Financial Fraud: 5 Common Categories to ConsiderPosted by Dencker Henry on May 17th, 2021 When it really is witnessed, one may think that it's an easy task to report financial fraud. However, there are some obstacles that prevent folks from blowing the whistle. Chief among these is the concern with losing one's job, as they believe their occupation will undoubtedly be in jeopardy if they shed light on fraud within their workplace. Thus, they are more likely to keep quiet, ignoring the problem entirely. However, there exist attorneys that are not only able to serve the public but do so in confidential fashion, yielding results that ensure justice is served. Concerning fraud of any nature, information is paramount. It's important for a potential whistleblower to learn about the types of financial fraud so that they will have a better understanding of what to look out for. This information will be nothing short of useful, providing whistleblowers with an increase of incentive to step forward and report what they know. Additionally it is worth noting that, by stepping forward with critical information, whistleblowers may be entitled to compensation. To begin with, here are 5 common types of financial fraud to consider. Phishing: One of the first forms of financial fraud to consider is phishing. While this is applied to most forms of fraud, generally speaking, it really is done by those that are looking to make a profit at another person's expense. Phishing is generally thought as the act of sending emails, under the fake guise of an established company, to others. Generally, these emails prompt users to reveal their personal information, including real names, addresses, social security numbers, and credit card details. When a person receives a contact that appears suspicious, especially with grammatical errors or unofficial email addresses, it?s probably an attempted phishing scam. Skimming: Next, let us discuss skimming, which is when charge card information is stolen during a transaction. Those that attempt this type of financial fraud use card-reading devices that store information once cards are swiped. Understand that this is uncommon at big-box retailers such as for example Target and Walmart, because they have more reputable card reading systems in place. Instead, it is committed by individual sellers that insist upon customers paying via credit or debit card. Their technology is comparatively less reliable for customers. This is yet another reason why the public should know how to report financial fraud, as virtually anyone can become a victim of skimming. Pyramid Schemes: One of the most common types of financial fraud are pyramid schemes, which involve investors recruiting others for the expressed goal of making money. This goal alone helps it be enticing for others to become investors, though this multi-level scheme rarely benefits anyone apart from those that formed it. Additionally, it is seen as a crime, since it's illegal in several states, New York included. In order to avoid becoming involved in a pyramid scheme, research the business being represented as thoroughly as you possibly can. Determine how reputable they are based on your findings. By doing so, you will be less likely to become involved in this type of fraud. Pump and Dump: This is a type of fraud that entails the usage of false or misleading information to improve the cost of stock. Pump and dump schemes allows stockholders to sell what they will have when it's at its highest value, which constitutes fraud. In addition, these cases have grown to be incredibly well-known, especially in pop culture. "The Wolf of Wall Street" is an example of a film where this form of fraud is really a critical narrative point. Make no mistake, however, as pump and dump schemes are completely real. If you're aware of a pump and dump scheme, as an employee or sales representative, you might wish to report financial company fraud . Tax Evasion: Defined as the deliberate withholding of tax payments, tax evasion has become the common types of financial fraud. When a person intentionally does not pay their taxes, they're in violation of the inner Revenue Service. Tax evasion can be done in different ways, too. For example, one may commit this felony by underreporting what they have made regarding income, the sole purpose being to pay less in taxes. It is also done by individuals and businesses, that makes it even more commonplace. As any whistleblower attorney can attest, intentionally withholding tax money can lead to substantial fines and, at worst, jail time. As stated earlier, you can find whistleblower attorneys that will help individuals blow the whistle on financial fraud. Regardless of what a particular kind of fraud entails, whistleblowers can rest easy realizing that their information and identity will undoubtedly be kept confidential. Are you aware of fraud in the financial services industry? For an improved understanding of you skill to make a difference, talk with an experienced attorney in your town.Like it? Share it! More by this author |