There has been a tendency to picture lower-class people as more likely to commit criminal acts, giving a misleading idea that upper-class people are free from criminal activities. However, the practice of crime and corruption by people in the upper echelons of society is not uncommon and has been pointed out from time to time.
The term “White Collar Crime” has been in frequent use in the literature of American criminology since December 1939 to indicate the practice of chicanery and corruption by highly placed individuals.
Understand White Collar Crime and Criminality
Where does The Term “White Collar Crime” come from?
In December 1939, Edwin H. Sutherland used the term “White Collar Crime” in his presidential address before the American Sociological Society. There was no official or legal definition, which made the term a bit ambiguous and controversial.
Sutherland used “White Collar Crime” as the title for his remarks.
He discussed the issues relating to “White Collar Crime” and later elaborated on many of its ramifications. Sutherland began systematic research into the criminal practices of the elite after the appearance of the first edition of his book “Criminology” in 1924.
Systematic Formulation and Criticism
In the second edition (1934) and third edition (1939), he changed the title of the book to “Principles of Criminology” and incorporated scattered comments on White Collar Crime.
But his 1939 presidential address was his first systematic formulation of the term, which faced criticism from various quarters. He responded to those criticisms in his article “Is ‘White Collar Crime,’ crime?” published in 1945.
Sutherland’s Comprehensive Study on White Collar Crime
He published a book-length study, “White Collar Crime,” in 1949, where he presented the data he had collected over many years of research.
He systematically presented his arguments and discussed the implications of the theory. In 1943, “New Horizons in Criminology” by Barnes and Teeters was first published.
This well-known textbook began with a discussion of the “revolution in the nature of crime” and described questionable commercial transactions, racketeering, and organized crime as “White Collar Crime.” From that time onwards, every criminology textbook contained a chapter titled “White Collar Crime.”
Southerland’s Formulation of White Collar Crime
Usual reports tend to give the impression that criminality is largely concentrated in the lower class and economically underprivileged people. These reports create a misleading idea that respected individuals, including highly placed businessmen and political figures, are righteous and free from criminality.
Defining White Collar Crime
Sutherland provided a concrete list of different categories of White Collar Crime. This type of criminality is said to occur in:
- Misrepresentation of the financial statements of corporations.
- Manipulation of the stock exchange.
- The bribery of public officials to secure desirable contracts or immunities.
- Bribery in commercial transactions.
- Misrepresentation in advertising and salesmanship.
- Embezzlement and misuse of trust funds.
- Dishonest bankruptcies, and more.
Class Bias and Immunity of White Collar Criminals
In an early article, Sutherland defined White Collar Crime as a “violation of criminal law by a person of the upper socio-economic class in the course of their occupational activities.”
He argued that “white-collar criminals are relatively immune (from criminal conviction) because of the class bias of the courts and the power of their class to influence the implementation and administration of the law.”
Class Bias in Criminal Handling
This class bias affects not merely present-day courts but also, to a much greater degree, affected the earlier courts which established the precedent and rules of procedure of the present-day courts. The usual consequence of this class bias is that crimes of the upper class are handled differently than the crimes of lower-class people.
- Crimes of the lower class are handled by policemen, prosecutors, and judges with penal sanctions in the form of fines, imprisonment, and death.
- Crimes of the upper class either result in no official action at all or result in suits for damages in civil courts or are handled by inspectors and by administrative boards or commissions with penal sanctions in the form of warnings, orders to cease and desist, occasionally the loss of a license, and only in extreme cases by fines or prison sentences.
Segregation of White Collar Criminals
Thus, white-collar criminals are administratively segregated from other criminals and, largely as a consequence of this, are not regarded as real criminals by themselves, the general public, or criminologists.
Evidence of White Collar Crime
Sutherland argued that if one collects statistics of hearings before regulatory commissions, civil suits for damages, and other procedures outside of criminal prosecution, in addition to the data of official convictions, he will gather numerous pieces of evidence of white-collar criminality.
Decisions of commissions and civil courts against a person or corporation are sufficient proof, Sutherland insisted, of a violation of the law and thus fall into the category of white-collar crime.
Distinguishing White Collar Crime from Ordinary Crimes
White-collar crimes are different from ordinary crimes. If upper-class people commit murder, robbery, or theft, they will be prosecuted by criminal courts as ordinary criminals. They will not be prosecuted as white-collar criminals merely because they happen to be upper-class persons.
Examples of White Collar Crime
In 1934, the Indiana Division of Public Health routinely tested ice cream samples, of which 40% were in violation of the law. Sutherland cited this as an example of white-collar crime.
These types of activities are done in clear violation of the law and continue as a part of the business with the intention of making a greater profit without concern for the public interest. In this, they are inflicting injury on the public.
Influence of Social Status
Sutherland pinpointed the reason why criminal courts do not deal with these types of activities. In his language, these types of behaviors were not handled by criminal courts “because their social status (white-collar criminals) have a loud voice in determining what goes into statutes and how the criminal law as it affects themselves is implemented and administered.”
Outcomes and Influence of White Collar Crime Research
When conducting research on improper business practices, many writers followed Sutherland’s terminology and methodology. This research revealed numerous instances of white-collar crime across various industries and sectors.
Defining White Collar Crime and Terminological Challenges
Sutherland’s introduction of the term faced criticism, primarily concerning its ambiguity and the distinction between civil and criminal actions. Some argued that a more definitive terminology was required for meaningful research, while others pointed to the blurred line between civil and criminal law.
Sutherland’s Contribution to Criminology
Sutherland’s groundbreaking work on white-collar crime reshaped the field of criminology, challenging preconceived notions and emphasizing the importance of understanding criminal behavior across class boundaries.
Terminological Problem: Is White Collar Crime Crime?
The behaviors pertaining to white-collar crime sometimes do not result in a criminal conviction and sometimes do not violate criminal law. After introducing the term, Sutherland faced severe criticism, which compelled him to define his proposition.
Sutherland’s Defense and Explanation
After 5 years, he responded to those criticisms with his article titled “Is ‘White-Collar Crime’ Crime?” Sutherland first presented the violations of law by 70 major American corporations and then attempted to prove why these violations constituted a crime. Sutherland argued that these violations constituted crime because:
- They were injurious to the public, as per the definition of the law.
- There were prescribed penalties for such violations.
- The behavior constituting white-collar crime was willful and intentional.
Persistent Controversies in Criminology
Though Sutherland categorically presented strong arguments for why violations by upper-class individuals constitute white-collar crimes, the controversy surrounding white-collar crime did not disappear. In criminological discourse, controversy has been projected by two principal types of criticisms.
Ambiguity and Usefulness of the Term
The first criticism is that the definition of white-collar crime is ambiguous and uncertain, making the term useless for research purposes.
Neglecting the Distinction Between Civil and Criminal Actions
The second criticism is that the term tends to ignore the distinction between civil and criminal actions.
Differing Perspectives on Defining Crimes
Paul W. Tappan objected to the term “white-collar crime” on the ground of ambiguity and argued that meaningful research required definitive terminology. Many interpretations of white-collar crime create obstacles in conducting meaningful research regarding white-collar crimes.
Defining Criminal Behavior
Professor E. W. Burgess also pointed to the failure to distinguish between civil and criminal law and added the offhand sociological definition:
- “A criminal is a person who regards himself as a criminal and is so regarded by society.”
He declared that this definition does not cover white-collar crime. In response to Burgess’s comment, Conklin argued that it is the law, not the opinion of the offender or society, which determines criminal and non-criminal behavior.
Sutherland’s Reformative Intent
Burgess and Tappan missed Sutherland’s fundamental point as he insisted that he did not attempt to reform society; rather, he attempted to reform the theory of criminal behavior through his analysis of white-collar crime.
A scientifically adequate theory of criminal behavior explains all criminal behaviors that have the essential characteristics of a crime, whether the criminal justice agencies define those as crimes or not.
Sutherland reviewed white-collar crimes of the upper class and common crimes of the lower class and concluded that “The crimes of the two classes differ in incidentals rather than essentials. They differ principally in the implementation of the criminal laws which apply to them.”
Reassessing Criminological Focus
Because criminologists are reluctant to consider the activities of upper-class people as crimes, usual theories of criminal behavior focus on poverty. Sutherland, therefore, argued that conventional theories of crime were invalid and that a theory was needed that could explain both white-collar criminality and lower-class criminality.
Unified Theories for Individualistic and Societal Perspectives
Sutherland argued that, from an individualistic point of view, both white-collar crime and lower-class crime can be explained by the theory of differential association, and from the point of view of society, both can be explained with the aid of the theories of anomie and culture conflict.