Fraud Crimes

The information below introduces you to the types of fraud, what prosecutors aim to prove in the matter as well as the penalties you will face if convicted. Analyzed below are the most common fraud cases in California. They include Auto insurance fraud, credit card fraud, and healthcare fraud.

1. Auto-Insurance Fraud

Any actions or activity whose intention is to defraud a car insurance provider amounts to auto-insurance fraud. Various activities define auto-insurance fraud, and different sections of the Penal Code provide how the crimes are to be prosecuted.

Damaging and Abandoning a Car, Penal Code 548

Penal Code 548 penalizes damaging, disposing, or hiding a vehicle insured against damage or loss to make a claim from the insurance provider. Such actions lead to losses incurred by the insurance companies and thus denying them their rights to make a financial gain. The law provides for two exceptions; that you can be held guilty even if your actions did not result in a financial loss or whether the car belongs to another.

The offense attracts a felony charge that is punishable by serving a jail sentence of two, three, or five years and/or paying a fine of up to $50,000. Formal probation is also an option the courts can impose. If you have any auto-insurance priors, you are looking at a two-year sentence enhancement for each conviction.

Fraudulent Claims, Penal Code 550

Fraudulent claims under section 550 (a) (4) PC occur when you seek an insurance claim falsely for a loss incurred due to the theft, damage, or conversion of said vehicle. Further, that you were aware of your false actions when you made a claim with your actions consistent with those of defrauding the insurance provider. Similar to Penal Code 548, you violate this law even if there was no financial loss incurred.

If you are found guilty of the crime, you are looking at a two, three, or five year long jail term. A judge may also require you to pay a fine of up to $50,000 over and above the jail sentencing or as the only penalty for the crime. However, depending on the circumstances of your case, formal probation is a possibility, an alternative to time in prison. Any prior convictions of auto-insurance fraud are punishable with a two-year sentence for each conviction.

Multiple Claims, Penal Code 550

Penal Code 550 penalizes those who present two or more claims for the same loss to defraud the insurance provider. Further, filing a claim with two different car insurance providers for the same loss is also a violation under this section.

Similar to offenses under Penal Codes 548 and 550, any conviction of a multiple claim offense is punishable with a $50,000 fine or double the amount involved in the fraud, whichever is larger. You could face a jail term of two, three, five years in prison or formal probation as alternative sentencing. Further, the judge considers your criminal history. If you have an auto-insurance fraud, you could face a two-year sentencing enhancement for each conviction. However, any prior conviction eliminates the probation option.

Causing an Accident, Penal Code 550

Code 550 (a) (3) penalizes anyone who knowingly caused or participated in a car accident to make fraudulent claims for the accident. In determining your guilt in the matter, the following will have to be substantiated:

• That your actions caused the accident, and
• That the accident will not have occurred had it not been for your actions.

You could face up to two, three, or five years in jail if convicted for causing an accident under Penal Code 550. Further, you may be required to pay up to $50,000 in fines or double the amount, whichever is greater. You can also avoid jail term by serving formal probation if it so directed by the presiding judge.

If you have any felony priors under Code 548 (Damaging and Abandoning a Car) or 550 PC, you could have a two-year sentence enhancement to your conviction. Any priors under Penal Code 550 (a) (3) (Causing an Accident) attracts five years added to your sentencing. You risk a further two years if the victims in the case suffered bodily injury or three or more years for any other person who suffered great bodily injury because of the accident.

False Statements, Penal Code 550

Subsections (b) (1-4) of the Penal Code 550 defines auto-insurance fraud from the following actions:

• Knowingly presenting misleading or false information as part of your claim or opposition to a car insurance claim.
• Knowingly presenting a written or oral statement as part of your insurance claim containing misleading or false information about any material facts.
• Knowingly presenting a writer, an oral statement as part of your claim falsifying that you reside in California while you live elsewhere.

Any successful conviction of presenting false statements in your claim filings are charged as either misdemeanors or felonies. The prosecution will look at the details of the crime, and your criminal history to determine what charges they will prefer. Felony penalties include a possibility of a $50,000 fine and/or a two, three, or five-year jail term. However, if convicted for a misdemeanor offense, you could serve up to one year in jail, pay a fine of up to $10,000, or serve summary probation.

Fraud by Employees or Business Owners, Penal Code 549

Business owners and employees can participate in insurance fraud. If they solicit, accept or refer any business to any employee of the insurance firm with reckless disregard or with the knowledge that the employee intends to commit insurance fraud, they are guilty of committing insurance fraud. Further, any auto repair shop that gets into a profit-sharing agreement or any other contractual terms with an agent, an insurance adjuster, or broker to refer policyholders of the said company to the repair shop is culpable for auto-insurance fraud.

Anyone found guilty under Penal Code 549 can be charged either as a misdemeanor or as a felony. You could spend up to sixteen months, two, or three years in jail for this offense. Further, you may end up paying $50,000 or double the amount in the case, whichever is greater. If misdemeanor charges are brought against you, you could serve summary probation, one year in jail, and/or a fine of no more than $1,000.

If the case was a matter of kickbacks sent to the insurance brokers, agents, or adjusters, the punishments issued are commensurate to the values stated in the case. Any amount to the tune of $950 in the case is a misdemeanor offense punishable with a jail term of no more than six years. Further, you will be required to part with $1,000 in fines. Any kickback whose value is above $950 is punishable with a fine of up to $1,000 and a jail sentence of no more than one year. Any conviction for a felony charge attracts a jail sentence of close to sixteen months, two, or three years with a likelihood of a fine of no more than $10,000.

2. Credit Card Fraud

Credit card fraud is an action whose intention is to use a credit or debit card in a fraudulent manner that causes a loss to another while giving you an undeserved benefit. Such activities include forgery, theft, or counterfeiting. Each fraudulent activity is addressed under a specific law and the penalties provided for such offenses.

Credit card fraud is also prosecutable as a federal offense. If the fraudulent activity is meant to defraud the government, it is committed across state lines, or it involves a governmental entity, you will be held liable for the crimes under the specific federal laws for which your actions violated. Government entities such as the Federal Trade Commission (FTC), the Federal Bureau of Investigations (FBI), and the National Fraud Information Centre (NFIC) work together in fighting credit card fraud. If they flag your activities as fraudulent, you will become a federal offender. You could face up to 20 years in prison with hefty penalties commensurate to the crime.

Stolen Credit/Debit Cards, Penal Code 484e

Any actions that entail transferring, selling, or acquiring another’s credit or debit card, or their debit or credit card information without their consent is a violation of Penal Code 484e. Your intention will be examined whether or not you committed the crime. It also follows that possession of a stolen credit or debit card or debit/credit card information is also punishable under Penal Code 484e.

Prosecutors examine the circumstances in the case to determine the charges they will bring against you. You could face misdemeanor or felony charges. Misdemeanors are punishable by a fine of no more than $1,000 in fines and/or a one-year jail term. Further, the law provides for a fine of up to $10,000 and/or sixteen months, two or three years in jail for a felony charge. You could also serve a probation term of no more than one year.

If you remain in possession of a stolen card with the intent to use, your case is considered as a petty theft offense. You will be required to serve a jail sentence of six months and/or a fine of up to $1,000.

Forging Credit/Debit Card Info, Penal Code 484f

When you knowingly alter the details of a credit or debit card or create one unlawfully, you are committing credit card forgery. Such actions are criminalized under Penal Code 484f. The law further includes creating a fake card as well as signing off someone else’s card without their consent as a forgery.

Penal Code 470, California’s forgery law, provides for penalties for forgery under Penal Code 484f. The law provides that the forgery matter be handled either as a misdemeanor or as a felony. If convicted for misdemeanor charges, you are looking at one year in jail. Felony charges, on the other hand, attract a three-year jail sentence.

Fraudulent use of Information from an Account or a Card, Penal Code 484g

You violate Penal Code 484g if you knowingly use an expired, stolen or revoked card. Further, you might be in trouble if you use a card that has been forged, altered, or is a counterfeit to buy goods or services or obtain money.

The value of the items you receive or the money that you obtained determines the punishment the judge will prefer. If the value of the goods, services, or money exceeds $950 over six-months, you will be charged for grand theft. If the value of the goods, services, or money in the case is below $950, you will be charged for petty theft.

Retailer Credit/Debit Card Fraud, Penal Code 484h

Penal Code 4844h handles fraud cases involving retailers. A retailer violates Code 484h PC when they sell goods or services to another, knowing that the credit or debit card they present is stolen, forged, counterfeit, revoked, or expired. Further, if the retailers knowingly claim payment for goods, services, or money that they did not provide or that the goods’ value is less than the sums charged, they in violation of Penal Code 484h.

Violations of Penal Code 484h are penalized dependent on the value of money, services, or goods, similar to violations of Penal Code 484g. Any sums above $950 are punishable as grand theft while sums below $950 will be treated as petty theft.

Counterfeiting Credit/Debit Cards, Penal Code 484i

Penal Code 484i makes it illegal to:

• Possess a card with incomplete details to complete the missing details without the issuer’s consent. If convicted, you face misdemeanor charges which will require you to pay a $1,000 fine and spend six months in jail.
• Selling credit or debit card making machinery, knowing that the buyer will make counterfeit cards. Conviction of this crime attracts a fine of no more than $1,000 and six months’ jail term if charged for a misdemeanor. Felony charges, on the other hand, are punishable by a $10,000 fine with an accompanying jail sentence of sixteen, two, or three years.
• Make changes to the card’s information and appearance to commit fraud. Any conviction is punishable as a forgery offense with a one-year jail term for a misdemeanor offense and three years in jail for a felony conviction as per Penal Code 470.
• Allow another to modify the card and/or its information. Such an offense is treated as forgery and is punishable under the guidelines of Penal Code 470.

Publishing Credit/Debit Card Information, Penal Code 484j

You violate Penal Code 484j when you publish a card’s information. That is you share (orally, in writing, or electronically) personal identification numbers, bank account information, computer passwords to defraud another or an entity. Violations of Penal Code 484j are punishable as misdemeanor offenses. They attract a jail term of up to six months with a fine of no more than $1,000.

3. Healthcare Fraud

Healthcare fraud is expansive. Various actions are considered fraudulent when they are geared to bill private healthcare providers and the government irregularly. Such activities encompass both the insured and the medical care providers. Here is a look at what constitutes healthcare fraud as per Penal Code 550.

• Submitting claims to a healthcare insurance provider for services not rendered.
• Filing multiple claims for the same service.
• Overcharging or undercharging a healthcare insurance company.
• Preparing any document as supporting evidence to a fraudulent claim.

The prosecution in healthcare fraud cases looks out for your intent and knowledge in the matter as well as the sums involved to build a case against you. You should have knowingly committed the crime and that you intended to defraud the private health insurance providers or the government.

The penalties in healthcare fraud cases are pegged on the sums involved in the case with the benchmark set at $950. Further, if the charges are based on more than a single claim, the value of the fraud in the case will be a total of all individual cases. If the value of the fraud matter is $950 and below, the matter is handled as a misdemeanor. If convicted, you will be required to pay a $1,000 fine and/or spend six months in jail.

If the sum of the claims is above $950, you could face misdemeanor or felony charges. If charged with a misdemeanor, you will be required to pay a fine of $10,000 and/ or spend one year in jail. If convicted for a felony, you may be required to serve a prison sentence of two, three, or five years in jail or serve a one-year prison sentence. A fine of $50,000 will also be imposed or double the sum in the fraud case, whichever is greater.

Professionals owe a legal standard of care to their patients. Any actions that compromise on their service delivery is considered unprofessional. As such, if convicted of healthcare fraud, you risk losing your license through either a suspension or revocation because of actions deemed to be contrary to the dictates of the profession. Doctors and nurses face stiffer penalties. They will be required to face the medical board for disciplinary action. They will have to honor the recommendations of the board, including the suspension of their licenses.

Certain offenses are related to healthcare fraud that are worth examining. They include the following:

• Participating in Medi-Cal fraud. Medi-Cal is a public health program in California meant for low-income earners to access healthcare. If convicted for Medi-Cal fraud, you will face healthcare fraud penalties as well as additional charges for defrauding the Medi-Cal program. The penalties are as dictated in Code 14107 WIC, the Welfare and Institutions Code.
• Aiding, abetting, conspiring, or soliciting in health care fraud.
• Being involved in prescription fraud. In summary, prescription fraud occurs when a patient is getting multiple prescriptions from various doctors or pharmacies. It is referred to as doctor shopping. Prescription fraud also takes the form of doctor issues prescriptions for illegitimate reasons.
• Workers’ compensation fraud occurs when an employer or employee makes fraudulent claims to benefit illegally from the compensation fund. Such claims include cases of employees falsifying their injuries to receive the benefits while employers are falsifying details of their work environment to reduce the premiums they have to part with. Further, any deceitful actions by the healthcare insurance provider to help employees access the compensation benefits amounts to workers compensation fraud.

The criminal system helps curb fraudulent activities that deny others of their entitled benefits. However, the system is not free from the consequences of falsification, malice, and imperfect investigations. Many have suffered life-long adverse effects such as jail terms, fines, and having their criminal record because of the above problems, the system faces. You should not encounter the same consequences. Having an attorney helps prove your innocence in the matter. By carrying out independent investigations, lining up witnesses for your case, and developing legal defenses are some of the services to expect from your attorney. Over and above these services, we provide a free consultation. Get in touch with us today at 408-622-0204 and let us represent you.