White-collar crimes in California and elsewhere in the United States involve several types of non-violent illegal financial activity. These crimes are named for the ones who frequently commit them, which include business people of status with the goal of benefiting themselves. The FBI divides white-collar crime into more than a dozen categories, but some kinds happen more frequently.
As the name implies, money laundering involves making illegal funds look “clean.” This money may come from embezzlement, drug trafficking or selling illegal firearms concealed in a legitimate business.
The money gets “laundered” in various ways, such as smuggling cash to foreign accounts, gambling and taking out life insurance policies. The most common way that scammers hide money is through making small deposits, often called structuring or smurfing. This creates a complicated trail for law enforcement or the FBI to follow.
Named after con artist Charles Ponzi, Ponzi scheme promises investors high returns with little or no risk if they entrust their money to the scammer. However, the scammer pays them with the money of other investors. A Ponzi scheme cannot succeed unless it keeps getting new recruits, so a lack of new recruits usually causes the scam to fall.
Borrowers or financial institution employees can commit mortgage fraud, which covers several activities. The FBI defines mortgage fraud as omission, misstatement or misrepresentation of facts to secure a mortgage. It further divides into fraud for housing and fraud for profit. A borrower may misrepresent income to qualify for a mortgage, possibly through identity theft. An example of lender fraud is appraisal fraud, which often includes deflating home values to buy foreclosures at lower prices.
White-collar crimes can come with stiff penalties and possible jail time. The defendant needs an experienced criminal defense team to potentially fight the charges or make a plea deal.