Understanding Fraud Law in the US

Fraud is a serious crime in the US and federal law defines it as any intentional deception or misrepresentation used for personal gain or benefit another person. Learn more about fraud law in US.

Understanding Fraud Law in the US

Fraud is a serious crime in the United States, and federal law defines it as any intentional deception or misrepresentation that is used for personal gain or to benefit another person. The federal government, through its prosecutors in the United States Attorney's Office, has criminalized several types of fraud specifically identified in federal laws. These laws identify specific types of fraud crimes, each of which has associated penalties. The list of crimes presented here is by no means exhaustive; there is a wide range of federal and state fraud crimes. An official website of the United States government, USA.gov, belongs to an official government organization in the United States. This chapter contains an analysis of federal laws that can be used to investigate and prosecute various frauds against the government, including 18 U.

S. states. The Department's policy is not to charge a Section 1001 violation in situations where a suspect, during an investigation, merely denies guilt in response to a government interrogation. However, this policy should be interpreted restrictively; affirmative, discursive, and voluntary statements to federal criminal investigators would not fall within the policy.

In addition, certain false answers to the questions proposed for administrative purposes (for example, tax returns) may be prosecuted under Section 1001. It is not necessary to consult with the Criminal Division before initiating proceedings for false statements to federal investigators; however, the Fraud Section is available for inquiries on cases related to these principles. The Department's policy is that, in cases where charges are normally filed in accordance with the most specific law. In cases where there are special aggravating circumstances, the United States reserves the discretionary power to prosecute a more serious violation of general law. In August 1982, the Attorney General and the Secretary of Defense created the Defense Procurement Fraud Unit in the Fraud Section of the Criminal Division to help concentrate and coordinate the Department of Defense's police resources in the prosecution of significant cases of fraud in acquisitions related to the multimillion-dollar acquisition of equipment and services by the Department of Defense (DOD). That unit is now called the Federal Procurement Fraud Unit (Unit) and deals with a variety of fraud cases affecting both civil and defense agency acquisitions, including cases of product replacement, false testing, incorrect cost collection, defective pricing and bribery cases. In addition to carrying out important procurement investigations, the Unit provides expertise and guidance on procurement fraud issues to United States investigative agencies and prosecutors that request their assistance.

In July 1986, the Department of Defense began its Voluntary Disclosure Program, which is designed to encourage self-surveillance and voluntary disclosure by defense contractors of issues related to acquisitions. The Federal Procurement Fraud Unit (Unit) of the Fraud Section is the Department of Justice's point of contact for overseeing voluntary disclosure issues. The Department of Justice is solely responsible for initiating or refusing prosecution. Before making any decision to prosecute or deny prosecution of a volunteer company, offices of the United States Attorney will notify the Unit (provide a summary of evidence, proposed theories of criminal liability, and charges proposed in case) and obtain its consent. In 1986, Congress amended the False Claims Act (31 U. C.), one of whose objectives was to encourage citizens to bring lawsuits on behalf of the United States for alleged fraud against the government as private attorneys general.

When U. prosecutors receive information about immediate action they should promptly send a copy of complaint and statement of evidence to Commercial Litigation Branch of Civil Division, particularly because rapporteurs frequently fail to notify Attorney General or are late in doing so. The Commercial Litigation Branch will contact agency involved, Criminal Division and frequently agency's Inspector General to determine if they are aware complaints and obtain evaluation material evidence presented by rapporteur. The Criminal Division will consult with offices United States Attorney (USAO) and appropriate investigative agencies to determine if complaints relate to pending criminal investigation. Given 60-day deadline it should be emphasized that rapid response these inquiries is required. A potential problem area related practice negotiating plea guilt has been identified respect administrative sanctions available Health Care Financing Administration United States Department Health Human Services (HHS) cases fraud between Medicare Medicaid. Since administrative sanction generally applies after any criminal proceeding plea agreements that include commitment waive or restrict administrative remedies which HHS may choose initiate under above-mentioned provisions should be infrequent should only be made after obtaining prior explicit approval from Criminal Division. Time when report will be submitted prosecutor discussed policy statement.

In ordinary investigation involving finalized facts policy statement simply follows Inspector General's legislation requires report whenever there are reasonable reasons that is ongoing crimes reports organized crime require immediate reporting. These urgent sensitive matters often require use sophisticated investigative techniques Inspector General must submit immediate report upon receiving information. Policy statement requires that FBI report appropriate Inspector General when it initiates investigation keep Inspector General regularly informed its progress. SSA has discontinued procedure summarizing each case related one more factors mentioned above recommending that no further action be taken however SSA will continue take administrative steps recover any overpayments cases that do not warrant criminal prosecution matters which factors mentioned above are not present or are not convincing.