Criminal fraud involves deception for personal or financial gain, with various types such as charity, counterfeiting, embezzlement, tax, insurance, and benefit fraud. Penalties vary by state, and fraud committed through electronic means has become more common.
The precise legal definition of criminal fraud may vary slightly by jurisdiction. Typically, however, criminal fraud involves an act of deception perpetrated on a victim for personal or financial gain. While many acts may involve deception, what usually makes a deceptive act an act of criminal fraud is the motive, or intent, behind the act.
The list of possible types of criminal fraud is almost endless. Common types of criminal fraud include charity fraud, counterfeiting and embezzlement, and tax and insurance fraud. With the advent of the digital age, fraud committed through electronic means, such as the Internet, wire or telephone, has become more common.
Benefit fraud occurs when a person applies for a government subsidy, such as food stamps or cash assistance, and is deceptive about their application or fails to disclose important information once they have been approved for benefits. Commonly referred to as “welfare fraud,” fraud associated with government benefits is a fairly big problem in the United States. Penalties vary by state, however, in each state, an applicant or recipient can face jail time if convicted of welfare fraud.
Counterfeiting generally refers to reproduction or copying that is legal tender. Once a perpetrator actually passes the bills in exchange for something of value, in most cases he or she has committed a fraud. Embezzlement can often be considered fraud when the embezzler uses a deceptive or illegal act to transfer or steal money that does not belong to them.
Tax fraud is also a common form of fraud in many jurisdictions. When a taxpayer fails to declare income, or claims a deduction or charge when he is not entitled to it, he is committing criminal fraud. Similarly, insurance fraud is committed on a massive scale in the United States. Insurance fraud can be committed in a variety of ways, such as making a claim created by the policyholder himself, claiming a loss that never occurred, or claiming injuries that don’t exist.
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