, credit card fraud and they also bring about large profits and transfers the incentive/ unlawful gains to legitimate activity through money laundering

Such a criminal tries to commit the offense in his field of operation. He commits these crimes generally, in his profession, business, trade and these sort of people do not belong from any criminal background rather they are decent people who in their inquisitiveness try to generate money through unscrupulous means that can be in the form of force, coercion, or with arms or ammunition. They commit these crimes holding such privileged positions and abusing such dominant power.

Due to the varying advancements in the political, social, economic, and technological sphere as well as the loopholes in the enactments, procedures, and policies of different countries, these hardened criminals irrespective of the territory, have brought these white-collar crimes in the national and international arena. These organized criminal groups are taking full advantage of the digitalized and globalized markets, dismantling trade barriers, and the liberalized migration policies, high-tech communicated equipment’s and sophisticated electronic techniques to grow and spread their deviant illegal activities.

Major types of White Collar Crimes in India

Advancements in commerce and technology have promoted the growth in white-collar crimes commonly known as cybercrimes. Corruption, bribery, fraud, embezzlement are the major white-collar crimes in India. Some of the other forms of white-collar crimes involve –

  • Bank Fraud
    The term Bank Fraud means engaging in such activities in order to defraud a bank using illegal means to obtain assets held by such financial institutions. 
  • Blackmail
    Blackmail means extorting money by using force, coercion, or threatening some person to cause physical or mental harm or to disclose his secrets or favors. 
  • Bribery
    Bribery means offering valuables such as money, goods, services, or any gift to someone in order to gain access to his commands and actions. It involves both- the one who is offering and the other accepting such favors. 
  • Cyber Fraud
    Such activities involve hacking or stealing information or getting access to another person’s privacy and confidentiality which usually benefits the doer. 
  • Embezzlement
    When someone entrusted with money or property uses it for his own use, it is embezzlement and shall also amount to criminal breach of trust and misappropriation of property. 
  • Extortion
    It involves the practice of illegally obtaining other property by the use of force and coercion. 
  • Insider-Trading
    The practice of illegally buying and selling securities of the listed public company by a person who has privileged access to confidential information concerning the company’s financial conditions and plans.  
  • Money-Laundering
    It involves the commission of an active and engaging in transactions designed to obscure the origin of money, especially the money that has been obtained through unlawful means 
  • Evasion in taxes
    Tax fraud means the exploitation of tax rules to minimize tax payments. It can also be termed as the illegal avoidance of paying taxes especially by providing wrong information or by making a false declaration of income.
  • Counterfeiting
    An act of counterfeiting, especially of false money intended to deceive or carry the appearance of being genuine.
  • Insurance Fraud
    The falsification or padding of insurance claims, receiving insurance policy-based compensation by intentionally causing an event due to which the claim for the compensation for the insured property becomes seemingly lawful and by concealing the ill intention.
  • Public Servant unlawfully involving in trade practices.

Penalties against White Collar Crimes

India is a developing country and such crimes are becoming detrimental to its development along with poverty, poor health, etc. These crimes require immediate intervention by competent authorities by the government by not only enforcing strict laws, heavy penalties, and stringent punishments but by also ensuring the proper implementation and execution of governmental actions. The white-collar crimes which are general to the Indian trade and commerce, are hoardings of profiteering and black marketing. The violation of the foreign exchange management act and its regulations pertaining to import and export laws are frequently resorted to for the sake of huge profits and marginal gains. 

Moreover, adulteration of edibles and drugs which cause irreparable loss to the health of the public at large is another common white-collar crime in India. Such crimes become difficult to prove, due to lack of evidence and lack of resource to the administration because they often involve sophisticated systems and chains at different hierarchical levels which are involved in the commission of a crime.

The government of India has adopted various measures, enacted and introduced various legislation involving regulatory mechanisms to govern such violations, which will lead to white-collar criminality. Some of the special enactments governing them are the Essential Commodities Act, the Industrial (Development and Regulation) Act, The Import and Exports (Control) Act, the Foreign Exchange (Management) Act, the Companies Act, Prevention of Money Laundering Act. Further the general criminal law i.e., the Indian Penal Code contains provisions to eliminate crimes and their respective punishments to the offender involved in such crime such as Bank Fraud, Insurance fraud, credit card fraud, etc.

The Reserve Bank of India has given various directives under various regulations which are to be strictly adhered to, by the commercialized banks. The banks and other financial institutions are required to keep and maintain the records of transactions for a period of ten years. To eradicate cyber-crimes, Information Technology Act, 2000 has been enforced to provide legal recognition to the authentication of information exchanged in view of commercial transactions.

Section 43 and 44 of the Information Technology Act provides the penalty for the following offenses – unauthorized copying of an extract from any data, unauthorized access and downloading files, the introduction of viruses or malicious programs which cause damage to a computer system or network. It also talks about the denial of access to an authorized person to a computer system. Further, helping any person to facilitate unauthorized access to a computer. Though the focus of the Information Technology Act is wide which involves one field of cybercrime, this Act contains provisions that deal with and provide measures to curb white-collar crimes.

The Effects

  • Effect on the company
    White Collar crimes bring damage to the companies. In order to revert back to the original condition, the companies tend to raise the cost of production of goods and services which eventually results in a decrease in the number of consumers for that product. As the law of demand states that, other things being equal when the price of a commodity rises, its demand would fall and when the price lowers, its demand would increase.
  • Effect on the employees
    White-collar endanger the working conditions of the employee. The employees tend to lose faith and trust towards the company as the employees begin to believe that the company’s involvement towards the commission of such illegal activities is hazardous to them as well as a matter of fact, such crime can be disclosed at any spur of the moment.
  • Effect on customers
    There is a huge decline in the relationship between the company and the clients which result in loss of rapport of the company. There arises a doubt in the mind of customers whether the product which they are optimizing is safe and secure. This arises due to the increase in the number of white-collar crimes.
  • Effect on society
    Society becomes polluted because of the crime committed by the descent persons belonging to the profession or business. This creates chaos as the individuals begin to lose faith in one another as the persons who are responsible for uplifting the right technology and progress of the development of the country are the only ones engaged in such malpractices.
  • Effect on offenders
    The authorities have shown no consensus on the amplitude and the definition of white-collar crimes of those involving a wide range of crimes. There are no accurate statistics and databases available to analyze the causes and effects of such crimes and therefore government fails to tackle and take exact measures to eradicate them. All though these crimes are on their surge, they are generally not reported by the authorities. As a matter of fact, these crimes have no eyewitnesses and the offenders usually commit these crimes in isolated rooms while sitting in a closed room or in their personal space using their systems and other devices, and nobody could even know about the happenings of the illegal acts which in leads to difficulty in tracking the offenders. Unlike in blue-collar crime, the punishment is much stern, these loopholes give feasibility to the offender to commit crimes at high ratios. They roam freely, giving a great danger to society.
  • Effect on the temperament of the affected person
    Mostly it is witnessed that the target to such crimes is the elderly people who have little knowledge or no knowledge of the technology and their cognitive ability which is less than that of a younger generation which results as a trap for the elder ones. Sometimes the loss incurred by them is unbearable and can never be undone, which also leads them into various anxiety attacks, depression, insomnia, and even suicidal thoughts.

Causes and reasons for the growth of White Collar Crimes in India

The situational pressure, loopholes in the present system and legislations, lack of proper implementation of laws, existing competition in the market, economic instability, the inherent characteristic or desire of extorting more and more money is the general perception of the people behind the commission of the white-collar crime. There may be other reasons as well which are discussed below:

  • Mindset that the white-collar crimes are not as grave and serious as blue-collar crimes
    People have a general perception in their minds that the actions performed by them are not as fatal as other organized crimes that result in the death of the person and do not resemble street crimes.
  • Growing rate of technology
    With the immense increase in technology and digitalization, the experts of such tend to misuse it and hamper the life of ordinary people who optimize such devices for their ease. The rapid rate in the growth of technology, business, and political pressure has evolved newer ways for offenders to commit a white-collar crime, it has made it easy, swift to inflict harm or cause unbearable loss and also gives disastrous and prolong effect to the victims at large which results in a decrease in competition for the product in the market.
  • Lack of awareness in the elder generation
    The conventional nature of crimes is much more different from such organized nature of the crime. People who lack knowledge and are not aware of such crimes ultimately become victims of such crimes.
  • Not realizable
    Some people are of the broader view that the system and the government regulations are such which creates an appreciable adverse effect on the competition in the market, they justify themselves that the governmental bodies are ignorant of the practical issues of competing in this globalized free enterprise system.
  • Necessity
    The reason behind committing such acts can be one in the name of need, to satisfy the economic conditions, needs of the family, to maintain a status quo and ego of attaining the higher social society which resembles them to the people of other higher strata of society.


There is no proper definition of white-collar crimes in India despite the enactment of special laws. They are of such nature that provides imminent danger and hampers the conditions of the people in the society. It tends to degrade the country’s finances and other economic conditions by bank frauds, evasion of taxes, economic thefts, etc., also our executive system is too slow in solving and investigating such organized crimes which leave no cues and evidence behind.

The laws are also drafted and implemented in such a way that they mostly favor occupational criminals. With the introduction of new types of white-collar crimes and the growing pace, the judiciary should also set up special tribunals for the speedy disposal of such cases and the legislators should amend the existing laws and introduce stringent punishments for those involved in such activities. Various crimes such as bribery, money laundering, embezzlement, corruption, degrade, and brings a blot upon society. Government should also think about plausible solutions to create and bring awareness to people and should impose strict regulations regarding economic thefts of the country.

Editor’s Note
The article gives a brief analysis of white-collar crimes in India. The article also lays down a concise argument on the types of white-collar crimes as well as the effect of these crimes. The author focuses on the causes as well as the reasons for the growth of these crimes and the same is concluded with the way forward.