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February 14, 2013

Are "pink-collar" crimes distinctive calling for distinct sentencing policies and practices?

The question in the title of this post is prompted by this intriguing new commentary by Kelly Richmond Pope at The Daily Beast, which previews a high-profile white-collar federal sentencing scheduled for today in Illinois. The piece is headlined, "Most Notorious ‘Pink-Collar’ Criminal to Be Sentenced for $53 Million Theft: Crundwell may be the most brazen of recent female embezzlers, but she’s not alone, as more and more women achieve positions of power, as well as access to funds."  Here are excerpts (with a few links preserved):

On Valentine’s Day, Rita Crundwell will be sentenced for her role in the largest municipal fraud in U.S. history.   Once known as one of the leading American quarter horse breeders, Crundwell embezzled more than $53 million from the town of Dixon, Illinois, which has a population of 16,000 and an annual budget between $6 and $8 million.  Crundwell, who was Dixon’s comptroller, carried on her scheme for 20 years, but it was discovered only when a Dixon city clerk opened a letter revealing that Crundwell had set up a secret bank account and was embezzling city monies to finance her lavish lifestyle.

While Dixon was cutting jobs, battling a budget deficit, and struggling to complete capital improvement projects, Crundwell was throwing epic birthday parties, building ranches and traveling the world.  According to court records, she stole an average of more than $37,000 for every day she worked for Dixon.

Some people are shocked to hear that a woman was at the center of such a vast scheme, but women in fact tend to be pretty savvy embezzlers. In fact, with more women taking on leadership positions in corporate America, an unexpected phenomenon has begun to emerge: pink-collar crime.

It’s never been a popular topic. In 1975 Rutgers criminologist Freda Adler wrote a groundbreaking yet controversial book, Sisters in Crime: The Rise of the New Female Criminal, that shed light on research analyzing the criminality of women. But in the era of the Equal Rights Amendment, Adler took a ton of heat, as critics believed her book undermined the feminist movement and distorted the facts about the female crime rate. But was Adler wrong?  I would argue she wasn’t.

Pink-collar crime is unquestionably on the ascent.  The term generally refers to the rise of women involved in white-collar crime, but it’s also a theory introduced by criminology professor Kathleen Daly during the 1980s to describe the types of embezzlement crimes typically committed by females.  Based on my research as a forensic accountant and fraud investigator, I’ve watched this trend swell over the years.

While perhaps no pink-col lar crime has been as scandalous as Crundwell’s, she is far from alone. In fact, according to the 2011 Marquet Report on Embezzlement, women are more likely to embezzle than men.  Based on a review of 473 major embezzlement cases in the United States in 2011 alone, nearly two thirds of the cases involved female perpetrators. Among the top 10 cases, five involved “pink-collar criminals” who pocketed anywhere from $4.8 to $16 million.

Before Crundwell, the largest municipal fraud was also an embezzlement case committed by a woman named Harriette Walters.  Walters was convicted of embezzling $48 million over 20 years in her role as a tax-assessment manager for the District of Columbia.  She is currently serving a 16 1/2-year sentence in a West Virginia federal prison.

So why is women’s stealing on the rise?  To help answer this question, I spoke with Kelly Paxton, a licensed private investigator and president of Denver-based Financial Caseworks LLC.  Paxton told me that the increase is due to both greater “perceived needs,” such as material goods, as well as more women being in positions where they have access to funds.

That observation is supported by my conversation with Diann Cattani, whom I interviewed for my documentary “Crossing the Line: Ordinary People Committing Extraordinary Crimes.”  Cattani, who served 18 months in prison for stealing $500,000, felt the need to provide more material possessions for her family in hopes that it would mend some personal issues within her marriage.  But the stigma of being a convicted felon ended up destroying her marriage, and continues to challenge both her personal and professional lives.

Maintaining a lavish lifestyle is a commonly cited rationale for committing white- or pink-collar crimes.  For Crundwell, it appeared to be her top priority. According to court documents, Crundwell first embezzled $181,000 in 1991, which she used to purchase a Suncruiser Pontoon boat and $3,000 worth of diamonds. The theft continued in 1992, when she pocketed $121,000, more than two thirds of which she used to pay off her credit card. In 1999 Crundwell pocketed more than $1 million, using $125,000 to purchase a horse. Even as the recession set in, Crundwell continued to use Dixon as her personal piggy bank, embezzling millions of dollars more....

In 1990 Freda Adler told the Wall Street Journal, "as more women are out in the mainstream, the more mainstream activities they are going to be involved in." We can only imagine what she would have to say about Rita Crundwell.

Recent related post on Crundwell case:

UPDATE:  The headline of this Chicago Tribune piece reports on the sentencing outcome today for Rita Crundwell: "Ex-Dixon comptroller gets 19.5 years for $54 million fraud".

February 14, 2013 at 11:12 AM | Permalink


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As of about 20 years ago, I remember seeing in one of the early USSC annual reports that broke down various crime-type categories of offender by race, sex, etc. that "embezzlement" was the only category (in the federal system for the relevant time frame) where a majority of the offenders were female. I was told at the time (by a former federal prosecutor) that the most likely reason was not so much high-stakes "pink collar" criminal masterminds, but the fact that fairly low-stakes employee embezzlement was much more likely to be federally prosecuted if the victim employer was a bank (since the bank would inevitably be federally insured, giving a jurisdictional hook) and that bank tellers were (at least in those days) predominantly female whereas comparably-sized embezzlements in other perhaps more male-heavy industries would typically be left to the state prosecutors. I don't know if those stats still play out the same way (the USSC website still being offline), and of course there has been considerable shrinkage in the teller workforce with the rise of ATM's.

Posted by: JWB | Feb 14, 2013 11:30:23 AM

One thing I've had against embezzlers, as opposed to some other white collar crimes, is that you can NOT "accidentally" embezzle. Embezzlement is a very intentional act---even if it was done for "good" motives (to save a marriage, support a child, "I was addicted to gambling", etc) or even if it was done with the intention of paying it back (I didn't intend any harm...I planned to pay it back...)--it was still done PURPOSEFULLY. Yet many embezzlers, because there is only One Victim, and because they are often a woman, with a sympathetic story/demeanor (pink collar, I suppose) tend to get a relatively low sentence for a very deliberate act. (to see Many embezzlers and many sentences, see fraudtalk.com)...I compare this to some white collar prosecutions, where business affairs seem to be getting mired down, and "temporary" solutions/coverups seem reasonable at the time that they are made, but result in things spinning out of control--with the results under the sentencing guidelines after a prosecution resulting in sentencing recommendations of Life in prison (see US v Adelson decision, among others)---even some Ponzi schemers admit that they made a bad bet at some point (after starting out honestly)---and their attempts at "fixing" or "saving their pride or reputation" led to one bad decision after another, when one might have repaired things, and hopefully left no harm to anyone. Yet in some of these white collar affairs, because numerous "victims" end up getting hurt by a poor decision, sometimes exacerbated by the economy--someone will have to pay the price--the bigger the organization (or fund or business) the harder the blamed person(s) will fall--against a stacked deck and draconian sentences, complete with enhancements. It just sometimes seems hard to square this "fall"(from poor business dealings) against a deliberate act (such as stealing). (I am Not defending ponzi schemers or asking for draconian sentences against embezzlers---I'm more pointing out that embezzling just can not be accidental)

Posted by: folly | Feb 14, 2013 3:52:46 PM

@Folly The problem is that we over charge petty crime rather than undercharge big crime. The article point out that she stole 37K for every day she worked but consider also that with a 19.5 year sentence she will spend probably only 12 years in actual prison which works out to be around one day for every $12k she stole.

I don't even need to go to the website you listed I simply pick up the local paper and I see that people get 10 years for a 50K fraud. How is that rational? Based upon the standard in this case the time in jail should be about four days.

Posted by: Daniel | Feb 14, 2013 7:14:08 PM

Past criminal damages of $6 million, the death penalty is needed. She killed the economic value of nearly 8 lives.

Posted by: Supremacy Claus | Feb 15, 2013 4:41:15 AM

She will spend 17 yrs in the slammer...19.5 * .875....Yup you actually serve %87.5 of your sentence...

Posted by: MidWestGuy | Feb 15, 2013 9:51:44 AM

See also today's headlines about the former mayor of San Diego who managed to reach a deferred prosecution agreement with the relevant US Attorney's Office regarding charges that she had improperly "borrowed" $2 million from a charity she controlled to cover personal gambling losses.

Posted by: JWB | Feb 15, 2013 2:51:08 PM

@JWB I did see that and wondered if Doug would blog about it.


Is that the federal standard? In my state the average woman serves only 60% of her sentence so that is what I went by.

Posted by: Daniel | Feb 15, 2013 5:26:50 PM

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