White–collar crime is an all–encompassingphrase for frauds, schemes, and financialoffenses by businesspersons, public officials,and confidence men and women of alltypes. Simply put, it covers a wide range ofnon–violent offenses that have cheating astheir central element. The types of differentruses can be as complex as stock marketmanipulation or as simple as an employeestealing from an employer. One thing all ofthese schemes share in common is stealingfrom somebody else by taking their moneyor property.
White–collar crime has existed aslong as mankind itself, and a quickglance at a nearly 400–year–oldEnglish case is instructive. This littletale of devious doings is straightfrom the pages of the court reportsof the Old Bailey , London’s CentralCriminal Court, as related January 14,1676:
“After this a woman was indicted,for that she together with two men,not yet taken, went into a house inthe city, and pretended themselvesâ€˜persons of quality’, one of themen saying he was a Steward to aperson of Honour, and the othera Gentlemen newly come fromIreland; they desired lodging, andtheir requests were answered; and atnight, it being Christmas time, theydesired to play at a game of cards,for their divertisement, with theirnew Landlord, and he to oblige themreadily complied â€¦. they desiredhim to send out for some DoubleBeer for them; he stept to the nextdoor and asked the Maid bring it in;after that they called for wine andhe sent the Maid to fetch it; thena little after they desired he wouldfetch them some more Double Beerhimself, and as soon as he was goneâ€¦. they took from thence a silverTankard and Money, to the value oftwenty pounds, and left him onlya light upon the stairs to see hislosses.”
This story of skullduggery still ringstrue today and encapsulates theessence of all white–collar crime:the cheat, the swindle, the gainingof the victim’s confidence by deceit.Whether it is Newman and Redfordin The Sting, or Ryan and TatumO’Neal in Paper Moon, some formof cheating is the central elementin every crime that is categorized aswhite–collar crime.
MODERN DAYWHITE–COLLAR CRIME
The Old Bailey story of thieveryshares its roots with many storiesstraight out of today’s headlines –oops – I mean websites and blogs –including Madoff , Enron, and many,many others. As new technologiescreate new opportunities forgrowth and wealth, so too are newtechniques developed to cheatpeople out of their investments,money, and other property. I havepersonally defended cases involvingschemes as diverse as bid–rigging,construction fraud, mortgagefraud, and employee theft in thepast several years. The housingmarket implosion, the stock marketmeltdown, and the struggles ofthe automobile companies allpoint towards white–collar crimecontinuing as a “growth industry,”with no end in sight as to thenumber of schemes concocted totake other folks’ money.
Disturbing as it may sound, themantra “Economy bad, whitecollarcrime good” seems is all tootrue. I would strongly suggest thatemployers, whether small or large,as well as investors, small or large, beparticularly careful of who has accessto financial information and assets. Alittle bit of extra diligence could payhuge dividends for your personaland/or corporate security.However, many modern schemesare not simple acts of thievery,but are much more complex. It isbeyond the scope of the article todiscuss the intricacies of aggressivegovernment prosecutions, butcorporate directors, officers andhigh–level employees have to bevery careful. Business practicesand industry procedures that arebased on value judgments canbe attacked as criminal by theDepartment of Justice. Decisionsand practices that formerly wereconsidered civil in nature havesuddenly been criminalized by theFederal Government and even pitcorporations against their ownofficers, and vice versa.
THE LAWNEEDS BALANCE
At the end of the day, there isnot much new under the sun, asthere have always been a certainpercentage of people who arewilling to lie, steal, and cheat toget other people’s money. Like the“gentle persons of quality” reportedin the Old Bailey case, conniversand grifters are ever ready to relievetrusting souls of their property. Thegovernment, on the other hand, hasbecome so aggressive in some casesthat complex securities and businessdecisions are being increasinglycriminalized. This can stunt freeenterprise and cause more harmthan the activity the Governmentseeks to prevent. A more balancedapproach is needed to ensure theinnocent are not swept away withthe guilty.
Just to illustrate that point , let’srevisit the Old Bailey case. Whathappened to the men that were“not yet taken”– did they coerceor force the woman’s involvementin the scheme? Perhaps the silverTankard and Money were stolenby the landlord from the Gentlepersons’ relations, and they weremerely taking them back. Maybethe landlord made the whole thingup to collect on an insurance policy.What if he had promised thosethings to the gentle people in returnfor certain favors? Perhaps his ownmaid took the property and framedthe gentle persons. The answer isnever as straightforward as it mightseem. One thing for certain is thatthe woman’s punishment wastransportation by ship straight to thethen penal colony of America!