What is White Collar Crime?
White-collar crime is defined by Edwin Sutherland as “a crime committed by a person of respectability and high social status in the course of his occupation” (1939). His theory was that criminal behavior was learned from interpersonal interaction with others and he attributed different characteristics and motives to white collar criminals which he considered to be different from street or common criminals. His goal was to prove that, at a time when the United States was experiencing growth, crimes relative to money would surely increase; his goal was to show that there was correlation between social status and the likelihood of going to jail for a white collar crime when compared to common street crimes which are more visible.
White Collar Crime and Corporate Crime
White-collar crime, therefore, overlaps with corporate crime because the opportunity for fraud, bribery, insider trading, embezzlement, computer crime, copyright infringement, money laundering, identity theft, and forgery are more available to white-collar employees.
White Collar Crime and Blue Collar Crime
Mr. Sutherland’s work also separated and defined the differences between street crimes or blue collar crimes, such as arson, burglary, theft, assault, rape and vandalism. These crimes are often labeled as issues that are psychological and, associational, whereas white-collar crimes are considered crimes of opportunity.
Definitional issues
Modern criminology generally rejects a limitation of the term by reference, and instead classifies the type of crime and the topic:
- By type of offense
- By type of offender
- By organizational culture
Type of Offense
Classification by the type of offense, e.g. property crime, economic crime, and other corporate crimes like environmental and health and safety law violations.
Some crime is only possible because of the identity of the offender, e.g. transnational money laundering requires the participation of senior officers employed in banks. But the Federal Bureau of Investigation has adopted the narrow approach, defining white-collar crime as “those illegal acts which are characterized by deceit, concealment, or violation of trust and which are not dependent upon the application or threat of physical force or violence” (1989, 3).
This approach is relatively pervasive in the United States, the record-keeping does not adequately collect data on the socioeconomic status of offenders which, in turn, makes research and policy evaluation problematic.
While the true extent and cost of white-collar crime are unknown, it is estimated to cost the United States somewhere between $300–$660 billion annually, according to the FBI (Lane and Wall 2006, cited; in Friedrichs, 2007, p46).
Type of Offender
Classification by the type of offender, e.g. by social class or high socioeconomic status, the occupation of positions of trust or profession, or academic qualification, researching the motivations for criminal behavior, e.g. greed or fear of loss of face if economic difficulties become obvious.
Shover and Wright (2000) point to the essential neutrality of a crime as enacted in a statute. It almost inevitably describes conduct in the abstract, not by reference to the character of the persons performing it. Thus, the only way that one crime differs from another is in the backgrounds and characteristics of its perpetrators. Most if not all white-collar offenders are distinguished by lives of privilege, much of it with origins in class inequality.
Organizational Culture
Classification by organizational culture rather than the offender or offense which overlaps with organized crime. Appelbaum and Chambliss (1997, 117) offer a twofold definition:
- Occupational crime which occurs when crimes are committed to promote personal interests, say, by altering records and overcharging, or by the cheating of clients by professionals.
- Organizational or corporate crime which occurs when corporate executives commit criminal acts to benefit their company by overcharging or price fixing, false advertising, etc.
Blue-collar crime
The types of crime committed are a function of what is available to the potential offender. Thus, those employed in relatively unskilled environments and living in inner-city areas have fewer “situations” to exploit (see Clarke: 1997) than those who work in “situations” where large financial transactions occur and live in areas where there is relative prosperity.
Blue-collar crime tends to be more obvious and thus attracts more active police attention (e.g. for crimes such as vandalism or shoplifting, where physical property is involved). In contrast, white-collar employees can incorporate legitimate and criminal behavior, thus making themselves less obvious when committing the crime. Therefore, blue-collar crime will more often use physical force, whereas in the corporate world, the identification of a victim is less obvious and the issue of reporting is complicated by a culture of commercial confidentiality to protect shareholder value. It is estimated that a great deal of white-collar crime is undetected or, if detected, it is not reported.