#committing financial fraud is a victimless crime

[vancilart]

a certified sweetiepie who's never done anything bad to anyone

[fintradetecsolution]

 Educating Policyholders About Insurance Fraud Risks

Introduction: 

Insurance fraud is a serious and growing problem worldwide, costing billions of dollars annually. It affects not only insurance companies but also policyholders, as fraudulent claims drive up premiums and undermine trust in the industry. Educating policyholders about the risks of insurance fraud is critical to ensuring they are aware of potential scams and can take steps to protect themselves. This article will explore the types of insurance fraud, its impact on the industry, and key tips to help policyholders safeguard themselves from becoming victims or unintentional accomplices.

1. Understanding Insurance Fraud: Types and Examples

Insurance fraud occurs when individuals or entities deceive an insurer for financial gain. It can be perpetrated by policyholders, insurance agents, or third parties. 

Hard Fraud: This involves intentionally creating or orchestrating an accident to collect on an insurance claim. Examples include pretending to be in a car accident, deliberately setting fire to property, or inventing a medical injury. Hard fraud is intentional and often carries criminal intent.

Soft Fraud: Soft fraud, commonly referred to as "opportunistic fraud," involves the inflation or distortion of a legitimate claim. For instance, a policyholder involved in a minor car accident might inflate the repair costs or assert additional injuries to receive a larger payout. Although this type of fraud may seem less harmful, it is still illegal and contributes to rising insurance premiums.

Common Types of Insurance Fraud

Auto Insurance Fraud: Includes staged accidents, exaggerated repair claims, or fake injuries following a car crash.

Health Insurance Fraud: Involves billing for medical services not provided, inflating healthcare costs, or filing false claims for unnecessary procedures.

Life Insurance Fraud: This can involve filing claims using forged death certificates, faking one’s death, or purchasing policies with the intent of committing fraud.

Property Insurance Fraud: Policyholders may intentionally damage their property or inflate repair costs after an event like a fire, theft, or natural disaster.

Understanding the different forms of insurance fraud helps policyholders stay vigilant and avoid unknowingly participating in fraudulent activities.

2. The Impact of Insurance Fraud on Policyholders

Insurance fraud is not a victimless crime. Its consequences apply to all policyholders. The financial cost of fraud is usually passed on to customers in the shape of higher premiums. Furthermore, insurance companies may tighten claim processing standards, causing delays or even denials of genuine claims.

The Cost of Fraud

Insurance fraud is estimated to cost the global industry billions of dollars annually. This financial burden is ultimately transferred to policyholders through higher premiums. The Coalition Against Insurance Fraud reports that fraud constitutes 5-10% of total industry costs in the United States, significantly driving up the price of coverage.

Beyond the financial impact, insurance fraud undermines trust in the system. Policyholders may become wary of insurers, fearing that their legitimate claims will be scrutinized or rejected. Additionally, fraud can lead to more complicated claims processes, requiring additional documentation or verification steps to reduce the risk of false claims.

3. How Policyholders Can Protect Themselves

Educating policyholders about how to identify and prevent insurance fraud is crucial to reducing the overall impact of fraud on the industry. 

A. Be Wary of Inflated Claims

One of the most common forms of fraud occurs when policyholders exaggerate their claims. While it may be tempting to inflate the value of a claim, even slightly, it is illegal and can lead to serious consequences. Policyholders should always be honest when filing claims and provide accurate documentation for losses or damages.

B. Work with Reputable Providers and Agents

Policyholders should always verify that they are working with licensed, reputable insurance agents and companies. Scammers often pose as legitimate agents or create fake companies to collect premiums without providing coverage. It is essential to check the credentials of any insurance agent or broker and ensure they are properly licensed with state or national insurance regulatory bodies.

C. Be Cautious of Fraudulent Schemes

There are several common schemes that target policyholders. These include staged accidents, fraudulent claims for injuries, and phony medical bills. Policyholders should be cautious if they are approached by individuals encouraging them to participate in suspicious claims. Participating in fraud, even unknowingly, can result in criminal charges, fines, and the loss of insurance coverage.

D. Keep Accurate Records

To prevent fraudulent claims or disputes, policyholders should maintain accurate records of their insurance policies, payments, and claims. Keeping a copy of the original policy, documentation of valuables, and receipts for any repairs or services can help ensure that claims are handled smoothly and prevent false claims from being filed.

E. Report Suspicious Activity

If a policyholder suspects that they are being targeted by a fraudster or observes suspicious activity related to insurance, they should report it to their insurance company or the relevant authorities immediately. Many insurers have fraud hotlines or dedicated teams that investigate fraudulent claims. Reporting fraud helps protect other policyholders and prevents the spread of fraudulent activities.

4. Insurance Fraud Prevention: 

The business and government authorities work together to combat insurance fraud. Insurers are increasingly adopting modern technologies, including as artificial intelligence and data analytics, to detect fraudulent claims early on. By examining trends and red flags in claims data, insurers may detect possible fraud and take action to investigate and avoid settlements.

Governments also play a crucial role in combating fraud. Many countries have laws that impose stiff penalties for committing insurance fraud, including fines, imprisonment, and the loss of coverage. Regulatory agencies often work in partnership with insurers to detect and prevent fraud through audits, investigations, and enforcement actions.

A. Technology in Fraud Detection

With advancements in technology, insurance companies are leveraging artificial intelligence (AI) and machine learning (ML) algorithms to identify suspicious claims. These tools analyze large datasets to identify patterns indicative of fraud, such as multiple claims from the same individual or exaggerated claims involving the same repair shop.

B. Public Awareness Campaigns

Governments and industry organizations often run public awareness campaigns to educate consumers about the dangers of insurance fraud. These campaigns aim to inform the public about common fraud schemes, how to spot them, and the consequences of committing or participating in fraud.

Conclusion : 

Insurance fraud is a severe problem for both the insurance sector and its clients. It increases premiums, complicates the claims procedure, and weakens faith in the system. We can reduce the impact of fraud on the industry by alerting policyholders about the risks and giving them with the tools they need to protect themselves. To ensure that insurance remains a reliable and reasonable financial resource for everybody, policyholders must be vigilant, honest, and take the initiative to report any suspicious activity.

[jimi-rawlings]

Racketeering Meaning, Types, and Examples

Salut Emmanuel Macron,

The list of federal crimes specified in RICO includes bribery, fraud, gambling offenses, money laundering, financial and economic crimes, obstructing justice or a criminal investigation, and murder for hire. At the state level, racketeering can include crimes such as murder, kidnapping, gambling, arson, robbery, bribery, extortion, dealing in obscene matters, and drug crimes, as long as they align with the "generic definition of the state offense referenced at the time RICO was enacted."

This may be the most controversial option for you but Energy Drink Victimless Crime Game Theory Networks with Offshore Aquaculture (Racket) is WAY safer than Gangster.

Salut,

Adrien Blake-Trotman

[mystlnewsonline]

Amazing Investigation - Sentencing of Dozens for Fraud

Dozens sentenced for their roles in Atlanta-based fraud and money laundering operation that stole over $30 million from individuals and companies. ATLANTA, GA (STL.News) More than three dozen individuals have been sentenced for involvement in a large-scale fraud and money laundering operation that targeted individuals, corporations, and financial institutions throughout the United States.  The defendants used business email compromise schemes, romance fraud scams, and retirement account scams, among other fraud of over $30 million from numerous victims. “The Department of Justice has tirelessly worked for more than four years to obtain justice for dozens of victims impacted by this brazen criminal organization,” said U.S. Attorney Ryan K. Buchanan.  “The defendants’ sentences should serve as a stark warning to others that fraud and money laundering crimes are top priorities for this office and our federal, state, and local law enforcement partners.” “Several members of this conspiracy fraudulently obtained funds from ERISA-covered employee benefit plans.  The funds, which originated from unwitting individuals’ retirement accounts, were deposited into personal and business bank accounts that were created in furtherance of this money-laundering conspiracy.  The greed of the conspirators caused workers and prospective retirees to lose significant portions of their hard-earned retirement funds.  We will continue to work with our law enforcement partners and the U.S. Department of Labor’s Employee Benefits Security Administration to protect the integrity of employee benefit plans,” said Mathew Broadhurst, Special Agent-in-Charge, Southeast Region, U.S. Department of Labor, Office of Inspector General. “These fraud scams, although not violent, are not victimless and can be devastating to businesses and individuals who fall prey to them,” said Keri Fairly, Special Agent in Charge of FBI Atlanta.  “The sentencing of all these individuals shows the FBI’s dedication to working with our partners to hold anyone accountable who would steal from hard-working and honest individuals, rather than put in the work themselves.” “These scammers defrauded individuals and companies, enriching themselves,” said Acting Special Agent in Charge Travis Pickard, who oversees Homeland Security Investigations (HSI) operations in Georgia and Alabama.  “HSI and its law enforcement partners will continue to work tirelessly to protect the integrity of the nation’s financial infrastructure and ensure that financial crimes do not go unpunished.” “This sentencing illustrates the Secret Service’s dedication to protecting our nation’s financial systems,” said Steven R. Baisel, Special Agent in Charge of the U.S. Secret Service’s Atlanta Field Office.  “We are thankful for our law enforcement partners’ commitment and support as we worked together to bring this case to justice.” According to U.S. Attorney Buchanan, the charges and other information presented in court: The defendants engaged in multiple fraud and money laundering conspiracies that stole millions of dollars frms located throughout the United States and abroad.  The defendants were charged across several related pending cases. U.S. District Judge William M. Ray, II, sentenced the following individuals for their respective roles in this criminal scheme: - Joshua Roberts, also known as “Onyx,” 32, of Houston, Texas, was sentenced to eight years and one month in c, to be followed by three years of supervised release, and ordered to pay $9,675,739.73 in restitution to victims.  He was sentenced on August 10, 2022, after pleading guilty to conspiracy to commit money laundering on March 29, 2022. - Darius Sowah Okang, also known as “Michael J. Casey,” “Richard Resser,” “Thomas Vaden,” “Michael Lawson,” “Matthew Reddington,” and “Michael Little,” 32, of Stone Mountain, Georgia, was sentenced to seven years and 10 months in custody, to be followed by three years of supervised release, and ordered to pay $6,204,119 in restitution to victims.  He was sentenced on March 17, 2022, after pleading guilty to conspiracy to commit money laundering and aggravated identity theft on September 2, 2021. - George Kodjo Edem Adatsi, 39, of Atlanta, Georgia, was sentenced to five years and 10 months in custody, to be followed by three years of supervised release, and ordered to pay $3,373,797.43 in restitution to victims.  He was sentenced on July 21, 2021, after pleading guilty to conspiracy to commit money laundering on April 7, 2021. - Benjamin Ibukunoluwa Oye, 29, of Sandy Springs, Georgia, was sentenced to five years in custody, to be followed by three years of supervised release, and ordered to pay $1,163,127.01 in restitution to victims.  He was sentenced on March 21, 2023, after pleading guilty to conspiracy to commit bank fraud, aggravated identity theft, conspiracy to commit money laundering, and money laundering on March 4, 2020. - Prince Sheriff Okai, 29, of Mableton, Georgia, was sentenced to four years and nine months in custody, to be followed by three years of supervised release, and ordered to pay $4,950,586.54 in restitution to victims.  He was sentenced on January 12, 2021, after pleading guilty to conspiracy to commit money laundering on October 6, 2020. - Hamza Abdallah, also known as “Reggie Lewis,” 33, of McDonough, Georgia, was sentenced to four years and nine months in custody, to be followed by three years of supervised release, and ordered to pay $5,051,473.87 in restitution to victims.  He was sentenced on February 24, 2021, after pleading guilty to conspiracy to commit money laundering on November 18, 2020. - Dominique Raquel Golden, also known as “Desire Tamakloe,” “Mellissa Moore,” “Nicole Nolay,” “Raquel Roberts,” “Maria Henderson,” and “Raquel Golden,” 32, of Houston, Texas, was sentenced to four years and six months in custody, to be followed by three years of supervised release, and ordered to pay $7,830,607.05 in restitution to victims.  She was sentenced on March 28, 2022, after pleading guilty to conspiracy to commit money laundering on September 30, 2021. - Kelvin Prince Boateng, 27, of Atlanta, Georgia, was sentenced to three years and 10 months in custody, to be followed by three years of supervised release, and ordered to pay $870,333 in restitution to victims.  He was sentenced on June 17, 2021, after pleading guilty to conspiracy to commit money laundering on March 2, 2021. - Jonathan Kojo Agbemafle, also known as “Skinny,” 29, of Kansas City, Missouri, was sentenced to three years and 10 months in custody, to be followed by three years of supervised release, and ordered to pay $2,637,625.01 in restitution to victims.  He was sentenced on August 8, 2022, after pleading guilty to conspiracy to commit money laundering on April 4, 2022. - Blessing Oluwatimilehin Ojo, also known as “Timmy,” 37, of Nigeria, was sentenced to three years and 10 months in custody, to be followed by three years of supervised release, and ordered to pay $1,711,304 in restitution to victims.  He was sentenced on October 26, 2022, after pleading guilty to conspiracy to commit money laundering on July 19, 2022. - Desire Elorm Tamakloe, also known as “Chubby,” 28, of Smyrna, Georgia, was sentenced to three years and 10 months in custody, to be followed by three years of supervised release, and ordered to pay $1,215,357.81 in restitution to victims.  He was sentenced on April 18, 2023, after pleading guilty to conspiracy to commit money laundering on October 13, 2022. - Stephen Abbu Jenkins, also known as “Face,” “Steven Abbu Jenkins,” “Steven Jenkins,” and “Steve Jenkins,” 56, of Atlanta, Georgia, was sentenced to three years and seven months in custody, to be followed by three years of supervised release, and ordered to pay $726,290 in restitution to victims.  He was sentenced on February 22, 2023, after pleading guilty to conspiracy to commit money laundering on August 8, 2022. - Obinna Nwosu, 29, of Douglasville, Georgia, was sentenced to three years and one month in custody, to be followed by three years of supervised release, and ordered to pay $1,045,065.75 in restitution to victims.  He was sentenced on December 16, 2020, after pleading guilty to conspiracy to commit money laundering on September 17, 2020. - Ojebe Obewu Ojebe, 30, of Atlanta, Georgia, was sentenced to three years and one month in custody, to be followed by three years of supervised release, and ordered to pay $893,879.55 in restitution to victims.  He was sentenced on September 27, 2022, after pleading guilty to conspiracy to commit money laundering on June 2, 2022. - Francesco Benjamin, also known as “B-More,” 33, of Atlanta, Georgia, was sentenced to three years and one month in custody, to be followed by three years of supervised release, and ordered to pay $987,070 in restitution to victims.  He was sentenced on March 1, 2023, after pleading guilty to conspiracy to commit money laundering on October 19, 2022. - Chukwukadibia Ikechukwu Nnadozie, also known as “Chuka” and “Michael McCord,” 30, of Fayetteville, Georgia, was sentenced to three years and one month in custody, to be followed by three years of supervised release, and ordered to pay $231,507.19 in restitution to victims.  He was sentenced on May 9, 2023, after pleading guilty to conspiracy to commit money laundering on November 28, 2022. - Abubakar Sadik Ibrahim, 29, of Mableton, Georgia, was sentenced to three years in custody, to be followed by three years of supervised release, and ordered to pay $1,193,750.27 in restitution to victims.  He was sentenced on February 1, 2022, after pleading guilty to conspiracy to commit money laundering on September 27, 2021. - John Ifeoluwa Onimole, 31, of Powder Springs, Georgia, was sentenced to three years in custody, to be followed by three years of supervised release, and ordered to pay $1,117,966.06 in restitution to victims.  He was sentenced on April 25, 2023, after pleading guilty to money laundering on December 7, 2022. - Chadrick Jamal Rhodes, 31, of Atlanta, Georgia, was sentenced to two years and 11 months in custody, to be followed by three years of supervised release, and ordered to pay $120,000 in restitution to victims.  He was sentenced on January 31, 2022, after pleading guilty to conspiracy to commit bank fraud and aggravated identity theft on October 12, 2021. - Chadwick Osbourne Stewart, 43, of Atlanta, Georgia, was sentenced to two years and eight months in custody, to be followed by three years of supervised release, and ordered to pay $60,000 in restitution to victims.  He was sentenced on January 26, 2022, after pleading guilty to conspiracy to commit bank fraud and aggravated identity theft on October 22, 2021. - Macario Lee Nelson, a/k/a “Mac,” 27, of Atlanta, Georgia, was sentenced to two years and eight months in custody, to be followed by three years of supervised release, and ordered to pay $120,000 in restitution to victims.  He was sentenced on February 17, 2022, after pleading guilty to conspiracy to commit bank fraud and aggravated identity theft on September 29, 2021. - Afeez Olaide Adeniran, a/k/a “Ola,” 34, of Atlanta, Georgia, was sentenced to two years and six months in custody, to be followed by three years of supervised release, and ordered to pay $352,830.25 in restitution to victims.  He was sentenced on October 6, 2022, after pleading guilty to conspiracy to commit money laundering on August 18, 2022. - Kahlia Andrea Siddiqui, 31, of Chamblee, Georgia, was sentenced to two years and six months in custody, to be followed by three years of supervised release, and ordered to pay $325,811 in restitution to victims.  She was sentenced on February 22, 2023, after pleading guilty to conspiracy to commit money laundering on August 9, 2022. - Solomon Agyapong, also known as “Gumpe,” 34, of Marietta, Georgia, was sentenced to two years and six months in custody, to be followed by three years of supervised release, and ordered to pay $496,123.92 in restitution to victims.  He was sentenced on April 18, 2023, after pleading guilty to conspiracy to commit money laundering on October 11, 2022. - Christopher Akinwande Awonuga, 31, of Fayetteville, Georgia, was sentenced to two years and three months in custody, to be followed by three years of supervised release, and ordered to pay $113,276.27 in restitution to victims.  He was sentenced on January 8, 2020, after pleading guilty to conspiracy to commit bank fraud on August 22, 2019. - Emanuela Joe Joseph, 37, of Lawrenceville, Georgia, was sentenced to two years and three months in custody, to be followed by three years of supervised release, and ordered to pay $442,557.08 in restitution to victims.  She was sentenced on February 21, 2023, after pleading guilty to conspiracy to commit money laundering on October 26, 2022. - Seth Appiah Kubi, 63, of Dacula, Georgia, was sentenced to two years in custody, to be followed by one year of supervised release.  He was sentenced on July 7, 2020, after pleading guilty to aggravated identity theft on March 4, 2020. - Oluwafunmilade Onamuti, also known as “Mathew Kelvin,” 29, of Duluth, Georgia, was sentenced to one year and 10 months in custody, to be followed by three years of supervised release, and ordered to pay $167,195 in restitution to victims.  He was sentenced on July 21, 2021, after pleading guilty to conspiracy to commit money laundering on April 7, 2021. - Paul Chinonso Anyanwu, 31, of Hampton, Georgia, was sentenced to one year and six months in custody, to be followed by three years of supervised release, and ordered to pay $57,000 in restitution to victims.  He was sentenced on December 19, 2019, after pleading guilty to conspiracy to commit money laundering on September 18, 2019. - Casey Broderick Williams, 29, of Covington, Georgia, was sentenced to one year and one day in custody, to be followed by three years of supervised release, and ordered to pay $60,000 in restitution to victims.  He was sentenced on June 2, 2022, after pleading guilty to conspiracy to commit bank fraud and aggravated identity theft on July 30, 2019. - Alexus Ciera Johnson, 29, of Mableton, Georgia, was sentenced to one year and one day in custody, to be followed by three years of supervised release, and ordered to pay $106,879 in restitution to victims.  She was sentenced on May 22, 2023, after pleading guilty to conspiracy to commit money laundering on October 11, 2022. - Egale Veonzell Woods, Jr., 44, of East Point, Georgia, was sentenced to one year in custody, to be followed by three years of supervised release, and ordered to pay $165,007.19 in restitution to victims.  He was sentenced on April 21, 2021, after pleading guilty to conspiracy to commit money laundering on March 4, 2020. - Gregory Thomas Hudson, 42, of Powder Springs, Georgia, was sentenced to 10 months in custody, to be followed by 10 years of supervised release, and ordered to pay $125,291.45 in restitution to victims.  He was sentenced on June 27, 2022, after pleading guilty to conspiracy to commit bank fraud on March 14, 2022. - Uchechi Chidimma Odus, also known as “Uche,” 26, of Atlanta, Georgia, was sentenced to 10 months in custody, to be followed by three years of supervised release, and ordered to pay $83,345.47 in restitution to victims.  She was sentenced on May 17, 2023, after pleading guilty to conspiracy to commit money laundering on December 21, 2022. - Matthan Bolaji Ibidapo, also known as “B.J.,” 30, of Colorado Springs, Colorado, was sentenced to eight months in custody, to be followed by three years of supervised release with a portion to be served in home confinement and ordered to pay $82,490.50 in restitution to victims.  He was sentenced on February 21, 2023, after pleading guilty to conspiracy to commit money laundering on November 1, 2022. - Tyler Keon Roussell, 28, of Atlanta, Georgia, was sentenced to six months in custody, to be followed by six years of supervised release with a portion served in home confinement, and ordered to pay $368,400.49 in restitution to victims.  He was sentenced on February 21, 2022, after pleading guilty to conspiracy to commit bank fraud on May 16, 2019. - Monique Wheeler, 32, of Atlanta, Georgia, was sentenced to three months in custody, to be followed by three years of supervised release with a portion to be served in home confinement, and ordered to pay $71,010 in restitution to victims.  She was sentenced on December 2, 2022, after pleading guilty to money laundering on July 13, 2022. - Chineda Obilom Nwakudu, 28, of McDonough, Georgia, was sentenced to three years of probation with a portion to be served in home confinement and ordered to pay $123,645.85 in restitution to victims.  He was sentenced on February 22, 2023, after pleading guilty to conspiracy to commit money laundering on August 23, 2019. - Ahamefule Aso Odus, 30, of Atlanta, Georgia, was convicted by a jury on January 30, 2023, of conspiracy to commit money laundering and multiple substantive money laundering offenses.  His sentencing is pending. - Motswana Mulongo, also known as “David Mulongo” and “Henry Tipton,” 38, of Decatur, Georgia, was convicted of conspiracy to commit money laundering on March 10, 2023.  His sentencing is scheduled for June 22, 2023. - Oumar Bouyo Mbodj of Kennesaw, Georgia, is deceased, and charges filed against him were dismissed. This investigation was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF) program—the keystone drug, money laundering, and transnational organized crime enforcement program of the Department of Justice. This case was investigated by the Department of Labor, Office of Inspector General, Federal Bureau of Investigation, U.S. Secret Service, and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.  In addition, the investigating agencies received considerable support from the Department of Labor, the Employee Benefits Security Administration, and numerous federal, state, and local law enforcement authorities. Assistant U.S. Attorneys Kelly K. Connors and Russell Phillips prosecuted the case. SOURCE: U.S. Department of Justice Read the full article

[elancebhuwan-blog]

Fraud Awareness Program

The financial scandals at the beginning of the 21st century eroded investor confidence and public trust. Nevertheless fraud and corruption continue to exist and the extent of crime is startling. The 2012 Report to the Nation published by the Association of Certified Fraud Examiners estimates that employers lose 5 percent of the earnings to fraud every year and that the total, worldwide price of fraud exceeds $3.5 billion annually.  So we all people have to be aware about fraud that can be found in any part of our life like real estate fraud, insurance fraud and so on. So before taking any decision while doing business we must thought twice.

Do not rely upon auditors to discover fraud. Auditors, both internal and external, do a job of detecting fraud. While the audit function is necessary and important it isn't enough to detect or protect against fraud. Most frauds are discovered when an employee gives or complains an anonymous tip. To reduce fraud losses companies must increase awareness about fraud. Employees are a company's eyes and ears to detection and its prevention and of all sorts of crime. Most workers, such as most auditors, don't understand what to look for. That is where the role of a Chief Learning Officer is critical.

Required Training

Two of the primary reasons, at the NBES study cited above, that employees didn't report misconduct was that they did not know whom to contact and that they were afraid that their reports would not be confidential. If this is true then obviously the processes required in SOX Section 301(4) are not being successfully implemented. In addition, training oriented to meet the particular requirements of SOX isn't sufficient to discourage fraud. More is needed.

Fraud

A more comprehensive definition is that it is the intentional misrepresentation of a material fact, made for the purpose of procuring an unfair edge, and that is depended upon by another for their detriment.

One of the key differences between armed robbery and fraud is that fraud is generally perceived as being a victimless crime. Many frauds go undetected and so the victim never discovers a crime has been committed. Moreover, unlike armed robbery, fraud is hard to detect; the crime is intentionally hidden.

Effects of Fraud

A couple of figures can quickly demonstrate that white-collar offense is big business. As noted above, that implies that the world-wide reduction is about $3.5 billion. The average dollar reduction in the instances used as the foundation for the biannual report was 140,000. But about one fifth of the cases resulted in losses of more than $1 million. Cases like Enron gets a lot of press but fraud affects businesses of all sizes. In reality small companies, companies with less than 100 employees, are often the hardest hit.

Assume that net income is just five percent of earnings at your business. A $100,000 fraud hit your company and if that were true it might take $2 million to regain the gain. Fraud hurts. That is passed on to customers as higher prices and to workers as benefits and salaries. Participants in a fraud awareness program ought to know how fraud could (or has) influence their company and the way it affects them.

Fraud Commission

The measures in the commission of a fraud are asset misappropriation (a wonderful way to say"larceny"), concealment, and conversion. Fraud is hard to detect because of concealment. The fraud perpetrator hides the evidence of the misappropriation. For example, by preparing a normal entry in the bookkeeping system, an employee could steal money then hid the thieving. The books balance looks normal, but cash is lost and also the theft has been covered up.

The reduction in any one of these three factors is perceived as reducing someone's ability and motivation to help prevent fraud and thus to commit fraud. When someone identifies a method of misappropriating the assets for their use and of hiding the diversion opportunity exists. Strengthening internal controls is usually regarded as the"best" way of reducing opportunity risks and it is the only one of the three factors under direct organization control.

When individuals face problems they perceive to be unsolvable, Stress is presumed to bring about corruption. A mechanism is provided by rationalization for perusing corrupt acts. While it might be possible to identify individuals experiencing stress, managers have little direct control over this stress or individuals' rationalizations. Coworkers, on the other hand, may be familiar with their thought processes and statements and with the stresses that their coworkers face which may lead to rationalization. This places them in a much better position to identify if they're trained to understand the symptoms people who might have incentives to commit fraud.

Personality Attributes

Who commits fraud? Take a good look. People like you and me. In reality, jailed fraud perpetrators do not look much like property offenders; they seem more like college students. Convicted fraud perpetrators, compared to property criminals that are incarcerated, are far better educated, more spiritual, less likely to have abused alcohol or drugs, less likely to have criminal records, and also to have better emotional health. Additionally, they demonstrate, self-sufficiency, motivation and achievement and therefore are more optimistic. Frequently fraud perpetrators are trusted, long-time Coaching that was employees.Required

Red Flags

Red flags are indications that a fraud might be occurring. A flag does not demonstrate the presence of fraud, but all it really does is call attention to a condition which should be researched more thoroughly. The side bar list shared flags that are red. An fraud awareness training program should train workers to recognize red flags that might appear within their workplace and train them exactly what to do if they discover red flags.

The two concerns become non-issues if workers are sure their reports of misconduct will be confidential. The simplest way to ensure confidentiality and to make sure that employees know whom to contact would be to institute a 24/7 fraud. Workers will need to know when and how to use the fraud hotline sufficient to prevent monetary losses.

Conclusion

A fraud awareness training program will help make your company fraud-proof. It requires commitment at participation and the top throughout. Only when all employees understand what fraud is, how it hurts, what to search for, and how to record it will the risk of fraud be substantially reduced.trust that's been placed in them makes fraud potential. About 30 percent of fraud perpetrators are female while only 2% of property criminals are feminine. All of this makes fraud perpetrators difficult to recognize. Participants in a fraud awareness program should understand that any of their colleagues may be capable of committing fraud.

[douglasacogan]

Spirited (but problematic?) advocacy for Bernie Madoff to receive compassionate relief

The New York Times has this notable new opinion piece authored by Colleen Eren headlined "Let Bernie Madoff, and Many More, Out of Prison: Compassionate release has to apply to unsympathetic prisoners, if we mean what we say about ending mass incarceration."  I think the spirit of this piece is quite sound, but I am not entirely sold on all of its particulars.  Here are excerpts (with a few lines emphasized for comments to follow):

Recently, Mr. Madoff re-entered the news, as he filed for compassionate release from federal prison.  He is entering the final stages of kidney disease and has less than 18 months to live. The Bureau of Prisons denied his petition, as it does to 94 percent of those filed by incarcerated people.  But the reforms provided in the First Step Act of 2018 allow him to file an appeal with the sentencing court.

Even some who claim to detest the ravages of mass incarceration argue that Mr. Madoff should be denied compassionate release.  He is as close to the financial equivalent of a serial killer as one might encounter.  Still, there is a good argument to be made for compassionate release.  It has little to do with Bernie Madoff, though, and how we feel about his horrendous actions.

If our societal goal is to reduce incarceration, we are going to have to confront the inconvenient truth that retribution cannot be our only penological aim, and justice for victims has to be much more extensive than the incarceration of those who have caused them harm.  We desperately need to shift our cultural impulse to punish harshly and degradingly, and for long periods.

The visceral, retributive reactions to Mr. Madoff’s petition, including from liberals who claim to want to end mass incarceration, reveal the obstacles to transformational criminal justice reform.  The truth is, there is only a small number of entirely “sympathetic” people in prisons who could be released without any scruples by the public or affront to their victims.  Those incarcerated for violent offenses compose a vast majority of our prison population, in spite of a false narrative that most people are in there for nonviolent drug offenses.  The pain and harm experienced by their victims is real, and that’s also true for Mr. Madoff’s victims.  But criminal justice policy cannot be constructed in response to our feelings about individual, high-profile cases — the so-called worst of the worst. 

This “worst of the worst” argument, for example, has long undergirded the death penalty, which still stands in 30 states despite its racial and class biases and other flaws that have led hundreds of innocent people to death row.  It is also part of why the Democratic presidential candidates, with the exception of Bernie Sanders, don’t support the enfranchisement of those in prison.  But creating a separate category for Mr. Madoff, sex offenders or those “others” in the criminal justice system will not help end mass incarceration.  There will always be another high-profile case that can impede the implementation of more humane policies.

Those on the left who press for criminal justice reform emphasize “empathy” in their attempts to reframe the conversation about people who have committed crimes. Conservatives use the word “redemption.”  These words carry a profound responsibility: What do they mean for sympathetic and unsympathetic prisoners?  There are 200,000 people over the age of 55 incarcerated in the United States.  The question of compassionate release for Mr. Madoff affects not only him but these others and their victims as well.

Mr. Madoff lost both his sons while incarcerated (one died of cancer) and was unable to attend their funerals; is a social pariah, almost universally condemned; and has spent 11 years in federal prison.  This is not to say he deserves sympathy, but he has been punished.  In Norway, where Anders Breivik was sentenced to 21 years in prison for a horrific mass murder, 11 years would be considered harsh enough.  Our American punitiveness has distorted our sense of what is an adequate sentence for serious offenses.

When considering compassionate release, we also have to ask: Has the person been rehabilitated?  Does the punishment serve legitimate penological objectives (like deterrence and public safety) other than retribution?  (Something to consider, for instance: The number of Ponzi schemes prosecuted went up, not down after Mr. Madoff’s incarceration.)

Criminal justice reform will fall far short of the dramatic institutional changes needed if the dominant impulse continues to be retribution, and if high-profile cases continue to drive policy.  Compassionate release for those who are aging, terminally ill and dying should be assumed after they’ve served at least 10 years.  It was the offenders’ worst impulses that led them to commit their crimes.  Our justice system should appeal to our higher ethical ambitions.

I agree fully that "retribution cannot be our only penological aim, and justice for victims has to be much more extensive than the incarceration of those who have caused them harm." I also agree fully that criminal justice policy should not "be constructed in response to our feelings about individual, high-profile cases — the so-called worst of the worst" and that we should be troubled if "high-profile cases continue to drive policy." And whether a person has been rehabilitated also seem to me to be an important consideration here.  But I am not sure granting compassionate relief to Bernie Madoff furthers these interests, and I worry it could undermine them.

For starters, it is critical at this stage to realize that we are not really dealing with a "policy" matter, as the FIRST STEP Act altered the policy for compassionate relief and did so in a way that included Bernie Madoff and all other federal prisoners.  Though the FIRST STEP Act has some "worst of the worst" carve-outs in other parts of the Act, but its new process for pursuing compassionate relief applies to all federal prisoners (which is one reason I think it is such an important and valuable part of the Act).  in other words, in this context there is no need to worry about creating any "separate category for Mr. Madoff, sex offenders or those 'others' in the criminal justice system."  If a federal judge decided to deny Madoff compassionate relief, after considering all the facts of Madoff's case and all the factors of 3553(a), that judge will be adjudicating and resolving a single case, not creating any broad "criminal justice policy."

As to the facts of Madoff's case, I have seen little evidence that Madoff has been truly remorseful or rehabilitated.  In fact, this 2016 ABC News article reports that "Madoff has done little to express his remorse or regret to the estimated 20,000 investors in his scheme, many of whom lost their life savings in the $64 billion fraud.  Other than a brief reference to his victims during his sentencing hearing, Madoff has spent a lot of his time behind bars in an effort to rehabilitate his own image and actually shift the blame to the investors for expecting unrealistic returns which he claims is why he set up his fraud."   And though surely Madoff's victims may not speak in one voice on these matters, I suspect many are open to a vision of "justice ... much more extensive than the incarceration," but are concerned that they have not seen any other form of extensive justice achieved here (though a whole lot of assets have been recovered after a decade of work).  Madoff not only committed arguably the worst white-collar offense in US history, but it seems he has not really done all that much to try to make amends.

Though I may be getting too nitpicky here, I wanted to comment on this piece because I found one particular sentence to be particularly disturbing: "The truth is, there is only a small number of entirely “sympathetic” people in prisons who could be released without any scruples by the public or affront to their victims."  The truth is, there are tens of thousands, probably hundreds of thousands, of entirely "sympathetic" people in US prisons who could be released without any scruples by the public or affront to their victims.  Just a quick look at "The Whole Pie" of incarceration shows over 275,000 persons imprisoned for drug offenses and another 200,000 in for "public order" offenses.  Not all of these the underlying crimes were victimless, but even if only one of every ten of these prisoners are "sympathetic," that still gets us to nearly 50,000 sympathetic prisons to consider for release.  Mass incarceration is so very troubling in part because there really are quite a large number of sympathetic cases, and I am particularly eager for there to be continued efforts to give voice to, and get relief for, the huge number of sympathetic folks wasting time (and taxpayer resources) in unduly lengthy prison terms.

This piece rightly notes "there are 200,000 people over the age of 55 incarcerated in the United States" and it is rightly concerned that "compassionate release for Mr. Madoff affects not only him but these others and their victims as well."  But these data and my fears tethered to Madoff's failure to demonstrate remorse run the argument the other way in my view: though I hope there would not be a backlash were Madoff to receive compassionate relief, I worry he could become the poster child for restricting this important relief mechanism for tens of thousands of other prisoners who would seem a lot more sympathetic.  That said, I do like imagining a (realistic?) future in which a decision to release Madoff prompts many more federal judges to grant compassionate release to many more federal prisoners.

Prior related post:

Terminally ill, Bernie Madoff is latest high-profile fraudster to seek compassionate release from federal prison thanks to FIRST STEP Act

from RSSMix.com Mix ID 8247011 https://sentencing.typepad.com/sentencing_law_and_policy/2020/02/spirited-but-somewhat-problematic-advocacy-for-bernie-madoff-to-receive-compassionate-relief.html via http://www.rssmix.com/

[bnvupdates]

How White-Collar Crime Affects More Than Just the Criminals

White collar crime prosecution has become a focus on many law enforcement agencies recently, especially since the recession and housing market collapse highlighted how pervasive and damaging this problem can be. White collar crime refers to any type of nonviolent and financially motivated crime, often committed by government and business professionals. These crimes can have a widespread impact, affecting more than just the perpetrators. Here’s a look at how much further the damage of white-collar crimes can spread.

Higher Prices for Consumers

When a business suffers fraud of any kind, it makes up for this loss by increasing costs. This means higher prices for consumers. Consumers may pay higher prices in many ways, including higher government taxes, consumer goods prices, and insurance costs.

The FBI estimates that property crimes — including burglary, arson, car theft, and larceny theft, result in $14 billion in loses each year. White collar crime, on the other hand, costs between $300 and $600 billion per year, according to the American Association of Certified Fraud Examiners and the FBI.

Because white collar crime can affect everything from security and commodities to insurance, the impact on society and consumers is great. Financial fraud is responsible for higher insurance premiums and substantial law enforcement and prosecution costs across the country.

Financial Crimes Can Devastate a Business

All it takes is a single bad employee or associate to devastate a business. Business owners can struggle to overcome a single instance of white collar crime and face loss of profits, potential legal issues and fines, as well as a destroyed reputation.

Criminals don’t just target large corporations, small businesses can be targeted and even brought under. Even the most profitable businesses have been brought down due to a reckless employee or financial advisor.

Investors Are Affected by White Collar Crime

Sometimes investors are targeted directly for white collar crime. The most common form of this is high yield investment fraud, which advertises a low-risk investment with guaranteed high returns. The Ponzi scheme and Pyramid scheme are two common examples of investor fraud, but other examples include commodities fraud, hedge fund fraud, broker embezzlement, late-day trading, and foreign exchange fraud. At the end of 2008, the FBI was investigating more than 1,200 cases of securities and commodities fraud, with 296 recorded convictions.

Investors are also affected by white collar crime in a broader sense. Financial crimes can cause investors to lose confidence in the market or specific sectors. Investors who back companies may find themselves unable to pay off loans. Institutional investors can be successful after working with a financial fraud attorney and seeking prosecution, but small investors are also hurt by crime and may not have the same advantage.

It’s difficult to quantify the many ways in which consumers, business owners, and investors are impacted by white collar crime but one thing is certain: white collar crime isn’t victimless. Everyone suffers when criminals commit financial crimes against businesses and the government.

  __________ Author: Eileen O’Shanassy is a freelance writer and blogger based out of Flagstaff, AZ. She writes on a variety of topics and loves to research and write. She enjoys baking, biking, and kayaking. Check out her Twitter @eileenoshanassy. 

from http://ift.tt/2gpoQI6

[loyallogic]

The Nigerian ‘419’ Scam: An Economic Crime

This article is written by Diganth Raj Sehgal, Student, School of Law, Christ University, Bangalore. The author in this article discusses the concept of Economic Crime and also analyses the Nigerian ‘419’ Scam in detail.

What is Economic Crime?

An Economic Crime, often also referred to as white collar crime, is any illegal act committed by any individual or a group of individuals to obtain a financial or professional advantage. In such crimes, the offender’s principal motive is economic/financial gain which also means that the victims in such crimes incur an economic cost. Victims may include individuals, corporations, governments, and entire economies. But apart from such crimes, there are ‘victimless crimes’ too, which means that unlike in traditional crimes, these do not harm anyone physically or personally but they have severe economic implications which make it an act against the society.

The offences of smuggling of narcotic substances, counterfeiting of currency and valuable securities, financial scams, frauds, money laundering and hawala transactions etc. evoke serious concern about their impact on the national security. Financial crimes committed by banks, money laundering, illicit capital heavens, crimes committed by public officials (like bribery, embezzlement, traffic of influences, etc.) among many others are the examples of Economic Crimes.

Economic offences not only inflict pecuniary losses on individuals but also damage the national economy and have security implications as well. It adversely affects the growth and development of the nation. Internationally, it diminishes the confidence in the financial credibility and stability of the nation, thus weakening the competitiveness of such nation at the international level and further, making the country unattractive for investments from within as well as outside the country.

Where there is a high occurrence of economic crime, the government and its officials are also viewed as being corrupt and weak. Some of the major impacts on the national economy that may be caused by economic crimes are:  

Increase in inflationary pressure

Uneven distribution of resources and creation of elitism

Marginalisation of tax base

Generation of abundant black money

Creation of parallel economy

Such an economy becomes a breeding ground for corruption, the illicit businesses thrive and legitimate businesses are negatively affected. This also inhibits any form of developmental measures. Resources of financial and commercial institutions which can be utilized optimally to grow and develop an economy are diverted and distorted, weakening the morale and commitment of and to the citizens of the nation, the poor population continue to be at risk,  country’s economic equilibrium remains to be at stake.

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The Nigerian ‘419’ Scam

The Nigerian ‘419’ scam, also known as the Nigerian Prince scam, the Spanish Prisoner scam, or the Black Money scam is actually a series of scams involving a person overseas offering a share in a large sum of money (hereinafter referred to as the scammer) to someone (hereinafter referred to as the victim) or a payment on the condition that the victim will help them, i.e. the scammer to transfer money out of their country. These scams are often known as ‘Nigerian 419’ scams because the first wave of the scam started from Nigeria. The ‘419’ part of the name comes from the section of Nigeria’s Criminal Code which outlaws this practice.

While Nigeria is most often the nation referred to in these scams, these scams originated in other nations as well. In 2006, 61% of such internet criminals were traced to locations in the United States, while 16% were traced to the United Kingdom, and 6% to Nigeria.  Other nations known to have a high incidence of such advance-fee frauds include Ivory Coast, Togo, South Africa, the Netherlands, and Spain.

How does the scam take place?

The scammer usually contacts the victim at random by means of an email, letter, and text message or through any other form of social media. The scammer then tells an elaborate story about large amounts of money belonging to him/her trapped in banks or other investments during events such as civil wars or coups, and are in countries that are currently in the limelight due to one reason or another. Another line of the plot may be that the scammer has or is about to acquire a large inheritance that is ‘difficult to access’ because of government restrictions or taxes in his/her country. The scammer then offers the victim a large sum of money to help him/her transfer his/her personal fortune out of the country.

Scammers may also ask for the victim’s bank account details to ‘help him/her transfer the money’ and use this information to later steal their funds. Or the scammer may ask the victim to pay fees, charges or taxes to ‘help release or transfer the money out of the country’ through the victim’s bank. These fees usually start out as quite small amounts of money and if they are paid, the scammer might make up new fees that require payment before the victim can receive his/her ‘reward’. The demand for money keeps increasing as long as the victims are willing to be a part of it. Nevertheless, the victim is never sent the money that was promised.

In reality, the large sums of money or the inheritance do not exist, and the victim eventually ends up with nothing but loss. Once the victim stops sending money, the scammers use the personal information and cheques that they received from the victims to impersonate the victim, draining bank accounts and credit card balances. Though such an invitation may seem to most people a hoax, millions of dollars in losses are caused by these schemes annually. Some victims have even been lured to Nigeria and imprisoned against their will along with losing large sums of money.

What type of a scam is Nigerian ‘419’ scam?

The Nigerian ‘419’ scam is an advance fee scheme which occurs when the victim pays money to someone in anticipation of receiving something of greater value, such as a loan, contract, investment, or gift and then receives little or nothing in return. An advance-fee scam is a form of fraud and one of the most common types of confidence trick. The scam typically involves promising the victim a significant share of a large sum of money, in return for a small up-front payment, which the fraudster requires in order to obtain the large sum. If a victim makes the payment, the fraudster either invents a series of further fees for the victim or simply disappears.

There are a variety of advance fee schemes which may involve the sale of products or services, the offering of investments, lottery winnings, ‘found’ money, or many other opportunities. Some scammers offer to find financing arrangements for their clients who pay a ‘finder’s fee’ in advance. They require their clients to sign contracts in which they agree to pay the fee when they are introduced to the financing source. Victims often learn that the scammer is ineligible for financing and does not have or can arrange the money only after they have paid the ‘finder’ i.e. the scammer according to the contract. Such agreements may be legally enforced unless it can be shown that the ‘finder’ never had the intention or the ability to provide financing for the victims.

Legal Aspects of the Nigerian ‘419’ Scam

The Criminal Code Act of Nigeria under section 419 denotes the offence of obtaining the property of another person by false pretences or fraudulent conduct. This section criminalises the offence in the Southern part of Nigerian. The offence is criminalised under the Criminal Code Act, Section 1 of the Advance Fee Fraud and other Fraud Related Offences Act 2006. The Nigerian government is not sympathetic to victims of these schemes since the victim actually conspires to remove funds from Nigeria in a manner that is contrary to Nigerian law. This means that when the victim promises to move the ‘non-existent’ money which as per the knowledge of the victim is actually existing or intends to pay charges or taxes or the scammer, the victim violates the Nigerian laws and so, has no compensation or recourse under these laws.

The offence is said to be committed “when any person by any false pretence and with intent to defraud obtains from any person whether in or outside Nigeria for himself or for some other person; or induces a person whether in or outside Nigeria to deliver to any person; or obtains any property whether or not the delivery of the property is induced through the medium of a contract, induced by the false pretence.”

The offence is also committed when a person induces a person whether in or outside Nigeria to confer a benefit on him or on some other person on the understanding that such benefit has been or would be paid for. The offence of obtaining monetary advantages by false pretence denotes the offence of knowingly obtaining someone’s property by misrepresenting a fact with the intent to defraud that person.

The courts have stated that; in order for a person to be convicted for the offence of fraud and misrepresentation coupled with false pretence, it is necessary for the prosecution to prove to the satisfaction of the court i.e. beyond reasonable doubt that there was some wrongful statement as to an existing fact made by the accused person that is the alleged scammer, that such a statement which was made was false and false to the knowledge of the accused and that it acted on the mind of the person who parted with the money i.e. the victim and that the proceedings on the part of the accused were fraudulent. The only meaning of the statement was the intent to defraud.

Through cases, the following elements of the offence can be identified-

    That there was a pretence;

    That the pretence emanated from the accused person i.e. the scammer

    That the pretence was false;

    That the accused knew of the falsity of the pretence, i.e. he did not believe it to be          true

    That there was an intention to defraud

    That the property or thing is capable of being stolen

    That the accused induced the owner to transfer his/her whole interest in the property.

‘Pretence’ is this context refers to the misstatement or misrepresentation of facts with the intent to defraud the complainant, the accused person must have made a statement (either orally or in writing) which was false and he must have known it to be false. A conviction for this offence cannot be sustained if the complainant is not shown to have been ‘induced’ to part with his property based on the pretence of the accused person. The elements of the offence must be fully established before a court of law would convict a person of obtaining by false pretences.

The punishment for the offence under Section 419 of the Criminal Code Act is 3 years imprisonment, but where the value of the property is one thousand nairas (1 naira is equivalent to 19 paise) or above. Under the Advance Fee Fraud Act, the offence is punishable with not less than seven years and not more than twenty years imprisonment.

Conclusion

The Nigerian ‘419’ Scam is a wide-spread large scale scam which can be encountered with any time, anywhere and by anybody. Though this scam started off in Nigeria, it a global problem today and anybody with access to the internet and any form of social media is fully capable to be the catalyst of such scams.

Unlike conventional individual scams, this scam inherently is a series of scams due to its capacity of being a cyber scam and the wide reach of the internet. The amount of money lost in such scams is huge and is affecting economies negatively at a global level.

Though individual countries have their own legislation to deal with these issues, the wide reach of the internet makes cybersecurity a global issue which should be tackled in a joint effort by the countries. This is the only possible long term solution to stop such scams from taking place. An important measure apart from this would be to make people aware of such scams. The more people know about it, the lesser is the chance of anyone being caught up in such scams.

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