“Power tends to corrupt and absolute power tends to corrupt absolutely” – Lord Acton

White Collar Crime defined by the most influential criminologist of the 20th century as “crime committed by persons of respectability and high social status in course of their occupation”. Thus misrepresentation through fraudulent advertisements, infringement of patents, copy rights and trademarks etc., are frequently resorted to by the manufacturers, industrialists and other persons of repute in the course of their occupation with a view to earn huge profits. Other illustrations of white collar criminality include publication of fabricated balance sheets of business, passing of goods, concealment of defects in the commodity for sale etc.

Sir Walter Reckless, an eminent American criminologist suggests that white collar crime represents the offences of businessman who are in a position to determine the policies and activities of business.

Some authorities suggest that white collar crimes are committed by persons of status not for need or greed. Wherever citizens of particular community become incurious to the working of their government, grafts, corruption and alliance between public servants and the criminal world are common phenomenons resulting into breach of trust, fraud and other malpractices. There is yet another important point in the context of white collar crime. At times the members of the society themselves knowingly or unknowingly contribute to the commission of various white collar crimes. Wrongful gratification to the public servants to get the work done quickly and black marketing in times of scarcity are some of the common examples of the white collar crime.

Contributing Factors of White Collar Crime –

  1. Earning huge profits – The problem of white collar criminality has its roots the competitive business community which tries to oust their opponents in order to gain huge profits. These types of crimes are committed merely for the sake of necessity. Thus, most of the private educational institutions in India which receive public-aid furnish accounts simply for the sake of retaining their existence.
  2. Financial gain- White collar criminality is also rampant in insurance business where both the insured as well as the insurer earn considerable profit by making false and fabricated claims such as intentional house burning, automobile destruction and even murders are planned by the persons of respectable society for the sake of making good fortunes for themselves.
  3. Light Punishment – Sutherland says that the only distinguishing feature of this type of crime is the temptation for considerable material gain with little or no loss. This again gives a misleading impression that the executive and judicial authorities who are concerned with the prevention of crime react favourably to the upper and middle class society and dispose of white collar criminals with mere censure or admonition while the other criminals are subjected to severe penal sanctions under the law without being given any pre-warning.

Position of White Collar Crime in India –

White Collar criminality has become a global phenomenon in recent times. Like any other country, India is also equally in the trap of white collar criminality. The reason behind this massive increase in white collar crime is to be found in the economic and industrial growth and also the changing socio-economic structure of the society couples with increase in wealth and prosperity has furnished the opportunities for such crimes.

The Report of the Vivin Bose Commission of Inquiry into the affairs of Dalmia-Jain group of companies in 1963 highlights how these industrialists indulge in white collar crimes such as fraud, falsification of accounts, tampering with the records for personal gains and tax evasions etc. Similar observations were made by Mr. Justice M.C. Chagla about big business magnate Mundhra who wanted to “build up an industrial empire of dubious means”. There were many as 124 prosecutions against this business tycoon and companies owned or controlled by him and most of them results into conviction.

Hoarding, Black Marketing and Adulteration – The white collar crimes which are common to Indian trade and business world are hoarding, profiteering and black marketing. Violation of foreign exchange regulations and import and export laws are frequently resorted to for the sake of huge profits. That apart, adulteration of foodstuffs, edibles and drugs which causes irreparable danger to public health is yet another white collar crime common in India.

Tax-evasion – The complexity of tax laws in India has provided sufficient scope for the tax payers to evade taxes. This evasion is more common with influential categories of persons such as adulterators, businessman, lawyers, doctors, engineers, contractors etc. The main difficulty posed before the Income Tax Department is to know the real and exact income of these professional persons. It is often alleged that actual tax paid by these persons is only a fraction of their income and rest of the money goes into circulation as ‘Black Money’.

White Collar Crimes in Certain Professions –

  1. Medical Profession – White collar crimes which are commonly committed by persons belonging to medical profession includes issuance of false medical certificates, helping illegal abortions, secret service to dacoits by giving expert opinion leading to their acquittal and selling sample of drugs and medicines to patients or chemists.
  2. Engineering– In the engineering profession underhand dealings with the contractors and suppliers, passing of sub-standard works and materials and maintenance of bogus records of work-charged labour are some of the common examples of white collar crime.
  3. Legal Profession – In India the lawyer’s profession is not looked with much respect these days. There are two main reasons behind this. The worsening levels of legal education and unethical practices resorted by the members of legal profession tp procure clientage are mainly responsible behind the deteriorating of the level of this profession which was once considered to be noble and honourable. Some common white collar crimes committed by the lawyers are – fabricating false evidence, engaging professional witness, violating ethical standards of legal profession etc.
  4. Educational Institutions – One of the fields where white collar criminals operate with impunity are privately run educational institutions in this country. The governing bodies of these institutions manage to extract large sums by way of government grants or financial aid by submitting fictitious and fake details about their institution.
  5. White Collar Crime in business world – Sutherland made careful study of a number of large corporations and business houses and found that they were involved in conspiracies in restraint of trade, misrepresentation in advertising, infringement of copyrights and trademarks, brining public servants and so on.

Remedies for Prevention of White Collar Crimes –

  1. Causing public awareness – Creating public awareness against white collar crimes through the media of press and other audio-visual aids and legal literacy programs may perhaps help in reducing the incidence of white collar criminality.
  2. Constituting Special Tribunals– Special Tribunals should be constituted with power to award sentence of imprisonment upto 5 years for white collar criminals.
  3. Drastic Punishment – Stringent regulatory laws and drastic punishment for white collar criminals may help in reducing these crimes.
  4. Imposing of heavy fines – Heavy fines should be imposed on white collar criminals to discourage them to commit these crimes in the future.
  5. Constitution of National Crime Commission – There is an urgent need for National Crime Commission which may tackle the problem of crime and criminality in all facets.

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