Iron company avoiding settlement is a criminal act (6)
I believe the answer is:
felony
'a criminal act' is the definition.
(I've seen this before)
'iron company avoiding settlement' is the wordplay.
'iron' becomes 'Fe' (chemical symbol for iron).
'company' becomes 'co' (abbreviation).
'avoiding' indicates named letters should be taken away.
'settlement' becomes 'colony' (synonyms).
'colony' with 'co' taken out is 'lony'.
'fe'+'lony'='FELONY'
'is' is the link.
(Other definitions for felony that I've seen before include "Criminal offence" , "Grave crime" , "Criminal act" , "Serious crime" .)