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Banking Cases

Bank Definition

A corporation empowered to deal with cash, domestic and foreign, and to receive the deposits of money and to loan those monies to third-parties.
Bank Fraud

The criminal offense of bank fraud is deliberately engaging in a secret scheme or deception intended to defraud a bank or financial institution, to obtain money or property owned by the bank or financial institution. Bank fraud is considered to be a white collar crime. In the United States, a criminal charge of bank fraud generally applies when an individual knowingly executes, or attempts to execute, at act (1) in order to defraud a financial institution, or (2) to receive money, assets, credits, securities, or property from a bank or financial institution using false information, pretenses, or insincere promises.

Types of Bank Fraud

There are dozens of ways in which an individual can commit bank fraud. Some of these schemes are more complex, and affect more people or institutions, garnering harsher penalties than others do. Common types of bank fraud include:

Bank Impersonation – one or more individuals act as a financial institution, often by setting up fake companies, or creating websites, in order to lure people into depositing funds.

Stolen Checks – fraudsters may obtain jobs that provide access to mail, such as the post office, mailbox stores, a tax authority, or corporate payroll company. After stealing checks, they open a bank account using an assumed name, and deposit the checks.
Forgery – forgery occurs when a person alters a check by changing the name or some other information on the face. Altering the amount of the check, such as adding a zero to the end of a number, can turn a $20 check into a $200 check, putting more cash into the forger’s pocket. Forging a person’s signature in order to cash or deposit a check also falls under this category.
Fraudulent loans – an individual who takes out a loan, knowing that he will immediately file bankruptcy, has committed bank fraud. The same is true if the borrow uses a false identity in order to become approved for a loan, or forges information on a loan application.
Internet Fraud – as it relates to bank fraud, internet fraud occurs when someone creates a website for the purpose of posing as a bank or other financial institution, to fraudulently obtain money deposited by other people.

Bank Fraud Investigator

Although many financial institutions employ their own brank fraud investigators, and local law enforcement is often involved in investigating such crimes, it is the U.S. Secret Service that is responsible for maintaining stability and integrity of the country’s financial framework and payment systems. In its role as bank fraud investigator, the Secret Service investigates such crimes as:

Counterfeiting
Identity Theft
Check Fraud
Automated Payment Systems Fraud
Direct Deposit Fraud
Check Forgery and Alterations

Bank Fraud Punishment

Any type of fraud subjects the perpetrator to serious penalties, the severity of which often depend on the monetary amount of the fraud, whether the fraud was committed against a protected class of person, and whether the crime is classified as a state or federal crime.

Bank fraud is almost always a federal crime. This is because most banks are protected by the Federal Deposit Insurance Corporation (“FDIC”), a federal program that protects consumers’ deposits in banks and other financial institutions. According to the FDIC laws and regulations regarding bank fraud punishment..