David L. McCormick

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An overview of white-collar crimes

| Apr 3, 2021 | White Collar Crimes

White-collar crime in Minnesota includes several areas of non-violent illegal business acts intended for financial gain. The name derives from the most common type of perpetrator, which is affluent people in business sectors. The FBI works to reduce the occurrence of white-collar crime by imposing stiff penalties.

White-collar crime definition and penalties

The FBI defines white-collar crime as an activity that deceives or violates trust, commonly carried out with the motivation to protect finances. The offender works to gain the victim’s trust either to obtain information or profit from them. Newer technology has given offenders the advantage of devising many new schemes.

White-collar crimes commonly classify as felonies, but penalties may vary, and they can also result in civil litigation. Some common penalties include prison terms, home detention, restitution, community confinement and fines. Some crimes, such as securities fraud, could carry a 20-year jail term.

Types of white-collar crimes

A common white-collar crime is the Ponzi scheme, which takes its name from Charles Ponzi, an Italian con artist from the early 20th century. A Ponzi scheme usually promises investors a high return with little or no risk in exchange for an investment. However, it requires a constant flow of new investors to pay the old ones, or it fails.

Tax evasion involves the offender attempting to avoid paying taxes through falsified income or offshore property and accounts. Money laundering means hiding the origin of illegal profits through “laundering” the money through several small transactions. The “dirty” money looks “clean” and becomes harder to track. Embezzlement involves improperly using funds or assets they have been entrusted with, such as an employee pocketing extra cash from overcharging customers.

Being charged with a white-collar crime can have many implications that could linger a long time. It is imperative to have the assistance of a criminal defense attorney throughout the process.