Even a hint that someone in California is under investigation for white-collar crimes can cause professional reputational damage. The public views these allegations as a betrayal of the trust placed in a person by an organization or company. White-collar crimes come in many forms and often rely on how the state or federal government interprets complex financial transactions.
Standard definition of white-collar crime
At its core, a white-collar crime happens when a person abuses a position of power for illegal gain. Being the CEO of a corporation represents an obvious position of power, but the law can define power more modestly. For the most part, a suspect only needs to be entrusted with some type of power or control over finances or activities that can abused for personal gain.
White-collar crimes in the nonprofit arena
An organization need not be in the business of making money for these types of crime charges to be made. A high-profile case in California has emerged against the former executive director of a large labor union.
The long-time union leader and her spouse have both been charged with:
- Filing false tax returns
- Under-reporting income for five years
- Failing to pay income taxes
- Failing to pay unemployment insurance taxes
Penalties for crimes of this nature can include fines, restitution, loss of professional licenses and imprisonment. On top of the threat of state-level prosecution, any activities that run afoul of bank regulations, the Internal Revenue Service or cross state lines can attract federal prosecution.
Swift professional consequences usually result
Organizations will generally suspend or dismiss people arrested for white-collar crimes. In the case of the union leader, she resigned once law enforcement acted against her. She had been in her leadership position since 2016.