University of Cambridge

White Collar Crime – Yvonne Miller

Introduction:

According to Edwin Sutherland (1939) white collar crimes can be defined as those crimes that are committed by people of high status quo in the course of their occupation, some of the most obvious types of white collar crimes include bank frauds, bribery, measure and weight crimes, extortion, black mail, counterfeit, computer frauds and insider trading, Bank Fraudinvolves actions in which a person is involved in the activities whose purpose is to defraud a bank of its funds; Black mailinvolves a person demanding money from another person using threats such as injury of property or accusation of a crime or even the exposure of a secret.Bribery is another form of white crime which involves a person giving something of value to another person with the intent of influencing their actions or persuading them to undertake certain favors.

Computer frauds involves a person stealing information that is contained in a computer and this mostly involves information from banks and credit card information, Counterfeiting involves the copying or imitating another person’s item without the authority from the owners of the original item or copy, this happens mostly in the clothing industry and electronics.Embezz1ement of fundsinvolves the action of a person who has been trusted with the money of an organization and he or she decides to use the money for his or her own benefit and use.

Extortion is also another form of white crime in which it involves the obtaining property illegally from another person through threats or by force, Forgeryis another type of crime in which a person will use instruments such a counterfeit checks and securities in the attempt to defraud the recipient.

Insider Trading involves the use of confidential information for own benefits; most of these crimes involve the issues of shares in public corporations.

Money Laundering also another form of white crime, money laundry involves the transfer of money from such sources as drug transactions so that the money appears to be legitimate and the source of funds cannot be traced. Tax Evasion is another common form of white crime in which a person will fail to pay taxes or commits a fraud in order to pay less than required in form of tax. Weights and Measures crime is a white crime which involves placing items in the market at the same price with other despite having a lower measure in terms of weight and at the same time labeling them as having the same weight as the other items.

White collar crimes can be prevented and controlled, the law enforcing system has a major role to play in preventing these crimes, heavy fines and jail terms are one way in which these crimes can be controlled and prevented. In institutions where the occurrence of embezzlement and frauds occur there is need to increase auditing of accounts to early detect frauds and fund loss through these crimes.

This paper discuses means by which white collar crimes can be controlled and prevented, white collar can be controlled as depicted by the social control theory, the containment theory by Walter Reckless (1961), the rational choice theory by Clarke (1997), and the situational theory by Clarke and Hough (1980) and finally the social transformation theory by Wilson (1975). All this theory depicts ways in which white collar crimes can be controlled and prevented.

Controlling white collar crimes:

Penalties and jail terms:

The improvement and reinstating the penal code is one way in which a nation can reduce white collar crimes, through reviews on penal codes that depict high levels of fines to offenders and also longer jail terms to these offenders will help deter white collar crimes, however according to a study done by Wrinkle and Sorenson (1999) in Texas predicted that harsh penalties do not deter crime, they stated that there was no relationship between murder rates and the rates of execution and death penalties, Bailey (1998) also found out that there was no deterring effect between the rate of execution after Oklahoma had resumed the execution verdict and murder crime rates.

Therefore the imposition of hard penalties on white collar crimes may not be a good solution to deterring these crimes, it is evident from the study done by Wrinkle and Sorenson (1999) and Bailey (1998) where they studied the level of murder crimes and the rates of execution and death penalties, they found no deterring effect t of execution in Texas and Oklahoma.

Increased surveillance:

Institutions may decide to increase surveillance that aid in crime prevention, such activities may include auditing of accounts by external auditors in cases that involve embezzlement of funds in institutions, retraining staff so that there will be reduced frauds in an institution.

Social control theory:

The social control theory was developed by Travis Hirsch, this theory states that the socialization process helps individuals to develop social control and also help individuals to restrain from antisocial behavior, however he stated that there are three form in which crime could be controlled and this include:

  • Direct control:

This is the use of threats such as punishment for those who intend to involve themselves in criminal acts, compliance with the society’s norms and rules on the other hand will be rewarded by the society.

  • Indirect control:

This is the control or refrains from criminal behavior due to the superego or conscience; this is whereby an individual will refrain from criminal behavior due to their conscience or what they term as wrong and the repercussions of doing wrong.

  • Internal control:

This is another type of control that result from those who will influence the behavior of an individual, for example a person will refrain from criminal act due to the expected disappointment they will cause to their parents or those other individuals he or she has close relationships with.

  • Need satisfaction control:

This type of control is related to need satisfaction, when the all the needs of an individual are met then the individual will have no point of involving himself in criminal activities.

From the above explanation of the social control theory the occurrence of white collar crime can be prevented by direct control which involves increased threats of punishment, conscience will also help individuals to refrain from criminal acts, the close relatives will also restrain people from committing crimes and finally the need satisfaction which will lender the individuals not to involve themselves in crime.

For the white collar crimes there is need to compensate those who hold high offices with a sustainable amount of salary or wage, this will build control as depicted by the need satisfaction form of control, these officials will have no need to engage in criminal activity, direct control should also be reinforced through the judicial system and the police force, this will increase threats that will eventually reduce the occurrence and frequency of white collar crimes.

Judicial system:

The judicial system has a major role to play in the prevention and control of the white collar crimes, corruption in the judicial system has also resulted to the increased occurrence of these crimes, wealthy people who commit this crimes have the funds to hire and corrupt the judicial system to win their way out of prison, therefore it is important to eradicate corruption in the judicial system in order to control such crimes. Corruption can be reduced by increased salaries to judges and also the development of organizations which specializes ion dealing with corruption cases in the judicial system.

The containment theory:

The containment theory was developed by Walter Reckless (1961), this theory focuses on the development of containment of a person as a youth, and the containment is developed within the family of the individual and is formed by the age of twelve years, these social relationships with the family and the outside world of a youth, when the containment is strong and the motivation to crime is high, then it is highly likely that the crime will not occur, however if the containment is weak and the motivation to crime is high then it is likely that the individual will commit a crime.

According to this theory by Walter, crimes will occur due to low containment that was developed through the individuals youth, therefore it is important that the society take into consideration and undertake into the efforts of developing containment in the youth and this is especially by the family.

The situational theory:

This theory was developed by Clarke and Hough (1980); this theory defines the possible ways in which crimes can be prevented through making the crime more difficult, this is achieved through the use of campaigns that make more people alert of opportunistic crimes, this will make people more familiar with the possibility or the occurrence of a crime in their organizations and therefore this makes crime more difficult.

This theory gives the strategies that increases the risks associated with criminal behavior and at the same time reduce rewards from criminal behavior. This strategies help reduce these opportunities as more and more people become aware of the incidences in which such crimes occur and the opportunities that aid the offenders..

From this theory therefore it is clear that through campaigns and giving out information concerning crime to the wider society makes crime more difficult, when techniques used in white collar crimes are learnt by every person then this will reduce the occurrence of these crimes and at the same time make these crimes difficult. Example when all techniques of forgery are learnt, then more people has the knowledge of such situations and there will be a reduction in forgery cases.

Rational choice theory:

This theory was by Clarke (1997), it states that crime is not only deterred by the existence of harsh sentences and verdicts, it states that certainty of apprehension of these crimes and not the severity of punishment will lead to deterrence from criminal behavior. Therefore crime will be deterred by the certainty of the occurrence of punishment and fines and not the severity of the punishment.

According to this theory therefore white collar crimes can be deterred by the existence of certainty that if an individual commits a crime then certainly the punishment or jail term will definitely be accorded to him or her, therefore if the judicial system provide fair judgments towards such cases without exceptions then the occurrence of these crimes will reduce. Crime will therefore be prevented by use of certainty of punishment and fines as a result of criminal acts.

Social transformation:

Wilson (1975) states that there must be social transformation in order to reduce crime rates, according to him such transformation should include proper socialization of the children in the society, improvement in the detection and the increased arrest rates, and reforming the attitudes of the judges who are lenient to offenders, through this social transformation the levels of crime will reduce, this strategy will reduce the occurrence of white collar crimes as more and more arrests are made and the judges who pass sentences to such cases are not lenient. This according to Wilson (1975) will definitely result to reduced crime rates.

Conclusion:

The theories provided by various authors show how white collar crimes can be prevented, the social control theory by Travis Hirsch states that the socialization process helps individuals to develop social control and also help individuals to restrain from antisocial behavior, he states that there are three form in which crime could be controlled and this include direct control, indirect control, internal control and need satisfaction form of control.

The containment theory by Walter Reckless focuses on the development of containment of a person in his or her youth, and that the containment is developed within the family of the individual, when the containment is strong and the motivation to crime is high, then it is highly likely that the crime will not occur, however if the containment is weak and the motivation to crime is high then it is likely that the individual will commit a crime.

The situational theoryby Clarke and Hough defines the possible ways in which crimes can be prevented, this through making the crime more difficult and this is achieved through the use of campaigns that make more people alert of opportunistic crimes, this will make people more familiar with the possibility or the occurrence of a crime in their organizations and therefore this makes crime more difficult.

Rational choice theoryby Clarke that crime is not only deterred by the existence of harsh sentences and verdicts, it states that certainty of apprehension of these crimes and not the severity of punishment will lead to deterrence from criminal behavior. Therefore crime will be deterred by the certainty of the occurrence of punishment and fines and not the severity of the punishment.

Finally the judicial system has a major role to play in the prevention and control of the white collar crimes, corruption in the judicial system has also resulted to the increased occurrence of these crimes, wealthy people who commit this crimes have the funds to hire and corrupt the judicial system to win their way out of prison, therefore it is important to eradicate corruption in the judicial system in order to control such crimes. Corruption can be reduced by increased salaries to judges and also the development of organizations which specializes ion dealing with corruption cases in the judicial system.

References:

J. Warring and David Weisberg (2001) White Collar Crime and Criminal Careers, Cambridge University Press, Cambridge

Ronald L. (1990) “Rational Choice, Deterrence and Social Learning Theory” Journal of Criminal Law and Criminology, 81(3), 653

Keel R.  (1997) Rational Choice and Deterrence Theory, Prentice Hall press, New York

Wilson J. and Herrnstein J. (1985) Crime and Human Nature, Simon and Schuster press, New York

Gottfredson and H Travis (1990) a General Theory of Crime, Stanford University Press, Stanford

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