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Fraud / White Collar Crimes

A charge of fraud can bring with it many serious consequences. It can cause personal ruin, professional devastation, and destroy your business. If you have a fraud charge against you, it is unwise to try to handle it yourself. You need the skill, education, and experience of a fraud attorney to ensure that your rights are protected. The sooner you act and seek legal representation, the more likely you are to have a favorable outcome on your case.

Experience and Skill in Representing Clients Charged with Fraud Offenses

If you have been charged with a crime of fraud, you need an experienced attorney to protect your rights. Mr. Litvak has extensive experience in representing individuals charged with serious fraud and white-collar offenses in federal and state court, including major cases that made headlines domestically and internationally. Some of his more notable fraud and white-collar cases include:

USA v Junio Artis II – New York, NY – Co-Counsel

A federal white-collar fraud criminal case involving commodities, credit cards, identity theft and large-scale investor fraud.

USA v Reyn – Newark, NJ – Co-Counsel

A major federal credit card fraud case involving multiple defendants and millions of dollars in losses.

USA v Groysman – Brooklyn, NY – Co-Counsel

A major federal white-collar case involving long term and large-scale insurance fraud, money laundering, and healthcare fraud conspiracy. Defendant was sentenced to 5 years of probation in a case that lasted almost 6 years. 

People of the State of New York v Weingarten – New York, NY – Co-Counsel

A major fraud case prosecuted by the Office of Attorney General, the case involved allegations of using phony not-for-profit organizations claiming to benefit Israel to collect $2 million which were then used for personal needs.

People of the State of New York v Ulanov – Brooklyn, NY – Co-Counsel

A fraud case involving allegations that a bookkeeper stole over $750,000 from a family-owned property management company.

People of the State of New York v Matsuk – Staten Island, NY – Co-Counsel

Medicare fraud case prosecuted by the Office of Attorney General involving allegations of conspiracy to bill the Medicare program for services which were never provided.

Overview of Fraud and Criminal Fraud

Fraud has always been a part of our society. Since the beginning of time, people have tried to get something for nothing or deceive others for their own personal gain. Many people understand fraud in its most basic, general terms: a false representation of facts in a situation or matter. It can be carried out in many ways including misleading or false allegations, by actions or conduct, by words spoken or written, or even by failing to disclose something that should have been divulged. The crux of this crime is that it is deception at its core and the intention of the person who commits it is to deceive someone else in order to achieve financial or other personal gain.

Fraud is generally considered to be dishonesty that is enacted for advantage. The dishonest person may be referred to as a fraud. In the United States legal system, the crime of fraud is a specific offense that carries with it certain penalties and defenses, as well as several defining features.

The most common area where fraud occurs in the marketplace. On a broad scope, it is often seen in transactions regarding real estate, copyrights, and stocks and bonds. There are federal and state laws that make certain types of fraud a crime, but there are some cases where the fraud a person commits does not meet the criteria that makes it a crime. Victims can pursue a civil case against the person who committed the fraud in order to seek redress, but that has little bearing on the criminal side of the offense. Occasionally, a fraud case may be heard in civil court, but it may not be tried in criminal court for these reasons.

The Burden of Proof for Fraud

When a person is accused of fraud, the burden of proof falls to the prosecution to show that actions of the defendant contain five specific elements:

  1. A false statement of a material fact
  2. The defendant had knowledge that the statement was false
  3. The defendant deliberately set out to deceive the alleged victim
  4. The alleged victim had reason to believe the false statement (justifiable reliance)
  5. The victim was injured in some way (financially, personally, etc.)

This makes fraud difficult to prove in some cases. The false statement must be related to a material fact in order to be fraudulent. The false statement must also have a substantial impact on the person’s decision to pursue a particular course of action such as enter into an agreement or complete a transaction. Not all statements that appear fraudulent actually are because they cannot meet the required burden of proof.

Federal Fraud Law

These are some of the federal fraud statutes that govern fraud cases in the United States. It should be noted that many of these have a state statutory equivalent, so the prosecution may pursue criminal offenses against the defendant in both federal and state courts.

  • The Dodd-Frank Act of 2010 (12 U.S. Code § 5301) – Provides greater accountability and transparency of Wall Street, also mortgage reform and investor protection.
  • Securities legislation (15 U.S. Code § 77a) – Sale and purchase of investments where the investor’s return depends on the actions of a third party.
  • The Foreign Corrupt Practices Act (15 U.S. Code § 78dd-1) – Prohibits the indirect or direct payments to foreign governments or officials in order to gain a business advantage.
  • The Sarbanes-Oxley Act of 2002 (15 U.S. Code §  7201) – Corporate scandals and misconduct. This is a massive statute with eleven Titles with numerous sections that address different offenses or actions.
  • The Computer Fraud and Abuse Act (18 U.S. Code § 1030) – Prohibits accessing a computer with the intent to defraud, accessing or acquiring national security information, password trafficking, and threatening to damage a computer if certain demands are not met (extortion), among others. It should be noted that under this statute, cell phones and similar mobile devices are fall under the classification of computers.
  • The False Claims Act (31 U.S. Code § 3729) – Conspiring to make or knowingly making financial claims to the government which are false. Typically applied to defense contractor, Medicaid, and Medicare fraud.

New York Fraud Law

New York Penal Law Title K covers a number of fraud offenses. Many of these offenses can be prosecuted on the federal level as well as the state level. Title K includes fraud offenses such as forgery, insurance fraud, residential mortgage fraud, and others. While any fraud case in New York must show an intent to defraud on the part of the defendant, the specific statute to which the crime applies provides more specific language that provides prosecutors with the criteria that must be met in order to prove beyond a reasonable doubt.

Types of Fraud Crimes

There are state and federal statutes for most crimes of fraud. Some of the most common are:

  • Mail Fraud and Wire Fraud (18 U.S. Code § 1341, 1343)
  • Bank Fraud (18 U.S. Code § 1344)
  • Bankruptcy Fraud (18 U.S. Code § 157)
  • Health Care Fraud (18 U.S. Code § 1344, 1347)
  • Issuing a Bad Check (New York Penal Law sections 170)
  • Forgery (New York Penal Law sections 170.05 through 170.15)
  • Criminal Possession of a Forged Instrument (New York Penal Law sections 170.20 through 170.30)
  • Insurance Fraud (New York Penal Law section 176)
  • Falsifying Business Records (New York Penal Law sections 175.05 through 170.10)
  • False Advertising (New York Penal Law section 190.20)

Federal Fraud Sentencing

There are several sentencing guidelines that have been set forth by the federal government for federal fraud laws. They are as follows:

  1. §2B1.1.  Larceny, Embezzlement, and Other Forms of Theft; Offenses Involving Stolen Property; Property Damage or Destruction; Fraud and Deceit; Forgery; Offenses Involving Altered or Counterfeit Instruments Other than Counterfeit Bearer Obligations of the United States
    1. Base Offense Level
      1. 7, if (A) the defendant was convicted of an offense referenced to this guideline; and (B) that offense of conviction has a statutory maximum term of imprisonment of 20 years or more; or
      2. 6, otherwise
    2. Specific Offense Characteristics
      1. If the loss exceeded $6,500, increase the offense level as follows:

Loss (Apply the Greatest) Increase in Level

(A) $6,500 or less no increase

(B) More than $6,500 add 2

(C) More than $15,000 add 4

(D) More than $40,000 add 6

(E) More than $95,000 add 8

(F) More than $150,000 add 10

(G) More than $250,000 add 12

(H) More than $550,000 add 14

(I) More than $1,500,000 add 16

(J) More than $3,500,000 add 18

(K) More than $9,500,000 add 20

(L) More than $25,000,000 add 22

(M) More than $65,000,000 add 24

(N) More than $150,000,000 add 26

(O) More than $250,000,000 add 28

(P) More than $550,000,000 add 30.

Penalties for Fraud Crimes in New York

Forgery, grand larceny, falsifying business records, criminal possession of a forges instrument, and identity theft are some of the most common types of fraud committed in New York. These crimes can range from misdemeanors to felonies, so it is important to understand how these crimes are classified and what penalties are attached. A New York fraud lawyer can help you understand your charges and the penalties that may be incurred as well as work to minimize any potential consequences that you may experience.

The penalty for misdemeanor fraud in New York is a maximum of one year in jail. Felonies carry weightier sentences. Felonies are categorized by class and the financial amount of loss also plays a part in the length of the sentence.

Certain types of check fraud are Class D felonies and can carry up to seven years in prison. This may include signing a check with someone else’s name or using an account that is not yours. The dollar amount of the loss does not apply to this type of fraud.

Identity theft is a serious offense and it can result in up to 25 years in prison, depending on the amount of loss.

Some types of falsifying business records can carry a prison sentence of up to four years. The dollar amount is integral in determining the sentence as does the method by which the fraud was committed.

Fraud Defenses

While the burden to proof for a fraud case rests on the shoulders of the prosecution to ensure that it meets the five factors, fraud can still be a difficult case to defend and you need an attorney who is experienced in fraud cases. Some of the more common fraud defenses include:

  • Absence of intent to commit a crime – The successful prosecution of a fraud charge hinges on the fact that the defendant was aware that they were being deceptive or acted with the intention of deceiving. If the prosecution fails to prove intent, the charges will be thrown out.
  • Entrapment – Providing an opportunity to break the law is not entrapment, but compelling or manipulating an innocent person to commit fraud (or a crime) when, under normal circumstances they would not have done it is entrapment.
  • Insufficient evidence – The prosecutor must prove fraud in order to obtain a conviction. By discrediting the evidence, the defense can show reasonable doubt.
  • Non-fraudulent statement – A statement can be false but not fraudulent. A misleading statement is fraudulent when it relates to a fact that is currently existing, but not when it promises to commit a future action. Additionally, someone stating an opinion does not constitute fraud.

A good fraud attorney can work through the nuances of the law and determine which defenses are most appropriate for your case.

A charge of fraud can bring with it many serious consequences. If you have been charged with fraud, you need an attorney who will work in your best interest and protect your rights. You need someone with the experience and education to represent you and help bring about the best possible outcome for your case. The Litvak Law Firm is committed to putting our clients first. At every step in your case, we will be there to support you and see you through to the end. Whether you are being investigated, arraigned, going to trial, or appealing a court decision, we will be there for you. Call (718) 929-2908 today, your initial phone consultation is free. Don’t wait to see what happens, get the representation that you deserve and protect your rights.



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