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White Collar Crime

"White collar crime" can describe a wide variety of crimes, but they all typically involve crime committed through deceit
and motivated by financial gain. The most common white collar crimes are various types of fraud, embezzlement, tax
evasion and money laundering. Many types of scams and frauds fall into the bucket of white collar crime, including Ponzi
schemes and securities fraud such as insider trading. More common crimes, like insurance fraud and tax evasion, also
constitute white collar crimes
Fraud
Many white collar crimes are frauds. Fraud is a general type of crime which generally involves deceiving someone for
monetary gain. One common type of white collar fraud is securities fraud. Securities fraud is fraud around the trading of
securities (stocks, for example).
Securities Fraud
Securities fraud comes in many flavors, but one common type is "insider trading," in which someone with inside informa-
tion about a company or investment trades on that information in violation of a duty or obligation. For example, an execu-
tive knows confidential information about an upcoming company earnings repor t decides to sell of a chunk of his stock in
the company. That would be considered securities fraud, specifically, insider trading.
Another type of securities fraud is when someone seeks investment in a company by knowingly misstating the companys
prospects, health or finances. By luring an investor to put up money based on false or misleading information, the com-
pany and individuals within it commit securities fraud. False or misleading statements in public reports from publicly traded
companies also can constitute securities fraud. To commit securities fraud, those speaking on behalf of the business must
make these false statements with knowledge that they are false, or at least reasonably should know them to be false.
Other White Collar Frauds
Many types of fraudulent schemes, including mortgage fraud and insurance fraud, are amongst the more common white
collar crimes. These can be as common as an individual embarking on an insurance scheme to improperly collect on an
insurance policy after lying in application materials. They can also extend to larger scale schemes by businesses to
defraud their customers or others in the marketplace.
Ponzi schemes and other business related scams to fraudulently take money from investors have been some of the most
famous white collar crimes. These can take all shapes and sizes.
Embezzlement
Embezzlement is improperly taking money from someone to whom you owe some type of duty. The most common exam-
ple is a company employee that embezzles money from his employer for example by siphoning money into a personal
account.
Embezzlement can take many forms, however. Lawyers who improperly use client funds commit embezzlement. So do
investment advisors who improperly use client funds they have been entrusted to protect.
Tax Evasion
Criminal tax evasion is a white collar crime through which the perpetrator attempts to avoid taxes they would otherwise
owe. Tax evasion can range from simply filing tax forms with false information to illegally transferring proper ty so as to
avoid tax obligations. Individuals, as well as businesses can commit criminal tax evasion. As with fraud, there are perhaps
infinite ways to commit tax evasion.
Money Laundering
Money laundering is the criminal act of filtering illegally obtained ("dirty") money through a series of transactions designed
to make the money appear legitimate ("clean"). Money laundering often involves three steps. First, the money is deposited
typically into a financial institution such as a bank or brokerage. Next, the money is separated from its illegal origin by lay-
ers of often complex transactions, making it more difficult to trace the "dirty" money. The third step is integration. This is
where the freshly "cleaned" money is mixed with legally obtained money, often through the purchase or sale of assets.
Depending on the charges in question, white collar crimes can involve a variety of state and federal laws. An experienced
white collar defense attorney can help navigate potential criminal liability, as well as defenses that may be available.
The FindLaw Guide to Online Fraud and Identity Theft
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