Could You Be Committing White Collar Crimes & Not Know It?
Most people hear the term “white-collar crime” and automatically think of large-scale fraud committed by businesses and government officials. However, it’s important to remember that white-collar crime can occur on a much smaller scale and is not a victimless crime. In fact, it’s possible to commit white collar crimes without even meaning to.
White-collar crimes aren’t limited solely to large-scale corporate fraud. Even smaller actions can have serious legal consequences if committed, whether knowingly or unknowingly. To protect yourself and your business from potential white-collar criminal charges, it’s crucial to understand the law regarding this and how to guard yourself against becoming a part of a scheme.
In this blog post, we’ll discuss the different types of white collar crimes, the difference between white collar crimes and other criminal charges, and how to spot a white-collar crime before you are in too deep. And if you need a Pennsylvania white collar crime attorney, don’t hesitate to contact us!
What Are Considered White Collar Crimes?
White-collar crimes refer to financially motivated criminal activities typically committed by individuals or corporations. The term is derived from the fact that most offenders are of high social status, are educated, and are respectably dressed in white-collared shirts. Although these criminals may maintain a veneer of respectability, their actions have far-reaching consequences that can adversely affect businesses and individuals alike.
The Difference Between White Collar Crime & Other Forms of Criminal Activity
The primary difference between white-collar crime and other forms of illegal activity is that it typically does not involve physical violence. The perpetrators usually operate from within an organization and use methods such as falsifying records, concealing information, altering documents, or fabricating evidence to achieve their objectives. These methods allow them to capitalize on the trust placed in them by others in their organization.
White-collar criminals also tend to be highly educated and possess specialized skills, such as financial knowledge or expertise in computer systems. This knowledge allows them to easily exploit weaknesses in internal systems such as inadequate controls or poor oversight. They are usually well-versed in the criminal justice system. They can take advantage of complicated regulations and procedures that make it difficult for law enforcement agencies to investigate the activities effectively.
What Are the Types of Common White-Collar Crimes?
White-collar crime can be hard to detect and prosecute because it often involves complex financial transactions but heavy penalties in federal court. Here are some of the most common types of white collar crimes:
1. Tax Evasion
Tax evasion is a serious offense with severe legal consequences. It includes filing false financial information on a business’ tax return and deliberately concealing income and assets from the government to avoid paying taxes. Some of the most common methods to evade taxes involve under-reporting income from business activities, failing to pay employee payroll taxes, or hiding large gains through offshore accounts and shell companies.
Corporations that commit tax fraud or evasion can face hefty fines, civil penalties, and even criminal charges in federal court, depending on how much was withheld or evaded. In addition to legal repercussions, this crime can have long-term implications that affect a person’s credit score and professional reputation.
2. Money Laundering
Money laundering is a serious crime involving converting illegally obtained money into legal assets, usually through a series of complex financial transactions. They use numerous methods to obscure or disguise the source of funds, including the following:
- transferring funds among different banking institutions in multiple countries
- structuring deposits to avoid federal reporting requirements
- disguising monies as legitimate sources of business income.
In more sophisticated crimes, money launderers may engage in “layering”—a process involving multiple funds transfers between accounts to hide the money’s origin. Such techniques make it difficult for authorities to trace and recover laundered funds.
The consequences of money laundering are far-reaching: from enabling organized crime and terrorism by providing illicit funding sources to depriving governments and citizens of much-needed revenue streams from taxation. Also, laundered funds can easily enter the legal economy directly or indirectly as they come into contact with legitimate businesses, leading to reputational damage and sometimes even criminal liability for those that unknowingly accept “dirty” money.
Fraud is a broad term that can describe the crime of creating false documents or records to conceal the true nature of an activity or transaction. It can take many forms, from creating false identities or documents to misrepresenting facts or activities to gain an unfair advantage. No matter the form of fraud, it is always considered a crime and punishable by criminal law in most countries.
Financial fraud crimes come with severe penalties, including hefty fines, jail time, and restitution. In the United States, financial fraud is considered a crime on both the state and federal levels. For instance, the penalty for federal wire fraud could include up to 20 years in prison and significant fines. In addition to these criminal sanctions, victims of financial fraud may also be able to seek damages from the perpetrator in civil court.
4. Insider Trading
Insider trading is a crime committed violating federal securities laws and can carry criminal or civil penalties. The U.S. Securities and Exchange Commission (SEC) can investigate and prosecute these white collar crimes. This crime can involve buying or selling stocks based on confidential information or using inside knowledge to influence the stock price to make an illegal profit for an individual or company’s financial gain.
While it is generally filed under “corporate crimes,” it is important to understand the individual implications of this criminal activity before engaging in any transaction involving public companies or their securities. It is also important to note that even though the SEC has the authority to investigate and prosecute insider trading cases, it is still possible for a company, corporate executives, or an individual to be liable in civil court if they are accused of it.
Cybercrime is an increasingly prevalent issue in the digital age and is also considered a white-collar crime. It covers various activities, from stealing personal information online to launching large-scale cyber-attacks on companies and government institutions. Cybercrime can include anything from electronically obtaining financial documents with account numbers or Social Security numbers, medical records, or emails containing sensitive information. Additionally, cybercriminals may use stolen information to commit fraud or open accounts in other people’s names without their knowledge or permission.
Unfortunately, cybercriminals are becoming increasingly sophisticated in their methods of attacking networks and exploiting digital systems. They can also target victims from anywhere in the world without needing physical access to them, making it difficult for law enforcement agencies to identify and prosecute perpetrators of white-collar crime that is done via the internet. In addition, criminals have developed sophisticated techniques for hiding their tracks when engaging in illegal activities online.
Bribery is a form of corruption and involves offering someone money, gifts, or favors in exchange for doing something that they would not otherwise do. The person receiving the bribe is usually in a position of power or influence and has access to resources that may benefit the bribe. Bribery can take on many forms, from cash payments to more subtle bribery, such as providing special privileges or preferential treatment.
Bribery as a white-collar crime has historically been used to achieve political advantages, gain access to resources, secure business contracts, and influence decision-making. In recent years, there has been increasing attention paid by governments and international organizations to crack down on bribery crimes and public corruption internationally. This includes introducing laws against it domestically and internationally and implementing monitoring systems that track suspicious transactions related to corrupt activities.
Is It Possible to Commit One of These Common White Collar Crimes & Not Know It?
Since white-collar crime does not require physical force or contact with a victim like a traditional felony, perpetrators may not realize that their actions constitute a criminal act. As such, they might only become aware of their wrongdoing when law enforcement officers begin investigating them or when they receive legal notices from a court system regarding charges against them. These white collar crimes can be committed without the perpetrator realizing that they are breaking the law, as the laws surrounding white-collar crime are often complex.
For example, a company executive may make an investment decision based on inside information without realizing that sharing such information with other individuals is illegal. Similarly, an employee may be asked to engage in off-the-books accounting schemes without understanding that doing so is fraudulent – and thus criminal behavior. Many white collar crimes remain uncovered until an audit or investigation is conducted, meaning those responsible for them can go undiscovered for quite some time before being discovered and prosecuted.
What Is Blue Collar Crime?
Blue-collar crime is a term used to describe an illegal activity that is committed by individuals who typically are not in high-paying jobs but are still committing the same type of crime. Examples of blue-collar crimes include embezzlement, individual tax evasion, burglary, shoplifting, and robbery.
Blue-collar crimes have increased in recent years due to increasing economic hardship for many individuals and families across the country. These individuals turn to these crimes out of desperation to provide for their families or keep up with bills they cannot pay otherwise. As such, these crimes can have serious implications for victims since they can lead to lost wages and heavy punishments.
Need a Pennsylvania White Collar Crime Attorney to Defend You? Marinaro Law Firm Is Here to Assist
With white collar crimes, committing them may only take a few simple steps or unwittingly becoming involved in one without even being aware you’re doing something wrong. At Marinaro Law Firm, we are an experienced Pennsylvania white collar crime attorney, and we’re committed to helping you receive the justice you deserve. Contact us to schedule your legal consultation today & have someone on your side fighting for you.