E-governance and white collar crime control
E-GOVERNANCE AND WHITE COLLAR CRIME CONTROL
1. Introduction:
White collar crime has proliferated in the modern civilization due to lack of information availability. It has led to financial loss, social loss, and declining moral ethics. e-Governance can achieve white collar crime control by democratizing information, making the government schemes effective and efficient, and introducing transparency. White collar crime is a crime of privileged class who cause irreparable damages by exploitative tactics, which is “omnipresent” i.e. it’s a global phenomenon. e-Governance has made significant contributions in the fields of economic growth, sustainable development and good governance. Following paper focuses on the drivers of white collar crime, how e-Governance can eliminate it and the risks associated with use of e-Governance and its mitigation or monitoring. This is supported by a case study of Land Records in India.
2. White Collar Crime in India:
a. White Collar Crime in various Domains:
1. Legal System in India: Currently numbers of cases are pending in High courts and Supreme Court which can be checked online using e-Governance, also the dates for next hearing are available to the parties. E.g. Telgi Scam of bogus stamp papers was having impact of Rs 80,000 crores, yet no effective remedies are done and the matter is dangling in legal system. Also, in some countries provisions are made to make hearing using Webcam, wherein the terrorists are in Jail, where they were, and no risk and extra cost incurred for carrying them to court.
2. In trade and industry: Santanam committee gives detailed report of criminal behavior of so called respectable men, e.g. big business tycoons, industrialists, public servants etc. Main point is "Corruption exists if there is someone willing to corrupt and capable of corrupting which is found in industrial and commercial classes, they indulge in evasion and avoidance of taxes, accumulate large black money, dirty money by various methods. For instance, suppressing profits by manipulation of transactions of immovable property by liason or men who live and spend and entertain beyond their means of income disproportionately”
3. Financial Institute Fraud: Financial institution fraud (FIF) continues to be a significant white collar crime problem throughout the country. After the deluge of 26/7 in Mumbai, the CBI has refocused its program for the same and is now investigating higher-priority cases to a much greater degree. Large-scale mortgage fraud and identity theft operations, many perpetrated by organized criminal enterprises, also continue to plague India.
4. Corruption in government and politics: This is global phenomena. Prevention of corruption act 1947 amended in 1988 is in practice. Yet, unscrupulous public servants amass wealth and possess disproportionate assets to their known sources of income. E.g. A encounter specialist police official, ordinary sub inspector of police of Mumbai Crime Branch amassed Rupees 225 crores of property in India and abroad. An officer attached to Psychotropic Narcotics Substances Act implementation amassed 250 crores of rupees assets and now settled in USA. One of the best examples of e-Governance is that the Central Vigilance Commission’s famous case when it published on its website the names of 34 IAS officers against whom charges of corruption were proved. The information percolated to millions on the net and led to the social outcaste of those corrupt officers. Public servants have meager salary and they have pressing needs of life and greed for modern luxary are reasons for corruption which is epedemic and found nearly in all public offices. Only its magnitude, degree and proportion vary. Similarly political corruption includes grafts right from stage of giving ticket to election, abuse of political offices i.e. 1 dozen MP’s (Members of Parliament) were punished for asking question in Parliament, at cost, proven by sting operation.There is rampant violation of election laws (representation of people act) Tul MohanRam Episode, Mundra Sirajuddin affairs involve high ranking officials like cabinet ministers etc. In short, it can be said that the criminal justice system is not delivering and there is serious erosion of people’s faith in its efficacy. It is commonly accepted that corruption is dysfunction to the system of governance and to society as a whole.
5. Forgery: Another growing form of white collar crime. It includes all sorts of forgery, varying from land record papers to Suppreme Court judgments.
6. Violations of Foreign exchange regulations and import export act: This is more prevalent among businessmen who do under invoicing of export goods and over invoicing of import goods thereby harming National economy. This can be avoided by adding transparency to the process which is the key to the problem.
7. Violation of tax laws: Tax evasion and tax avoidance, demarcation line is thin i.e. non-payment of tax which is to be payed and spreading of total income in such a manner that it does not incur tax liability legally, respectively. The loss incurred to state exchequer due to violation of tax is tremendous. Actual tax paid is only a fraction of total income, remaining of which goes to black money. Santhanam Committee report gives flow-sheet of tax evasion by various groups of several crores of rupees. Tax regulatory acts enforcement is in full swing. However, black money is converted to white money by various methods which adversely hamper economy of the country.
b. White collar crimes in various professions:
1. Legal Profession: Preparing false and fabricated claims , fabricating evidence delaying litigation by colluding with opposite party, adopting unscrupulous tactics, violation fo ethical norms of legal profession i.e. Advocate act 1961, converting “criminal lawyer to lawyer criminal”
2. Engineering: The underhand dealing in getting tenders passed for contractors, suppliers showing oversight of the use of sub-standard amterials for constructions and thereby buildings are collapsing prematuredly say within 25 yrs. Falsification of records, frauds, if the original tender of a lowest bidder is “X” the completion cost of the project is usually “3X/4X” which proves there are totally time-overrun and cost-overrun of the project though there is prjt monitoring on paper through PERT charts. This leads to multicrores of rupees losses in every prjt and social cost of delay of prjt are very huge.
3. Educational Institutes: Private educational institutes e.g. not even approved by Delhi AICTE, run private engineering colleges admission to which is given without merit, also institutes running on govt aid make fake and bogus enrolment of students, give meagre salary to teachers while getting signature for full salary frauding large sums of govt grants.Large sums of Govt grants, issue of fictitious bogus manipulative certificates, collection of unauthorized donation in the name of bldg funds, issuance of fake degrees and diplomas by unrecog institutes even professors are taking bogus PhDs at cost and getting enhanced salaries.
4. Money laundering techniques: Black/dirty money converted into white. Black money means not obtained from legal activities i.e. obtained by corruption/ held in secracy to avoid income tax liability and circumvent restrictions by laws of the country and dirty money is obtd thru completely illegal means i.e. it can be hidden in Swiss banks but cannot be used by the holder until there is special scheme declared by govt like amnesty scheme thus its converted to clean money e.g. trafficking illegal drugs generate enormous qty of dirty moneys. Concealing its origin, ownerships and other potentially embarrasing factors by investing it to benami properties (unfortunately legitimate in India)
3. Drivers of White Collar Crime:
Firstly let us know what white collar crime is?
White Collar Crime is a term that has been coined by Sutherland as “crime committed by a person of respectability and high socioeconomic status.” i.e. its illegal act characterized by quite deceit and concealment without single drop of blood or violence. Edelhertz further adds to it that it is committed by neophysical means and by concealment/guile to obtain money or property, to avoid payment, or loss of money or porperty or to obtain business or personal advantage.
Its drivers are:
1. Greed: A primary driver of white collared crime is greed for pursuit of money, wealth, power, food, or other possessions. Greed also breeds corruption which is inherent in any public sector services and government services in India. We need to deter greed, for which e-Governance increases transparency and hence reduces greed.
2. Control and Power: The white collar criminals want to exercise the complete control and power of the system in their hands and enjoy benefits of it (by both, good and bad means).
3. Job Security: People want to make sure that their future life is secure until they are on the job.
4. Why e-Governance for White Collar Crime Control:
· As per report on “Auditing e-government” INTOSAI, standing committee on IT Audit, the definition of e-government: “E-Government is online exchange on government information with, and the delivery of services to, citizens, business and other government”.
· e-Governance will achieve the crime control by democratizing information, making the government schemes effective and efficient, and introducing transparency.
a. Domains where we must use e-Governance:
1. G2G: e-Administration, e-Policing, e-Court,
2. G2B: e-Tax payment
3. G2C: To encompass services delivered to citizens like Passports, Ration Cards, Certificate issuing, e-Medicine, e-Education, e-Registration.
b. Merits of e-Governance:
§ Transparency
§ Reduced Delay, which is main cause of corruption
§ Minimizes Corruption
§ Less Cost incurred
§ Delegation and empowering becomes easy
§ Easy access to public records
§ Increase in public awareness
§ Faster processing of documents
§ Increased utilization and satisfaction to consumers
§ Paperless or less paper work
§ Tracking illegal transactions and tracing frauds becomes easy
§ Middlemen between citizen and senior officers are eliminated
c. Developing countries - e-Governance examples:
1. Bofors Scam: e-Governance has important significance in tracing the global corruption. It strengthens the coordination mechanism at international level by timely exchange of data at International level. Timely freezing of account of Mr. Quatrochi, an Italian businessman, the main accused in Bofors Scam in India, by the British authorities is a live example of E-Governance’s role in curbing corruption abuses.
2. Even though e-Governance existed at Interstate Computerised Check posts in Gujarat, corruption continued unabated. A bribe of one dollar is being charged from every driver and a third of the overloaded trucks are allowed to go without fines. Bribes are collected from such trucks averaging three dollars, which is only 10% of the fine that should have been collected. It did not build benefits for a variety of stakeholders, such as truck drivers, transportation companies, and inspectors. There were many vested interests, which bounced back after the political support was withdrawn.
3. Mazdoor Kissan Shakti Sangthan (MKSS), an NGO in Rajasthan, conduct regular hearings of the irregularity and corruption cases, in villages, in the presence of the local people and government officials; on behalf of people who are whistle-blowers. Corruption hits the poor hardest, the rich least; Let the downtrodden people know how corrupt officials are embezzling the funds meant for them. Here, e-Governance:
§ Automates processes to take away discretion from individual officials.
§ Makes decisions traceable- tracks actions
§ Provides Fast Processing, File tacking, online file monitoring by superior officer, online status of the files/complaints.
4. Creating a national ID system in Egypt: In Egypt the information and decision support center has created a comprehensive national database with 85 million birth records, 34 million death records and 12 million marriage records and a 2 million divorce records. This has provided the basis for a national ID card. Automation of previously manual processes has saved considerable sums of money. The information base and ID numbers have also been an essential building block in creation of other public sector planning and services delivery applications. This makes tracing and tracking of people easy and fake identity cases reduce to great extent.
5. Passport office: Citizens can see the status of their application, reason for pending and probable delivery of Passport. Superior officials keep on watching the progress and responsibility can be fixed as he/she can ask why a particular application was not processed within the stipulated timeframe. Thus, if biometrics is used along with e-Governance, then people like Dawood Ibrahim won’t have as many as 21 passports on their disposal.
d. e-Governance addresses following areas of White collar crimes:
1. Financial Loss: Financial loss by the white collar criminals is greater than financial loss from burglaries, robberies, and larcenies is minimized using e-Governance.
2. Social Damage to morale & institution: White collar criminals destroy the moral and promote social disorganization. Since crimes are violations of trust, they create and extend feeling of distrust. E-Governance keeps government a trustworthy body for people.
3. Privileged class deviance: Misuse of official power, favoritism, change in land use pattern, undervaluation of house and land price, etc. are generally done with cooperation of government officials or the relevant parties in absence of e-Governance.
5. Role of e-Governance to reduce White Collar Crime:
1. e-Governance is improved communication between the government and the citizens i.e. Governments have been putting out vast amounts of material on the Internet. A fair number of these would be available in hard copy. It is advantageous on the part of the governments to provide information online because of quick communication and reduction in printing and stationery costs.
2. The internet connects citizens together and also connecting them to government. Such lobbying may be done through e-mail, listserv, discussion board and the like. Again, this role encroaches into the media’s traditional role as a window for lobby groups.
3. Electorates can be hooked directly to enable them to vote or voice their opinion on a wide range of issues. Voting online, touch-tone telephones, voice signatures and digital signatures can become real and people can shape opinion from their homes or nearby Internet kiosks. Some countries have already gone in for online referenda to settle specific issues.
4. e-governance can also help fight corruption. The fact that it brings in a much-needed measure of transparency can act as a check against corruption. Aided by the political and administrative will, e-governance can definitely battle corruption. But the traditional role of the media as a watchdog against corruption will not disappear in a digital democracy.
5. e-Governance makes its possible to maintain a think-tank for government and for country and for society at large, and to avail prizes of 20% amout to establish disproportionate assets of corrupt officials and burden of proving innocence should be on the alleged corrupt officials
6. It also avails fast track courts to establish criminality of the corrupt officials on day to day basis. The properties of the corrupt officials’ should be attached at the first instance and to be released iff he is proven innocent in the court. Similarly, all the bank accounts in his name and in the name of his relatives/friends of suspicious nature must be frozen till pendancy of the proceedings.
7. With e-Governance, we can anticipate trends in technology, in international economic relations etc. and advice government about the measures which can be taken to put the trends to work.
8. We must create awareness in people about steps to be taken and therby prepare them for hard decisions like social boycot on white collared criminals and attach stigma to them for the lifetime. Encourage public interest litigations against white collared criminals for bringing them to books immediately. At the same time, false allegations should be deterently penalized.
9. Easy monitoring of all projects and schemes so as to minimize cost and time over-runs and makes them more productive and effective.
10. Evaluating impacts of projects and schemes, and thereby make changes required in them becomes easy. This is obtained using Impact Assessment Table which has the priority of components of the Risk factors i.e. Process, Cost, Schedule and Support.
Along with e-Governance, following points are recommendations for its effective utilization:
11. There should be expert advisorto PM’s office in all such matters and there should be commission which should make finding publicin all probecasesagainst white collared criminals and there should be public notification in all leading newspapers in all languages at the cost of white collared criminal.
12. There should be midyear review of the economy of assumptions made in the budget and policies set out in it are faring in practice and take corrective measures and its assessment of states.
13. Mechanism must be devised for commission to make presentations on policy issues periodically, monthly, quarterly and yearly to:
a. Prime Minister personally
b. The Cabinet Committee on economic affairs.
14. The structure of organization and staffing of commission must be of “stainless” character i.e. Ceaser’s wife should be above all suspicions and they must be tested periodically to check their stainless character by intelligent methods and proper surveillance on them under direct control of Prime Minister.
15. Investment planner: Commission should be transformed to body, the principal functions of which are:
· To frame policy options for govt on specific issues which it has to confront and management for maintaining govt funds with performance auditing. E.g. Chronic disease control, waterborne diseases, AIDS, etc, the technologies which can be deployed/developed to contain management for these.
· Foreign collaboration if required can be taken.
6. Case Study: Computerization of land records- Social Impact:
a. Need of e-Governance
1. Lack of transparency and accountability: Lack of transparency in political parties’ funding, election which entails heavy investment with poor legitimate returns and insecurity of getting elected again prompts politicians to harvest for the investment made during election campaign. Acute shortage of resources in comparison to demand is of essence, especially in our country where population is multiplying exponentially for resources. Situation is compounded more when citizens become impatient to get resources or services by any means. In an era of Globlisation and Liberalization and with growing consumerism, charm of modern gizmos which are indicators of lavish life-style, have become status symbols in our society., Real salaries of government servants are decreasing in comparison to their counterparts in private sector due to galloping inflation rate in economy. Lack of transparency and accountability in public dealings, are the major reasons of rampant corruption.
2. Maintenance and updation of records: Maintaining the records of land and subsequent updation and modifications reflected at Tahsil or Circle or block or subdivision level registrars, being approved by competant authority. Later the master copy at district head quarter is subsequently updated. The subsequent changes in land records due to sale-deed, mortgage, lease, acquisition, partition, availability of irrigation, crops grown, change of land types, etc. are known as mutation. Any physical change of land plot due to various possible causes i.e. erosion, earthquare or otherwise is reflected in its cadestrial data and in map. This will make land records foolproof, so that lowest level Revenue Dept official cannot play any mischief. Which otherwise leads to chronic trouble to the owner of the land. As it’s a rampant corrupt practice in the manual land record system, with many lacuna. E.g. lack of standardization, hand written sometimes, difficult to retrive data from land registers, the wear and tear further creates chronic difficulties. Its suseptible to manipulation, large chunks of land belonging to govt, reserve land, forest land protected areas are manipulated by mischief mongers. E.g. On forest lands mumbai buiders have enchorached and it lead to historical agony of the flat purchasers ie. Innocent victims of the crime are 5 lakh citizens in mumbai. The poor and underpriviliged are the worst sufferers as they have little idea of Records of Rights (ROR) and ownerships are diverted to private owners by land mafias, in league with corrupt revenue officials i.e. marshy lands adjoining to link roads in Mumbai are grabbed by land mafias in western suburbs.
3. e-Governance: e-Governance is of major significance because it uses computers in processing information in which speed is an inherent component. A single computer can process the information within seconds, which cannot be paralled by hundreds of employees for years together. It enables us to simplify the rules. Example: Bhoomi Project of Karnataka Government, which computerized the twenty million land record containing about 1billion data fields. It addresses the concerns of 7 million farmers’ families or 35 million rural populations. Nine thousand village accountants were maintaining these records manually in earlier system. In the new system, 177 Bhoomi kiosks distribute computerized land records, 750 Village Accountants maintain its backend. Rs. Eighty million user charges have already been collected as against total investment of 180 million in the first two years itself. This project has won laurels at the international level, as it is the winner of silver in Commonwealth Innovation Award 2002.
Elimination of Intermidiary
Intermidiaries like peons
b. Problems addressed by e-Governance for Land record system in India:
· Unmanagability: Due to population explosion, rise of mutation, maintenance of land records becomes unmanagable, manual compilation of records is time consuming and cumbersome. Revenue staffs are already overloaded and also engaged in other activities e.g. Conduct of elections, relief and rehabilitations, medical gains, implimentation of govt schemes, issue of certificates.
· Difficulty to enform Land reform act: Ceiling surplus land act, ownership right to tenants, prevention of alienation, and restoration of aliented tribal lands etc.
· Delay in updation:Inconsistency in various hierarchies leads to chaos, so delay in delivery of land records. So, Record of Rights is nightmare for public.
· Cumbersome mutation process: No reporting mechanism abt pendancy
· Land Resource Management: There is no record of lands available after mountains are reduced to ground level after stone querrying which are easily encroached by land mafias with help of corrupt revenue official, which is eliminated if there is transparency in process.
· No link with other institution: It leads to great inconvinience due to non-availability of land data in e-form, increasing litigations, due to defective records at Sub Registrar’s office.
· Encroachments on Govt land: It goes abated and is difficult to arrest.
· Expansion of Mafia Raj: It leads to lack of maintenance of law and order.
c. Advantages of e-Governance in Land Records:
· Easy access to record of rights and quick delivery.
· Increase public awareness
· Transparency
· Increasing Credit Flow: Since ROR is vital document to acquire financial loan, it helps flow fo credit fund to households and further leads to growth of economy increasing of land sales and purchase. After computerization, it will facilitate quick buy-sell of land resulting growth of economy and revenue to government by stamp duty.
· Reduction of disputes
· Quicker mutation process
· Enforcement of Land reforms
· Linkages with other institutes in many states: Judicial Financial Development departments, NGO’s etc can have access to land record database.
· Creation of jobs for local youths
· Encroachment can be easily controlled and detected and transparency and government / public can easily be admitted.
Transparency due to e-Governance: Lack of transparency and accountability in public dealings, are the major reasons of rampant corruption. There should be public participation, where state and central functionaries have to serve or support even correct the citizens else there are violent agitation leading to massacre as experienced at Nandigram near Calcutta in land acquisition stage itself. This means software has to be written to codify rules, procedures and other related government functions and public access should be through IT which leads to success for bringing transparency in administration and management through E-commerce and e-business leading to e-Governance which is definitely possible. Appropriate legal instruments empowering government enable such interactions should be done simultaneously.
d. Disadvantages of computerization of Land records:
· Delay in delivery: Unexpected delay in delivery due to frequent load shedding (power cuts), technical snags, and lack of infrastructure causes great inconvenience to public. Non-Conventional Energy can tackle any crisis of energy.
· Delay in update: A mutation entry is time consuming to update in land register. It should be improved for remote update through mobile technology.
7. Challenges to e-Governance:
a. The challenges for development are listed out in four major categories as under:
1. Political aspects include strategy and policy, laws and legislation, leadership, decision-making process, funding issues, international affairs and political stability.
2. Social aspects includes people, education, employment, income, digital divide, literacy and IT skills
3. Economical aspects include funding, cost-savings, business models and e-commerce. Internet access is expensive in the areas wherein Internet is not deeply penetrated and
4. Technological aspects include software, hardware, infrastructure, telecom, IT skilled people, and maintenance, safety and security issues.Further, illilteracy is the major barrier in rural areas for Internet usage or lack of knowledge of English. e-Governance is smart and transperant with seamless access, secure and authentic flow of information crossing the interdepartmental barrier and providing a fair and unbiased service to citizen. India is planning to implement e-Governance in 1-2 years with risk that the technology may become expensive, obsolete and desired benefits could not be derived out of it. There should be qualitative measure on the impact of egovernance on the society.
b. Risk Handling: From the above challenges, for rural development, we recognize an important reality that is contextually very much Indian – that the majority of our population are people who will not be in a position, at least not in the foreseeable future, to search for and access e-Governance services on their own . This in turn emphasizes the need of a mediator (human or machine or a combination of both) who can deliver these services through channels that reflect citizens’ preferences. The risk mitigation and monitoring must involve:
· We must start with Project Planning with Managament Information System.
· Initially, in any project, goal identification and its feasibility prediction is to be done. Technology to be used is to be determined. Then, we must decide who will do what work.
· The risks arising of the above disadvantages can be mitigated by good systems architecture design and implementation using PERT (Project Evaluation and Review Techniques) & CPM (Critical path Method) techniques to evaluate the risk and mitigate it when necessary and monitor it when needed.
· Risk identification and Risk projection are major parts to avoid disadvantages of e-Governance. Anticipating problems, determining the probability of problems occurring, evaluating the potential impact and reparing solutions in advance requires considerable effort.
· Further, it is necessary to develop a contingency plan – a course of action for each potential problem identified in the project risk profile. Carefully examine each problem and develop one or more alternative solutions. Contingency planning is a form of insurance and comes with a price. The tradeoff is that a problem that has been identified, with a solution developed in advance, is far simpler and cheaper to resolve than one that occurs unexpectedly.
8. Other Application of e-Governance:
1. Legal System in India: e-Governance will enhance the working of judiciary as the status of the cases pending in High courts and Supreme Court can be checked online, also the dates for next hearing and many more.
2. Election ID and e-Governance: There must be a single citizen ID card for all govt schemes. There should be integration of IT based government services and their e-delivery. E.g. Gyandoot in MP, e-seva in AP, Friends in Kerala, in Maharashtra, Rajasthan, Tamil Nadu now provides online registration of property transactions. In mumbai there is registration of births and deaths by BMC. In Karnataka, totally computerized land records under Bhoomi project. There should be computerized transactions of treasury in all districts and taluka. There should be monitoring of public grievances and disaster mgmt systems under control of Chief Minister.
3. Inter-ministerial Works in India: E-Governance plays a vital role in coordinating the work of inter-ministerial or inter-departmental, i.e., a most awaited “Single Window Clearance” delivery of services to the citizens of various departments.
4. E-documents: Forgery is major part of white collar crime which takes place by bribing corrupt official, with partnership. Forgery can be avvioded by matching the documents with original by means of PKI. Moreover, many employees, in an organization, know about the corrupt practices and want to complain but do not do so due to the fear of wrath from senior officers. For the fear of disclosing their identity, they do not report it to the vigilance department. E-Governance renders golden opportunity to such people to alert concerned officials through Email, E-forms, and E-complaints.
5. Right to Information: The right to information envisaged by electronic governance presupposes decentralisation in power structure and decision-making.E-governance is a tool for connecting people and sharing information. It will result in improved transparency, speedy information dissemination, higher administrative efficiency and improved public services in sectors such as transportation, power, healthcare and local administration.
Fight against Corruption in Government and Semi-Government:
A model of people to be involved in Fight against corruption:
Police, CBI, judiciary: prompt delivery of judgment
Central Vigilance Commission (CVC)
Post Completion Auditing (PCA)
Vigilant Citizens
NGOs
Media: TV, newspapers, BlogSpot, Internet
Figure above shows that combined effort of Citizens, CVC, Police and other people will help us to eliminate corruption from our country and to allow the government system to be fully utilized by its citizens.
9. Concluding Remarks:
White Collar Crime erodes the faith of the general public in the legitimacy of the politico-administrative system and eventually saps the idealism of those in public service and thus destroys the moral fabric of society. It is the main reason for social unrest in any society. In many countries the Governments have toppled down on the charges of corruption. In short, corruption-ridden governance is termed as “Bad Governance”. We discussed applicability of e-Governance to curb white-collared crime by making the process transparent, accountable, and citizen-friendly and how to measure the effectiveness of e-Governance initiatives from the white collar crime reduction perspective.E-government can lead to transparency provided that the legal framework supports free access to information.
ACKNOWLEDGEMENTS
1. http://portal.unesco.org/ci/en/ev.php-URL_ID=19065&URL_DO=DO_TOPIC&URL_SECTION=201.html
2. CRIMINOLOGY and PENOLOGY, book written by Mr. M. Ponian
