Fraud, ID & Money Fraud and Misrepresentation: Civil & Criminal Offenses

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  1. Fraud involves dishonest and deceptive conduct by a person or a party for the purpose of obtaining an unfair and unlawful gain. The act can constitute both a crime and a civil wrong. Detecting fraud can be difficult and sometimes it is never discovered. While knowing the law and your remedies is important, being able to identify circumstances when a fraud is most likely to occur is the best way to protect against such harm.

    Fraud, Misrepresentation and the Law

    Not all misrepresentations are fraud but almost all fraud includes misrepresentation. The goal of a fraudulent act is to trick or mislead an innocent person into thinking that something has a certain value (or is worthless) and which the perpetrator knows is false. While the term is defined very broadly, all fraud offenses include some type of misrepresentation, deception and/or false statement. Federal and state statutes cover a wide variety of different fraud charges and punishments. Criminal fraud generally requires the existence of at least two elements – (1) the defendant’s intent to commit the crime, and (2) that the criminal act of fraud was actually committed by the defendant. Additional elements may be required. For example, to constitute federal wire or mail wire fraud, the criminal act must also involve an interstate transmission or communication using a wire or the postal service. Generally, many fraud laws require the presence of the following:
    • A person makes false statement concerning a material fact;
    • who knows or should know that the statement is false or has no knowledge of whether the representation of a fact is true or false;
    • which is made to a person who reasonably relies upon the false statement;
    • who suffers damages as a consequence of relying and acting upon the false statement.

    Some statutes require the presence of an intent to defraud or deceive. In addition, state laws may require each element to be proven with “particularity ” or separately for an entire fraud charge or claim to be found.

    Common Types of Fraud

    Mail and Wire Fraud 18 U.S.C. § 1341, 1343

    This crime occurs when someone uses the postal service or makes a wire, radio or television communication, which crosses state lines, in order to commit fraud upon another or to obtain money or property under false pretenses.


    Have you ever received an email that looks like it is from your bank but is not? Phishing is the effort to obtain access to your private accounts by pretending to be a your vendor, banking institution or other legitimate company. The fraudster goes “fishing” for passwords to ATM, bank and other financial accounts using deceptive acts and misrepresentation.

    Identity Theft

    This crime consists of fraudulently acquiring another person’s personally identifiable information for the purpose of making financial transactions for the fraudster's financial gain. If you have been a victim of identity theft, you should immediately file an identity theft report with the FTC and take the recommended actions to help yourself.

    Credit Card Fraud / Debit Card Fraud

    Closely related to identity theft, this crime consists of the use of the debit or credit card of another person without the owner’s authorization. Purchases or cash withdrawals are then made against the victim's account.

    Securities Fraud

    This occurs when someone makes a false statement which misrepresents the value of a stock or security, which induces someone else to act based upon that misinformation. Examples of securities fraud include “pump and dump” schemes or short-selling. The fraudster makes positive comments about a stock which he or she has an interest knowing they are false. This induces people to buy the stock, which rises with the artificial demand for the stock as a result of the misrepresentation. The fraudster sells his stock while the price is artificially high. The victims soon find out that they are holding stock worth far less than they thought when the price falls upon a release of accurate financial information concerning the company.

    Punishment for Fraud

    Criminal fraud is typically considered a felony crime and punishable by a fine, imprisonment and/or probation. The punishment for civil fraud may consist of two parts: (1) monetary compensation to put the injured party back into the position the victim was in before the fraud occurred (“restitution”); and (2) the payment of a fine in order to punish the perpetrator for wrongful behavior.

    Fraud Detection

    Most fraudulent acts come with warning signs which a consumer can identify to avoid becoming a victim. You should always proceed with caution, using common sense and prudent judgment. The following are other tips which can help you identify fraud: Don’t provide your social security number, last known address, mother’s maiden name or any other confidential or personal information to someone you don't know who contacts you. In almost all instances, your banking or financial institution will only ask you these questions if you – the account holder – has initiated the call. If you receive emails that seem unusual, strange or concern accounts which you do not believe you own, do not click on any of the links in the email. This may be a phishing attempt. You may be taken to a login page on a website which resembles your banking institution but is actually a fraudulent website. Any information entered will be captured, such as user names and passwords. Always look at the URL for any webpage which requires you to enter personal or financial information. Examine the URL to make sure that it is the appropriate, secure website you intended to reach. Business fraud can occur when entrepreneurs, small business owners and potential tenants provide phony information such as fake names, addresses, phone numbers and references. Sometimes part of the information is true, so as to make the recipient believe that the entire application contains truthful, accurate information.

    Fraud Remedies

    Often victims of fraud feel a great deal of shame and embarrassment from being fooled by a scammer. You should not feel so ashamed because many fraudsters are experts in what they do and target trusting, unsuspecting people. It is important to get help as soon as possible – emotional, psychological and legal. While fraud victims rarely recover what they lost, a partial or even a full recovery may still possible as well as the punishment of the fraudster. Timing is of the essence and it is important to contact those who may be able to help. You can file a fraud complaint with the FTC, contact your state attorney general as well as your local Better Business Bureau for business related matters. When cases involve larger sums of money (such as securities fraud) or a crime, you should retain an attorney who is familiar with prosecuting or defending fraud claims.
    Criminal Law & Procedure:
    Criminal Charges - Fraud

    Michael Wechsler

    Michael Wechsler
    Michael M. Wechsler is an experienced attorney, founder of, A. Research Scholar at Columbia Business School and of-counsel to Kaplan, Williams & Graffeo, LLC. He was also an SVP and chief Internet strategist at and legal consultant at Kroll Ontrack, a leading service e-discovery and computer forensics service provider.
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  1. Mk8 Fair
    Mr. Wecshsler,
    We have gone through a pretty DEVISTATING extreme loss due to ID theft by use of durable POA. We have filed ID theft complaints only to get no help. The person's who have done this massive stealing...of our lives, whom we've had to file and get restraining orders against. Which had been granted from 2009 thru 2016. Yet these people were able to petition for partition of OUR home that we owned, the officer who came to evict us and gave us 5 min to get what we wanted and leave or go to jail. We had no where else to go and kept being told the selling of our home and personal property would be locked down. We took our legal files and researched papers everything our office and the clothes on our backs is what we left with and believing that we would be able to get our personal property. These career criminals have used the courts and local police as the tool to carry out their criminal activity.
    There's been loans taken out in our names and SS. #'s now after all this devistation. The duly approved commissioner that was asked for by the petition/criminal. Sold our home and then recorded documents that weren't submitted into the court case for the judge to see. But these documents show the commissions name at the petitioners home address attached to my husband's SS# for tax purposes. And this commission recorded a document of death on my father in law who hax already been recorded death certificate but yet. Come to discover was declaring my father in law consent after years of his passing? And yet had again my husband's SS # And now my husband's information has been twisted with his father's and is now considered deceased. Which is false. We are hard working tax paying people and simply do not know what direction to go in?