White collar crime is financially motivated, nonviolent crime perpetrated by people, companies, and governmental professionals underlings. Money laundering, corporate fraud, securities fraud, and embezzlement are among instances of white-collar crimes. The legal system of a nation seeks mostly to treat all its inhabitants fairly and without prejudice. But in every legal system, this discrimination exists. These are the system’s loopholes that need investigation. In our society, an offence committed by a person of low social status is punished harshly under strict laws. However, if a person of high social status commits the same offence, the circumstances are often different. In reality, the law or the system is more forgiving toward the culprit.

Every sphere of society, including crime, faced new challenges as society evolved. One type of crime that emerged was White-Collar Crime. The chief advocate of this social idea of crime, sociologist Edwin Sutherland, first coined this phrase.

Within criminology, Edwin Sutherland has defined white-collar crime as:

A crime was carried out during his employment by a man of respectability and strong social standing in 1949.

It covers criminal actions committed by government officials, people in positions of power, or even people working for commercial institutions. White-collar crime, therefore, overlaps with corporate crime because white-collar personnel have greater opportunities for fraud, corruption, insider trading, embezzlement, computer crime, and forgery.

The economy and financial condition of a country are severely affected by white-collar crimes.

Classifications of White-Collar Crime

Whereas all previous laws did not define this term, this was the first time the categorisation of white-collar crime was undertaken under the National Accountability Ordinance. It involves two individuals:

Holders of Public Office: as defined in Sec 21 of the Pakistan Penal Code, 1860;

A person, such as a corporation or body corporate, including the sponsors, chairman, chief executive, managing director, or elected directors, by whatever name known.

Holder of Public Office

National Accountability Ordinance 1999, section 5, clause (l) defines a holder of public office.

A public office holder is someone who:

1. has been the President of Pakistan or the Governor of a Province.
2. The list of individuals who have held the office of Federal Minister or Minister of State, and have been appointed under the Central Law Officers Ordinance in 1970 (VII of 1970), includes those listed below. Additionally, each person has fulfilled a specific role, such as Advisor to the Prime Minister or Special Assistant to the Prime Minister. Member of Parliament, Auditor General, Political Secretary, Advisor or Consultant to the President.
3. Individuals may include the Chief Minister, Speaker Provincial Assembly, and Deputy Speaker Provincial Assembly, as well as individuals who have held similar positions in previous administrations.
4. Except for a person who is a member of any of the Armed Forces of Pakistan, or for the time being is subject to any law relating to any of the said Forces, or has been a member of the said Forces and is holding, or has held, a post or office in any public corporation, bank, financial institution, undertaking or other organization established, controlled or administered by or under the Federal Government or a Provincial Government, or in the service of Pakistan, or any service in connection with the affairs of the Federation, or of a Province, or of a local council constituted under any Federal or Provincial law relating to the constitution of local councils, or in the management of corporations, banks, financial institutions, firms, concerns, undertakings or any other institution or organization established, controlled or administered by or under the Federal Government or a Provincial Government,
5. Composed under any Federal or Provincial law about local councils, the Chairman or Vice Chairman of a Zila Council, Municipal Committee, Municipal Corporation, or Metropolitan Corporation has been, is or has been. Explanation: For this purpose, the terms Chairman and Vice Chairman shall encompass the Mayor and Deputy Mayor, as applicable, and the appropriate councillors therein.
6. any person who has served in the Armed Forces of Pakistan and retired, resigned, was discharged, or was fired.

Commission of Offence

The white collar crime is said to be committed when a holder of a public office, or any other person, commits or has. Individuals may include the Chief Minister, Speaker Provincial Assembly and Deputy Speaker Provincial Assembly, as well as individuals who have held similar positions in previous administrations. committed the offence of corruption and corrupt practices:

1. Should he accept or receive from any source or offer any reward directly or indirectly, other than legal compensation, as a motivation or incentive as defined in section 161 of the Pakistan Penal Code 1860 for doing or forbearing to do any official act, or for exhibiting or forbearing to show, in the exercise of his official functions, favor or disfavor to any person, or for providing or trying to provide any service or disservice to any person; or
2. From any person he knows to have been, or is likely to be, involved in any proceeding or company that has been or will be conducted, or having any relationship with his official duties, or from any person he knows to be interested in or related to the individual so concerned, he accepts, receives, or offers any valuable thing without regard, or for a consideration he knows to be inadequate.
3. If he dishonestly or fraudulently steals or otherwise converts for his own usage, or for the use of any other person, any property given to him or under his control, or knowingly enables any other person so to do; or
4. Should he, by corrupt, dishonest, or illegal means, get or attempt to acquire for himself, or for his wife or dependants or any other person, any property, valuable item, or financial benefit; or
5. If his standard of living exceeds his known sources of income, or he cannot reasonably account for it, or holds irrevocable power of attorney in respect of any assets or financial resources disproportionate to his known sources of income, any of his dependants or benamidars owns, possesses, or has acquired right or title in any property; or
6. If he uses his authority unfairly to obtain any profit or gift for himself or any other individual, or makes or attempts to make or deliberately fails to use his authority to stop the grant or rendition of any unwarranted benefit or favour; or
7. Should he have issued any policy, direction, or any SRO (statutory Regulatory Order) or any other command granting or seeking to grant any excessive advantage or benefit in any taxation matter or law otherwise to profit himself or any relative or acquaintance or a benamidar or any other person; or
8. Should he willfully default or commit an offence of willful default,
9. Should he commit the offence of cheating as defined in section 415 of the Pakistan Penal Code, 1860, therefore dishonesty encourages members of the public at large to bring any property, including money or valuable security, to any person; or
10. If he, as specified in section 405 of the Pakistan Penal Code (Act XLV of 1860), commits the offence of criminal breach of trust regarding any money or other valuable securities entrusted to him by members of the public at large; or
11. Should he, in his capacity as a banker, trader, factor, broker, lawyer, or agent, commit criminal breach of trust as specified in section 409 of the Pakistan Penal Code, 1860, in relation to property entrusted to him or over which he has dominion; and

The Islamic Republic of Pakistan High Court has authority under Article. 199 to order a writ against the National Accountability Bureau and its officials. At any point during the inquiry under this Ordinance, the Chairman of NAB shall have the authority to order the accused’s arrest if they are not already incarcerated. The accused must be told why he was detained.

Types of White Collar Crime

Under the procedure provided in the laws, the injured parties could present their claims to the Courts or to a special institution known as the National Accountability Bureau created under the National Accountability Ordinance 1999. The following are the different forms of white-collar crime:

Embezzlement

A person to whom someone’s possessions are entrusted grabs them.

Larceny

Entails stealing someone’s items without paying for or returning them.

Extortion

Also known as blackmailing, the illegal use of one’s official role or capabilities to get wealth, favours, or gifts.

Fraud

Though not restricted to it, health care fraud and tax evasion are frequently included.

Price Fixing

Two parties agree to fix prices for a particular commodity, thereby breaking free market dynamics.

Racketeering

Money extracted by force or a pattern of criminal activity executed to advance the aims of a criminal organisation.

Computer Fraud

Commissions of crimes utilising computers or other technical gadgets.

Bank Fraud

To participate in a scheme or activity designed to defraud a bank. This describes how an illicit enterprise operates for personal gain.

Tax Evasion

A person commits tax filing or payment fraud.

Bribery

Bribery

When money, goods, services, information, or anything else of worth is given to affect the behaviour, views, or choices of the recipient. Whether you give the bribe or receive it, you could be arrested for bribery.

Cellular Phone Fraud

The unauthorised use, meddling with, or manipulation of a cell phone or service. One of two ways one can achieve this: either with a stolen phone or with an actor who signs up for service under false ID or who clones a valid electronic serial number (ESN) using an ESN reader and replugs another cellular phone with a valid ESN number.

Cyber Crime

Where computer hackers take proprietary information, credit cards, and bank data from sources housed on computers.

Insider Trading

When someone trades shares of publicly traded corporations using internal, secret, or proprietary information.

Insurance Fraud

To participate in an activity or behaviour whereby one gets compensation from an insurance provider via a trick.

Investment Schemes

Where the actor contacts an unsuspecting victim to promise a significant return on a little investment.

Kickback

Happens when a seller refunds part of the purchase price to the buyer.

Larceny / Theft

When someone intends to appropriate, change, or steal something by taking money or property from someone else wrongfully.

Money Laundering

The source of money from racketeering, narcotics transactions, or other theft operations is either undetectable or legitimate, thus it seems either undisclosed or untraceable.

Telemarketing Fraud

Actors make telephone calls to residences and businesses where they ask for a donation to an assumed philanthropic group or for cash in advance or a credit card number in advance, and do not use the donation for the stated purpose. They operate out of boiler rooms.

Welfare Fraud

To participate in an act or acts aimed at receiving benefits (i.e. Public Assistance, Food Stamps, or Medicaid) from the State or Federal Government.

Weights and Measures

Shortweighting an item or selling it at one price yet charging a greater one at the time of sale.

For Instance When The Accused Is Guilty Of An Offence Mentioned Above, I.E. When The Embezzlement Is Said To Be Committed?

Normally, assets that have been given to one or more people are inappropriately confiscated or hidden. Financial fraud is one kind of it.

A financial advisor might embezzle funds from investors, a lawyer might embezzle money from a client trust account, a clerk or cashier handling considerable sums of money might embezzle money from his or her employer, or a spouse can embezzle funds from his or her partner, for instance. From the very little in nature, involving only small sums, to the enormous, including great amounts and complex scams, embezzlement might run the gamut. Usually, in an effort to reduce the chance of exposure, the trusted individual steals just a little portion or fraction of the money taken. Should they be successful, embezzlements might go on undetected for years or perhaps decades. The victims sometimes only realise their funds or savings are gone, and they have been tricked by the embezzler when the money is demanded or called upon for use. Because embezzlement is a statutory offence, the definition of the crime changes. Common components are:

• Fraudulent conversion; the requirement that the conversion be fraudulent means only that the accused purposefully and without right or mistake converted the property to his or her own use;
• Property of somebody else; and
• by a person legally holding the property.

A crime against ownership is embezzlement; that is, the owner’s right to govern the disposal and use of the property. Unlike larceny, in which the smallest movement of the property accompanied by the intent to deprive someone of permanent possession of it is enough, the conversion component demands a considerable interference with the property rights of the real owner.

The definition of the crime under embezzlement laws is not restricted to conversions of personal property. Generally, legislation covers conversion of choses in action, intangible personal property, and physical personal property. Typically not included is real estate. The key is that the defendant must have been in legal control of the items at the time of the fraudulent conversion and not just have been in custody of them. Embezzlement occurs if the defendant has legal possession. The crime would be larceny if the defendant only held custody. Should the embezzlement occur in firms, the claim can be directed to the Court under Section 290 of the Companies Ordinance, 1984.

How is the offender penalised under the law of the land as guilty of such offences?

The dishonest administration once catered for the Provincial subjects in their respective regions. Being a Federal Agency with great powers and laws with a cancelling impact, the National Accountability Bureau (NAB) was watching over Pakistan as a whole. Section 409 PPC was taken out of the FIA Act in 2004, though, and all unresolved cases in special courts were given to NAB.

Until 2004, the main responsibility was to look into incidents of white-collar crime and corruption. In 2004, the government gave the NAB Anti-Corruption and Economic Crime powers.

Pakistan Penal Code 1860

Main tools in the hands of anti-corruption law enforcement agencies are Sections 161 to 165-A Pakistan Penal Code, 1860, Sec 5 of the Prevention of Corruption Act, 1947 and Sec 9 of the National Accountability Ordinance, 1999. The first two sets of laws are used by the Provincial Anti-Corruption Establishment; the National Accountability Bureau uses the third set.

• Section 161 PPC: Public official receiving satisfaction beyond legal salary regarding an official act
• Taking pleasure, by immoral or illicit means, to influence a public official under Section 162 PPC.
• Article 163 PPC: Taking enjoyment in the practice of personal influence with a public servant
• Section 164 PPC: Sentence for assistance of offences specified in Section 162 or 163 by a public servant.
• Section 165 PPC: A public servant receiving a worthwhile item without regard for the individual involved in the hearing or any business carried out by such public servant.
• Section 165-A. Punishment for abetment of offences specified in Sections 161 and 165

National Accountability Ordinance (No.XVIII) of 1999

Promulgation of the National Accountability Ordinance was a step forward in providing society with efficient means by establishing an organisation of the National Accountability Bureau so as to eradicate corruption and corrupt practices.

From the date of promulgation of the Ordinance, all the ongoing cases would be moved to the NAB.

The first Act in a campaign to regulate/eradicate corruption from the nation was the Prevention of Corruption Act. Still in force, this Act fell short of its goals. The National Accountability Ordinance was then promulgated by the Federal Government of Pakistan in November 1999. The Act’s reach was expanded beyond public officials to encompass holders of public office as well as those engaged in commercial affairs.

The proceedings under this Order shall, mutatis mutandis, apply the provisions of the Code of Criminal Procedure, 1898, (Act V of 1898). Trials conducted under this Ordinance shall be governed by the clauses of Chapter XXIIA of the Code. For reasons to be noted, the Accountability Court may dispense with any provision of the Code and follow such process as it may find appropriate in the circumstances of the case.

Previous Legislations

• Prevention of Corruption Act, 1947
• Public and Representative Offices Disqualification Act, 1949 (PRODA)
• Elective Bodies (Disqualification Order, 1959 (EBDO)
• Pakistan Criminal Law Amendment Act, 1958
• Ehtesab Act, 1996 (Repealed)
• National Accountability Bureau Ordinance, 1999

Other Related Laws

• Pakistan Penal Code, 1860
• Criminal Procedure Code, 1898
• Income Tax Act
• Customs Act
• Recovery of loan Ordinance

Under Article 199 of the Constitution of Pakistan, the High Court may issue a writ against the NAB and its officials.

At any stage of the inquiry under this Ordinance, the Chairman of NAB will be empowered to instruct that the suspect, if not already apprehended, be held. The grounds of the arrest of the accused should be told to him.

Grant of Bail

Provided that he assists or supports someone or a public official accused of committing an offence as stated in clauses (i) to (xi), including conspiring. Despite the provisions of sections 426, 491, 497 and 498 of the Code of Criminal Procedure 1898 or any other law in force at the time. No Court will be authorised to grant bail for an accused person under this Ordinance.

International Co-operation Request for Mutual Legal Assistance

In accordance with the law of such State, the NAB Chairman or any officer authorised by the Federal Government may ask a Foreign State to take the following actions: to have documents or other materials generated or evidence gathered.

Transfer of Property Void

Any transfer of any right, title or interest or creation of a charge on such property shall be void while the inquiry, investigation, or proceedings are pending before the NAB or the Accountability Court.

Power of the Court to Freeze Property

Should reasonable grounds exist to believe the accused has committed such an offence, direct the freezing of his property, movable or immovable, or part thereof, whether in his possession or in the possession of any relative, friend, or person acting for him.

Exclusively empowered to hear and decide upon all claims or complaints against the freezing of any property under Sec 12 above, the Accountability Court is the ultimate authority. These assertions or protests must be made within 14 days of the order stopping such property before the Accountability Court.

Disqualification to Contest Elections

If an accused person is convicted for the crime of corruption or corrupt practices, he will stand ineligible for 21 years for seeking or from being nominated, selected, elected or appointed as a member or representative of any public office, or any statutory or municipal authority of the Government of Pakistan.

Given that any accused person who has taken advantage of sections 26 and 27 of this Ordinance would also be considered convicted for an offence under this Ordinance and would face 21 years of ban as above.

Reporting of Suspicious Financial Transactions

All banks and financial institutions will be responsible for quickly and immediately notifying the Bank of all strange or substantial transactions with context to the account, which have no clearly legitimate economic or legal aim and, upon honest professional judgment of the Bank, suspicion that such transactions may be connected to or constitute illicit or illegal activity, corruption, or corrupt behaviour.

Cognisance of Offences

Except on a reference made by the Chairman of NAB or an NAB officer legally permitted by him, the Court will not consider any violation under this Ordinance.

Initiation of a Reference under the National Accountability Ordinance

• A reference received from the appropriate government; or
• Receipt of a complaint; or
• Its own accord.

The NAB Chairman or an officer of the NAB duly authorised by him will refer the case for enquiry or investigation where he believes it to be warranted and suitable to begin proceedings against any individual. The NAB will be charged with responsibility for an investigation into an offence claimed to have been committed under this Ordinance.

Accused to be Competent Witness

Section 29 of NAO 1999 says that Any person charged with an offence punishable under this Ordinance shall be a competent witness for the defense and may give evidence on oath in disproof of the charges made against him; the accused shall not be compelled to be a witness against himself; and The court may draw such negative inference from an accused person’s choice of appearing as a witness and refusal to answer any query it deems appropriate.

The Accountability Court will have the authority and jurisdiction to take cognizance of a crime committed in the course of the investigation or hearing of a case by any officer, any witness, including an expert, who has presented fake evidence in the matter, whether he testified in court or not, or any other person under sections 176 to 182 of Chapter X, or sections 191 to 204, or 211 to 223, or 225-A of Chapter XI, of the Pakistan Penal Code 1860 (Act XLV of 1860) or under any other law about false evidence and offences against public justice and summarily try him and give penalties under the statute.

Prohibition to Hamper Investigation

Should any individual involved with the case’s inquiry, investigation, and prosecution purposefully and intentionally with malice, jeopardise, defeat, compromise, impede, mislead or jeopardise an inquiry or investigation of a case under process before NAB or any pertinent agency or authority or the Court.

Section 31-A of NAO 1999 states that individuals who abscond to evade the service provided by this Ordinance, such as avoiding or preventing such process or hiding from punishment, are guilty of a crime punishable by imprisonment up to three years. 87.

Withdrawal from Prosecution

With the Court’s consent, the Prosecutor General can withdraw from pursuing an accused person before a charge has been established, as stated in Section 31-B of NAO 1999.

Court to take Cognisance of the offence with the prior approval of the State Bank

Section 31-C of NAO 1999 stipulates that no Court established under this Ordinance shall take cognisance of an offence against an officer or an employee of a bank or financial institution for writing off, waiving, restructuring, or refinancing any financial facility, interest or mark-up without the State Bank of Pakistan’s approval.

Structure and Functioning of the National Accountability Bureau (NAB)

National Accountability Bureau (NAB)

• There shall be constituted a National Accountability Bureau for the whole of Pakistan.
• Chairman National Accountability Bureau
• Acting Chairman, National Accountability Bureau
• Deputy Chairman, National Accountability Bureau
• Appointment of members of the staff and officers of the National Accountability Bureau is done by the Chairman of NAB or any other person on his behalf.
• Prosecutor General Accountability

Power to Seek Asistance

Under Section 27 of NAO 1999, the Chairman of the National Auditorium (NAO) has the authority to request complete assistance and information from any relevant department or department in relation to any issue or proceeding before the NAB, as determined by the requesting authority.

Reporting of Public Contracts

Section 33B mandates that all Federal Government Ministries, Divisions and Attached Departments, along with Federal government and provincial government holders of public office, must provide NAB with a copy of any contract made between these departments.

Measures of Prevention of Corruption and Corrupt Practices

As per Sec.33C of NAO 1999, the Chairman of NAB is obligated to establish a committee consisting of private or public sector officers and organisations to educate and promote effective enforcement of laws and prevention of corruption in society.

NAB to submit Annual Report

As per Sec 33-B, the Chairman of NAB is required to present a report of its affairs to Congress and the President as soon as possible after each calendar year ends, but before the end of March. The report must be deemed an official document, and copies of it should be distributed to members for equitable charges.

According to Section 36 of the National Accountability Ordinance, concerned authorities are immune from any lawsuits, prosecutions or other proceedings against them, including the Federal Government, Provincial Government (the Chairman of NAB), and any person exercising power or performing a function under this Ordinance. And under sec. 37.