Commonly Encountered Federal Business Fraud Statutes

Businesses in the U.S. commit fraud casually on a daily basis. Most out of ignorance; they don’t realize that what they’re doing is considered fraud, and some simply because they don’t fully understand how serious federal business fraud actually is.

There are four types of federal business fraud statutes that are shockingly common. While the state penalties may vary for these types of fraud, the way they occur is the same across all fifty states. To learn more about these types of federal business fraud and their potential criminal repercussions, you can go to http://criminal.findlaw.com/criminal-charges/fraud.html.

 

1. Bank fraud (18 U.S.C. Sec. 1344)

Bank fraud is committed when one attempts or succeeds to defraud a federally insured financial institution. That includes anything owned by that financial institution, such as funds, properties, securities, etc.

Even if you simply put that financial institution at risk (rather than actually taking anything of value from them), it’s considered bank fraud. Those “risks” can include your bad check, you printing false statements on loan applications, student loan fraud, ATM fraud, mortgage fraud, vehicle title fraud, fraudulent credit card receipts, or credit card fraud.

 

2. The False Claims Act (31 U.S.C. Sec. 3729)

This is most commonly associated with making false financial claims in regards to Medicare, Medicaid, or government-funded financial aid. Even if you “accidentally” filled out your Medicare application incorrectly, it could be considered as a false financial claim made to the government.

False claims on other documents could also include “worthless service,” which is when an individual or business provides service so poor that it’s the equivalent of no service at all. A false claim on loan applications could also apply, and affect how title loans work. That’d be considered a false claim of service, and could be punishable under The False Claims Act initiated by President Lincoln.

 

3. Bankruptcy fraud (18 U.S.C. Sec. 157)

Put simply, if you lie or misrepresent your finances when filing for bankruptcy, you could be charged with bankruptcy fraud. Claiming bankruptcy is meant to protect individuals and businesses financially, so it’s another serious offense to commit.

Other types of commonly-encountered fraud include frauds closely related to bankruptcy fraud, such as mail and wire fraud, tax fraud, money laundering, perjury, and Sarbanes-Oxley offenses such as destroying, altering, or falsification of records.

 

4. Health care fraud (18 U.S.C. Sec. 1344, 1347)

This covers both public and private health care providers, and there are different statutes related to health care fraud that protect health care providers as well as the recipients of financial health care. While there is a separate but related statute that prevents individuals from making false claims to health care providers in order to secure payment,  there are statutes to help prevent physicians from referring patients to other doctors, clinics, or institutions in which the physician has some sort of financial relationship with, as well. Doctors, clinics, and hospitals are often more at risk of committing health care fraud than their patients are.