Los Angeles Business Fraud Attorney

Understanding Business Fraud: What You Need to Know

Looking at criminal law, fraud is defined as deceiving another for personal gain or with intent to harm an individual or group. It is considered a crime in the United States and can be penalized by extensive fines and time in prison. 

Business fraud refers to the act of intentionally deceiving or manipulating individuals or entities for personal or financial gain within a business context. It involves various fraudulent activities conducted by individuals or groups, targeting organizations, employees, customers, investors, or even the general public.

When it is related to business there many different ways that fraud can be committed. It can come in the form of internal employee fraud, bribery and corruption within a corporation or even false financial documents.

Common Types of Business Fraud You Should Recognize

Below is a list of some of the most common types of fraudulent activity related to the financial aspect of business:

• Embezzlement: One of the most frequent types of fraud, also known as larceny, occurs when an individual utilizes funds within a business for their own personal needs.
• Payoffs: When an employee works a deal with another company to accept cash or other positive benefits in exchange for business. Oftentimes the employee will take the extra cash and take it for their own, costing his or her company extra money for products. This can even be classified as bribery in some cases.
• Skimming: Workers who do not properly record the company's revenue and take cash from receipts that have been filed.
• Internal theft: This occurs when an employee steals assets from a company such as certain supplies or goods. Oftentimes this can be the cause of inventory issues and missing products.