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27 Nov 23

Philadelphia Federal Bank Fraud Charges: Investigations and Penalties

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Last Updated on: 10th December 2023, 07:40 pm

Philadelphia Federal Bank Fraud Charges: Investigations and Penalties

Bank fraud charges in Philadelphia can lead to serious criminal penalties. With complex federal investigations and laws, having an experienced white collar criminal defense lawyer is crucial. This article provides an overview of common bank fraud schemes, what triggers federal investigations, potential defenses, and the penalties defendants face if convicted.

Bank Fraud Schemes in Philadelphia

Some of the most common bank frauds charged in the Eastern District of Pennsylvania include:

  • Check kiting – Writing bad checks between bank accounts to temporarily inflate balances. This tricks banks into approving checks or withdrawals that would otherwise bounce.
  • Credit card fraud – Using stolen or fake credit cards to make purchases. Networks of people will provide or encode cards and PINs onto gift cards or debit cards.
  • Mortgage fraud – Falsifying information on mortgage applications like income, assets, occupancy status etc. to get larger loans approved. Foreclosure rescue schemes convince homeowners to sign over title with false promises.
  • Embezzlement – Bank employees or clients stealing money by exploiting their access privileges. Methods range from skimming cash, to diverting wires, to adding fake loans.
  • Identity theft – Using someone else’s personal information to open fraudulent bank accounts or credit cards. Criminals get the info from data breaches, mail theft, or buying it online.
  • ATM skimming – Installing devices on ATM machines that steal debit card numbers and PINs. The data lets thieves clone cards or withdraw cash.

What Triggers a Federal Bank Fraud Investigation?

Bank frauds over $1,000 trigger federal jurisdiction. But most charges involve losses exceeding $100,000. Investigations often start based on:

  • Bank Audits – Internal fraud audits detecting suspicious transactions like unusual wires. External audits catching false reporting.
  • Law Enforcement Tipoffs – Informants providing evidence of fraud schemes. Undercover operations infiltrating theft networks.
  • Whistleblowers – Insider employees reporting frauds they see. They may file civil suits or contact the FBI or SEC.
  • Victim Complaints – Banks, investors, or customers reporting being defrauded. Mortgage lenders seeing red flags may request federal investigations.

Prosecutors often start with lower level conspirators. Then leverage plea bargains for testimony against ring leaders. Parallel civil suits also aid evidence gathering.

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Potential Defenses to Federal Bank Fraud Charges

Viable defenses depend on the specifics of each fraud scheme. But common strategies include:

  • Lack of Intent – Proving the defendant didn’t knowingly attempt fraud. Perhaps they relied on a dishonest employee or made an accounting mistake.
  • Entrapment – Arguing that law enforcement induced the defendant into committing a crime they wouldn’t normally do. This rarely succeeds.
  • Duress – Claiming the defendant only committed fraud under threat of harm. This can reduce culpability.
  • Statute of Limitations – Many federal frauds have a 5 year limit after the crime occurred. But complex schemes may fall outside this window.
  • Jurisdictional Issues – Challenging if bank operations “affected” interstate commerce enough to justify federal charges. Or claiming multi-district venue is improper.

An attorney can also negotiate pretrial diversions to avoid convictions. These involve paying restitution, restrictions like probation, and meeting other requirements.

Penalties if Convicted of Federal Bank Fraud

Maximum bank fraud sentences depend on the specific charges and loss amounts. Common statutes used include:

Prosecutors often stack multiple charges across co-conspirators. Other penalties include:

  • Fines – Up to $1 million per count
  • Restitution – Repaying all losses to victims
  • Forfeiture – Seizure of property obtained illegally
  • Supervised Release – Probation lasting years after prison

Sentences depend heavily on Federal Sentencing Guidelines calculations based on:

  • Loss amounts
  • Number of victims
  • Defendant’s role as leader/organizer
  • Obstruction (perjury, evidence destruction etc.)
  • Criminal history

Even first offenses with plea bargains often result in multi-year prison terms. Getting an experienced federal criminal defense lawyer is critical for investigating defenses and negotiating lesser charges. Be wary of attorneys making unrealistic promises. Reputable lawyers will provide an honest assessment of the case challenges.

With the complex bank fraud laws and severe sentences, anyone facing charges should consult a defense attorney immediately. Thorough pretrial preparation offers the best chance at avoiding convictions or reducing penalties.