California Fraud Crimes

Fraud and financial crimes in california

Any person, legal entity or even government can become a victim of fraud crimes. The most important thing to overcome fraud offenses is to know how you can detect the early warning signs of it in order to save money and time.

In practice, documents entitling proprietary rights are often subject to various fraudulent transactions. The fraud is considered to be committed when documents proving the right of possession are under the control of an offender. It should be noted that there is no difference whether he or she succeeded to obtain the corresponding property in cash or otherwise.

In today’s complex economy, financial crimes and frauds obtain various forms. Below, we will introduce you the main elements of the California Fraud Law. In the resources of our site you can find detailed information about different kind of financial crimes and fraud in California.

1. Legal Definition of the Fraud in California
2. Elements of the Fraud Offense
3. Punishment of Fraud
4. Common types of California Fraud
5. Legal Defenses to California Fraud Accusations
6. Related Articles

In addition, we are ready to provide answers to your initial questions concerning fraud charges in California for free.


1. Legal Definition of the Fraud in California

The term “fraud” refers to a variety of acts involving “dishonesty” and fraudulent act. In general, the fraud is defined as intentional deception of a person or entity by the offender in order to gain personal or monetary benefits. Fraud offenses can be committed by misrepresentation, deceitful conduct, false documentation etc. These crimes typically involve some form of deceit, abuse of a position or trust, and these characteristics differ fraud from theft or robbery.


2. Fraud: Criminal Elements

In order to prove that a person has committed any fraud offense, the prosecutor must prove the following elements of California fraud offense:
1) a misrepresentation of a material fact;
2) by a person or entity who knows or believes it to be false;
3) to a person or entity who justifiably relies on the misrepresentation;
4) it resulted in actual injury or loss occurring from his or her reliance.

In general, each element should be proven with “particularity”, it means that every element has to be proven separately in order to stand the whole charge.

Example: John sells a used car to Steven. John knows that the car is stolen and cannot be legally driven in California. Nonetheless, John does not tell it to Steven. Thus, the failure to provide the important information from the side of John is considered to be fraud.


3. What Penalties Can I Face for Fraud in California?

In California, fraud is punishable as either a felony or a misdemeanor, depending on the specific circumstances of the case and criminal history of the defendant.

The Fraud offenses include the following penalties:

  • criminal penalties;
  • civil penalties;
  • both of them.

California criminal fraud can be punished by fines or imprisonment if the prosecution has succeeded to prove the offender’s criminal intent. Mostly, fraud offenses are considered to be felony crimes and they are punishable by jail, fines, probation or all of them. Referring civil fraud, the negative consequences are applicable if the bad-faith is involved and there is a need to put the victim back in the same position as it was before the crime took place. Civil penalties system includes restitution and payment of substantial fines. The severity of legal consequences depends on various factors of the unlawful conduct, such as the crime was committed by a legal entity or an individual, the value of the taken property etc.


4. Common types of California Fraud

There some common schemes of fraud crimes which are often used by perpetrators in order to deprive the victims from their money.

a) Pigeon Drop Schemes

A scammer says a victim (the pigeon) that he or she has won a big amount of money but there is need to pay the entry fee if the scammer had lost. The scammer promises to pay back the money. After receiving it, the scammer disappears.

b) Ponzi Schemes

Ponzi Schemes, named for an Italian thief Ponzi, consists of attracting new investors by promising to return their money with big procents. The idea is that the new investments have to satisfy earlier investors’ interests. However, it cannot continue too long. And one day the scheme fails.

Example: McManaman raises more than $500 million from his investors promising to invest in his wholesale distribution company. In reality, this company does not exist. The new money is going to be used to fund principal and interest to earlier investors. At the same time, the offender takes millions of dollars for his personal use. In consequence, he will be found guilty of fraud.

c) Pyramid Schemes

Pyramid Schemes have common treats with Ponzi Schemes, money collected from new investors are paid to earlier investors. The difference is that the victims are deemed to recruit new victims in order to get recruitment commissions.

Example: Isabella recruits her friend Johanna into a company which distributes cheap napkins. Isabella fail to tell the prospective participant that this is mathematically impossible for everyone to do. Generally, participants drop out when they recoup their original investments and the circle goes on.

Taking into consideration all aforementioned examples, you should verify the legitimacy of any investment or franchise before investing.


5. Which defenses can be used against California Fraud Accusations?

Your California defense attorney can use various legal defenses in order to reduce or dismiss the charge. Below, we represent some of them.

The Margarian Law Firm aggressively protects the rights of criminal defendants in California. Each defense will be developed upon the facts of your individual case. Do not hesitate to contact us. You will get your legal assistance as soon as you contact us. We handle every aspect of your case, from the first step to the very last court hearing.

You may file your request online, by telephone or by mail. 818-553-1000


6. Related Articles

California Theft Crimes

Identity Theft

Insurance Fraud

Mail Fraud

Credit Fraud

Security Fraud

Telemarketing Fraud

Wire Fraud

Tax Evasion

Mortgage Fraud

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