What Are the Most Common Types of Financial Crime?

Financial crime encompasses a wide range of illegal activities, and these crimes can vary significantly in their methods, complexity, and impact. Understanding the most common types of financial crime can help you avoid them, as they can lead to significant financial losses and legal consequences. If you've been accused of any financial crime, contacting a qualified embezzlement attorney is a crucial first step.

Common Types of Financial Crime

Fraud

Fraud is a broad category that includes any criminal deception intended to result in financial or personal gain. Common examples include credit card fraud, insurance fraud, and mortgage fraud. In these schemes, the perpetrator deceives the victim to obtain money, property, or services unlawfully.

Embezzlement

Embezzlement involves the unauthorized taking of money or property by a person who was trusted with its care or control. This typically occurs in employment and corporate settings, where employees divert company funds for personal use. Unfortunately, it's not uncommon for people to be caught up in embezzlement actually perpetrated by someone else. Click here to learn what an embezzlement defense attorney can do to help if you've been accused.

Money Laundering

Money laundering is the process of making illegally gained proceeds appear legal. This is done by disguising the origins of ill-gotten money through a series of complex transactions and accounting tricks. Money laundering is often linked to other criminal activities like drug trafficking and terrorism financing.

Identity Theft

Identity theft involves stealing someone's personal or financial information to commit fraud. This can include opening new credit accounts, filing fraudulent tax returns, or making unauthorized purchases in the victim's name.

Securities Fraud

Securities fraud, also known as stock or investment fraud, involves deceptive practices in the stock or commodities markets. This includes insider trading, where individuals use non-public information to gain an unfair advantage in trading, and Ponzi schemes, where investors are promised high returns that are paid from the contributions of subsequent investors rather than from actual profit.

Tax Evasion

Tax evasion is the illegal avoidance of taxes by individuals, corporations, and trusts. Tactics for tax evasion include underreporting income, inflating deductions, and hiding money or assets in unreported offshore accounts.

Legal Consequences of Financial Crimes

The legal consequences of financial crimes are severe and can include heavy fines, restitution payments, and imprisonment. The severity of the punishment often correlates with the scale of the crime and the amount of financial loss incurred. For businesses, the repercussions can also include loss of licenses, reputational damage, and a decline in shareholder trust and market value.

Various laws and regulations are in place to combat financial crimes, including the Bank Secrecy Act, the USA PATRIOT Act, the Texas Penal Code, and regulations enforced by the Securities and Exchange Commission (SEC) and the Financial Crimes Enforcement Network (FinCEN).

Defense Strategies for Financial Crimes

For individuals accused of embezzlement or other financial crimes, know that while the accusations can carry severe legal consequences, there are avenues for defense that can be explored with the guidance of an experienced defense attorney. The first step in mounting a defense is to fully understand the nature of the accusations. In cases of embezzlement, this involves reviewing the specifics of the alleged misappropriation of funds or property.

Exploring Lack of Intent

One common defense in embezzlement is showing a lack of intent to commit a crime. This strategy involves proving that any misappropriation was due to a misunderstanding or mistake rather than deliberate theft or fraud.

Challenging the Evidence

Challenging the prosecution's evidence is another pivotal aspect of the defense. This can include questioning the methods used to gather evidence, pointing out inconsistencies, or highlighting gaps in the prosecution's case.

Evaluating Plea Offers

In some situations, plea negotiations may be a strategic choice. It's important to carefully evaluate any plea offers, considering the potential reduction in charges or sentences against the implications of a guilty plea.

An experienced attorney can provide crucial guidance in making this decision. Beyond legal penalties, being accused of a financial crime can significantly impact one's professional reputation and personal life, and understanding these ramifications is essential in making informed decisions throughout the legal process.

Working With an Embezzlement Attorney

Engaging a defense attorney with experience in financial crimes is critical to achieving the best outcome in your case. A qualified attorney will know all your legal rights, be familiar with the best defense strategies and how to employ them, and understand the often complicated nuances of financial laws and regulations at the federal and state levels.

Being accused of a financial crime such as embezzlement presents a complex and challenging situation, but with the right legal counsel and an informed approach, it's possible to work towards a resolution that minimizes the impact on your professional and personal life.