4 ways a white-collar crime can turn into a federal offense

White-collar crimes, such as embezzlement, fraud and insider trading, may seem like non-violent offenses, but they can quickly escalate into federal offenses with severe consequences.

Understanding how these crimes can cross the line into federal jurisdiction is crucial for anyone involved in corporate or financial matters. In this blog, we will explore three key ways white-collar crimes can turn into federal offenses.

1. Cross-state or international impact

When a white-collar crime involves activities that extend beyond the borders of a single state or country, it can catch the attention of federal authorities. For instance, if a fraudulent scheme operates in multiple states, engages in interstate commerce or targets victims abroad, it falls under federal jurisdiction.

2. Large-scale financial losses

The magnitude of financial losses resulting from a white-collar crime can also elevate the offense to a federal level. If the monetary damages exceed a specific threshold set by federal guidelines, the case can attract federal attention. For instance, embezzling a significant sum of money from a corporation or orchestrating a massive Ponzi scheme can easily breach this threshold.

3. Use of technology and cybercrimes

In today’s digital age, technology plays a prominent role in white-collar crimes. When committing fraud, identity theft or hacking using computer systems or the internet, the crime may become a federal offense.

4. Conspiracy and racketeering

White-collar crimes can also escalate to federal offenses when they involve elements of conspiracy or racketeering. Engaging in a criminal enterprise, like an organized scheme to defraud, can lead to charges under the Racketeer Influenced and Corrupt Organizations Act.

Although white-collar crimes remain relatively low, with only 4,180 people prosecuted in 2022, they are still serious offenses. When they turn into a federal case, it can lead to more extensive investigations and stricter penalties.