White Collar CrimeNon-violent crimes committed by individuals in high-status positions, typically for financial gain., first published in 1949, is considered a groundbreaking work in criminology. In this study, Edwin H. Sutherland not only coined the term “white collar crime” but also expanded the definition of crime to include offenses committed by upper-class individuals in the context of their professional roles. He criticized the prevailing criminological focus on “street crime” and demonstrated that criminal behavior is widespread among the upper classes—yet far less frequently prosecuted.
Key Points
Edwin H. Sutherland – White Collar Crime
Main proponent: Edwin H. Sutherland (1883–1950)
First published: 1949
Country: USA
Core idea: CrimeActs or omissions that violate criminal laws and are punishable by the state. is not limited to the lower classes but also occurs within the highest levels of society. “White collar crime” refers to offenses made possible through positions of power and trust in professional contexts.
Foundation for: Critical CriminologyA perspective that examines power, inequality, and social justice in understanding crime and the criminal justice system., Economic Sociology, Corporate CrimeIllegal or harmful acts committed by companies or individuals acting on behalf of a corporation. Studies
Related theories: Differential Association Theory, AnomieA state of normlessness in which social norms lose their power to regulate individual behavior. Theory, Cultural CriminologyA perspective that studies crime and control as cultural products shaped by meaning, emotion, and symbolism.
Edwin H. Sutherland was one of the most influential criminologists of the 20th century. Considered the founder of modern American criminology, he was a long-time professor at Indiana University and co-author of the first systematic criminology textbook (Principles of CriminologyThe scientific study of crime, criminal behavior, prevention, and societal reactions to deviance within and beyond the criminal justice system., first published in 1934). As president of the American SocietyA group of individuals connected by shared institutions, culture, and norms. of Criminology (ASC), he championed a sociologically grounded, interdisciplinary approach to crime research. His work not only shaped generations of criminologists but also helped establish white collar and organizational crime as legitimate fields of academic inquiry.
Definition: White Collar Crime
White collar crime refers to offenses committed by individuals in high-status professional roles—such as managers, executives, or politicians—in the context of their work. These crimes typically include fraud, tax evasion, insider trading, corruption, and money laundering.
In contrast, blue collar crime refers to traditional crimes such as theft, robbery, or assault, often associated with manual labor and the working class. While blue collar crimes tend to involve violence or direct harm, white collar crimes are characterized by calculated, often hidden actions that primarily cause financial damage.
Historical and Scientific Context
Edwin H. Sutherland published White Collar Crime at a time when crime was almost exclusively considered a phenomenon of the lower social classes. Offenses were seen as the result of poverty, social disintegration, and lack of education. Sutherland challenged this view and showed that members of the upper classes also commit crimes—often unnoticed and rarely punished.
His concept of “white collar crime” encompasses not only the acts themselves but also the social conditions that enable such crimes: positions of power, access to networks, and economic resources allow perpetrators to engage in criminal behavior without facing the same consequences as lower-class offenders. His work thus laid the foundation for later developments in Corporate Crime Studies and Critical Criminology.
Main Arguments and Core Ideas
Crime Among the Upper Class
Sutherland argued that crime occurs across all social classes, but that economically motivated offenses by those in power are often not perceived as “crime” and are less harshly prosecuted.
Example: Enron Scandal (2001)
The Enron scandal ranks among the most significant corporate frauds in modern history. Top executives at the company hid debt and deceived investors through falsified balance sheets. The case illustrates how criminal practices among economic elites can remain undetected for years—even as they cause far more damage than most street crimes.
Differential Sanctioning
Sutherland observed that white collar crimes are less frequently prosecuted and less publicly condemned than crimes committed by the poor. He introduced the concept of “differential sanctioning,” meaning that upper-class offenders benefit from social status and influential networks. Legal consequences are often mild—even when the economic harm is considerable.
Example: 2008 Financial Crisis
During the 2008 financial crisis, widespread market manipulation and fraud were exposed. Despite proven misconduct, few responsible individuals faced criminal charges—while the social and economic consequences affected millions. This highlights how economic offenses are often treated differently from conventional crimes.
Trust as a Resource for Crime
A key aspect of white collar crime is the trust that individuals in powerful positions enjoy. Sutherland demonstrated that trust, while a cornerstone of legitimate business relations, can also serve as a cover for criminal behavior.
Example: Bernie Madoff and the Ponzi Scheme
The Bernie Madoff case is a striking example of trust abuse. Over decades, Madoff defrauded investors through a massive Ponzi scheme, using new contributions to pay off earlier ones. The case shows how trust in authority figures can obscure criminal conduct.
Method and Empirical Research
Edwin H. Sutherland’s analysis of White Collar Crime was based on a sociological methodology that marked a clear departure from the dominant criminological approaches of his time. While classical studies of crime focused on statistical data related to property and violent offenses in disadvantaged social groups, Sutherland redirected attention to economic crimes committed by the upper classes.
Sociological Perspective on Crime
Sutherland viewed crime from a sociological standpoint, emphasizing that it cannot be explained solely by poverty or social marginalization. He coined the term white collar crime to describe economically motivated offenses committed by individuals in positions of trust and authority. According to Sutherland, these crimes typically exhibit the following characteristics:
- Abuse of trust: Offenders exploit positions of power to gain illicit economic advantages.
- Lack of visibility: These crimes often go undetected because they occur behind closed doors rather than in public spaces.
- Differential sanctioning: Upper-class offenders receive more lenient treatment than their lower-class counterparts for similar or even more damaging offenses.
Empirical Basis of the Study
Sutherland grounded his theory in extensive case studies and data from court proceedings, insurance records, and corporate reports. A central part of his research was a collection of 70 companies that had repeatedly violated laws—engaging in activities such as price-fixing, fraud, tax evasion, and bribery. Despite clear violations, these companies were rarely prosecuted and usually faced only modest fines.
Example: The Ford Pinto Case (1970s)
In the 1970s, it became known that the Ford Motor Company had ignored a design flaw in its “Pinto” model. The fuel tank was positioned in a way that made it prone to explosion in rear-end collisions. Internal documents revealed that Ford consciously chose not to implement a costly recall and instead accepted the risk of future lawsuits. This case exemplifies how economic priorities can override public safety—fitting squarely into Sutherland’s concept of white collar crime.
Differential Association Theory and White Collar Crime
A central theoretical foundation of Sutherland’s work is the Differential Association Theory, which holds that criminal behavior is learned through interaction within social groups where such conduct is normalized or encouraged. Sutherland argued that economic crime follows this pattern as well: within corporate environments and professional networks, illegal practices may be seen as acceptable—or even necessary—for maintaining competitiveness.
Example: LIBOR Scandal (2012)
The LIBOR scandal involved the manipulation of global interest rates by major banks such as Barclays, Deutsche Bank, and UBS. Internal communications revealed that manipulation was openly tolerated and in some cases promoted within the institutions. Employees exchanged tips on how to fix rates without fear of legal repercussions. These practices had become part of the corporate culture—perfectly illustrating Sutherland’s Differential Association Theory.
Methodological Innovation: Economic Crime as a Criminological Subject
Sutherland’s methodological approach was revolutionary for criminology at the time. Until the publication of his work, crime and deviance were considered phenomena of the lower classes, while economic offenses were often dismissed as mere “gentlemen’s infractions.” Sutherland expanded the criminological perspective by demonstrating that the societal elite also engages in criminal behavior—though often in areas hidden from public scrutiny.
He called for an expanded definition of crime that applied not only to the lower social strata but also included offenses committed by the “respectable” members of society. This perspective laid the foundation for later developments in corporate crime studies and the critical analysis of economic crime within the framework of critical criminology.
Criticism and Reception
Sutherland’s White Collar Crime (1949) marked a turning point in criminology. Prior to its publication, criminological research had almost exclusively focused on property and violent crimes among disadvantaged populations. Crime was generally understood as a consequence of social disintegration, poverty, and lack of education. Sutherland broke with this paradigm by bringing elite criminality to the forefront.
Critical Appraisal
Sutherland was criticized for his assertion that economic crimes were widespread among the upper classes and systematically concealed. Traditional criminologists accused him of expanding the definition of “crime” too far and of introducing moral bias. His findings challenged the dominant belief that crime was primarily associated with social deprivation and deviant behavior among the poor.
Another point of contention was his methodology. Sutherland relied on case studies and corporate documents sourced from public records and court filings. Critics argued that his data were selective and non-representative. Furthermore, companies that voluntarily disclosed information often revealed only offenses they deemed minor or defensible. Despite these critiques, Sutherland’s work is regarded as a milestone in criminology for its focus on the intersections of power, economy, and law.
Reception in Contemporary Criminology
Sutherland’s concept of white collar crime has since been expanded and redefined in multiple directions. Especially in the 1970s and 1980s, the social and cultural dimensions of corporate crime became more prominent. Several theoretical developments emerged from his foundational insights:
Corporate Crime Studies
Following Sutherland, sociologists and criminologists began large-scale investigations of economic crime. These studies revealed that white collar crime was not limited to individual actors but was often embedded in corporate structures. Concepts such as corporate crime and organizational crime extended Sutherland’s theory and demonstrated the systemic nature of economic offenses.
Example: Enron Scandal (2001)
The Enron scandal is one of the most infamous cases in corporate crime history. The U.S. energy company manipulated financial statements and concealed billions in debt over several years. Accounting firm Arthur Andersen failed to expose the scheme, which ultimately led to Enron’s bankruptcy. The case sparked worldwide debate over corporate accountability and auditing practices.
Criminological relevance: Enron exemplifies corporate crime at a systemic level. Its internal structures facilitated widespread fraud, misleading investors and regulators alike—an ideal case study of Sutherland’s theory in action.
Critical Criminology and Marxist Criminology
Sutherland’s research provided a foundation for the development of critical criminology, which views economic crime as a manifestation of social inequality and class conflict. While Sutherland emphasized the systemic nature of corporate crime, scholars such as David Gordon and William Chambliss expanded his approach. They argued that criminal law primarily protects the interests of the ruling classes, allowing elite offenses to go largely unpunished.
Example: Subprime Mortgage Crisis (2007–2008)
The global financial crisis of 2007–2008 is one of the most severe economic crises of the postwar era. Banks had issued risky mortgage loans based on unsound securities. The collapse triggered mass unemployment, poverty, and a global recession. Although many banking practices were fraudulent, few of those responsible faced criminal prosecution.
Criminological relevance: The crisis illustrated that systematic economic crime among elites often goes unpunished. Critical criminologists interpret this as evidence of structural power dynamics and economic interests that receive more protection than the public good.
Cultural Criminology
In the 1990s, theorists like Jock Young and Jeff Ferrell developed cultural criminology. This approach builds on Sutherland’s insights by emphasizing the cultural dimensions of corporate crime. Cultural criminologists argue that illegal practices in corporations also reflect cultural norms and the reproduction of power and prestige. Economic gain is only part of the motivation; maintaining status and hierarchy is equally important.
Example: Dieselgate (2015)
In 2015, it was revealed that Volkswagen had manipulated emissions data for its diesel vehicles. Special software was used to produce favorable results during emissions tests. The scandal cost Volkswagen billions and led to widespread lawsuits.
Criminological relevance: The emissions fraud shows how economic crime can be culturally embedded. In the auto industry, it was an open secret that emissions data were “optimized.” The case illustrates how criminal behavior can be normalized within specific industrial cultures.
Impact on Modern Criminology
Sutherland’s work continues to influence criminology and the study of corporate crime. His concept of white collar crime broadened the scope of criminological research and led to more nuanced analyses of criminal behavior. Contemporary research on mass incarceration and the role of inequality in the criminal justice system often revisits his foundational ideas.
Scholars such as David Garland (The Culture of Control, 2001) and Loïc Wacquant (Punishing the Poor, 2009) extended Sutherland’s theory by incorporating the dimension of social control. Garland analyzed punitive policies in the neoliberal era, showing how punishment stabilizes social and economic hierarchies. Wacquant argued that modern penal systems primarily target marginalized populations—a perspective that parallels Sutherland’s critique of unequal enforcement but applies it to the criminalization of poverty.
Relevance and Contemporary Significance
More than 70 years after its initial publication, White Collar Crime remains highly relevant. Developments in digital capitalism affirm and expand upon Sutherland’s core assumptions. The idea that economic crime is not only prevalent but structurally embedded in societal power dynamics is evident in numerous recent cases. These cases also highlight that such crimes often go underpunished, while offenses by the socially disadvantaged are disproportionately prosecuted—a selective enforcement issue that Sutherland had already criticized and which remains central to today’s criminal justice debates.
This selective enforcement also connects to broader sociological critiques of power. A closely related perspective is offered by C. Wright Mills in The Power Elite, which examines how institutional elites in politics, the economy, and the military maintain dominance through interlocking interests. Both Mills and Sutherland uncover how elite groups shape norms and evade accountability, highlighting the structural dimensions of privilege and deviance.
Contemporary Cases of Economic Crime
Wirecard Scandal (2020)
The Wirecard scandal is one of the largest financial frauds in recent history. The German fintech company collapsed in 2020 after it was revealed that €1.9 billion were missing from its balance sheets. Over several years, Wirecard manipulated financial statements and misled investors, banks, and regulators. The case exposed not only the scale of elite financial fraud but also the failure of state oversight mechanisms.
Wirecard and Regulatory GapsThe Wirecard case revealed severe deficits in state supervision. Despite numerous warning signs, regulatory authorities like BaFin (Federal Financial Supervisory Authority) failed to act. Only after in-depth investigative journalism by the Financial Times did the scandal unfold publicly. This case exemplifies how the enforcement of legal consequences for economic crime is often shaped by political and financial pressure.
Criminological relevance: Wirecard illustrates Sutherland’s thesis that economic crime is typically less punished than conventional crime. Despite massive financial damage, criminal prosecution was delayed. The complex relationships between corporations, regulators, and political actors prevented timely intervention.
Facebook-Cambridge Analytica (2018)
This scandal involved the unauthorized harvesting of millions of Facebook users’ data by Cambridge Analytica to influence political campaigns. The data collection occurred without users’ consent and constituted major violations of data protection laws.
Big Data and White Collar CrimeThe Cambridge Analytica case revealed the enormous potential for abuse in the digital data economy. The ability to harvest and manipulate personal data for political purposes represents a new frontier in economic crime—one that is largely unregulated.
Criminological relevance: Economic crime no longer occurs only in banks or corporations—it now affects digital spaces with far-reaching consequences. The underregulation of data markets and the lack of legal protections against data abuse show how White Collar Crime is evolving in the digital age.
Cryptocurrency Fraud and Digital Currencies
The rise of Bitcoin, Ethereum, and other digital currencies has created new opportunities for financial crimes. Unregulated markets and anonymity attract criminal actors. Cases like the collapse of Mt. Gox (2014) and the OneCoin Ponzi scheme (2019) show how billions in losses can occur without significant legal consequences.
Cryptocurrencies and Economic CrimeOneCoin is one of the largest Ponzi schemes in cryptocurrency history. Founder Ruja Ignatova promised high returns on a non-existent digital currency. The fraud amounted to over $4 billion before the platform was shut down.
Criminological relevance: This case shows the difficulty of prosecuting economic crimes in digital spaces. The anonymity and decentralization of cryptocurrencies present new challenges for law enforcement and regulation.
International Regulations and Criminal Oversight
Given the global scope of modern economic crime, international regulatory bodies have become increasingly important. The Financial Action Task Force (FATF), established in 1989, develops international standards to combat money laundering, terrorism financing, and financial crime. The European Union has also strengthened its legislation to fight transnational economic crime more effectively.
Financial Action Task Force (FATF)The FATF is an international body dedicated to combating money laundering and economic crime. It sets standards that member countries incorporate into national law. Key measures include:
- Transparency in financial transactions
- Combating money laundering and terrorism financing
- International cooperation in law enforcement
Criminological relevance: The FATF demonstrates that economic crime is increasingly global in nature and can only be effectively tackled through international collaboration. Compliance with FATF standards is now seen as a benchmark for sound financial regulation.
White Collar Crime, Environmental Crime, and Organized Crime
Edwin H. Sutherland’s concept of white collar crime is not limited to economic offenses within the corporate world—it also overlaps with other forms of organized and environmental crime. A recent example is the Cum-Ex tax scandal.
Example: Cum-Ex Scandal – White Collar Crime on a Global Scale
The Cum-Ex scandal is one of the largest tax fraud cases in European history. For years, banks, investors, and funds exploited a legal loophole to claim reimbursement of capital gains taxes multiple times—despite having paid them only once. The estimated damage to the German state exceeds 30 billion euros. The complex financial transactions, conducted across borders, clearly demonstrate the challenges of prosecuting white collar crime in a globalized financial system.
Criminological relevance: The Cum-Ex case reveals the structural weaknesses of state oversight in the field of financial crime. Despite clear evidence, it took years before the first criminal convictions were made. The case illustrates that white collar crime is often difficult to prosecute due to economic and political entanglements.
Connection to organized crime: Funds from illegal tax refunds were partially funneled into offshore accounts or used to finance other criminal activities. This highlights the close link between white collar crime and organized crime, which uses money laundering as a tool to funnel illicit profits into the legal financial system.
Environmental Crime and Green Criminology
Another area where white collar crime manifests is environmental crime. Companies that violate environmental laws, illegally dispose of waste, or profit from deforestation are classic examples of elite crime that causes massive ecological damage.
Green Criminology – The Ecological Perspective on Crime
Green criminology examines the social and ecological dimensions of crime that harm the environment and natural resources. Corporations are often the actors behind such offenses, using illegal practices to bypass environmental regulations. Examples include illegal chemical dumping, river pollution by industrial waste, or deforestation for commercial gain.
Example: The VW emissions scandal (Dieselgate) revealed how companies systematically bypassed emissions regulations to maximize profit. Illegal software was used to manipulate test results. The resulting pollution had significant environmental consequences—a clear violation of environmental law and a form of white collar crime.
Criminological relevance: The analysis of such cases shows that environmental crimes are often treated as minor infractions, even though the ecological and societal damage is substantial. Green criminology calls for stricter legal enforcement that reflects the severity of such harms.
Organized Crime and Money Laundering
An often-overlooked aspect of white collar crime is its connection to organized crime. Economic crimes such as tax evasion or illicit financial transactions enable criminal networks to move vast sums of money and launder it into the legal economy.
Money Laundering as a Link to Organized Crime
Money laundering is the process of integrating illegally obtained funds into the legal financial system. It typically involves disguising the origin of the funds through a series of transactions and converting them into legitimate assets. Common methods include:
- Smurfing: Breaking large sums into smaller transactions to avoid detection by financial regulators.
- Offshore accounts: Transferring illicit funds to tax havens with weak oversight.
- Real estate investments: Using real estate markets to legitimize large cash flows.
Example: The Panama PapersA massive leak of financial documents in 2016 exposing how global elites used offshore accounts to evade taxes, launder money, and conceal wealth. scandal (2016) revealed the extensive use of offshore accounts to conceal illegal profits from tax authorities. These mechanisms were used to shield capital from state regulation and accountability.
Connection to Sutherland’s theory: These techniques of concealment and integration align with Sutherland’s argument that white collar crime often goes unrecognized as crime, even when the social damage is immense.
Conclusion
With White Collar Crime, Edwin H. Sutherland redefined the boundaries of criminological inquiry. By focusing on the criminal practices of elites, he challenged the prevailing notion of crime as a phenomenon limited to the lower classes. His work represents a paradigm shift that continues to shape both academic research and broader debates about power, law, and justice.
