Bank Fraud Crimes At The State And Federal Levels In Texas

When we think of “bank fraud” we may think of sophisticated white collar criminals stealing thousands or millions from banks through high-tech schemes. In reality, though, bank fraud can be far less complicated – and more common – than that.

Bank fraud occurs when a person (or group) fraudulently attempts to obtain money or property from a financial institution. When the transaction is carried out using false pretenses, misrepresentations of essential facts, or other dishonest methods, a person can potentially be charged with multiple crimes, including bank fraud.

Some examples of conduct falling within the category of bank fraud can include:

• Falsifying information on a loan application;
• Purposefully misstating income and/or assets on applications for loans, credit, or other financial services;
• Issuing checks with the knowledge that funds aren’t available to cover them and the recipient will be defrauded (also known as “check kiting”);
• Embezzlement or misdirection of funds by a bank employee (unlawfully taking the institutions funds or property for their own personal gain);
• Purposefully approving loans to borrowers that don’t meet application standards (often with some sort of “kickback” involved).

Bank fraud under Texas law can be charged as a misdemeanor or felony, based on the amount allegedly taken and the circumstances of the alleged crime. The penalties involved reflect whether a misdemeanor or felony is charged. Misdemeanor charges of fraud against a financial institution can carry fines of up to $4,000 and up to a year in jail. Felony convictions can bring up to 10 years in prison and $10,000 in fines as well as any restitution that may be ordered by a court.

Bank fraud may also be a Federal offense if the bank involved a FDIC-insured institution. The Federal charges can be brought under 18 U.S.C. Sec. 1344, and include penalties up to 30 years in prison, and up to $1 million in fines.

Conviction of bank fraud under Federal or State charge includes a risk not only of jail time but of serious career-damaging harm to a person’s reputation. Anyone charged with bank fraud must present a strong defense from Day One, ideally with the assistance of a skilled Texas criminal defense attorney.

Potential Defenses to Bank Fraud Allegations

A person charged with fraud against a bank or other financial institution does have several potential defenses available, based on the circumstances:

• Lack of Knowledge. Prosecutors must show the defendant “knowingly” carried out (or attempted) a “scheme to defraud”. In other words, there must have been some formulated plan to submit falsified information and obtain funds that were not deserved.

• Lack of a Material Fact. A “material fact” is something that a reasonable person would rely on to make their decision – especially a financial decision regarding the issuance of loans or credit. Details about income or assets showing ability to pay back a loan, for example, are material facts. Certain clerical errors or mistakes might not rise to the level of a “material fact”, however.

• Lack of Intent to Defraud, or Intent to Cause Loss or Injury. When it comes to financial information, mistakes can cause harm or financial loss to other people and institutions. Perhaps this makes a person liable under some other criminal charge. To prove fraud, however, prosecutors must demonstrate intent to defraud another. A defendant may be able to counter these allegations with documentation or testimony showing some kind of mistake, but not fraud.

When to Call a Texas Criminal Defense Attorney

When faced with an investigation or criminal charges of bank fraud, a person absolutely cannot settle for less when it comes to building a legal defense. The risks are too great. At Keith B. French Law, we know how to handle fraud defense on even the most serious charges. If a defendant’s side of the story is not properly told, they could face serious consequences and penalties. Contact our Pearland criminal defense lawyers today.

Source:

statutes.capitol.texas.gov/Docs/PE/htm/PE.32.htm