The author wants to absolve criminals of faulthood because "criminal actions, like all actions are ultimately products of the environment..."

But then, later in the argument, the author wants to center faulthood on the law-abiding citizenry because they "by their actions do the most to create and maintain that environment."

I'm sure you see the contradiction in his argument:

The reason he wants to absolve one group of faulthood is the same as the reason he wants to ground faulthood on another group.

Therefore, he his contradicting himself--that is what makes his argument flawed, and that would be a good prediction of the right answer.

Now, aggressively scan for a match to that prediction: Then, Choice E matches this prediction.

Because we spent time solving the argument and generating a prediction, we don't want to spend a lot of time drowning in the answer choices. So, we aggressively scan for the match, and we don't overuse POE. POE means figuring out four reasons why four wrong answers are wrong; an arduous process considering how good the test-maker is at designing seductive wrong answers. Also, by doing this, we get sucked in by choices and our original analysis of the argument dims. We don't care about wrong answers and why they are wrong. And we get rewarded for one and one thing only: selecting the correct answer. Remember, you don't have to decide whether a choice is correct the first time you read it; instead, keep the prediction/solution clear as day in your head, and aggressively scan for a response that impresses you as matching.

Anyways, because this is a clear flaw in the argument, and because it matches one of the answer choices, choice E must be correct. And Choice C is wrong because Choice E is right. (We don't care why wrong answers are wrong, and critical reasoning is just as objective as math--there is one and only one correct answer--no such thing as a "good" or "better" answer.)

Anyways, for reviewing (rather than performing/practicing) purposes, let's take a look at choice C:

(C) the way it distinguishes criminals from crimes
implicitly denies that someone becomes a
criminal solely in virtue of having committed a
crime


How, exactly, does the stimulus "distinguish" criminals from crimes? How does anyone distinguish a criminal from a crime?

Let's see, "distinguish" means "to tell apart." So, how does one tell apart a criminal from a crime?

Well, obviously, a "criminal" is a person and a "crime" is an act. That's how you tell those things apart. The author clearly does not have to draw such an obvious distinction. And so he didn't. This means that choice C is wrong: the right answer to a flaw question is always a reasoning error that the author actually committed--you can always eliminate a flaw answer choice if the author didn't even "do" the thing that the answer choice describes. But even if the answer choice had instead said "fails to distinguish between criminals and crimes," it would still be wrong because it is tremendously unlikely that failure to draw such an obvious distinction would ever be the reason why a GMAT arguer's reasoning would be flawed.

Also, choice C states that the author implicitly denies that someone becomes a criminal just because they committed a criminal act. In fact, the author more or less explicitly denies this.