White collar criminal investigations declining across the U.S.

White collar criminal investigations have fallen to a 20-year low, according to the Star Tribune.

Minnesota has also seen a downward trend in these prosecutions, which is good news for a state that has a relatively bad history in the world of white collar criminals. Its lowest point was a $3.65 billion Ponzi scheme created by Wayzata businessman Tom Petters, which was one of the largest schemes in U.S. history. Recently, federal prosecutors have uncovered a ring of thieves who specialized in stealing smartphones, several organized crime operations revolving around identity fraud, and 14 investment schemes in 2014.

However, U.S. Attorney Andrew Luger says white collar crimes are still a very real problem, so much so that he has asked for help from state and local law enforcement. In the Twin Cities, most cases are handled by the FBI, the Internal Revenue Service and the U.S. Postal Inspection Service.

Federal agents in the Twin Cities say they’ve been limited lately by declining personnel, resulting in fewer resources to launch investigations. (Another problem is how long investigations can take—months or more—which prevents agents from starting new investigations.) The U.S. Postal Inspection Service has cut its agents in the Twin Cities office by 20 percent since 2010, while the number of IRS agents nationwide has decline 16 percent since 2011, probably affecting its Twin Cities office as well. Meanwhile at the FBI, spokesman Kyle Loven declined to release exact numbers of agents but said the number of agents working on white collar cases has remained “relatively steadfast.”

According to Luger, one way to overcome declining resources is to create more partnerships among other agencies, such as the Minnesota Bureau of Criminal Apprehension (BCA) and the Minnesota Department of Commerce fraud division. In addition, the Secret Service in Minnesota and the Dakotas has been working alongside investigators to offer help. However, since Secret Service staffing has shrunk across the country, those agents are sometimes pulled out to help with special assignments throughout the U.S., disrupting investigations.

The state agencies have seen their own successes as well. The Minnesota Financial Crimes Task Force (made up of federal, state and local law enforcement) obtained 56 federal indictments in 2014, compared to only nine in 2013. Meanwhile, the Minnesota Department of Commerce recently reorganized its fraud bureau and hired more experienced investigators, according to Commissioner Mike Rothman.


Grace Webb

Grace Webb

A former Editor of Connect Business Magazine

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