The FBI’s 6 Most Prevalent Types of White-Collar Crime
In previous articles, I've described in general terms, the meaning of "white collar crime." While non-violent in nature and, by definition, committed by members of the educated, professional class, these crimes are still rigorously prosecuted in most jurisdictions and often carry stiff penalties. But this may leave you wondering, exactly what crimes are classified as "white collar"?
The following are the six most prevalent "white collar crimes" as classified by the FBI:
1. Corporate Fraud When big money is at stake, the temptation to hide any kind of operational malfeasance is immense. Many corporate executives also find irresistible the temptation to use their knowledge of impending mergers, sales, and earnings statements to place "sure bets" on their own company stock. Hence, this broad category of white collar crime includes insider trading, falsification of financial records/misrepresentation of company assets, and interference with regulatory bodies, such as the Securities and Exchange Commission (SEC), whose job it is to make sure publicly traded companies behave on the up-and-up. And then there is simple, outright fraud, such as when a company raises funds for products it has no intention to produce, orders merchandise for which it has no intention of paying for (“bust-out schemes”) or, in some fundamental way misrepresents a product or service it sells to the general public.
2. Embezzlement. This one is pretty simple. And all too common. A trusted corporate officer or company employee steals money from the company coffers and keeps it for him/herself, usually "cooking the books" to conceal the nefarious activity. In the public sector, using campaign funds for personal purposes also falls under this category.
3. Ponzi Scheme. Back in the 1920s, investment guru Charles Ponzi reportedly made millions by having his clients invest in postage coupons, delivering high returns by paying old clients with funds obtained from new ones. Such "investments" do produce high yields … until new investors can no longer be found and the whole house of cards collapses. Otherwise known "pyramid schemes," Ponzi schemes continue to attract greedy investors to this day, the most recent purveyor of note being the infamous New York investment guru Bernie Madoff.
4. Extortion. This is good old-fashioned blackmail. Someone demands money from you in exchange for suppressing potentially embarrassing or otherwise damaging personal information about you, or for a promise to "protect" your home or place of business from property damage. (Which, of course, will occur if you don't pay up.) Most victims are afraid to report extortion because of the damaging details such reports would necessarily reveal, or for fear of physical retribution.
5. Money Laundering. A favorite of TV crime dramas, like AMC's "Breaking Bad" and Netflix's "Ozark," money laundering involves using legitimate businesses to provide a legally credible source for large amounts of cash actually generated by illegal enterprises, such as the drug trade or large cash payments from other entities and transactions. Businesses dealing with large amounts of cash — such as laundromats, restaurants, car washes, and gambling casinos — are sometimes fronts for money laundering operations.
6. Cybercrimes. Over the past 15 years, cybercrimes have become so prevalent they deserve a category of their own. Depending upon the use of computers and the Internet, cybercrimes include everything from electronic identity theft, bank account and credit card hacking, mortgage fraud (where a homeowner’s mortgage information is used to secure lines of credit used by thieves to drain a homeowner’s equity in the property) to ransomware (in which a cybercriminal remotely locks your computer and demands a "ransom" to provide you with the numerical key to unlock it).
Have you been charged with a white collar crime and need expert legal representation? Feel free to contact my office for help. I am also more than happy to answer your questions by cell at 714-381-1366 or @ bob@hartmannlawfirm.net.
META DESCRIPTION: What types of crime qualify as "white collar"? The following are the six most popular "white collar" crimes as classified by the FBI.