White-collar crime is defined as a financially motivated, nonviolent crime committed for illegal monetary gain. Although there has been some debate as to what actually qualifies as a white-collar crime, the term today generally encompasses a variety of nonviolent crimes usually committed in commercial situations. Many white-collar crimes are especially difficult to prosecute due to complex transactions. Examples include fraud, bribery, Ponzi schemes, insider trading, embezzlement, cybercrime, copyright infringement, money laundering, identity theft, and forgery.
According to the Federal Bureau of Investigation, white-collar crime is estimated to cost the United States more than $300 billion annually. Although typically the government charges individuals for white-collar crimes, the government has the power to sanction corporations as well for these offenses. The penalties for white-collar offenses may include fines, forfeitures, restitution and imprisonment. However, sanctions can be lessened if the defendant takes responsibility for the crime and assists the authorities in their investigation. Any defenses available to non-white-collar defendants in criminal court are also available to those accused of white-collar crimes. A common refrain of individuals or organizations facing white-collar criminal charges is the defense of entrapment.
The activities that constitute white-collar criminal offenses may be covered by both state and federal legislation; the Commerce Clause of the U.S. Constitution gives the federal government the authority to regulate white-collar crime, and a number of federal agencies including the FBI, the IRS, U.S. Customs and the Securities and Exchange Commission all participate in the enforcement of federal white-collar crime legislation. In addition, most states employ their own agencies to enforce white-collar crime laws at the state level.
To combat white-collar crime, the U.S. Congress passed a wave of laws and statutes in the 1970s and 80s. The Racketeer Influence and Corrupt Organizations Act (RICO), originally associated with organized crime, was also applied to white-collar crime. Under RICO, racketeering now includes embezzlement from union funds, bribery and mail fraud. RICO has made it easier to prosecute organizations and seize assets related to corruption, as well as allowing states or people to sue perpetrators for up to three times the amount of damages. Since the United States tightened its federal sentencing guidelines, white collar criminals now face longer sentences with less opportunity for early release. Opponents argue that white-collar crime punishment is too harsh, considering that white collar criminals tend to be first-time offenders.