Legal framework and policy gaps in addressing political, medical and engineering white collar offences in India.

AUTHOR: MUSKAN SHARMA

BCOM L.L.B. (Hons.) IX Sem

Prestige Institute of Management & Research, Gwalior

Introduction

“White-collar crime” is a capacious category that captures non-violent, financially or reputationally harmful wrongdoing committed by persons in positions of trust or authority. In India such offences range from bribery, procurement fraud and corporate malpractices to professional negligence and regulatory non-compliance in medicine and engineering. Since white-collar crimes tend to involve subtle facts, cross-institutional players, technical subject matter and advanced cover-up, the responses of law and policy to them are distinct from those suited for run-of-the-mill street crime. The article analyzes the legislative and institutional framework governing political, medical and engineering whitecollar crimes in India; identifies longstanding legal, institutional and policy loopholes; and provides specific reform proposals to enhance prevention, detection and accountability. (Where relevant, primary legislative sources and authoritative institutional accounts are referenced. Foremost statutes addressed include the Prevention of Corruption Act (1988), Prevention of Money Laundering Act (2002), Companies Act (2013), and medical regulation statutes such as the National Medical Commission Act (2019).

1. What is white-collar crime in India?

White-collar crime in India is not defined by a single code; instead, it is an overlapping cluster of offenses extracted from the Indian Penal Code (IPC), special economic law and sectoral regulatory legislation. Common offenses are bribery and corruption, criminal breach of trust, cheating, fraud, insider trading and market-manipulation, money-laundering for proceeds of predicate offenses, corporate fraud (e.g., mis-statement of accounts), medical professional misconduct (unsafe negligence, fraudulent prescriptions, kickbacks), and engineering frauds (sub-standard contracting, false test reports, collusive bidding). Indian commissions and commentators have traditionally listed white-collar offenses to encompass tax evasion, share-pushing, corporate malpractices, hoarding, profiteering, corruption and sub-standard performance on government contracts. Why it is important legally: a large number of these acts are prosecuted under common criminal codes (IPC provisions on cheating, criminal breach of trust, criminal conspiracy), whereas others draw upon specific legislation (e.g., Prevention of Corruption Act for bribery by public officials; PMLA for tracing and confiscation of proceeds of crime; Companies Act for corporate governance lapses). The plurality of legal sources conditions the incentives for enforcement — and also generates coordination and evidentiary issues.

2. The core legislation and institutions (overview survey)

Principal statutes

• Prevention of Corruption Act, 1988 (PCA) — the main statute criminalizing bribery and public servant corrupt practices; contains offence definitions, punishment and procedures on public sector corruption.

  
  

• Prevention of Money-Laundering Act, 2002 (PMLA) — facilitates tracing, provisional attachment and confiscation of property obtained from criminal activity, and authorizes the Enforcement Directorate (ED) to investigate money-laundering and associated financial offences.

  
  

• Companies Act, 2013 — corporate governance, duties of directors, duties of auditors, criminal civil recourse to false accounts, frauds and company mismanagement.

  
  

• Indian Penal Code (IPC) — provisions relating to cheating, criminal breach of trust, criminal conspiracy, forgery and connected offenses. (IPC is the foundation criminal legislation applied across cases.)

  
  

• Sectoral regulatory legislation — for medicine the National Medical Commission Act, 2019 (NMC Act) in place of the Medical Council of India governs medical education, practitioner registration and disciplinary procedures; engineering does not have a standalone, overarching statutory regulator at the national level but professional organizations (Institution of Engineers, others) and draft/proposed legislation have attempted to do so.

Investigative and adjudicatory agencies

• Central Bureau of Investigation (CBI) – central investigative agency regularly dealing with high-profile cases of corruption and corporate fraud; federalism and jurisdictional issues since criminal law is a state subject in most ways.

  
  

• Enforcement Directorate (ED) – conducts PMLA investigations, provisional attachments and prosecutions in special courts.

  
  

• Special courts — by law or designation for PMLA, Prevention of Corruption Act trials, Companies Act offences, etc.

  
  

• Sectoral disciplinary agencies — National Medical Commission (NMC) for physicians; state medical councils; professional societies for engineers (Institution of Engineers, Council of Architecture for architects) which are primarily based on codes of professional conduct and discipline as opposed to criminal sanction.

These tools collectively provide the legal architecture for prevention and punishment, but the architecture leaves significant enforcement weaknesses.

3. Manifest gaps and structural problems

Below, I analyze the prime gaps hindering efficient detection, investigation and rectification of white collar crimes in political, medical and engineering fields.

A. Fragmentation of legal sources and overlapping jurisdiction

White-collar conduct tends to engage several statutes at the same time: corruption, money-laundering, company fraud, tax evasion and regulatory contraventions can spring out of the same factual setting.

This multiplicity results in: Coordination issues among agencies (CBI, ED, state police, revenue authorities, sectoral regulators).

Investigative sequencing disputes and contesting for superior jurisdiction are prevalent. ED's strong financial attachment powers under PMLA, for instance, can be used only on predicate offences, but there is disagreement as to whether predicates actually exist—creating litigation on jurisdiction. Recent jurisprudence has focused on the fact that ED's PMLA powers have to be backed by a valid predicate offence; however, the demarcation between financial investigation and regular criminal investigation continues to be an issue of debate. Replication and delay — concurrent investigations and litigation for jurisdiction increase transaction costs and may slow ultimate resolution.

B. Complexity of evidence and capacity deficits

White-collar crimes are paper-intensive and involve forensic accounting, analysis of digital evidence, technical audits (medical records, clinical tests) and engineering audits (conformity to design, quality tests). Most significant deficits: Forensic capacity deficit — lack of independent forensic accountants, high-level cyber forensic laboratories and technical experts (medical, engineering) integrated within investigating agencies. This results in poor quality evidence packets or excessive reliance on confessions and witness evidence. Adversarial courts + technical complexity — technical backup may be lacking for judges to interpret forensic accounting reports or engineering test evidence, impacting the quality of reasoning during trial.

C. Regulatory enforcement and disciplinary weakness in professional sectors

Medical sector

The NMC substituted the Medical Council of India with reformative purpose, such as new education standards and powers of discipline. But there are still gaps: Long disciplinary proceedings — professional misconduct investigations and disciplinary hearings take years; during this time the practitioner can continue practicing on patients. The NMC and state councils require quicker interim remedies to suspend risky practitioners subject to inquiry. Overlap between criminal prosecution and professional discipline — uncoordinated exercise results in evidence fragmentation; sectoral regulators might not possess robust investigative arms to maintain evidence for criminal cases (e.g., seizing medical records, maintaining labs). Commercialization and perverse incentives — fee-splitting, kickbacks to referral agents, and corporate ownership of clinical facilities create structural financial incentives that encourage fraud and overtreatment. Regulatory architectures do not adequately target these market incentives.

Engineering and construction sector

Weak statutory regulation — engineers, unlike doctors or architects, have no strong statutory, nationwide licensure and disciplinary mechanism with teeth. Professional certification by organizations like the Institution of Engineers is voluntary or self-regulatory in much of the country, leaving a regulatory vacuum for malpractice or collusive contracting. Recent lobbying and draft proposals have called for a national Professional Engineers Act (there are debates and private sector synopses), but there is no comprehensive, nationally enforceable statute. Public procurement vulnerabilities — collusive bidding, below-standard materials, fake test certificates and contract-splitting are common issues; procurement audit and technical oversight are usually poor.

D. Political white-collar crime — immunity, influence and evidentiary obstacles

Political corruption and crimes involving political players are particularly challenging: Public office and influence — political players can apply pressure on investigating agencies, witnesses, and preservation of evidence. The law may not accord blanket immunity, but facto bars to investigation (delay in imposition of sanction for prosecution under the PCA in certain instances, political influence) hinder accountability. Sanction requirement and delay — some prosecution actions against public officials need sanction in advance (under PCA and other laws) and administrative delay in granting or denying sanction can hinder prosecution. Judicial intervention is a help but an expensive one.

E. Enforcement incentives and political economy

Investigative agencies may face perverse incentives: political pressure to prioritize certain targets, resource constraints that favors high-profile cases instead of systemic enforcement, and public distrust over selective enforcement. This dynamic undermines deterrence.

F. Evidentiary, procedural and sentencing limitations

Low conviction rates in complex fraud cases stem from poor investigation, weak witness protection for whistleblowers, and challenges proving men’s rea in complex corporate settings. Penalties too infrequently calibrated — civil disgorgement and administrative penalties not always correlated to the magnitude of illegal gains; criminal punishments long in documentation but faintly enforced on the ground.

4. Sectoral deep dives: political, medical and engineering offences

Political white-collar offences

Common acts: bribery to win contracts with public funds, enrichment through irregular means, nepotistic distribution, electoral abuses financially driven, quid-pro-quo appointments, political donation laundering.

Legal instruments at disposal: PCA, IPC offences (criminal breach of trust, cheating), electoral legislations (Representation of the People Act), PMLA to follow proceeds.

Still significant hurdles remain:

• Predicate-offence requirement for PMLA — courts have insisted on a predicate offence for ED jurisdiction. Where predicate offences are stale, case-killed, or politically sensitive, ED interventions can be contentious.

  
  

• Sanction and administrative bottlenecks — sanction to prosecute public servants under PCA or departmental proceedings can be delayed.

  
  

• Asset concealment and cross-jurisdictional flows — sophisticated corporate structures and offshore vehicles make tracing difficult in the absence of strong beneficial-ownership registries and rapid international cooperation.

  
  

• Policy implications: fighting political white-collar crime necessitates not merely criminal law but transparency instruments (asset/public interest disclosures), campaign finance reform, whistleblower protection and speedier administrative sanction procedures.

  
  

Medical white-collar crimes

Typical offenses: profit-driven over-treatment, ghost surgery, cheating diagnostics, kickbacks for referrals, prescription forgery, spurious medical qualifications and unqualified physicians running clinics.

Legal/regulatory mechanisms: NMC disciplinary framework, IPC sections of cheating and causing grievous injury, Drugs and Cosmetics Act for misbranding of drugs, consumer protection for misconduct, and criminal offenses for gross negligence that results in death (section 304A IPC).

Gaps:

• Delay in disciplinary and criminal follow-through — patients and complainants spend extended periods of time waiting in judicial and regulatory environments.

  
  

• Data opacity and record-keeping — incomplete or doctored medical records render evidence of negligence or fraud difficult. Clinical data are often not digitized, and health data governance is patchy.

  
  

• Corporate hospital complexities — if corporate groups rather than individual proprietors own clinical facilities, ascription of individual culpability or piercing corporate veil becomes procedurally cumbersome. Whistleblower danger for health employees — disclosure of kickbacks or malpractice may lead to loss of work; safeguarding structures are thin.

  
  

• Policy implications: obligatory electronic patient records with audit tails, more robust interim suspension provisions for enforcers, business-based liability schemes permitting penalizing organizations (not only individuals), and clear anti-kickback provisions linked to criminal sanctions.

  
  

Engineering white-collar offences

Usual offences: forgery of test certificates, application of sub-standard building materials, collusive tendering, bribery in approval and certification, professional negligence resulting in structural collapse.

Legal/regulatory mechanisms: IPC offenses, contract law remedies, consumer protection, and building/safety legislation at state level. But unlike medicine, engineers lack, consistently throughout India, a statutory national licensing body with robust disciplinary powers; most engineers are subject to employer controls or local systems of registration. The Institution of Engineers issues certifications but compliance is poor. Attempts and plans for a national statutory system of professional engineers have been debated.

Key gaps:

• Regulatory fragmentation — permissions for building, quality checks and enforcement are scattered across municipal, state and central government agencies with variable standards.

  
  

• Collusion by contractors and suppliers — procurement mechanisms are susceptible; technical oversight and independent quality checks are under-staffed.

  
  

• Evidence and standards — forensic examination on materials, independent testing facilities and chainofcustody issues render establishing engineering fraud as a challenge.

Policy implications: mandatory continuing professional competence through national licensing, third-party testing laboratories independent of industry with publicly available accreditation and results, and increased criminal and corporate liability standards for certifying engineers and contractors.

5. Cross-cutting systemic weaknesses

a) Weak whistleblower architecture and witness protection

Whistleblowers are main sources of white-collar exposure. Although India has the Whistle Blowers Protection Act (2014), implementation is spasmodic and institutional backing is inconsistent; fear of reprisals is real. Secure, effective, and confidential means with legal protection and relocation/support are needed.

b) Beneficial ownership secrecy

Corporate forms can be used to conceal proceeds. Even though the Companies Act and connected rules require disclosures, ongoing lack of transparency with respect to beneficial owners as well as shell companies undermines asset tracing. Beneficial ownership registries need to be fortified, connecting PAN/Aadhaar/registry information and real-time sharing of data is essential.

c) Capacity and training

Investigators, prosecutors and judges must be constantly trained in forensic accounting, digital evidence law, medical/engineering expert-evidence interpretation and managing complex corporate litigation. Special prosecution cells with technical experts would enhance case quality.

d) Procedural delays and incentives for settlement/compromise Long litigation periods spur settlement or political horse-trading, which can lead to impunity. Fast-track procedures for financial crimes and empowered special courts with technical benches would help.

e) Political oversight and independence of agencies

True autonomy of investigation agencies is crucial. Appointment and removal procedures, financial security and operational independence are policy levers to minimize capture and selective enforcement.

6. Recommendations — law, institutions and practice

Here are actionable reforms to make the response to political, medical and engineering white-collar crimes stronger. They are categorized thematically.

A. Legal reforms

1. Harmonize and clarify predicate-offence rules for financial investigations

Enshrine guiding principles on when jurisdiction is triggered under PMLA/ED to minimize jurisdictional litigation and facilitate prompt action—without compromising judicial review. Judicial statements (e.g., highlighting predicate offences) must be harmonized by statute or rules to minimize procedural bickering.

2. Enhance corporate criminal liability

Amend the Companies Act and criminal procedure rules to clarify and simplify corporate liability for design/engineering/medical fraud (e.g., reverse burden for corporate falsification of records, strict liability for lack of legally mandated safety/quality records).

3. Mandatory disclosure and public registry of beneficial ownership

Operationalize strong, searchable registries with verification to avert concealment of illicit proceeds.

4. Strengthen anti-kickback and conflict-of-interest rules in healthcare and procurement

Statutory prohibition and criminal sanctions for fee-splitting, hidden referral commissions and inducements, with compulsory disclosure by health organization.

5. Statutory professional registration of engineers

Pass a national law that makes provision for engineers' licensing, discipline and continuing professional competence (subject to respecting state competence where relevant). Where proposals already in draft form, expedite parliamentary debate and stakeholder consultation.

B. Institutional and procedural changes

1. Specialist prosecution cells and specialist benches

Establish multidisciplinary prosecution cells (forensic accountants, technical engineers, clinicians) in central/state agencies and assign special courts or benches to deal with complicated white-collar cases with technical advisers.

2. Streamline disciplinary panels in health and engineering

Regulators like NMC and emerging engineering regulator need statutory authority to issue interim suspensions pending investigation and faster final hearings.

3. Enhance whistleblower protections and ensure reporting

Implement robust digital reporting platforms with anonymity, witness protection measures and enforceable non-retaliation rules, plus fast triage of credible complaints.

4. Accreditation and independent testing

Build an independent national accreditation framework for testing laboratories (materials, clinical diagnostics) and publish test results for public procurement projects.

5. Inter-agency coordination protocols

Formal interagency joint investigation procedures and data exchange memoranda between the ED, CBI, state police, tax authorities and sector regulators to prevent duplication and accelerate evidence collection.

9. Conclusion

White-collar crimes in the fields of engineering, politics, and medicine damage public finances, put lives in danger, and erode institutional confidence. Many of the appropriate tools, such as the PCA, PMLA, Companies Act, NMC, and other sectoral instruments, are present in India's statutory framework; nevertheless, their efficacy is diminished by fragmentation, capacity deficiencies, poor disciplinary regimes in professional sectors, evidential complexity, and political economy dynamics. Targeted legislative reforms, institutional investments (technical prosecution cells, forensic capacity), transparency, and preventive regulation (digital records, anti-kickback laws, procurement reforms) are all required. Improving whistleblower safety and shielding enforcement from selective politics are equally crucial to ensuring that wrongdoing is identified and dealt with quickly. Strengthening professional ethics, public openness, and governance are essential remedies that go beyond illegal activity. With appropriate legislative remedies and adequately funded investigations . Strengthening public openness, professional ethics, and governance are essential remedies that go beyond criminal activity. Many of the gaps that currently allow white-collar criminals to avoid prompt discovery and punishment can be closed in India with the help of political will, appropriately funded investigative and regulatory agencies, and calibrated legislative remedies.