By FindLaw Staff | Legally reviewed by Bridget Molitor, J.D. | Last reviewed June 01, 2022
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Fraud is a term that refers to the use of intentional deception to gain something of value, usually money. Fraud is generally committed through the use of false statements, misrepresentation, or dishonest conduct intended to mislead or deceive. This article looks at types of fraud crimes, the criminal and civil penalties for fraud, and provides some example cases.
Fraud is a criminal offense but a person alleged to have committed fraud can also be taken to civil court. A government prosecutor brings charges in criminal court. A victim of fraud would file a civil lawsuit against the alleged scammer to recover money. Sometimes, both criminal and civil actions are brought against a person accused of fraudulent activity.
In civil lawsuits, the standard of proof is lower. Instead of proving guilt "beyond a reasonable doubt," the attorney for the victim only needs to prove guilt by a "preponderance of the evidence." Another way to say that is, "it's more likely than not that the situation occurred in that manner."
If a victim wins a civil case, the defendant does not go to prison but is required to pay restitution (return the victim's money). The judge may also order monetary damages.
When federal government regulators, such as the Federal Trade Commission (FTC), file civil lawsuits against large or small businesses accused of fraudulent activity, they may seek injunctions to stop the behavior, restitution for the victims, and fines.
In the criminal context, prosecutors must prove fraud "beyond a reasonable doubt." That is, the evidence is satisfactory, the facts are proven, and guilt is established. This is a higher degree of certainty than a civil case, and the penalties are harsher if found guilty.
The prosecutor must prove the following in order to get a conviction:
The penalties for fraud depend upon the type of fraud, the number of victims, and the amount of financial loss. Punishment usually includes a prison sentence, an order of restitution to make the victim whole again, and fines.
FindLaw has an entire section on white-collar crimes and financial fraud, which includes in-depth information about these and other fraud schemes:
The Coronavirus pandemic has even given rise to a new kind of fraud involving unemployment benefits and identity theft. Some scams take advantage of the public's fear of the pandemic and falsely promote COVID help (vaccines and other medical help) while requiring people to provide personal information.
Many fraud schemes involve stealing others' social security numbers, credit card information, computer passwords, bank PINs, and other sensitive information that can be used for identity theft. Some scams involve computer viruses or malware spread through hyperlinks in "phishing" emails.
A victim will receive a check from someone for more money than they expected. When they tell the payer that it is too much money, they are told to deposit the check and to send them the extra money back on a gift card. They may even talk to the person on the phone while they are buying the card so they get the card number and PIN number over the phone. That's all they need to access the money immediately. A few days later, the bank will report that the original check bounced and the victim loses the money.
In 2020, the Department of Justice (DOJ) charged 42 doctors and nurses and 100 other medical professionals with healthcare fraud. More than $1 billion in fraud was committed with false charges for telehealth services. Many millions were connected to illegal drug schemes, like forged prescriptions for opioids. Some $29 million was lost to COVID-19 fraud.
The DOJ said telemedicine executives paid doctors and nurse practitioners to order unnecessary equipment, diagnostic tests, and pain meds without speaking to the patient or speaking to them only briefly without ever meeting. The executives received kickbacks and bribes in exchange for those orders and falsely billed Medicare and insurers.
Fraud charges can carry a lengthy prison sentence. You need a strong defense from a knowledgeable attorney. Contact a criminal defense attorney near you to protect your legal rights.
Contact a qualified criminal lawyer to make sure your rights are protected.
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