Fraud is a very broad term. Its definition includes a wide variety of acts committed by people with the intention to scam someone else. This action is usually taken to obtain monetary or personal gains. Unfortunately, fraud is quite common and every year many people fall victim to it.
While fraud is covered by both civil and criminal laws, only government prosecutors can file criminal charges. Anyone else can file a civil suit.
US government statistics show that there were almost 290,000 civil lawsuits filed in the US last year, but fraud lawsuits can be civil or criminal and as times get tougher, the trend is towards heightened fraud complaints and lawsuits.
And business fraud is not as uncommon as you might think. Small businesses with fewer than 100 employees experience an average loss of over $150,000 due to fraud, according to the Association of Certified Fraud Examiners (ACFE).
The business fraud risks run from identity theft to payroll fraud, ‘return’ fraud and more.
What are the main elements of fraud?
In general terms, they are:
- Purposeful distortion of an important fact
- Doing so with the knowledge that it is false
- Acting in this way while being fully aware that the victim is relying on whatever is being distorted
- As a result of this action, causing the victim to suffer an actual loss
What type can your business be accused of having committed?
There are several types of fraud that a business can be accused of, among them:
- Small business tax fraud
- Online fraud
- Business opportunity fraud
- The creation of a fake merchant identity
- Selling counterfeit merchandise
- Not delivering promised merchandise
- Running unauthorized transactions
- Stealing cash
- Stealing credit information
- Identity theft
- Accounting schemes to alter or hide financial information
- Wire fraud
- Postal fraud
What penalties are assessed for business fraud?
There are different penalties, depending on the type of fraud. There is a big difference between a business that was set up for the sole purpose of committing fraud such as stealing customer’s identities, running a credit card scheme, or engaging in money laundering and a business that is charged with engaging in conduct that results in fraud charges against the government.
Business fraud offenses can lead to a conviction of 20 years of incarceration or 30 if the fraud is committed against financial institutions. Defrauding the government may result in charges under the False Claims Act.
What can you do if your business is accused of fraud?
There’s no way around it. You will have to fight the charges that have been leveled against your business. And you want to address them right away before any further damage is done to your business and its reputation.
Keep in mind that you should always cooperate, particularly if any law enforcement agency becomes involved in your case. Be prepared to share documents, papers, accounts, or whatever is requested. You must come across as willing to collaborate and act in an honest and open fashion.
Now is not the time to start thinking about suing whoever accused your business of fraud. You should focus on getting the legal help you need to get these charges dismissed as soon as possible.
How can a business lawyer help you if your business is accused of fraud?
These days, fraud is such a common occurrence and it happens in so many different forms that it can also , that it may happen that your business is wrongfully accused of having committed a fraudulent act. No matter what the specific situation of your business or the charges that have been leveled against it, you need an insightful and experienced approach to your particular case.
Rahul Parikh, a business fraud lawyer based in Orlando Florida can provide valuable assistance and create an individualized strategy to address the charges faced by businesses in fraud cases.
Source: Parikh Law