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A Guide to Financial Fraud Crimes

By Hager & Schwartz, P.A.

March 4, 2022

While many people understand the concepts of DUI, violent crimes, and domestic violence, financial crimes tend to have a bit more unknown. There are many categories of these offenses, and they happen more often than you might think.

Common Types of Financial Fraud Crimes

Credit Card Fraud

Have you ever had your physical credit card or account information stolen? If yes, you’ve likely been the victim of credit card fraud. However, credit card fraud is more complex than just using someone else’s card.

You may face credit card fraud charges if:

  • You open a credit card account using fraudulent information
  • You open numerous credit card accounts with no intention of paying your credit line
  • You illegally obtain someone else’s credit card account (switching the credentials into your name)

The type of credit card fraud that accounts for over 80% of all cases is card-not-present fraud. This is when fraudulent purchases are made without a physical card. For example, ordering something online with just card number information. This type of transaction is extremely common for legitimate purchases, so individuals committing this type of fraud can typically slide under the radar. While online shopping is a convenience and joy to many, it also increases the frequency of credit card fraud.

The potential penalties for credit card fraud are severe and can rise to the federal level. Whether you’re charged with a misdemeanor, felony, or federal charge will greatly depend on the frequency of the fraud and the value of goods stolen with the fraudulent credit card. For example, if the fraudulent credit card was used twice in six months to purchase over $100 in goods, this is a felony offense.

For felony cases, you face:

  • Up to five years in prison
  • Five years of probation
  • Up to $5,000 in fines

Bank Fraud

Bank fraud is an umbrella term that encompasses many specific fraud offenses. In general terms, bank fraud occurs whenever an individual conducts activity meant to defraud a financial institution.

This could involve many individual types of fraud, including:

  • Forgery
  • Accounting fraud
  • Check fraud
  • Skimming
  • Loan fraud
  • Money laundering

The potential penalties you face will change depending on which type of bank fraud you engaged in. For example, money laundering will likely face more severe charges than minor forgery.

Investment Fraud

Investment fraud occurs when individuals commit fraud in order to solicit investments from investors or otherwise profit through fraudulent investing.

Some examples you may be familiar with include:

  • Ponzi schemes
  • Cryptocurrency scams
  • Pump-and-dump schemes

These factors are common in investment fraud schemes:

  • High-pressure tactics
  • Cold-calling/out-of-the-blue contact
  • Low risk, high reward promises
  • Deals that seem too good to be true

If convicted of investment fraud, you face prison time in addition to numerous financial penalties.

Tax Fraud

We’re right in the thick of tax season, so here’s what you should know about tax fraud. Tax fraud is another common crime, and surprisingly, one that you can commit accidentally.

Individuals may commit tax fraud by failing to file their taxes, misreporting their income, or otherwise falsifying statements in order to get a higher return or pay less money.

However, sometimes innocent mistakes can be mistaken as intentional tax fraud. If this is your current situation, contact our defense team at Hager & Schwartz, P.A.. We want to help prove that your tax error was not meant to be fraudulent but was a simple mistake.

Can You Commit Fraud By Accident?

While types of fraud like embezzlement and money laundering cannot be committed accidentally, other types can. Tax fraud is one of the most common types of accidental fraud. The IRS is aware of this though and expects some individuals to make innocent errors on their tax documents. However, even if you don’t face criminal charges, you may be required to pay a penalty. For example, if you mistakenly pay less than you were supposed to, you’ll be required to pay the missing amount and a percentage penalty. This may be an additional 20% payment.

However, some cases of accidental fraud may not be so clear and you may be accused of committing a crime. In these situations, though you know you are innocent, you need to contact a criminal defense attorney.

If You’re Being Charged with Fraud

Once you have been charged with a fraud crime, you need to be cautious of everything you do. First, do not talk to the police. You may believe that offering information to the police will help you later on. However, this is not the case and you should never make any statements without consulting with your attorney. You would be surprised what can be twisted and used against you. Instead, use your right to a defense attorney right away.

Next, begin thinking of your defense options. Did you have the intent to commit fraud? What evidence do the prosecutors have against you? Were you coerced? It’s important to consider all possible defense strategies. Your defense attorney can work with you futher to determine the right course of action for your case.

Additionally, stay offline. You don’t want to discuss your case online. When it comes to the Internet, nothing is really private. Social posts, texts, and phone records may be used as evidence.

Miami Fraud Defense Attorneys

If you’ve been charged with a financially-motivated fraud crime, you need to take action. These cases are serious, especially if you are being charged at the federal level. You face years in prison, expensive fines, and damage to your personal and professional reputation if you are convicted.

At Hager & Schwartz, P.A., we have helped numerous clients facing fraud charges reach the best possible outcome. When it comes to a serious accusation like fraud, you want the strongest defense possible by your side. Share the details of your situation and learn how our team can help you by calling (305) 330-1360 or filling out our online form here.