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When it comes to federal crimes, you should remember that white-collar crime doesn’t feature violence as other criminal acts. At the same time, the main motive is financial, which is an essential factor to remember.
Generally, this particular type uses a prestige or position of power with an idea to get a proper compensation that is above average.
Keep in mind that the term became a part of the legal world in the ’30s by Edwin Sutherland. He used it to describe many crimes committed by people who possessed a high social status or people with respectability.
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Before introducing this particular concept, people thought that the upper classes could not deal with different activities.
It is a type of illegal activity by corporate-level individuals. Today, sophisticated technology is available, which means that a particular problem can result in millions of losses.
Differences Between White and Blue-Collar Crimes
It would be best to remember that the main difference between blue-collar and white-collar crime depends on individuals’ various engaging activities. The blue-collar option comes with more limitations, which means that it is straightforward, including burglary and robbery.
On the other hand, white-collar options depend on a particular position, including loan officers, bank credit analytics, and many more.
Different Types You Should Remember
- Fraud – Even though this is a broad term that treats different schemes with an idea to take money out of particular people, the simplest one includes sending someone a lot of money if they send a small amount first as a processing fee. The main idea for a fraudster is to get a small amount and never send out the amount he promised, which is a confidence con.
- Insider Trading – When it comes to insider trading, you should know that it is a practice of selling and purchasing publicly-owned companies by possessing detailed data, including non-public information, which allows an investor to cheat various financial markets. For instance, if an employee from a particular investment bank knows that company 1 wants to acquire company 2. Therefore, he/she will buy stocks from company 2 because of the knowledge that a particular value will rise significantly after public acquisition.
- Cybercrimes – One of the most common options nowadays is computer system hacking and identity theft, federal crimes. According to statistics, due to identity theft, people obtained more than two billion dollars illegally in 2019.
- Ponzi Scheme – We are talking about a standard pyramidal scheme based on Charles Ponzi, who first used this particular scheme. It is an investment fraud that gives investors high returns at first. Initially, it pays investors large sums by using newly deposited funds from other investors. The sum rises as people gain confidence in their returns. However, when the scammer reaches the desired amount, he/she decides to leave investors with huge losses, while a scheme collapses as a result.
- Counterfeiting – The main reason why countries create invisible signs, details, and colors on paper money is to prevent potential counterfeiting, which is a problem that can affect the overall economy. Since today’s advanced laser printers and computers are creating currency, it is challenging to copy and make false money. On the other hand, back in the day, people used numerous ways to copy an old currency.
- Embezzlement – We are talking about the crime of robbery or theft that can range from a complex scheme that can take millions of dollars to an employee who can take a few dollars from a cash drawer.
- Money Laundering is a complex process in which criminals are trying to hide their actual income source. As a result, they are trying to clean or pass money by using different complex transfers. It is a standard tool for drug traffickers that deal with a high amount of cash without the ability to pass it through appropriate and legal means. Therefore, it features sending cash through different accounts and into legitimate businesses. It means that sent money will combine with regular revenue of a legitimate business, and no one will be able to identify it as dirty money.
- Espionage – Spying or espionage is another form of white-collar crime, especially if you have in mind that a particular foreign government wants to get technology info from successful companies from other countries. Therefore, they will find an employee from that specific company and pay him/her money to obtain a particular copy of the technology.
You should click here to understand the history of white-collar crime.
White-Collar Crime Classification
- Individual – Financial or individual white-collar crimes include individuals or a single person who uses the aforementioned types. Therefore, the most common option for personal fraud is Ponzi Scheme. We are talking about a fraudulent investment program. An individual will use different investors to take their money and give them high returns until he/she reaches the desired amount.
- Corporate – You should know that numerous frauds function on corporate levels as well. For instance, a particular company may start with money laundering or have an employee who will engage in a trading scheme.
After the Internet entered a scene, everything changed and expanded. Today, you can find a wide array of white-collar crimes conducted through the Internet, including phishing and other scams falling under the term of cybercrime.
You should know that hacking is a form of breaking into a particular database with an idea to obtain relevant data or credit card records for getting money or identity theft.
It didn’t exist a few decades ago, which is something you probably understand by now.
Email and phishing scams are also prevalent because computers and other devices allowed us to use different features and capabilities that existed in the past.
Of course, a technological advancement comes with a potential for crime, which is why a smartphone and PC-connected world brought new types of illegal activities. At the same time, we think that as technology expands, the crime types will too.