Fraud is a complicated white-collar crime governed by state and federal laws. Understanding when you or your company may be inadvertently at risk of being accused of fraud can be essential to defending yourself from these charges. There are numerous variations, but some occur more frequently than others. At Griffin Durham Tanner & Clarkson LLC, we want you to understand what you need to know about the three main types of fraud and how a Georgia white-collar crimes defense attorney can help if you are charged or under investigation.
What is fraud?
Fraud is a crime where one person intentionally acts to benefit themselves or their company in an illegal or unethical manner. These actions often negatively affect another party. Corporate fraud cases may include making false or misleading statements, submitting deceptive documentation, or purposely misdirecting authorities.
A legitimate fraud claim should be investigated and the wrongdoers brought to justice, but false charges are more common than you may think. Entrepreneurs and small companies may make unintended mistakes that look like fraud. After an audit, however, individuals can frequently show reason for the charges to be dismissed.
Even if your name is cleared, the damage done to your reputation by a government investigation can be irreparable. Retaining a white-collar defense lawyer who can help you avoid these situations is worth your while and peace of mind.
What are the three main types of fraud?
Insurance and healthcare fraud are primary concerns for individuals, but for businesses and professionals, there are three main pitfalls. They are asset misappropriation, bribery and corruption, and financial statement fraud.
Asset misappropriation
According to the Association of Certified Fraud Examiners (ACFE), asset misappropriation accounts for 89% of occupational fraud, resulting in substantial monetary loss in real estate, transportation, and construction industries. An employee may embezzle or misallocate resources for their benefit. They may inflate invoices, charge false business expenses, or steal cash.
Asset misappropriation fraud may involve employees working in conjunction with vendors. They may set up a scheme whereby the cohorts benefit while causing overall harm to the company or its customers.
Bribery and corruption
Bribery and embezzlement are a form of corruption, often involving kickbacks and conflicts of interest. Specifically, corruption involves public or private officials accepting money or favors in exchange for benefits, while bribery is the act of offering or providing the incentive to commit corruption. The key is that the money or favor is unearned, unlike typical reimbursement for a product or service.
Parties who engage in these behaviors on both sides of the transaction can be convicted of fraud. According to the United States Sentencing Commission (USCC), while 88.4% of offenders had never committed bribery before, 80% were sentenced to federal prison.
Financial statement fraud
Although financial statement fraud is the least common form, it often results in much higher losses for the victims. When an individual or company “cooks the books,” they may do so in several ways, such as:
- Misstating transaction amounts and dates
- Intentionally leaving out payments that are then diverted to private bank accounts
- Understating liabilities
- Overvaluing assets
- Submitting false business expenses
- Making statements intended to manipulate a company’s stock price
How a white-collar criminal defense attorney can help you avoid fraud charges
The best way to avoid fraud is to examine your business and employees to ensure procedures are in place to catch and deter illegal actions. As companies grow, it becomes increasingly difficult to manage all aspects, and unscrupulous individuals may take advantage of unidentified loopholes. This can result in unexpected criminal charges against you or your company.
Allowing a reputable white-collar criminal defense lawyer from Griffin Durham Tanner & Clarkson LLC to conduct a process review can help you catch potential problems before they happen. In addition, if you are facing fraud charges, our team will build a customized defense strategy and communicate with officials on your behalf. We focus on developing a robust attorney-client relationship to fully understand the situation and prepare your case for the best achievable outcome.
A fraud conviction has severe consequences, including heavy fines and substantial prison time. In addition, you may lose your job or business and be unable to find future employment. You could also face criminal and civil trials as victims attempt to recover what they claim to have lost. Your defense attorney will try to reduce the penalties you experience whenever possible.
Learn more about defending against fraud charges
When you suspect you are the target of a criminal investigation or have already been charged, do not delay seeking experienced legal representation. Prosecutors will be working overtime to secure a conviction and make an example of you, so you need an aggressive Georgia white-collar criminal defense attorney in your corner.
Contact Griffin Durham Tanner & Clarkson LLC to schedule a consultation today. You can also call our Atlanta office at (404) 891-9150 or reach us in Savannah at (912) 867-9140.