Bank fraud is a criminal act in which a person:
[K]nowingly executes, or attempts to execute, a scheme or artifice—
(1) to defraud a financial institution; or
(2) to obtain any of the moneys, funds, credits, assets, securities, or other property owned by, or under the custody or control of, a financial institution, by means of false or fraudulent pretenses, representations, or promises[.]
The federal bank fraud statute, 18 U.S.C. section 1344, carries a penalty of up to 30 years in federal prison and a fine of up to $1 million for each charge.
The scope of the federal bank fraud law is broad and there are a variety of types of bank fraud that can occur, including:
Providing any false financial information, orally or in writing, to banks can also be considered bank fraud and can carry serious consequences, so long as the information was capable of influencing the bank’s credit decision. This applies to mortgage and loan applications, and can also apply to credit card applications.
Because most credit card companies are tied to federal banking institutions, it can be considered bank fraud to obtain a credit card through deception, such as by lying about income or employment on a credit card application. However, charges like these are rare because the federal government would usually rather spend its time prosecuting more serious offenders.
Lying on a credit card application may be tempting because credit card companies rarely require you to provide pay stubs, W2s, or tax returns to prove your income like loan providers typically require. However, what seems like a small fib about income can have serious legal consequences in rare situations in which the government decides to prosecute, which usually involve a significant financial loss for financial institutions.
Bank fraud can carry serious penalties because it is a type of crime that affects the nation’s financial institutions. In order to be convicted, the government must prove that the accused willingly and knowingly committed the fraudulent action. If you are facing federal bank fraud charges, you will need a criminal defense attorney who has experience handling federal white collar crimes.