Operating a Small Business and White Collar Crime Text Size:

The term "white collar crime" broadly refers to any kind of illegal conduct that occurs in a business setting. Examples include theft and tax evasion. Prosecutors have a lot of discretion in deciding whom to prosecute for white collar crimes, so you should cooperate with government investigators. However, once you become aware of a criminal investigation at your business, go see your attorney immediately.

Definition

"White collar crime" is currently defined by state and federal investigators as an illegal act or series of illegal acts committed by nonphysical means and by concealment or guile to obtain money or property, to avoid the payment or loss of money or property or to obtain business or personal advantage.

These acts occur in a business setting. Examples include:

• Theft
• Bribery
• Extortion
• Fraud
• Tax evasion
• Other acts of corruption

White collar crimes can carry stiff penalties, including prison sentences that can sometimes exceed the sentences for crimes like armed robbery.

What Should You Do?

The ability to prosecute white collar crimes is a strong weapon in a prosecutor's arsenal. It was income tax evasion, for example, that brought down Al Capone.

Today, many executives find themselves in the difficult position of either agreeing to a plea bargain for a white collar crime, or rolling the dice on being sent away to prison for many years if they go to trial and are convicted by a jury.

Prosecutors have a lot of discretion in deciding whom they prosecute for white collar crimes.

For this reason alone, it is usually in your best interest to cooperate with government officials, since even the simplest of inquiries can turn into criminal investigations if not handled properly.

As a business owner, you have good reason to be aware of what's appropriate and inappropriate behavior in the business place.

The law in this area can also be a trap for the unwary, because it is easy to commit a crime without even knowing that you are doing anything wrong. Anyone who had anything to do with a criminal act or an attempted criminal act can be charged with the crime of conspiracy.

Even if charges are never filed, it can still be a crime known as obstruction of justice to interfere with a pending criminal investigation. It may take nothing more to step over the line than calling up a friend who is a prospective witness in the investigation.

If you are under criminal investigation, don't be your own worst enemy. Immediately contacting your business's attorney for help is likely your best next move.

Also, remember the constitutional right against self-incrimination. It is very much a true statement that anything you say can and will be used against you.

Government agencies now have the Racketeer Influenced and Corrupt Organizations ("RICO") laws to combat white collar crime. These laws make it much easier to get convictions for patterns of criminal activity and they have been applied in many situations involving white collar crimes.

A white collar criminal defendant will always be "outgunned" in terms of resources. Wiretappings, recordings and other surveillance tactics are commonplace. Criminal prosecution of friends and family is also common.

Furthermore, even if you beat the rap on one charge, prosecutors can simply turn around and file other charges.

Criminal liability is not limited to individuals, as business entities such as corporations can also be convicted of criminal wrongdoing. Obviously, you cannot send a corporation to jail. But fines and injunctions are a powerful weapon that prosecutors can use to bring a business to its knees.

When it comes time to deciding upon the best strategies in a white collar crime defense, you need to:

• Think about the future of your family, business and employees
• Keep your hands clean
• Watch out for the company you keep
• Hire good legal counsel

If you have any questions about white collar crime or your business is being investigated by state or federal investigators, contact a small business lawyer or a criminal lawyer in your area.

Questions for Your Attorney

• If one of my employees is charged by the state prosecutor's office with feloniously assaulting his secretary, is that a white collar crime?
• If I lie to a federal regulatory agency about the financial condition of my business, can I be prosecuted under the RICO laws?
• Can a prosecutor lawfully agree not to prosecute one of my employees for fraud if the same employee agrees to testify against me at my trial for tax evasion?

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