Features and Prevention of White-Collar Financial Crimes in China

Abstract

White-collar financial crime is characterized by its concealment and social harm. It is a crime committed in the financial sector where management, technical personnel, and business personnel take advantage of their professional convenience to seek illegal benefits, which can seriously damage the financial security as well as the interests of innocent people. With the vigorous development of China's capital market, more and more white-collar financial crimes occur which brings relatively serious consequences. It often involves large sums of money. The number of investors influenced by the crime and the related damages are hard to estimate. In China, combined with the limitation of law, the complexity and professionalism of white-collar financial crimes have made it difficult to regulate purely through criminal laws. Although China has established a criminal legal framework to prevent financial crimes, the status of criminal regulations for white-collar financial crimes in China is still not optimistic. The incoherency of relevant administrative laws and regulations, the improper setting of constitutive elements of the crime and the small proportion of relevant cases investigated all suggests the failure of existed coping approaches. However, the present unfavourable situation cannot be simply blamed on a poor legislation system or judicial system. It is also closely tied to the limitation of the law itself and the particularity of white-collar financial crime. The requirement of the legal principle and modest principle often means that there will be a lag between the provisions of the law and the ever-changing society. Also, the influence of external negative factors has catalysed the growth of white-collar financial crimes. The spread of ill-formed norms and subcultures in the financial markets has further exacerbated the status quo of white-collar financial crimes. By Contrast, comprehensive social governance methods are more flexible and effective，which can be superior in preventing white-collar financial crimes and curbing crimes increase. Not only do we need "hard laws" such as criminal laws, economic law, relevant administrative regulations to handle such crimes, but also require an application of so-called "soft laws" of relevant social means and countermeasures. Through establishing a governance mode, and building a systematic Legal Prevention Structure, together with improving the internal supervision, strengthening industry self-discipline and applying big data, we can form a comprehensive prevention system and reduce white-collar financial crime rates effectively. This paper attempts to explore a new way to prevent white-collar financial crime from the perspective of social governance combined with a more scientific legislation system, and in the meanwhile, puts forward some specific preventive measures.