White collar crime and its

changing dimensions in
India
- Abhishek Sharma
- 00119103516
- BBA LLB 9th Semester
INTRODUCTION
• White-collar crime is a nonviolent crime committed for financial gain.
According to the FBI, a key agency that investigates these offenses,
"these crimes are characterized by deceit, concealment, or violation of
trust." The motivation for these crimes is to obtain or avoid losing
money, property, or services, or to secure a personal or business
advantage. Examples of white-collar crimes include securities fraud,
embezzlement, corporate fraud, and money laundering.
• White-collar crime has been associated with the educated and affluent
ever since the term was first coined in 1949 by sociologist Edwin
Sutherland, who defined it as "crime committed by a person of
respectability and high social status in the course of their occupation.“
• The harm caused by white collar crimes is, in most cases, palpable. For
example, tax evasion leads to reduce revenue for the treasury, bribery lead
to biased governmental decision making, inside trading lead to loss of
investments in investors. There are moral complexity and uncertainty in
white collar crimes which is not visible in other offenses. The identification
of victims is very difficult, and victims are unaware of victimization.
• These white collar crimes by nature are such that the injury or the damage
caused as a consequence of them is so widely diffused in the large body of
citizens that their enormity as regards personage victim is almost trifling.
DEFINITION of White collar crime by
SUTHERLAND
• The most influential criminologist of the 20th century and also a
sociologist,  Edwin Hardin Sutherland, for the first time in 1939, defined
white collar crimes as “crimes committed by people who enjoy the high
social status, great repute, and respectability in their occupation”. The five
attributes of the given definition are:
It is a crime.
That is committed by an important person of the company.
Who enjoys a high social status in the company.
And has committed it in the course of his profession or occupation.
There may be a violation of trust.
LIMITATION OF SUTHERLAND’S
DEFINITION
• It has not laid down any criteria for who these ‘persons of responsibility and
status’ would be.
• Also ‘person of high social status’ is not clear. It is perplexing as the meaning
of the phrase in law could be different from its general definition.
• Sutherland’s definition did not take the socio-economic condition of the
person into consideration. It only showed the dependency of white collar
crimes on its type and the circumstances in which it was committed.
• Mens rea, i.e. guilty mind and actus reus, i.e., wrongful conduct are two
essential elements to constitute a crime. However, Sutherland’s definition
implies that according to him white collar crimes does not necessarily
require mens rea. 
• For instance: A manufacturer of drugs who deliberately supplies
substandard drugs is a white-collar criminals. But in a case where
there is no connection between the crime and the occupation, for
example, a doctor evades tax, is not a white-collar criminal, a director
of a company who smuggles foreign goods is not a white-collar
offender.
REASON FOR GROWTH OF WHITE
COLLAR CRIME IN INDIA
1. The white collar crimes are committed by people who are financially secure
and perform such illegal acts for satisfying their wants. These crimes are
generally moved by the greed of the people.
2. Poverty is considered as a major cause for underdevelopment in India. Poverty
is a cause for financial and physical duress among the major chunk of
population. Since people are so much in need of money, they easily get
attracted by the false representations made to them. They forget to look into
the veracity of the representations being made to them.
3. The gravity of white collar crimes are more intense than other traditional
crimes. White collar crimes causes one great loss at all levels, i.e. financial,
emotional, etc. Corporate mishaps, like false pharmaceutical tests, costs more
lives than the crime of murder.
4. With the introduction of the people to the internet and digital world,
where big transactions takes place within seconds and where reaching
out people from all over the world is a matter of few minutes, criminals
have got an incentive to commit more crimes and hide anywhere in the
world.
5. Our law enforcement agency also become reluctant to deal with such
crimes as these cases are very complicated and tracing a suspect is a
difficult job. The investigation in case of white collar crimes is much
more consuming than that in traditional crimes.
TYPES OF WHITE COLLAR CRIMES
• The most common type of white-collar crime is fraud. Fraud involves the intentional
misrepresentation or omission of a material fact. That misrepresentation must be
reasonably relied on, and someone must suffer a monetary loss as a result. The most
prevalent types of fraud include:
• COMPUTER FRAUD: The act of stealing a bank, credit card, or proprietary information
from a computer.
• BANKRUPTCY FRAUD: The concealment of assets, misleading creditors, or illegally
pressuring debtors.
• HEALTH CARE FRAUD: The acceptance of kickbacks or billing for services not performed,
unnecessary equipment, and/or services performed by a less qualified person. This type
of fraud applies to all areas of health care, including hospitals, home health care,
ambulance services, doctors, chiropractors, psychiatric hospitals, laboratories,
pharmacies, and nursing homes.
• Securities fraud: The act of manipulating the market and stealing
from securities accounts.
• Counterfeiting: The act of printing counterfeit money or
manufacturing counterfeit designer apparel or accessories.
• Financial fraud: The act of engaging in fraudulent activities relating to
commercial loans, check forgery, counterfeit negotiable instruments,
mortgage fraud, check-kiting, and false applications.
• Credit card fraud: The use of someone’s credit card information to
make unauthorized purchases.
• Insurance fraud: The falsification, inflation, or “padding” of insurance
claims.
• Government fraud: The act of engaging in fraudulent activities with
public housing, agricultural programs, defence procurement,
educational programs, or other government activities, including
bribery in contracts, collusion among contractors, false or double
billing, false certification of the quality of parts, and substitution of
bogus parts.
• Telemarketing fraud: The use of the telephone as the primary means
of communicating with potential victims.
PENALTIES FOR WHITE COLLAR CRIMES IN INDIA

• Punishment for fraud: Section 447  of the Companies Act, 2013 provides
punishment against the commission of fraud. It states that in case a person is
found guilty of an offence of fraud he would be imprisoned for a period not
less than 6 months and which extend to 10 years. And he will also be subject
to fine which should not in any case be less than the amount involved in fraud
and which may extend to 3 times the amount involved in the fraud.
• Bribery: Section 171-B of Indian penal code 1860 defines bribery as giving or
acceptance of a gratification either as a motive or reward to any person, to
induce him to stand or not to stand as a candidate or to withdraw from the
contest or to vote or not to vote at an election. It also includes offer or
agreement to give an offer and attempt to procure a gratification, as explained
in Section 7 of the Prevention of Corruption Act, 1988.
• Counterfeiting of Currency: Section 489-A, 489-B, 489-C, 489-D were
introduced so as to provide additional adequacy for the protection of
currency note and bank notes from forgery under the Indian Penal
Code, 1860 that was passed before existence of paper currency in India,
currency notes weren't protected by any special provisions however just
by the general provisions, applying to forgery of valuable securities.
• Adulteration of Food and Drugs: Section 272 to 276 of the Indian Penal
Code that are associated with the adulteration of food and drugs. It is
interesting to notice that the penalization does not exceed six months
and fine of only one thousand rupees that is provided under these
sections looks to be entirely inadequate within the present day.
• Public Servant Unlawfully Buying or Bidding for Property: Section 169
provides that “Whoever, being a public servant and being legally bound as
such public servant, not to purchase or bid for certain property, purchase or
bids for that property either in his own name or in the name of another, or
jointly, or in shares with others shall be punished with simple imprisonment
for a term which may extend to two years, or with fine or with both and the
property, if purchased, shall be confiscated.
• Offences related to Public Servant under Prevention of Corruption Act,
1988: Section 7– Public servant taking gratification other than legal
remuneration in respect of an official act shall be punishable with
imprisonment, which shall be not led than six months out which may extend
to five years and shall also be liable to fine.
Recent white collar crime cases in India

• ABHAY SINGH CHAUTALA V. C.B.I.

There were two appellants in the present case against whom a charge sheet was filed
for committing an offence under Section 13(1)(e) and 13(2) of the Prevention of
Corruption Act, 1988 read with Section 109 of the Indian Penal Code, 1860 in separate
trials. It was alleged that both the accused had accumulated disproportionate wealth as
per their income when they were they members of the Legislative Assembly.
When the Central Bureau of Investigation (CBI) initiated its investigation it was found
that the father of the appellant had acquired huge properties and same as the case
with the appellants. The High Court held that the appellant had provided a totally
different office(s) of the accused than they were actually holding at that time. Thus the
sanction under Section 19 of the Prevention of Corruption Act, 1988 was held to be
without any merit. 
• Binod Kumar v. State of Jharkhand & Others
This case was filed against several ministers of the State of Jharkhand
along with the Chief Minister for having the possession of
unaccountable money. The High Court had requested the Central
Government to transfer the case from Enforcement Directorate to CBI
by way of power given to it under Section 45 (1A).
It was alleged that the ministers were in possession of hefty amounts of
money and though no evidence was found to charge them with money
laundering case, a strict investigation was proposed.
• The ministers were said to be the owners of property not only in India but
abroad as well. Therefore, the court asked for an investigation to determine
this wealth was acquired by making use of the official position. It was to be
clarified if a white crime has been committed under the Prevention of
Corruption Act, 1988 and under the Indian Penal Code, 1860.
• The CBI started its investigation under Prevention of Corruption Act, 1988
and the Indian Penal Code, 1860 as the power to carry on investigation
under Prevention of Money Laundering Act was only with the Enforcement
Directorate, which is of course subjected to the power given to the Central
Government under Section 45 (1-A) of the Prevention of Money-laundering
act.
Measures to curb white collar crimes
• The top investigating agencies of the country like the Central Bureau of Investigation,
the Enforcement Directorate, the Income-tax Department, The Directorate of
Revenue Intelligence and the Customs Department, needs strengthening, by way of
implementing strong regulating policies. The Central Vigilance Commission should
monitor the working of the officials sitting at top positions and also cross-check their
works, so as to ensure transparency in the system.
• As the method of commission of such white collar crimes is advancing, so should the
training of the investigating officials. It often happens that ageing officers are well
experienced to understand the nature and techniques, but are not able to utilise the
technology for tracking the suspect. This happens due to lack of training. So, every
investigating officer must be trained in such a manner that, no matter how
complicated the case is, they would be able to easily resolve it.
• To uproot the existence of such crimes, it is very important to include strict laws
into the system. Less amount of fine and shorter period of imprisonment makes it
very casual for the offenders to commit such crimes. 
• Fast track courts and tribunals should be set in all the parts of the country for the
early disposal of these cases. The tribunal should be provided with the power to
fine or imprison someone who has been held guilty. Such measures would lower
the rates of occurrence of white collar crimes.
• The electronic and print media should be utilized in the right way to spread
awareness about white collar crimes. The general people need to be aware of
such crimes and that they are taking place everywhere, from a small cafe to big
multinational companies. Also, they need to be aware of the remedies they could
seek in case they become victim to such crimes.
CONCLUSION
• As our society is growing towards modernity and the world is experiencing
new technological advancement, the rate of crime is also increasing at a
faster rate. Particularly the growth in white collar crimes has been
enormous. From the medical profession to educational institutions, these
crimes are being committed everywhere.
• The investigating officials are in need of training where they could acquire
the skill to trace these criminals, otherwise tracking of whom is  difficult,
complicated and tiresome job. The investigating officials’s work should be
scrutinized to ensure transparency in the work as the white collar crimes
are committed by people enjoying higher social status in their occupation.
• The government must make laws that are strict enough to reduce the
commission of such crimes. And the system should be such that not
only there exist laws giving strict punishment to the accused but also
dispose off maximum cases in a short while. If not done so then
people will soon lose complete faith in the system, as these crimes
are committed by people who should act as a role model for the
society.