Free White-Collar Crime. Distinct Elements Essay Sample
The economic crime (white-collar crime) has become an integral feature of the development of the countries that rely on the market economic model. Moreover, nowadays, the people become victims of such crimes on the regular basis. In order to understand the origins of the genesis of white-collar crime as a large-scale and mass social phenomenon immanent in the modern market economy, it is necessary to define its elements and types. Therefore, the following essay focuses on the reviewing of the distinct elements of the white-collar crime and provides insight into its several categories.
The concept of white-collar crime has been introduced by Edwin Sutherland, who was among the first sociologists to draw the attention of the community to a particular social danger of the crimes committed by the respectable people (e.g. businessmen) in the course of their professional activities. Sutherland noted that the white-collar criminals occupy a high position in the society and use it for the purpose of abuse of trust for their personal gain.
By using this statement as a basis, it is possible to distinguish the two distinct elements of the white-collar crime. The first of them is the corruption of highly prestigious people (white collars) that are invested with trust and hold the positions of responsibility in the government, industry, trade unions, and other civic organizations. On the contrary to the other types of crime, it usually does not affect the rights of an individual citizen directly, rather being a threat to the society, industry, or country. Another significant element of white-collar crime is the absence of violence since it involves the traditional concept of deception and misrepresentation to obtain funds, property, and services, avoid payments (namely taxes) or achieve business advantage.
White-collar crime can take many forms depending on the area the offenders operate in. Still, it is possible to review the following four categories of this criminal activity. The first of them, consumer fraud, is among the most widespread crimes, with about 25 million adult citizens of the U.S. (about 11%) becoming its victims each year. In particular, it may involve the manufacturing of the obviously unsafe products as in the case of Ford Motor Company. One of its vehicles, Ford Pinto (1970s), was equipped with a flawed fuel system that was prone to occasional bursts during the collisions. Despite the fact that fixing it would increase the manufacturing costs only by 11 dollars per car, the companys management decided to save 87.5 million dollars instead of ensuring the safety of their customers. The exact number of the victims is unknown, so it is impossible to calculate the costs of this crime precisely. However, considering the fact that the company has paid 127.8 million dollars to a single victim, as well as was forced to recall the Pintos from the American market, it is possible to assume that the consequences of the overlooked flaw were quite significant.
Another category of white-collar crime is related to the environmental crimes, i.e. the ones when the corruption of the officials results in the significant damage to the ecology of a particular area. The vivid example of such crime is the case of Exxon Shipping Company involving the crash of one of its tankers, Exxon Valdez, into Bligh Reef near Prince William Sound, Alaska in 1989. The accident has resulted in a large-scale spill of crude oil, causing untold damage to the environment. The investigation has shown that the tankers radar was broken, being unusable for more than a year before the accident. Moreover, the Exxon management was aware of the situation but failed to take any actions since, according to it, it was too expensive to repair the radar and work with it. Additionally, it was confirmed that Exxon has used overworked crew on the ship, which may have also resulted in the accident. By taking into account that the oil spill has affected a large area and its negative effects are to be observed for many years, it is possible to say that the cost of this crime is tremendous. In particular, it is known that Exxon has been made to pay at least 5 billion dollars for the damage dealt by the oil spill.
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Religious fraud involves the betrayal of trust of the believers by those occupying high positions in the religious system for the personal gain. In this case, it is possible to provide an example of a Reverend J. E. Ewing from Los Angeles, California. The offender has solicited the donations from the believers by promising them material wealth. The scheme involved mailing the monthly pledges through the so-called Gods Gold Book Plan for Financial Blessings. In case of religious fraud, its costs are primary individual due to the fact that the offenders usually target separate people rather than social groups. However, since the cash is being extracted from the members of the society, one may assume that their purchasing power lowers thus having a negative effect on the overall state of the economy in the area. In particular, the scheme of J. E. Ewing brought him about 4 million dollars annually until his church filed bankruptcy in 1977, which is a rather significant sum.
Finally, such category of white-collar crime as corporate fraud involves using ones high position to betray the trust of the companys stakeholders to obtain business advantage. In this regard, it is possible to provide an example of the Swedish Match Company established by Ivar Kreuger in 1913. For the time being, the annual interest rates of its stocks and bonds reaching 20% a figure almost unheard of at the time. However, the money used to pay them was not coming from the companys revenues but rather from its capital. In other words, the investors that have purchased the bonds of the company were receiving the money provided by the other stakeholders. In turn, there was a never-ending circulation of the funds entrusted to the firm by its stakeholders between them while the profits went to the owner of the company, allowing him to monopolize the match market.
Due to the secrecy of Kruegers business affairs, it is difficult to assess the costs of his corporate fraud. However, it is known that he has owned false Italian banknotes that could bring him about 150 million dollars in case they were cashed in the banks. Moreover, the significance of costs is also confirmed by the fact that after the truth was uncovered, the New York Stock Exchange has initiated the most stringent oversight rules to prevent such frauds from occurring in the future.
Thus, it is possible to say that white-collar crime is an anti-social behavior (deception and trust betrayal) of the persons occupying socially prestigious positions that is practiced within their profession and is primarily aimed at their enrichment. As was shown in the work, the effect of such crimes may range from the level of a group of people (religious fraud) to that of the entire country (consumer and corporate fraud) or even the global scale (environmental crimes). Therefore, it is not a problem to be neglected since virtually any person may become its victim in one way or another.