An Introduction to Fraud Crimes and Fraud Law


People often stretch the truth for personal benefit. They may exaggerate their resumes to get a better job. Every day, people call in sick to take an impromptu vacation. However, some people use lies to take advantage of others, take their personal information or steal their money. When criminals use falsehoods that cause legal harm, they are committing some form of fraud.

What is fraud?

Individuals who feel defrauded frequently contact us through the website. They are frustrated because they have been deceived. However, fraud is more than not telling the truth. People engage in fraud when they knowingly use lies intending to cause harm. The intentionality of the act is critical when charging someone with fraud.

It is not enough that the defendant said something untrue. Dishonesty can be a symptom of several mental disorders. Although the statements might be untrue, the speaker does not intend to cause harm. Even if a statement turns out to be false, if a speaker believes that what he is saying is true at the time, it would not constitute an illegal act.

Some Common Types of Fraud

From a scammer pretending to be someone else to a company exaggerating the benefits of its products, fraud takes many forms. Some types of fraud have been around for centuries, and others have arrived with new technologies.

Identity Theft

Someone stealing personal information can cause a great deal of harm in a victim’s life. With data like a credit card number and an address, the criminal can ruin someone’s credit and make them spend hours trying to resolve the situation.

Ponzi and Pyramid Schemes

Many fraudsters use greed to manipulate their victims. Even though there are ample warnings, people still fall for classic Ponzi schemes. In this arrangement, a fund manager promises remarkably high returns. In the beginning, investors often see positive growth. However, the growth comes from money given by other investors and not actual profits. When there are no new investors, the scheme falls apart.

Pyramid schemes are similar except that the investors are put to work recruiting new members into the scheme. Again, any profits an investor sees are the result of new capital and not legitimate gain.

Phishing and Online Fraud

The growth of technology has introduced new ways to fool people. Criminals may pore over social media sites to gain information about a potential victim. Then, they can approach the target posing as an acquaintance. The familiarity increases the chance that the target will send money or give personal information.

Consumer Fraud

It is unethical for businesses to be dishonest about their products. However, It is not difficult to find examples of companies that exaggerate their claims for profit. A common scheme is launching a product with questionable benefits. The fraudsters then dissolve the company before consumers can get their money back.

Tips to Avoid Becoming a Fraud Victim

A high-pressure pitch with promises of impossibly high gains is a common feature of many types of fraud. An email or call that requires you to act immediately should be a warning sign. Legitimate companies should not mind if a potential investor needs to do some research.

To avoid internet fraud, it is always best to refrain from clicking on links or opening files if you do not know the origin of the email. Users should also avoid giving personal information over email or phone. Most banks and government agencies will take steps to prove their legitimacy.

The Difference between Criminal and Civil Fraud

In the court system, fraud cases take two forms: civil and criminal. The primary difference between the two is the party that is pursuing the case. Prosecutors from local, state or federal authorities carry out criminal trials. While these cases may result in compensation for the victim, there are other potential penalties.

An important difference between civil and criminal fraud cases is that the state can prosecute a fraud case even if the fraud was unsuccessful. A criminal prosecutor will pursue a trial on the grounds that the accused person intended to commit fraud.

In a civil case, the fraud victim brings the accused fraudster to court. In this trial, the main concern is receiving compensation for the losses caused by the dishonesty, and the plaintiff must prove that the defendant successfully caused some form of damage.

Penalties for Criminal Fraud

In a criminal fraud case, the court has more penalty options. Someone found guilty of fraud might receive jail or probation time. They might also have to pay financial compensation or other penalties. The severity of the punishment will depend on factors like the extent of the fraud, the amount of damage and prior fraud convictions.

Penalties for Civil Fraud

In a civil case, the primary penalty is compensation for damages. In addition to receiving lost money, the court might award damages for lost time or suffering.

Common Fraud Defenses

Lack of Intent

A lawyer can defend a client accused of fraud by demonstrating a lack of intent. A dishonest statement only counts as fraud if the speaker intended to cause harm or take advantage of the person.

Non-Fraudulent Statements

A defense lawyer might argue that a client’s statement was not false or that the client did not believe it was false. Many companies seek to prevent accusations of fraud by adding statements in fine print in their advertisements or contracts.

Insufficient Evidence

This defense argues that there is not enough evidence to establish that the defendant is responsible for the crime. It is a general strategy that seeks to put distance between the defendant and the fraud. Since criminal cases must meet the standard of guilt beyond a reasonable doubt, the defense lawyer will seek to create questions about the plaintiff’s story.

Responding as a Fraud Victim

Victims of fraud may feel powerless to respond. They may also feel foolish for having believed statements that were too good to be true. However, fraud victims should seek help from an attorney who will help them understand their legal options and prepare for the case.

At, we specialize in helping victims of consumer fraud find justice. An experienced legal team will help clients through the court process. Recovery from fraud begins by holding fraudsters accountable for the consequences of their dishonesty.

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