What Are the Types of Financial Frauds?

And How a Financial Fraud Attorney Can Defend You Against Allegations

The types of financial frauds are many and ever-evolving. Yet they all have a common element: deception or failure to convey a key fact to obtain some kind of self-enrichment.

Many examples of financial fraud can also incur wire fraud or mail fraud charges. Almost always, a means of communication is used to carry out the actions in question. Federal mail and wire fraud laws criminalize the use of the postal service or telecommunication services to carry out a fraudulent action. The federal statutes often come into play when an individual tries to take advantage of people with deceptive mail, email or telephone communications. Penalties for financial fraud convictions can range from small fines to hefty sentences and fines combined.

Some financial fraud cases involve charges of identity theft or cybercrime. And some connect a network of people and processes, so they may also draw conspiracy charges. Individuals can be charged with money laundering, concealed credit card transactions or tax fraud if investigators uncover steps taken to hide financial gains.

Here, we review some of the most common financial fraud cases we take on.

Common Types of Financial Frauds

Our office commonly sees several types of financial fraud crimes in Texas, from misdemeanors that carry only fines to serious felony charges.

Credit Card Abuse Charges

Texas Penal Code § 32.31, Credit Card or Debit Card Abuse, is the Texas credit card fraud statute. Its provisions make it illegal to:

  • Use an expired credit or debit card.
  • Use a fictitious card.
  • Use or sell fictitious card details or another person’s credit or debit card without consent.
  • Deliberately cause credit card owners to make purchases they cannot repay.

Whether you have been subjected to or accused of credit card fraud, several circumstances may preclude conviction:

  • The person using the card did not intentionally benefit from the transaction.
  • The person mistakenly used the card.
  • The person erroneously believed themselves authorized to use the card.

Convictions under Texas credit card fraud provisions are felonies subject to state jail sentences. If the prosecution demonstrates that the fraud victim was an elderly person, this becomes a third degree felony. In Texas, a third degree felony incurs a two to 10-year prison sentence and a fine of up to $10,000.

The Michael J. Wynne Law Office accepts cases involving allegations of credit card fraud. Contact us as soon as possible if you need assistance in such a case.

Health Care Fraud Scenarios

Any attempt to gain an improper benefit from medical insurance can be deemed insurance or health care fraud. Health care fraud also includes false Medicaid or Medicare claims. We are familiar with cases of medical offices seeking reimbursements by way of federal Medicare or Medicaid claims to collect unearned payments.

Sometimes, the consumer may be the one subjected to fraud by the provider. According to the Texas Attorney General’s office, some key examples of medical insurance and billing fraud are:

  • Billing for services never rendered
  • Billing for pricier services than the consumer received
  • Unbundling, which involves billing more for multiple aspects of services a la carte, when they were in fact rendered as whole procedures
  • Deliberate misdiagnosis to provide unnecessary medical services

The recent Medicaid fraud annual report from the Office of Inspector General for the Department of Health and Human Services finds that federal fraud control operations landed 1,503 criminal convictions against providers. Nationwide, prosecutors convicted 16 dentists, recovering $11 million in criminal cases. Nothing to smile about here.

In financial fraud cases involving state and federal agencies, Texans look to financial fraud attorney Michael J. Wynne. If you need legal counsel in a case of improper medical billing, he has a track record of advising and representing clients nationally and internationally.

Common Securities and Investment Frauds

Securities or investment fraud can, or course, involve using insider knowledge to tip off investors. But it can also entail dubious promises of high returns on investments. The federal Securities and Exchange Commission (SEC) considers unfounded hype a form of financial fraud through the Securities Act.

A state body, the Texas State Securities Board also prosecutes financial fraud related to investments.

A Ponzi scheme is a common example of investor abuse outlawed at the state and federal level. Using hype to draw investors, scammers use money from new investors to pay earlier ones. Sometimes, the thing of value they pay for isn’t real. Ultimately, the scammers abandon the venture.

Related to the Ponzi scheme is the pyramid scheme. This type of investment fraud, outlawed under the Texas Business and Commerce Code and categorized as a felony, is initiated by an investor who recruits others to invest. A chain of recruitment follows. When difficulties arise in getting new recruits, the scheme falls apart, leaving many people with major losses. The key trait of the pyramid, which makes it a financial fraud, is that investors expect payouts mainly because they recruit—not from the sale of a valuable product.

We defend clients by demonstrating that the venture was not a pyramid scheme, that the client did not establish or promote the scheme, or that a product of value was in fact sold. For decades, Michael J. Wynne has defended reputations, careers and individual rights by taking on complex financial fraud cases such as these.

A Proven Financial Fraud Attorney for Defense Against Allegations

Clients call on Michael J. Wynne when seeking solid experience helping people charged with financial fraud crimes, tax violations, or any disputes connected with financial dealings. Attorney Wynne’s previous work as a prosecutor equips our clients with knowledge that works.

Houston’s go-to financial fraud attorney, the Harvard Law-educated Michael J. Wynne has given media presentations on securities fraud, corporate fraud and garden-variety financial crimes. How can we inform you?

For general information, please send your financial fraud questions to our firm through our secure portal. If your questions relate to particular situations or allegations, please enter your contact information to schedule a case evaluation.

We value your trust and interest. Contact our office if you are ready to call on trusted financial fraud attorney Michael J. Wynne.

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