Fraud is a term, generally speaking, used when someone intentionally lies or withholds information for personal gain.
Another way to look at fraud is that someone uses information that a potential victim doesn’t have, which would allow the perpetrator to steal from the victim. Fraud will get you into big legal trouble, and it comes in many different forms. These include:
Bank fraud is the attempt to defraud a financial institution for personal gain. There are many kinds of bank fraud, which can include:
- Accounting fraud: This can occur when businesses make it seem like they’re more profitable than they really are, also called “cooking the books.”
- Loan fraud: This includes lying on a credit application to earn more money on a loan than that which can be reasonably paid off or using a false identity to take out loans.
- ATM fraud: This involves using an ATM to steal others’ personal banking information.
- Phishing fraud: This is a scam that involves collecting others’ banking details over email, phone or text for personal use.
More common types of bank fraud include forgery or deliberate bouncing of checks, debit and credit card fraud (typically, as a result of identity fraud) and Automated Clearing House (ACH) fraud (through electronic fund transfer).
Another kind of fraud happens when information is excluded or altered that’s used by mortgage underwriters or lenders to fund, purchase or insure a mortgage loan. This kind of fraud may be committed by borrowers and mortgage lenders.
Some forms of mortgage fraud are committed by people who have insider information, which could allow them to misuse mortgage loans to steal cash and equity. Other forms of mortgage fraud happen when a borrower lies about, for example, their income or savings so that they’re approved for a loan.
Bank and mortgage fraud are serious offenses and can lead to severe legal repercussions, such as fines and incarceration. You may need to understand your legal options if you’re accused of fraud. Even if you’re innocent, this is not a situation you can handle alone.