Apr. 04 – Fraud Law and You

Fraud is defined as an intentional perversion of truth, or an intentionally false representation of a matter of fact that causes someone to be divested of something valuable to him or her or to give up a legal right without fully understanding the circumstances due to the deception of the defrauder.

In addition to the criminal or legal definition of fraud, there are also several regulatory laws that include precise rules one must follow in order to avoid committing fraud. If one does not follow these rules exactly, one runs the risk of being charged with and convicted of fraud. Federal securities law covers a wide range of possible types of fraud. Fraud isn’t limited to the sale of bunk securities. Securities fraud also involves selling legitimate securities for illegal reasons or purposes. Such laws make “insider trading” a violation of the law. Insider trading is the purchasing or selling of securities of a firm while in possession of material information that has not been generally disclosed in the marketplace.

To show that a fraudulent act has been committed, the deception in question must be connected to “existing fact” and not a case of broken or unfulfilled promises, unless you can show that the person accused of fraud made a promise to do something they knowingly never intended to carry out. Making a promise to do something in the future or simply offering one’s personal or professional opinion does not satisfy the legal requirements for a claim of fraud unless one can show that the opinion in question expressed access to privileged or otherwise extraordinary information that would not be available to a similar party.

There are a great number of federal and state laws that are intended to cover fraud in a several areas. Some of the most common include consumer fraud, corporate fraud, and insurance fraud. Mueller Hillin specializes in Fraud Law in Philadelphia, Atlanta, Houston and Austin.