White-collar crimes are crimes committed by people in their line of duty either in businesses or in government professionals. White-collar crimes are mostly committed to personal financial advantages and are frequently handled by people ranked with high social standards. The main purpose of the white-collar crime is securing a personal or business advantage, get property gain/ privileged services and acquire money. Collars misrepresent finances to mislead the regulator in an organization by committing fraudulent investment where returns are overstated and risks less stated or not stated. Some examples of white-collar crimes are embezzlement, money laundering, security fraud, and corporate fraud.
Money laundering is the practice of acquiring money earned from illegal activities like drug trafficking, corruption, terrorism, human trafficking, and healthcare fraud. Criminals tend to make the money look like it’s earned from the legal business where this laundering process returns the money to the launderer in an indirect way. Effort and time are considered by enforcing strategies that won’t raise any considered suspicions. Money laundering involves three steps; placement, layering, and integration. Placement involves the process of moving dirty money into a legitimate economy keeping it away from its source. The money then moves through financial institutions and businesses. Placement can occur in different ways like; sending small amounts to banks, purchasing foreign money with illegal revenues and placing money away from source organizations. Placement is a very risky stage especially when crossing money on borders with high security. The second money Laundering stage is layering; this stage involves making illegal money hard to detect and moving it as further from the source. The collar makes layering very complicated by moving international funds from their source and creates a deliberately complicated audit through a series of financial transactions. The integration process then takes place where the money is taken back to the economy by the criminal; the criminal may purchase a property through this legal money. The money then is received through a source like a salary or a wage and it’s not easy to detect the money once it gets back to the economy for most criminals even allow it to be taxed. The government enhances ways of detecting and deterring dirty money through regularly coordinating money laundering with local enforcement agencies, federal and the state.
In the embezzlement process, persons withhold assets entrusted to them by an organization and converse the assets on themselves. For example, an advocate can embezzle funds from the trust accounts or a partner can embezzle funds from a joint bank account. Embezzlement is performed with precautions that occur without the knowledge of the affected person(s). It mostly involves a small portion of the entrusted funds or resources to avoid the detection of fraud. The victims realize afterward that some funds or resources are missing. Embezzlement is a criminal offense which, may be charged on fraudulence and criminal conversion.
Corporate fraud is intentionally misrepresenting company funds and resources perpetrated by corporate and government institutions. Like in embezzlement, corporate fraud is not detected at its early stage. The government tries to prevent fraud with policies and laws that help law enforcement detect scheme. Fraud mostly incurs losses in an organization that can cause job loss or imprisonment for the criminals charged guilty. Audit and Legal regulations detect and prevent corporate fraud.
In the security fraud, criminals misrepresent information used by investors to make decisions; it can also be termed as investment fraud which is a serious crime involving the investment world. Security fraud may take many forms; High-yield investment fraud involves guarantees of high rates of return claiming there are no involved risks. Ponzi and pyramid security frauds use the funds of investors to pay investors caught upon the arrangement process.
White-collar crimes are crimes committed by educated people and professional elites. It can have a large economic impact on society when losses are incurred on businesses, organizations and the government white-collar crimes also increase cost. It is therefore of great importance to put remedy for white-collar crimes through detection and elimination.
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Friedrichs, D. O. (2009). Trusted criminals: White collar crime in contemporary society. Cengage Learning.
Benson, M. L., Madensen, T. D., & Eck, J. E. (2009). White-collar crime from an opportunity perspective. In The criminology of white-collar crime (pp. 175-193). Springer, New York, NY.