Under federal law, bank fraud can occur when someone either illegally obtains funds from a financial institution through deception or attempts to illegally gain access to such assets. The funds or assets can be owned by the bank or can be held by the financial institution on behalf of an individual or company. State laws are similar to the federal law but can vary on their definition of bank fraud. Federal bank fraud is considered a criminal offense.

What are Some Examples of Bank Fraud?

There are several different types of bank fraud, including, but not limited to the following:

    • Check Theft: this can occur when someone, for example, steals checks from another’s mailbox.
    • Counterfeiting: this happens when someone makes fake money or credit cards and attempts to present them as a real form of currency or credit.
    • Direct Deposit Fraud: these types of scams target company’s human resources departments and/or individuals with direct deposit accounts and encourage them to switch to a fictitious other bank account.
    • Forgery: occurs when one falsifies the signature of another.
    • Identity Theft: most often occurs online by cybercriminals and is prevalent in our country as well as globally. It can occur to anyone and once it does it can be difficult to regain one’s identity.
  • Payment Fraud: can include unauthorized transactions, stolen goods or fraudulent returns of merchandise.

Bank fraud targets can range from individuals to large corporations.

How is Bank Fraud Possible?

With the technology and online security systems of today, many people think it should not be possible for cybercriminals to succeed in their attempts at bank fraud. However, fraudsters are still able to find a way into online systems and steal personal data that assists them in conducting bank fraud.

There is no single formula of how bank fraud occurs, however there are several methods and schemes that bank fraudsters use to gain access to personal data. Oftentimes, a bank fraudster gains illegal online access to victims’ contact information. This contact information can include an email address or phone number.

The fraudster then poses as a legitimate financial institution that the victim is affiliated with, such as a credit card company. The victim falls prey to believe the information that the bank fraudster is conveying because the fraudster often has just enough information to convince folks that they are legitimate. Victims, unwittingly, give out sensitive information that promotes the bank fraudster’s criminal activities.

What are the Signs of Bank Fraud?

If you receive a phone call or email from someone that is posing to be from a financial institution and something just does not seem right about the communication, it is important for you to follow your intuition. Banks and credit card companies typically already have the sensitive information that a fraudster is requesting.

Some indications that may warrant concern in a communication, include:

    • Threatening Language: For example, “If you don’t deposit funds into the account link provided in this email, we will terminate your account.”
    • Poor Grammar: Misspelled words and poor grammar in an email message, could be an indication that the message you received is not from a legitimate source.
  • Request for Personal Information: If a bank or credit card company that you are associated with unexpectedly contacts you requesting personal information, that they should already have, then it should warrant your attention.

If you have the impression that something seems suspicious about a phone call or email, etc., that you received from your financial institution, it is best to be cautious and not give any information out.

If you receive a phone call, ask the individual for their name. If they hang up, it is a good indication that it was not a legitimate call. It is always a good idea to follow up with your financial institution and let them know you were contacted by someone purporting to be from their bank.

What is the Punishment for Bank Fraud?

Bank fraud is a serious crime with severe consequences. Under the federal law, a person convicted of bank fraud can be ordered to pay a fine of up to $1,000,000 or imprisoned for up to 30 years. In severe cases the court can impose both a fine and jail time.

Are there any Defenses to Bank Fraud?

Bank fraud is a crime that must be done knowingly. In order to find a person guilty of such a crime the prosecution must prove that the defendant conducted the crime with knowledge.

Here is a simple example to illustrate whether or not an individual knowingly participated in a bank fraud crime:

  • Person A steals a box of checks from Person B’s mailbox.
  • Person A forges one of the stolen checks they took.
  • Person A delivers the fraudulent check to Person C for a payment owed.
  • Person C takes the bad check to the bank to cash it however the bank teller calls the authorities because Person B has since reported their box of checks stolen.
  • The authorities do not press charges against Person C because they did not know that the check was forged and stolen.
  • The authorities will instead go after and prosecute Person A in this scenario.

Do I Need a Lawyer If I Have Been Accused of Bank Fraud?

If you have been accused of bank fraud, then it is imperative to speak with a fraud attorney as soon as possible. A criminal defense attorney has the experience and knowledge to assist you with this serious matter.

Bank fraud is a crime that can have a life-long impact on you and those around you as well. It is important to preserve your rights and receive guidance from someone that is familiar with this type of law. To determine your options, contact a bank fraud attorney in your area today.

If you are a victim of bank fraud, then you must immediately contact your bank and let them know about the situation. Take whatever steps they advise, but also be prepared to report this to the relevant authorities (like the police) if necessary. Make sure you keep all of your documents that show proof of bank fraud, and be ready to follow whatever steps the process might require.