A Contemporary Study of the Decision to Incarcerate White-Collar and Street Property Offender by Van Slyke and Bales

This month’s article, by Shanna Van Slyke and William D. Bales, deals with the sentencing of white collar criminals. The study analyses sentencing guideline data from Florida for the period 1994 to 2004, comparing ‘in/out incarceration sentences’ for white collar crimes with the offences of burglary and theft.

The authors seek to investigate whether white collar offenders in the 21st century enjoy sentencing leniency compared with nonviolent, street level property offenders. Their findings suggest that, despite operating under sentencing guidelines designed to reduce disparities, white collar offenders are afforded greater leniency, though this relationship varies by the type of white collar crime considered, the offender’s social status, and whether the sentencing occurred before or after the Enron scandal (a national corporate scandal in USA during the period 2001-2002).

The article kicks off with analyses of white collar offenders in the 21^st century. The conventional wisdom has always asserted that white collar offenders are viewed in a different light by the public and are treated less punitively than street offenders by the criminal justice system; however, sentences arising from the aforementioned Enron scandal and others, has cast doubt on this long held assumption. For example, Jeff Skilling, former CEO of Enron, received a 24 year sentence for the offences of conspiracy, insider trading, and lying to auditors.

The article goes on to compare definitions of white collar crime. Sutherland proffers an offender based definition, imagining white collar crime to be ‘committed by a person of respectability and high social status in the course of his occupation.’ This definition accords with the social status based explanations for sentencing leniency or the ‘status shield’ that purportedly protects white collar offenders from harsh treatment. In addition, many of the mitigating factors that judges may take into account in sentencing, such as stable employment, family relationships and community involvement, are more likely to be present in the life of the typical white collar offender. Finally, it is also argued that the Judge may take the view that undergoing the process of arrest, detention and trial is punishment enough for a person with the social status associated with white collar offenders. Moreover, the status shield may operate in a more instrumental manner. For example, it has been suggested that the political influence associated with white collar offenders makes them particularly immune to punishment, as prosecutors may feel too threatened or intimidated to prosecute them for fear of retaliation or other negative consequences.

A second perspective, which is adopted in this article, focuses on the characteristics of the offence rather than characteristics of the offender to explain the greater leniency afforded to white collar crime. Legalistic factors that operate in favour of white collar criminals include the greater complexity of the typical white collar crime, the diffuse nature of the victims who are oftentimes unaware of their victimisation and thus do not report it, the specialised knowledge required to investigate and prosecute many of these cases, jurisdictional issues stemming from the geographical distance between perpetrator and victim(s), and the reluctance of prosecutors to pursue such cases that tend to place an onerous burden on an already overwhelmed court docket.

A third perspective draws upon a large body of public opinion literature and argues that both the public and the criminal justice system view white collar crime to be less serious than street crime and, consequently, less deserving of lengthy penal sentences. A 1988 study by Wheeler et al found that harm and seriousness variables, including presence or threat of physical violence, amount of monetary loss, duration of the offence, nature of the victim and violation of trust, were among the most important determinants used by judges in their sentencing decisions. The authors point out that this suggests that if a crackdown on white collar crime is in fact underway, one potential explanation for it could be the increasing recognition of the seriousness of these acts and a growing intolerance of white collar crime in general, brought about by developments, such as increased media attention on white collar crime, the consumer movement, environmental concerns and the equal rights movement which prompted scholars to question the over-representation of offenders from socially disadvantaged backgrounds in prison, despite the immensely harmful criminality of the more powerful and well-connected members of society.

The next section deals with the existing empirical research in this area, most of it dating back to the 1970s. The authors of this study, therefore, present their work as a timely update to the literature. According to the them, two lines of research, both conducted prior to the introduction of sentencing guidelines, dominate this area of white collar crime scholarship: (1) the examination by Hagan et al of sentencing patterns for white collar and street offenders in 10 federal district courts from 1974 to 1977; and (2) the Yale studies that combine quantitative and qualitative research to evaluate the assessments made by judges in federal white collar crime cases from 1976 to 1978. Hagan et al found that white collar offenders generally did not receive more lenient treatment at the sentencing stage of the criminal justice process. In addition, it was found that the specific type of white collar crime considered impacted sentencing outcomes and that the Watergate scandal of 1970s had no appreciable effect on sentencing disparities because the greater tendency to sentence white collar offenders to prison after Watergate was offset by their shorter sentences.

The article then goes on to address the authors research in relation to the following questions: (1) Are white collar offenders sentenced more leniently than comparable street level property offenders; (2) Does the type of white collar crime committed impact the relative sentencing severity of judicial sanctions; (3) Are high status white collar offenders sentenced more leniently than low status white collar offenders; and (4) Are white collar offenders sentenced more harshly following Enron than similar white collar offenders sentenced before Enron?

In answer to question (1) it was found that white collar offenders were 33.4 percent less likely than street criminals to receive prison sentences. In relation to question (2) considerable variability in sentencing was found across specific types of white collar crimes. Frauds against businesses, those involving credit card fraud, and bribery were significantly more likely to be imprisoned, while offenders convicted of defrauding the Government and embezzlers were no more or less likely to be imprisoned than consumer fraud offenders. In relation to question (3) the findings indicate that offenders convicted of the more high status white collar crime (Medicaid provider fraud) were significantly less likely to be imprisoned, with the odds of receiving a term of incarceration 98.7 percent lower than comparable offenders sentenced for a low status white collar crime (public assistance fraud). The finding for question (4) show there was a significant increase (up 30.7 percent) in the likelihood of white collar criminals receiving an prison sentence after Enron, while there was no significant change in the likelihood of imprisonment for offenders convicted of street crimes.

Discussion

In order to fulfil the principle of equality before the law is it necessary to treat white collar criminals more leniently, seems as a prison sentence will inevitably impact more harshly on a middle class offender?

And so kicked off our discussion on sentencing white collar offenders.  The characteristics of the typical white collar offender were thought to be relevant, as usually he or she will be employed long-term, have a stable family relationship, and may be active in their local community, all things which mitigate against a harsh prison sentence. It may also be judged that after their scare with the law they are unlikely to re-offend and thus pose a low risk to society. Therefore, on the ground that imprisonment serves no practical purpose other than to punish, which every member of the group was opposed to, it may be legitimate to hand down more lenient sentences to white collar criminals. It was also argued that for a middle class offender, prison may not even be the harshest punishment, and that the process of arrest, trial and detention are punishment enough as they usually lead to a loss of status, professionally and personally.

Against this point of view, it was argued that although it might be the case that a middle class person’s subjective perceptions of spending time in prison are worse than a street offender who is well accustomed with the system, this is no reason to excuse middle class offenders from serving lengthy sentences. Three points were proffered in support of this position. First, middle class offenders are better equipped to access legal counsel who can argue their defence and so affording them privileges in respect of sentencing tilts the balance of justice unfairly in their favour. Second, the criminal law has decided that imprisonment is a suitable punishment for criminal acts and objectively prison in fact hurts people, whether or not their subjective preferences have adapted to the harsh reality of a prison regime. Third, the public’s perception that white collar offenders get off lightly may not deter future offenders from criminal activity. Although, it was conceded that sentencing works on the basis of the offender’s individual responsibility and it may not be fair to factor in to someone’s sentence the need to set a general deterrence.

The practice of sentencing guidelines in USA was also discussed and their application was explained to the group. Judges’ discretion is severely fettered  in that they apply the facts of the case (the scale of offence, previous convictions, mitigating circumstances) to a scale and are given a sentence to hand down. The process has led to harsher sentences across the board but still more lenient for white collar crimes compared with street level crimes. It was suggested that if an objective scale turns out more harsh punishment for street offenders it might be that they are deserving of longer sentences due to the risk they pose to society and the harm they have committed. However, it was argued that perhaps there is an inherent bias in the US sentencing guidelines which has created the perception that street crime is more harmful. It was noted that corporate crimes, although the effects are usually diffuse, can lead to very serious consequences such as environmental damage, economic loss and sometimes death. For example, Enron’s mismanagement of the energy market in California led to rolling blackouts during which residents suffered hugely and some people died. 

The discussion then led on to sentencing guidelines in Ireland which were roundly criticised for lack of consistency. The latitude between the sentence a judge in Dublin Circuit Court and a country court, in say Mayo, might hand down for the same offence can be huge, leading the group to talk of a ‘geographical lottery.’ The practice of judge-picking was also discussed, whereby cases are adjourned until a perceived more favourable judge is sitting. The option of   judicial training was discussed in order to achieve better outcomes in sentencing. It was felt that such a practice might work well for sexual offences; however, it’s applicability for corporate crime was doubted. Many of the biases of judges may be unconscious, such as identifying with the offender and it may not be possible to train judges not to hold such views.

The impact of public perception on sentencing was also discussed and it was favoured by the group that public opinion shouldn’t weigh too heavily on judges decisions. Although it was accepted that inevitably it is the case that fear of public outcry plays on judges' minds. The example of Carney J’s reversal of a suspended sentence in Fiona Doyle’s case was given, as well as judge’s references to Love/Hate in the context of a gangland crime case. It was felt that series such as Love/Hate and the media’s reporting of trials can lead to a sort of moral panic regarding a crime explosion in Ireland. It was felt that this may play on a judge’s decision to hand down harsher sentences for street or gangland criminals.

The discussion ended with a look to the future and a discussion of the upcoming Anglo cases for their effect on the judiciary’s and public’s view of the gravity of corporate crimes. This week’s article provided a useful focal point for the group’s discussion of white collar crime sentencing and sentencing guidelines in general.

This month's blog was written by Angelina Cox.

The views expressed herein are those of the author's alone.