Bank fraud is the use of a potentially illegal way to earn money, assets or other property owned or held by a financial institution, or to get money from depositors fraudulently disguised as a bank or other financial institution. In many instances, bank fraud is a crime. While specific elements of a particular banking fraud law vary depending on jurisdiction, bank fraud terms apply to actions that use schemes or intelligence, as opposed to bank robberies or thefts. For this reason, bank fraud is sometimes considered a white-collar crime.
Video Bank fraud
Bank fraud type
Check stolen
Fraudsters may seek access to facilities such as mailroom, post office, tax authority offices, corporate payrolls or social offices or veterans' offices, which process large checks. The fraudsters can then open bank accounts under pseudonyms and deposit checks, which can be changed first to appear legitimate, so they can withdraw unauthorized funds.
Alternatively, counterfeiters obtain unauthorized access to blank checkbooks, and falsified signatures that appear to be valid on checks, as well as to illegally gain access to unauthorized funds.
Check kiting
Check how to make use of the banking system known as "float" where money is calculated temporarily twice. When a check is deposited into an account at Bank X, the money is immediately available in the account even if the corresponding amount of money is not immediately removed from the account at Bank Y where the check was taken. So both banks calculate the amount of the check as an asset until the check is officially deleted at Bank Y. Float it serves a legitimate purpose in the banking but deliberately exploits the float when funds in Bank Y are insufficient to cover the amount withdrawn from Bank X is a form fraud.
Counterfeiting and altering checks
Fraudsters have changed the check to rename (to deposit checks intended for payments to others) or the amount that is in advance of the check, a simple change can convert $ 100.00 to $ 100,000.00. (However, such large value transactions are routinely investigated as policy issues to prevent fraud.)
Instead of tweaking the real checks, fraudsters can alternately try to forge a depositors' signature on a blank check or even print their own checks taken on someone else's account, no account, etc. They will then cash out a fraud check through another. bank and withdraw money before the bank realizes that the check was a fraud.
Accountant accountant
To conceal serious financial problems, some businesses have been known to use fraudulent bookkeeping to overstate sales and earnings, inflating the value of a company's assets, or declaring earnings when the company operates in a state of loss. These damaged footage are then used to seek investment in corporate bonds or security issues or to create fake loan applications in a last resort to earn more money to delay the inevitable collapse of unprofitable or mismanaged companies. Examples of accounting fraud: Enron and WorldCom and Ocala Funding. These companies "cook books" to look as if they have a quarterly profit, when in fact they are very indebted.
Uninsured deposits
A bank that asks for public savings may not have insurance or does not have permission to operate at all. The goal is usually to request deposits to these uninsured "banks", although some may also sell shares representing the ownership of the "bank". Sometimes the names seem very official or very similar to a legitimate bank name. For example, the unlicensed "Trust Chase Bank" from Washington D.C. appeared in 2002, has no affiliation with a clear name; The real Chase Manhattan Bank is based in New York. Fraudulent accounting has also been used to hide other thefts that occur within the company.
Draft deception request
Demographic demographic drafts (DD) typically involve one or more corrupt bank employees. First, the employee removes several sheets of DD or DD leaves from stock and writes it like a regular DD. Because they're insiders, they know the coding and punching the demand draft. Drafts of such fake requests are usually withdrawn in a distant city without debiting accounts. This draft is disbursed in the branch of the debt. Fraud is only found when the bank's head office does branch-wise reconciliation, which usually takes six months, when the money is lost.
Remotely make check fraud
Remotely built-in checks are payment orders made by the payee and authenticated by the customer remotely, using the phone or internet by providing required information including MICR codes from valid checks. They do not bear customer signatures like regular checks. Instead, they give the legend "Authorized by Drawer". This type of instrument is typically used by credit card companies, utility companies, or telemarketers. Lack of signatures makes them vulnerable to fraud. Fraud is considered DD fraud in the US.
Badger merchant
A rogue trader is a merchant in a financial institution involved in unauthorized trading to cover the losses he suffered in previous trades. Out of fear and despair, he manipulates internal controls to avoid detection in order to buy more time.
Unfortunately, unauthorized trading activities always result in more losses due to time constraints; most of the rogue traders found in the early stages with losses ranging from $ 1 million to $ 100 million, but very few who work out of the agency with very loose controls are not found until the losses have reached more than a billion dollars. The size of the loss is a reflection of weakness in the controls instituted in the company and not the greed of the trader. Contrary to public perception, naughty merchants have no criminal intent to deceive their employers to enrich themselves; he's just trying to cover up losses to make his whole company and save his job.
Some of the biggest unlawful trade losses are found in Barings Bank (Daiwa Bank), Sumitomo Corporation (Yasuo Hamanaka), Allfirst Bank (John Rusnak), (JÃÆ' Â © rÃÆ'Â'me Kerviel), UBS (Kweku Adoboli), and JPMorgan Chase (Bruno Iksil).
Fraudulent Loans
One way to spend money from a bank is to take out a loan, which the banker is more than willing to push if they have a compelling reason to believe that the money will be paid in full with interest. However, counterfeit loans are one in which the borrower is a business entity controlled by a dishonest bank officer or accomplice; "Borrower" then declared bankrupt or disappeared and the money is gone. The borrower may even be a non-existent entity and the loan is just a tool to hide the theft of large sums of money from the bank. It can also be seen as a component in mortgage scams (Bell, 2010).
Fake loan application
It takes a number of varied forms from individuals who use false information to hide a credit history littered with financial problems and unpaid loans to companies that use accounting fraud to exaggerate profits to make risky loans appear to be a sound investment for banks.
Fake or deceptive documents
Fake documents are often used to hide other thefts; banks tend to calculate their money carefully so that every penny must be accounted for. A document that claims that some money has been borrowed as a loan, withdrawn by an individual depositor or transferred or invested therefore can be valuable to someone who wants to hide the fact that the bank's money has actually been stolen and is now gone.
Wire transfer forgery
Wire transfer networks such as the SWIFT international inter-bank transfer system are very tempting because the target as a transfer, once created, is difficult or impossible to return. Because these networks are used by banks to settle accounts with one another, rapid transfers or overnight large sums of money are common; while banks have placed checks and balances in place, there is a risk that insiders may try to use fake or fake documents claiming to ask for bank depositors' money to be transferred to other banks, often overseas accounts in some distant foreign country.
There is a very high risk of fraud when dealing with unknown or uninsured institutions.
The biggest risk is when dealing with foreign banks or the Internet (as this allows the selection of countries with loose banking regulations), but not in a limited way on these institutions. There is an annual list of unlicensed banks on the website of the US Treasury Department which is currently fifteen pages in length.
Also, one can send wire transfers from one country to another. Since this takes several days to transfer to "clear" and available to withdraw, others may still be able to withdraw money from other banks. A new cashier or a corrupt officer may approve the withdrawal because it is in a waiting status that then others cancel the wire transfer and the bank institution takes monetary losses.
Cut fraud charges
Basically a trick of self-confidence, fraudsters use their company to gain bank confidence, masquerading as a sincere and profitable customer. To give the illusion of being a desirable customer, the company regularly and repeatedly uses the bank to get payments from one or more of its customers. This payment is always made, because the customer in question is part of the fraud, actively paying for any and all bills that the bank is trying to collect. Once the fraudsters gain bank trust, the company requests that the bank start paying the company up front for the bill that will be billed from the customer later. Many banks will agree, but it is not possible to go directly to the world. So once again, business continues as usual for fraudulent companies, fraudulent customers, and banks unnoticed. As the bank grows more comfortable with the arrangement, it will trust the company more and more willing to give bigger and bigger money up front. Finally, when the outstanding balance between the bank and the company is large enough, the company and its customers disappear, taking the money that the bank pays ahead and no one pays the bills issued by the bank.
Payment card fraud
Credit card fraud is widespread as a means of stealing from banks, traders and clients.
Booster checking
Booster checks are fraudulent or bad checks used to make payments to a credit card account to "quench" or increase the amount of credit available on a valid credit card. The check amount is credited to the bank account by the bank as soon as the payment is made, even if the check has not been cleared. Before a bad check is found, the offender makes a purchase or gets an advance until the "new" card limit obtained on the card is reached. The original check then bounced off, but by then it was too late.
Stolen payment card
Often, the first indication that the victim's wallet has been stolen is a phone call from a credit card issuer asking if the person has been shopping; the simplest form of theft is to steal the card itself and charge a number of expensive items into the first few minutes or hours before it is reportedly stolen.
This variant is to copy only the credit card numbers (instead of attracting attention by stealing the card itself) to use the numbers in online fraud.
Duplicate or skimming card information
This requires a number of forms, starting from the merchant who copies the client's credit card number for use in illegal or criminal activities that uses carbon copies from old machine card printing machines to steal info, until the use of damaged credit card or debit card to copy the magnetic strip from the card temporary payments hidden cameras capture numbers in advance of the card.
Some fraudsters have attached fake stripe card readers to publicly accessible ATMs, to gain unauthorized access to the contents of magnetic lanes, as well as hidden cameras to illegally record user authorization codes. The data recorded by the camera and the fake strip card reader is then used to generate duplicate cards which can then be used to make ATM withdrawals from the victims' accounts.
Deposit empty ATM envelope
A criminal overdraft may occur because the account holder makes an unworthy or incorrect deposit on the automatic teller machine to get more cash than it is in the account or to prevent a check being returned because of insufficient funds. The US banking law makes the first $ 100 immediately available and perhaps more uncollected funds will be lost by the bank the next business day before this type of fraud is found. The crime can also be committed against someone else's account in "account takeover" or with a fake ATM card, or an account opened with someone else's name as part of an identity theft scam. The advent of ATM deposit technology that scans currencies and checks without using envelopes can prevent this type of fraud in the future.
Identity theft or Impersonation
Identity theft has become an increasing problem; scam operates by obtaining information about an individual, then using information to apply for an identity card, account and credit in the person's name. Often more than the name, parent's name, date and place of birth are sufficient to obtain a birth certificate; each document obtained is then used as an identification to obtain more identity documents. Government-issued standard identification numbers such as "social security numbers" are also valuable to fraudsters.
Information can be obtained from insiders (such as a bank or dishonest government employee), by a fraudulent offer for employment or investment (where the victim is required for a long list of personal information) or by sending bank correspondence or counterfeit tax. Some of the fictitious tax forms allegedly sent by banks to clients in 2002 were:
- W-9095 Application Form for Certificate/Ownership Status for Withholding Tax
- W-8BEN Certificate of Foreign Ownership Status for US Withholding Tax
- W-8888
The true origins of these forms are not banks or tax officials - they are sent by potential identity thieves and W-8888 does not exist, W-9095 is also fictitious (W-9 is actually asking for less info) and W- 8BEN is real but may have been tampered with to add additional annoying questions. The original form being the basis of this false is intended to collect information for income tax on income from deposits and investments.
In some cases, SIN names/pairs are required to imitate a citizen while working as an illegal immigrant but often identity thieves use false identity documents at other criminal commissions or even hide from prosecution for past crimes. The use of stolen identities for other fraud such as gaining access to bank accounts, credit cards, lending and social benefits of fraud or tax refund claims is not uncommon.
Not surprisingly, the perpetrators of such fraud are known to take out loans and disappear with cash.
Central bank fraud
The "main bank" operation claimed to offer an urgent and exclusive opportunity to monetize the best secrets in the banking industry, backlog of "main bank", "constitutional bank", "bank notes and bonds issued by the bank" from top 500 world banks " , "bank guarantees and standby letters of credit" that result in spectacular returns without risk and "supported by the World Bank" or various national governments and central banks.However, these official-sounding phrases and more are the hallmark of so-called "major bank" fraud: they may sound great on paper, but offshore investments secured by unclear claims of easy 100% monthly returns are all fictitious financial instruments intended to deceive individuals.
Fictitious bank inspector'
This is an old fraud with a number of variants; the original scheme involved claiming to be a bank inspector, claiming that the bank suspects that one of its employees stole the money and that to help catch the culprit "bank inspector" requires the depositor to withdraw all his money. At this point, the victim will bring a large amount of cash and can be targeted for the theft of the fund.
Other variants include claiming as a potential business partner with a "lifetime opportunity" then requesting access to cash "to prove that you trust me" or even claiming to be a new immigrant who brings all their money in cash for fear that the bank will steal from them - if told by others that they keep their money in the bank, they then ask the depositor to withdraw it to prove the bank has not stolen it.
Impersonation recently became a way to steal personal information for use in identity theft scams.
Phishing and Internet fraud
Phishing, also known as Internet fraud, operates by sending fake e-mails, impersonating online banks, auctions, or payment sites; e-mail directs users to a fake website designed to look like a login to a legitimate site but that claims that users should update their personal info. The stolen information is then used in other scams, such as identity theft or online auction fraud.
A number of "dangerous Trojan horse" programs have also been used to sneak Internet users online, capturing keystrokes or confidential data to send them to external sites.
Fake websites can trick you into downloading computer viruses that steal your personal information. A security message is displayed that tells you that you have a virus and need to download new software, by doing this you are tricked into downloading the actual virus.
Money laundering
The term "money laundering" dates back to the days of Al Capone; Money laundering has since been used to describe any scheme that is a source of hidden or hidden funds.
Money laundering is a process whereby large amounts of illegally obtained money (from drug trafficking, terrorist activities or other serious crimes) are given the impression of being from a legitimate source.
Maps Bank fraud
Banking fraud by country
United States
Under federal law, bank fraud in the United States is defined, and made illegal, primarily by the Bank Fraud Statute in Title 18 of the US Code. 18 U.S.C. Ã, § 1344 (Statute Fraud Bank) states:
- Anyone who consciously executes, or tries to execute, scheme or intelligence -
- (1) to deceive financial institutions; or
- (2) to obtain any of any money, funds, credits, assets, securities or other property held by, or under the custody or control of, financial institutions, for the purpose of fraud or fraud, or an appointment;
- will be fined no more than $ 1,000,000 or incarcerated for not more than 30 years, or both.
State law can also criminalize the same, or similar action.
The Bank Fraud Statute was passed after a Supreme Court ruling at Williams v. United States, 458 US 279 (1982), in which the Court stated that the check-kiting scheme does not constitute a false statement on the financial institution (18 USC Ã,§ 1014). Congress responded by passing the Bank Fraud Statute (18 U.SC Ã,§ 1344). Section 1344 has been supported by the Reform of Financial Institutions, the Restoration and Enforcement Act of 1989 (FIRREA), Pub. L. No. 101-73, 103 Stat. 500.
Bank Fraud Statutes federalally criminalize check-kiting, check forging, not disclosing information about loan applications, transfer of funds, use of automated teller machines (ATMs), credit card fraud, and other similar violations. Section 1344 does not cover certain forms of money laundering, bribery, and waiver of checks. Other provisions include this violation.
In the United States, the consumer's responsibility for unauthorized money transfer on a debit card is protected by E-Rule of the Federal Deposit Insurance Corporation. The level of consumer liability, as described in section 205.6, is determined by the speed of the consumer to notify the bank. If the bank is notified within 2 business days, the consumer is responsible for $ 50. For two business days, the consumer is responsible for $ 500, and more than 60 working days, unlimited consumer responsibility. In contrast, all major credit card companies have zero liability policies, which effectively eliminate consumer responsibility in cases of fraud.
China
A lawsuit concluded in 2012 in Wenling city, Jejiang province made the news because the local court ordered the bank to fully replace the person who was the victim of the card duplication.
Australia
The Commonwealth Fraud Control framework describes the Australian Government's prevention, detection, investigation and reporting requirements for fraud control. This template includes three documents called Fraud Rules, Fraudulent Policies and Fraud Guides
Fraud Rule is a legislative instrument that binds all Commonwealth entities that establish the main requirements of fraud control.
Fraud Policy is a government policy that binds a non-corporate Commonwealth entity that establishes procedural requirements for specific areas of fraudulent control such as investigation and reporting.
Fraud Guides that prevent, detect and handle fraud, support best practice guidelines for Fraudulent Rules and Fraudulent Policies that set government expectations for fraud control arrangements in all Commonwealth entities.
Other important acts and regulations within the Australian Government fraud control framework include:
- CrimesAct 1914 , which sets criminal violations against the Commonwealth, such as fraud
- KUHP 1995 , which sets criminal offenses against the Commonwealth, such as fraudulent behavior
- Public Services Law 1999 and Public Services Regulations 1999 , which govern the establishment and management of Australian Public Services and their employees
- The Result of Crime Act 2002 and Revenue from Crime Rules 2002 , which provides for the seizure of criminal proceedings.
Important case
- 1873 Bank of England fake
- Missing in 60 Seconds (bank scams)
- Moldovan bank scams
- Laundromat Russia
The Difference between a Client Account, Small Business Account and Business Account
Consumer Bank Account
Consumer bank accounts in the United States are protected by federal law.
The Bank has the option of performing fraud detection either in real time or every 24 hours. Since personal accounts are the bank's responsibility, fraud detection for personal accounts is usually done in real-time.
Small Business Bank Account
Although Visa and MasterCard both claim Zero Liability on their respective websites for Small Business Accounts, the fact is, every bank can choose whether or not they want to hold Zero Liability guarantees. If an account does not specifically say "Small Business Account", it should be assumed that standard business account responsibilities apply.
Even if the account says "Small Business Account", one should check with their respective bank to determine how much of an obligation the account has.
The Bank has the option of performing fraud detection either in real time or every 24 hours. If the bank places the obligations of the Small Business Account to the customer, it should be assumed that fraud detection is done every 24 hours. If the bank assumes liability for fraud on Small Business Accounts, fraud detection can be done in real time or every 24 hours. We recommend checking with your bank to determine how often fraud detection is performed.
Business Bank Account
MasterCard and Visa do not provide liability protections for business accounts. Since fraud is the responsibility of the customer, and not the bank, one should assume that fraud detection is done every 24 hours. Check with your bank to determine if a business account has real-time fraud detection.
See also
- Alfredo SÃÆ'¡enz Century
- Baninter case
- Carding (fraud)
- Check out fraud
- FBI
- Mail blocking
- Mortgage fraud
- Nigerian Script 419
- Taylor, Bean & amp; Whitaker, the top-10 wholesale US mortgage lending company that quit doing business after billions of billions of fraud revelations
- Counterfeit wire
- United States Secret Service
References
External links
- Online Bankers
- Persuasion Crime
- US Securities and Exchange Commission
- US Code
- The crime of humanity of Ukrainian banks
Source of the article : Wikipedia
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