White Collar Crime: The Challenges of Sentencing
White collar crimes include financial offenses committed for personal gain using deception. They typically involve abuse of trust or position, deceit or maneuver and white collar crimes are more common in the business world. These crimes do not involve violence or overtly illegal activities. Instead, the offenders are generally involved in lawful businesses and often hold respectable positions, both in the organization and in the community.
These crimes are investigated and prosecuted by the federal government in the U.S., which means the accused is in a deep soup if convicted of such fraudulent schemes. Besides, the conviction rates bythe federal authorities are high. The accused, if proven guilty, will be treated with no leniency and the jail sentences can be as long or ven longer than those convicted of violence or drug-related crimes.
However, sentencing white collar offenders is a rather challenging task. First, the offender (although proven guilty of fraudulent schemes) do not present any physical threat to society. Secondly, there is a disparity in sentencing white collar crimes in the U.S. despite having uniform guidelines.
But before exploring the challenges of white collar sentencing in the country, let’s take a closer look at some of the common types of financial offenses.
What are the Common Types of White Collar Offenses?
The country witnesses a number of white collar crimes each day, the variety of which is only limited by the offenders’ imagination. From tax evasion, insurance fraud, insider trading, embezzlement and bribery to money laundering, white collar crimes are happening on both small and large scales, some of which affect hundreds or thousands of lives especially those committed by securities brokers. Such investment frauds include the likes of a Ponzi scheme, which was first performed by Charles Ponzi in the 1920s.
There are several examples of Ponzi schemes in which millions of people lost their hard earned money. Let’s take example of the epic Madoff investment scandal that broke in December 2008. Bernard Madoff, NASDAQ Chairman and New York money manager used an elaborate Ponzi scheme to rob clients of his Wall Street firm of an amount of around $65 billion. Madoff plead guilty in 2009 and the federal government sentenced him to 150 years in prison.
In addition to Ponzi schemes, white collar crimes include:
· Fraud such as deception, using a lie, dishonesty, or falsehood to gain a benefit
· Cyber-crime or electronic crime involving the use of computers and Internet for illegal transfer of funds, stealing, identity theft, cyber stalking, erasing, or changing financial data
· Investment fraud like illegal interception, lottery scams etc.
· Money laundering, bribery and corruption, market abuse and Insider trading, embezzlement, forgery, tax evasion, blackmail, and racketeering
Dealing with a White Collar Crime Investigation
People suspected of white collar crime often become aware that they are being investigated even before the actual arrest, providing them enough time and opportunity to deal with the matter. On the other hand, it may even make them nervous as they often start experiencing fear and apprehension about the consequences. But instead of giving in to fear, a suspect of such fraudulent schemes should first consider hiring a criminal defense attorney to try and reduce his/her exposure to criminal liability considerably, if not avoid or eliminate the charge completely.
Instead of impeding the investigation, your defense attorney will help you with the plea bargaining following an arrest. The criminal defense lawyers also act proactively so that you are not forced to give in to the demands of investigators, unless required. They also deal with the prosecuting attorneys in order to negotiate and resolve the issue before the beginning of the formal court proceedings. In most cases, they are successful in negotiating a deal, especially in case of small scale white collar crimes as the prosecuting attorneys and the plaintiff are often aware of the challenges associated with white collar crime sentencing.
The Challenges of Sentencing
If you or a loved one has been convicted of a financial fraud crime, it is better to have an idea about how the judge determines the sentence. The first thing the judge considers and refers to is the sentencing guidelines. And here lies the main source of the challenges the federal court faces when sentencing white collar offenders.
There are several loopholes in the sentencing guidelines for economic frauds and many people in the government believed that guidelines need to be updated in order to ‘fit the crime.’ They were concerned that offenders were getting off easy. As a result, the U.S. Sentencing Commission adopted changes to the fraud guidelines. The new amended guidelines take various other things into consideration such as harm caused to victims, offender’s intent, and individual culpability. If convicted of an economic crime, the sentence for a white collar offender can be similar to that of a person convicted of an arson or a kidnapping. But it seems even the new guidelines fail to resolve the issue.
Let’s take a look how the guidelines calculation is determined in case of a fraud crime.
Obviously, the loss amount is taken into consideration. Fraud cases where the loss amount surpass a million dollars, the sentence is likely to be over three years. The loss amount is an important factor when determining white collar crime sentencing. And by loss amount, we don’t mean just the amount of money the victim(s) lost. According to the sentencing guidelines, it is the amount of money the victim(s) could have been losing in that situation. In other words, the loss amount refers to the ‘reasonably foreseeable loss’ and it is usually larger than the amount the offender(s) actually made.
The guidelines also takes the number of characteristics about the fraud crime into consideration. The position of trust of the offender, the way he/she abused the same and the number of victims etc. can further increase the sentence for a fraud crime.
Conclusion
If you are a suspect of a white collar crime and are likely to be prosecuted, remember that both your reputation and career are at stake. Not just that, but you are also likely to lose your freedom. An experienced criminal defense lawyer is your best bet to get the right advice about your situation and can also help you once the court proceeding starts.
Author Bio: Rachel Oliver is a thought leader in laws dealing with personal injury and related niches. Updated with the latest happenings in the legal world, she shares her experiences and anecdotes through her write-ups on various websites. Interact with her through her Google+ profile.