White collar crimes are criminal activities involving people in their regular courses of business. These crimes do happen in the regular classes of peoples business and involve extortion, bribery, embezzlement, and fraud (Goldstraw-White, 2011). These crimes usually end with the perpetrators having financial gain. Some examples that constitute white collar crimes include price collusion that is, conspiring with other corporation to fix the price of services or goods as a way of gaining high profits that are artificial or driving a competitor out of the market (Simpson, 2013). Falsifying reports of test on pharmaceutical products so as to obtain manufacturing license and substituting cheap, defective materials for a more cost component stipulated in the construction of infrastructures by charging the client for the whole charge of the specified content. These activities can be done by individual employees or executives working on their initiatives. These crimes represent a collective and organized effort by an organization to increase its profit at any cost (Simpson, 2013).
According to Simpson 2013, most of the white collar crimes offenders are persons of high social status and respectability in the course of their occupation and most of them are over the age of 18. These crimes can be committed by individuals at any level of an organization (Goldstraw-White, 2011). Either be it cooperate executives and their employees at the bottom of their corporate hierarchy though it is highly associated with executives for they can take advantage of privileged information about an impending stock or event in their gain an advantage by engaging in illegal insider trading. Statistics also proved that male is more involved in the crimes than the females.
The florid Subrata Roy, flashy, the chief promoter of the Sahara Group has been in Tihar jail since March 4, 2014, having committed the following white collar crimes. Held back in 2012, the Supreme Court declared his companies acted in the contravention of the SEBI riles for public issues by unlisted companies. He had his legal arguments that the SEBI had no legal jurisdiction over optionally convertible debentures that were unadvertised issuance by unlisted companies that were rejected by the Supreme Court. He was directed to refund Rs 175 billion that accounted to USD 4 billion that were collected by his 1.2 million agents from an estimated 22 million small investors. This was between the year 2008 and 2011.lin more legal environment, Roy would be termed an investor par excellence who extended financial inclusion to million investors, and a million agents got lively hood through him.
He used his innovation to by providing informal financial services and the wave of public corruption which has been at the same level with the GDP between 2 and 5percent since the year 1990s. His operation method was quite simple; he would provide a clock of legitimate financial service to the public servants that are corrupt and politician by managing the cash generated illegally by them (Goldstraw-White, 2011).. This commercial service cloak is based on a micro financial network of investors and agents on a scale that is staggering with massive investment and 3000 branches in real estate.
On any other Ponzi scheme that was similar, his way was to offer enormous returns more than 25 percent per year. The Ponzi scheme fails ultimately because they run out of new investors to provide the flow of cash to service the existing investors because there are no valid returns from the underlying asset invariability (Goel & Saini 2015). This is where the Sahara Company had an opportunity to emerge as the winning team. They possibly had to access a resource that was inexhaustible of cash coming to them from corrupt politicians and public servants. Other sources might be the firm industry terrorism and drugs.
Sahara was immune to the government censure since they provided service to the politically powerful. But the main reason why they remained below the radar was possible that they had maintained a strong leash on the volume of small-time depositors who offered the cloak to the big investors. The Supreme Court was left to wonder who big the real investors were and how many they were (Goel & Saini 2015). If the investment exceeded the illegal cash, the scheme would have imploded what it never did.
Sahara was sewed by the Security Exchange Bureau of India. It investigated the local cash selection done by agents from Sahara that amounted to Rs 175 between the year 2008 and 2011 against the issue of the improvised instrument known as the Optional convertible debentures. It was held that this had a relation with the public issue and hence on their turf (Levi, 2013). Since the organization had no permit from the SEBI for providing such public securities, the cash collection was illegal. What motivated SEBI to wake up was complaint response to an association of investors. Another reason is, the financial fighting regulatory for turf within the ministry of corporate affairs. There was SEBI's apprehension that significant domestic savings were being directed away from bourses were under the oversight of the SEBI the listed companies raised money (Levi, 2013). Between the year 2008 and 2011 t listed businesses in India raised USD 26 billion against $4 billion that was raised by the Sahara firm, unlisted company in India. The political score set by t e Indian government also created an impact.
When the Sahara Group's activities came under the control of SEBI, it leads to the arrest of Sahara Indian Pariwar founder Subrata Roy in 2014. SEBI alleged that Sahara Indian Real Estate Corp Ltd and the Sahara Housing Investment Corp Ltd, which issued debentures collected investors' money illegally. SEBI went on to the order of issuing a full refund to its investors which were later challenged by Sahara to repay investors before the Securities Appellate Tribunal. Sahara moved to the Supreme Court in August 2012 when the SAT upheld SEBI's order. Sahara was ordered by the Supreme Court to refund the investors' money by depositing it with SEBI. Sahara declared that it had repaid most of the US $3.9 billion had been repaid to the investors and a partly saving of around US $ 840had been made for SEBI. SEBI disputed this by saying that the details of the investors that had been refunded had not been provided. When Sahara failed to deposit the money with SEBI and Subrata Roy skipped the hearing, the Supreme Court of India issued an arrest warrant for the Sahara chief.
The misuse of political connection and money laundering charges were brought about out, Sahara denied all charges and continued to defy SEBI. The regulatory preserved through the hide and seek games of Sahara and finally managed to pin down Sahara chief Subrata Roy in 2014. In this victory, SEBI did not only bring Sahara to justice but also made a perfect example of why the regulatory and other like it requires greater penalizing and autonomy power.
India and the US have a common characteristic in the cases of white collar jobs. According to the comparison made in the two countries and the way justice is administered there appears a similar character between them (Geis, 2011). The advancement of technology and scientific development is a contribution to the emergence of with a small controlling elite and a great rank and file. This encourages the growth of monopolies, the rise of managerial class and intricate institutional mechanisms (Levi, 2013). The inability of all sections of the society to fully appreciate in full this need results in the emergence and growth of white collar crimes.
Offenses considered as white collar are categorized as those calculated to prevent or obstruct the economic development of the country or state and endanger its economic growth (Geis, 2011). The evasion or avoidance of taxes lawfully imposed; misuse of position by a public servant in making of contracts and disposal of public property and issuing of permits and licenses and similar other matters. The delivery of an individual, industrial and commercial undertaking of goods not by agreed specification and in fulfillment of contracts entered into with the public servants (Geis, 2011).