Fraud & Federal Crimes


Bank Crimes

Bank crimes are felonies under federal law. The various federal bank crimes include bank fraud (18 U.S.C. § 1344), false statements (18 U.S.C. § 1014), embezzlement (18 U.S.C. § 656), misapplication (18 U.S.C. § 657), false entries (18 U.S.C. § 1005 and § 1006), and bribery (18 U.S.C. § 215).

Bank Fraud

Bank fraud is obtaining assets, money or property from a financial institution under false pretenses.

Description:
Bank fraud may include stolen or forged checks, check kiting (also known as “floating” checks), fraudulent loan applications, credit card fraud, stolen debit cards, or skimming of credit or debit card information.

Prohibited Activities

In order to be found guilty or being convicted of Bank Fraud, the government must prove beyond a reasonable doubt that the defendant:
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Knowingly;
Executed or attempted to execute;
A scheme or artifice to defraud a bank, or a scheme or artifice to obtain moneys, funds, credit, assets, securities, or other property owned by or under the custody or control of a bank by means of false or fraudulent pretenses, or promises.
The elements of a violation under 18 U.S.C. § 1344 (1) bank fraud:
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The defendant knowingly executed or attempted to execute a scheme or artifice to defraud.
The defendant did defraud or attempt to defraud the financial institution.
The defendant used a material misrepresentation or concealment of a material fact as part of the scheme or attempted scheme.
The financial institution was insured or chartered by the federal government.
A “financial institution” is defined under 18 U.S.C. § 20 as follows:
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An insured depository institution (as defined in section 3(c)(2) of the Federal Deposit Insurance Act).
A credit union with accounts insured by the National Credit Union Share Insurance Fund.
A Federal home loan bank or a member, as defined in section 2 of the Federal Home Loan Bank Act ( 12 U.S.C. 1422), of the Federal home loan bank system.
A System institution of the Farm Credit System, as defined in section 5.35(3) of the Farm Credit Act of 1971.
A small business investment company, as defined in section 103 of the Small Business Investment Act of 1958 ( 15 U.S.C. 662).
A depository institution holding company (as defined in section 3(w)(1) of the Federal Deposit Insurance Act.
A Federal Reserve bank or a member bank of the Federal Reserve System.
An organization operating under section 25 or section 25(a) of the Federal Reserve Act.
A branch or agency of a foreign bank (as such terms are defined in paragraphs (1) and (3) of section 1(b) of the International Banking Act of 1978).
It is of note that an actual loss to the financial institution is not necessary to be proved so long as there is evidence that the defendant intended to expose the institution to such a loss.

Next, a scheme or artifice to defraud, is defined by 18 U.S.C. § 1346 as follows: The term "scheme or artifice to defraud" includes a scheme or artifice to deprive another of the intangible right of honest services. The phrase “scheme to defraud” of 18 U.S.C. § 1344 has been broadly construed by the courts. The ‘scheme to defraud’ clause of Section 1344(1) is interpreted broadly, and requires that the defendant act with the ‘specific intent to deceive or cheat for the purpose of getting financial gain for one’s self or causing financial loss to another.

Nonetheless, an attempt or conspiracy to commit bank fraud is subject to the same criminal penalties as the substantive bank fraud — 18 U.S.C. § 1349 provides as follows: Any person who attempts or conspires to commit any offense under this chapter shall be subject to the same penalties as those prescribed for the offense, the commission of which was the object of the attempt or conspiracy. The statute of limitations for a federal bank fraud case is 10 years.

Punishment

Bank fraud can be a federal crime that carries a punishment of up to 30 years in federal prison and a fine of up to $ 1,000,000.00. Similar violations may be charged by state prosecutors under laws against criminal fraud, most often when the offense consists of passing bad checks or check kiting. http://www.law.cornell.edu/uscode/text/18/1344

In California, the punishment for this crime is up to one year in jail. California: http://law.onecle.com/california/penal/476a.html

In New York, issuing a bad check is a class B misdemeanor, which carries a sentence of up to three years. http://law.onecle.com/new-york/penal/PEN070.15_70.15.html

In Texas, the same crime is a class C misdemeanor, punishable by a fine of up to $ 500.00. http://law.onecle.com/texas/penal/32.41.00.html

Sentencing factors in imposing a sentence for bank crimes are found in 18 U.S.C. § 3553 which provides as follows:
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Factors to be considered in imposing a sentence. --The court shall impose a sentence sufficient, but not greater than necessary, to comply with the purposes set forth in paragraph (2) of this subsection. The court, in determining the particular sentence to be imposed, shall consider:
the nature and circumstances of the offense and the history and characteristics of the defendant;
the need for the sentence imposed-- (A) to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense; (B) to afford adequate deterrence to criminal conduct; (C) to protect the public from further crimes of the defendant; and (D) to provide the defendant with needed educational or vocational training, medical care, or other correctional treatment in the most effective manner;
the kinds of sentences available;
the kinds of sentence and the sentencing range established for-- (A) the applicable category of offense committed by the applicable category of defendant as set forth in the guidelines-- (i) issued by the Sentencing Commission pursuant to section 994(a)(1) of Title 28, U.S.C., subject to any amendments made to such guidelines by act of Congress (regardless of whether such amendments have yet to be incorporated by the Sentencing Commission into amendments issued under section 994(p) of Title 28); and (ii) that, except as provided in section 3742(g), are in effect on the date the defendant is sentenced; or (B) in the case of a violation of probation or supervised release, the applicable guidelines or policy statements issued by the Sentencing Commission pursuant to section 994(a)(3) of title 28, U.S.C., taking into account any amendments made to such guidelines or policy statements by act of Congress (regardless of whether such amendments have yet to be incorporated by the Sentencing Commission into amendments issued under section 994(p) of Title 28);
any pertinent policy statement-- (A) issued by the Sentencing Commission pursuant to section 994(a)(2) of Title 28, U.S.C., subject to any amendments made to such policy statement by act of Congress (regardless of whether such amendments have yet to be incorporated by the Sentencing Commission into amendments issued under section 994(p) of Title 28); and (B) that, except as provided in section 3742(g), is in effect on the date the defendant is sentenced.
the need to avoid unwarranted sentence disparities among defendants with similar records who have been found guilty of similar conduct; and
the need to provide restitution to any victims of the offense.
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