All About White-collar Crime

White-collar crime refers to a crime that is non-violent and is mainly financially-motivated in nature. It encompasses several offences including money laundering, fraud (including forgery), fraudulent trading, conspiracy to defraud and false accounting.

These crimes are mostly perpetrated behind the scenes, away from the direct eyes of the victims. Therefore, they may not be caught straight away until it’s too late, much like the financial crisis of 2008, Jordan Belfort and his illegal trading, Charles Ponzi and his discounted coupons pyramid scheme and even Frank Abagnale and his forged cheques; all lucrative, but ultimately prosecuted.

However, these are just the most famous examples. What about the perpetrators who are never caught? In this rapidly expanding and innovative digital age, committing and getting away with white-collar crime has both become easier and harder, meaning you are unlikely to see a conman performing the Three-card Monte on the street anymore. Instead, they are behind their computers, home and abroad, defrauding the companies and the public that use them, like the Bangladesh Bank cyber heist.

So, how is this relevant today?

As we are coming out of what is (hopefully) the last lockdown due to the pandemic, it can be noted that these sorts of crimes are on the rise as these crimes are just being noticed.

Why? To put plainly, the pandemic. Although the technology we have today has enabled us to comfortably work from home through the use of video calls and integrated work platforms, that same technology can leave us vulnerable.

Research shows the increase of employees across all sectors working from home on unsecured network has substantially increased the surface area of propagation of data outside of GDPR rules, thus more breaches are likely to occur, sensitive data leaked and fraud committed. In addition to ‘accidental’ data leakage, having more work devices on home networks opens up what should be ‘secured company devices’ to unfettered internet. This could have been mitigated, but the speed at which the companies had to transfer from in-office to homeworking meant massive delays in rolling out the necessary protection.

The furlough scheme has also especially been susceptible to fraud, with employers claiming relief money from the government after an employee has left by delaying the submission of a P45 to HMRC.

This is not a criticism of the absolute necessity that have been the lockdowns but more an observation that we are now finding that like in the wake of the financial crisis in 2008, we once again unprepared for the fall-out post-pandemic. Legislation enacted post-2008 to combat such crimes tightens the loopholes making these types of crimes easier to prosecute, however as the economy recovered so did the investment in key white-collar crime practice areas stagnate.

Experienced candidates I have spoken to have found themselves becoming busier and busier, so it should not come as a surprise that demand for Associates and Partners who specialise in this area of law will increase and soon.