Many types of fraud exist, but they all share common elements. Fraud involves a deception that illegally benefits the perpetrator. For example, someone who commits fraud might pretend to be someone else or fabricate evidence to gain money from an insurance company or other entity.
Perpetrators of fraud could face both civil and criminal penalties. In criminal court, the prosecutor can file charges against the suspect based on state or federal statutes that prohibit fraudulent acts. The victim of fraud can also sue the perpetrator to recover monetary damages as a result of the defendant’s actions.
The most common types of fraud include:
When a perpetrator uses the mail to deceive someone else, they could be charged with mail fraud. This type of scheme could involve letters or packages that the perpetrator uses to entice someone to send them money or valuables. For instance, a scam artist might send a letter that promises a free vacation if the recipient sends an application and a small fee.
If someone uses another person’s credit without their permission, it’s known as credit fraud. The most common example is credit card fraud. The perpetrator uses someone else’s credit card information to make purchases. Credit fraud can also be committed by taking out a loan in someone else’s name.
State assistance systems exist to provide aid to people experiencing financial hardships. When committing welfare fraud, an individual provides inaccurate or misleading information to obtain assistance, such as understating their income or claiming a non-existent hardship.
Check fraud can be committed by the writing of a check on someone else’s bank account without their permission or by writing checks on a closed account or an account without adequate funds. Bad checks go by many different official and unofficial names, such as hot, bounced, or worthless checks.
This is a blanket term that covers any fraudulent activity that occurs on the Internet. For instance, if identity theft occurs online, it’s often called online fraud. Other examples of online fraud could include:
When a doctor, nurse, pharmacist, or medical professional makes false promises about a treatment’s effectiveness or uses questionable diagnostic or treatment procedures, they might have committed medical fraud. Also called “health care fraud,” medical fraud might include the sale of unnecessary or ineffective drugs or the filing of exaggerated insurance claims. According to the FBI, medical fraud can also include the fraudulent use of someone else’s insurance coverage.
If a person provides false information to their insurance company or deliberately causes damage to their own property and files a claim, they could be guilty of insurance fraud because it results in a fraudulent insurance payout. These scams not only result in high costs to the insurance company, but also make it more difficult for consumers to gain coverage.
For first-time offenders, the prosecutor might offer a plea bargain that reduces a felony charge to a misdemeanor even if the facts of the case make the crime a technical felony. This is why it’s essential to hire a lawyer if you’ve been charged with any type of fraud.
Knowing what fraud is defined as is only the first step to protecting yourself. While many forms of fraud are committed intentionally, it’s also possible to commit a fraudulent act without understanding that the behavior is illegal.
For instance, you might write a check on a bank account that you have already closed. If you simply grab the wrong checkbook, you could commit fraud without realizing it. Similarly, you might attempt to sell a purse online without realizing that it isn’t a designer bag, which could expose you to charges of consumer fraud.
Although most criminal statutes require fraud to be intentional, it can be difficult to prove that you didn’t realize you were committing a crime. Before you conduct business with another party or take money from another individual, carefully examine the transaction and its potential consequences. Should you be charged with fraud, you will most likely need the help of a criminal defense lawyer.
Nobody wants to find themselves the victim of a fraudulent scheme. The best way to avoid identity theft and other types of fraud is to protect your personal information:
If you suspect that a person you’re in contact with might attempt to defraud you, consider the circumstances. It helps to know how to look for red flags, such as:
If you believe that someone has defrauded you, report the incident to the police. Law enforcement will investigate the fraud and file charges against the appropriate party. To increase the chances of successful prosecution, cooperate fully with the police and prosecutors.
You might need to report certain types of fraud to federal authorities such as the FBI or the Securities and Exchange Commission. The Inspector General’s Department of Health and Human Services Office often handles medical fraud cases on the federal level, while the Federal Trade Commission might accept reports of identity theft and consumer fraud. If you’ve been a victim of mail fraud, consider reporting it to the US Postal Service.
However, if you report the incident to your local police department, the officers can tell you how to proceed with your complaint if the matter requires outside agency involvement. Once you file a fraud claim, law enforcement will gather evidence and interview suspects. They might ask you for documentation to support their case, such as copies of checks or money orders and any written correspondence between you and the perpetrator. If the case goes to trial, you might have to testify against the defendant.
When you’re the victim of fraud, you might need a lawyer to protect your rights and help you recover damages. Criminal cases are separate from civil cases. Even if the police do not have enough evidence to charge the perpetrator with a crime, you can still file a civil lawsuit to recover damages.
Your attorney can help you decide when and if you should file a lawsuit and assist you in collecting evidence. Lawyers can also communicate with law enforcement and prosecutors to keep you up-to-date on the status of a criminal case.
You might need a lawyer to help you recover from fraud, as well. For instance, in identity theft cases, an experienced attorney can help you dispute negative marks on your credit report and repair problems with financial institutions, such as your bank. In many cases, lawyers can achieve results much faster than a consumer working alone.
Look for a lawyer who has handled fraud cases before. Even if you’re not sure whether you can prove someone else defrauded you, an attorney can provide guidance and support as you decide how to move forward.
Fraud costs money and can impact the rest of your life, whether you’re the victim or the perpetrator. Understanding how fraud works can help you avoid committing it or becoming a victim of it. However, if you find yourself in legal trouble, hiring a fraud lawyer is the best way to protect yourself.