What Is "White Collar Crime"?
"White Collar Crimes" are a category of criminal offenses that
typically occur in businesses or corporations, such as "insider trading,"
"antitrust violations," "computer fraud," "securities
fraud," and "money laundering." White collar crimes are
non-violent in nature, and generally involve some form of fraud or dishonesty.
These crimes are committed through apparently legitimate businesses. Sometimes
the principals of the business are involved in the crime, while on other
occasions the crime is committed by an individual or employee within a
business, without the knowledge of anyone else.
What Should Businesses Do To Prevent Or Respond To
White Collar Crime?
Businesses can impose safeguards, to check on the conduct of even trusted
employees. They can audit banking activities to ensure that employees
are not engaging in unauthorized transactions - even if the books balance,
there may be hidden transactions that would reveal questionable activities
by an employee. They can quickly respond to rumors or allegations of wrongdoing,
by launching an internal investigation, and by making sure that records
are preserved. A business that does not respond appropriately to criminal
activity, or allegations of criminal activity, may appear to be involved
in that activity. Particularly if your business is subject to state or
federal regulation, it is important to have appropriate compliance, reporting
and investigatory mechanisms, to handle any rumors or reports of illegalities
by employees. If a business does not wish to be held responsible for illegal
conduct, or wishes to diminish its responsibility, the best means of doing
so is usually to cooperate with any investigation of the wrongful conduct.
When Can A Business Be Charged With An Offense?
The answer to this question varies, depending upon whether the business
is being charged under civil laws or criminal laws. Any time a business
appears to have engaged in activities prohibited by antitrust laws, or
to have engaged in "racketeering conduct," having failed to
keep required records, having failed to comply with laws requiring certain
financial transactions to be reported to the government, or in a broad
range of other illegal activities, it may face a civil suit for its offense.
However, there may also be circumstances where a business or corporation
appears to be so heavily involved in criminal activity that a criminal
charge is filed against the business itself. This usually happens when
it appears that the managers and directors of the business were so involved
in, or so indifferent to, the illegality that the entire business appears
to have actively or tacitly condoned or committed the crimes.
The concept of "corporate criminality" grew considerably in
the late 1980's, when deregulation left many businesses unchecked by the
government, and many businesses took advantage of the lack of regulation
or inspection by committing criminal acts -- such as having their employees
work under exceptionally dangerous and illegal conditions, or by engaging
in rampant fraud or money laundering activities. This area has cooled
down somewhat, as the federal government has returned to enforcement of
its regulations in the wake of serious crises, such as the "savings
and loan" disaster.
How Can A Business Be "Punished" If It Is
Convicted Of A Crime?
A business can typically be punished only in financial terms. However,
it is possible to impose a "corporate death penalty" by imposing
fines so large that the business is forced to shut down. It is also possible
to impose a term of "probation," during which the business can
be carefully monitored by the court.