Articles Posted in Fraud

Chicago_Stock_Exchange_7405590890-300x193The complexity of the securities and commodities fraud case list means that the legislation must be written in such a way as to encapsulate all the various forms of criminality that are involved. Typically, this means that there are many agencies that support the work of the prosecutor even if they are not directly involved in handling the criminal case (see the Lindstrom case). For example; there is almost always a civil aspect of the case management that focuses on recovering some of the lost funds in order to compensate the victims. For purposes of clarity and consistency, the courts have tended to separate the criminal from the civil aspects of the prosecution.

The other important consideration is the systemic malaise that is associated with securities and commodities fraud. These are some of the most important platforms for handling large scale trade. That means that vast sums of money are exchanged, sometimes relying on individual investors who sink in their life savings. It is therefore abhorrent to the courts that public confidence would be undermined by fraudsters who use the product in order to access their victims. That is why in some cases the punishments for this type of crime have appeared to be harsh. The courts are particularly concerned to ensure that the perpetrators do not get away with large stacks of cash when the victims are left to rely on the small comfort of a successful criminal prosecution.

Investor Agents with No Qualifications and Bad Intentions

les-anderson-207333-300x196The pyramid scheme has become one of the favorite conduits for confidence fraudsters to make illicit money on a grand scale. That is why organizations like the Federal Trade Commission were set up to fight this type of crime. Chicago, like many parts of the USA, is not immune to this scourge. For the defense attorney, pyramid scheme cases in Chicago present unique challenges which, although difficult, are not insurmountable. The fraudsters are always coming up with new ways to mask their true intentions and hoodwink an unsuspecting public. A case in point are the chain letters that ask for group contributions. There will be some people at the top who have the highest culpability as the masterminds of a criminal enterprise. The middlemen and middle women will have a range of roles that may determine their level of culpability once before the court.

The Criminality of Recruiting Unsuspecting Victims

The pyramid scheme may be deemed a form of confidence fraud because it promises that which is impossible to deliver. Like the Ponzi scheme, it is marketed on the basis of profit levels that are just not sustainable. The crime therefore reduces public confidence not only in the judicial system but also in the other structures that are designed for societal functionality, like the economic system. The requirement may not necessarily be monetary. Sometimes it is a call for your time or expertise in a particular field. Therefore, the crime focuses on the implicit deceit rather than merely restricting the jurisdiction to money alone.

bruno-nascimento-113628-300x199The victims of money laundering are not just those that lose the funds but also those that are used in disposing of it. This much is made clear by the provisions of legislative instrument number 720 ILCS 5/29B-1 of Chicago. It is not uncommon for family members to be unwittingly roped into fraudulent schemes based on their love for a son or daughter. The attorney that is handling such cases can expect a significant involvement in the investigative process. The discovery alone is bound to be a real challenge. The definition of the crime includes any act that seeks to hide the source of illegally acquired funds. The most sophisticated version of the crime involves “washing” dirty money by making it appear to be legitimate.

This is a crime that is prosecutable at both the state and federal level depending on the circumstances and the charges that are preferred by the prosecutor. The defending attorneys must be well versed in all the rules of the financial system. The defendant may have a very sophisticated web of information and tactics that make an investigation difficult. They may even lie to their lawyer in order to save face. That is why the services of an experienced counsel can be invaluable in cases such as this.

How to Untangle the Ingredients that Constitute the Crime

Gov-us_passportTo the uninitiated, forgery in Chicago seems like a straightforward case. However, a closer examination of the law indicates that it is every bit as complicated as any constitutional issue that you can imagine. The fact that this law affects a large number of ordinary folks means that it is an important area for a defense attorney to be aware of. Certainly a lot of expertise and experience is required in order to successfully defend such cases. The consequences of failing to mount a successful defense can be serious, leading to between two and five years in custody (see Thomas M. Bartholomew for sentencing guidelines). On the other hand, a conviction is effectively an indicator of fraud and that could ruin career prospects in much more serious ways than even a murder conviction.

A Long Investigative Process

Normally forgery cases in Chicago will require a thorough investigation because the expectation from the police is that the typical defendant in these cases is highly sophisticated. To be fair, some forgeries are straightforward cases of misguided ambition. Examples include an altered bus pass or rail ticket. By contrast, there are some forgeries that have multiple layers, involving serious corporate fraud and other related consequences. The court will consider the chain of events from the first forgery to the eventual consequences on the victims when dealing with each case, particularly with regards to sentencing. Hiring a good defense attorney is essential, particularly when complex technicalities are highlighted and contested.

800px-USMC-05469Credit card fraud is becoming the crime of choice for offenders in Chicago who are not particularly inclined to violence. If undetected, the crime can be staggeringly lucrative and often does not carry the stigma of outright theft, sexual depravity, or violence. It is tempting to cast credit card fraudsters as low-level miscreants who do not deserve the worst approbation of society. However this is not a victimless crime, as residents of Minooka will testify. The South West side of Chicago seems to have developed a particularly affinity for this specific economic crime. Although the law enforcement agencies have already sent out the alarm to the local population; they are not clear about what exactly causes this locality to have a higher than usual propensity for the crime.

The fraud will take a number of forms which are increasing in their complexity and scope. For example some people engage in identity fraud and impersonation. Unsuspecting victims will only realize that they have been caught in the web when they are sent a bill for goods and services that they never purchased. The fraudster will have used the victim’s identity in order to make a fraudulent application for a credit line and will proceed onto an expansive spending spree. At other times the perpetrator is far more subtle; getting the details of the card and using it to make online purchases. When the card is physically stolen, most victims will make a police report, but hardly anything ever comes out of that process because of the difficulty of tracing the culprits and the relatively low individual amounts that are involved in each incident of credit card fraud.

It is a Systemic and Structural Issue

DSC04156-BThe state and definition of counterfeiting laws will tell you a lot about the community in which they are designed and implemented. Illinois is no exception. The state has a set of complex and situational rules relating to counterfeiting and forgery; a true Pandora’s Box for a diligent attorney. For the most part, the law seems to target those who create forged money, but there are many other forms of falsification that are captured by the legislation. A person is guilty of a crime in Illinois when he or she creates or uses written documents that have been falsified or altered in significant ways. In this case the constituent ingredients of the crime can encompass both the making of forged/altered documents as well as possessing them with the intention of using them for illegal purposes.

A Counterfeiting Law for the New Age

As criminals in this area have become more sophisticated in their modus operandi, the law has been forced to play catch-up. For example it recognized the use of false documents for defrauding in which possession is disputed as well as the effects of subtle alteration using digital means (720 Ill. Comp. Stat. § 5/17-3). The classic case is that of a forged check that is successfully cashed by a third party because the signature on it appears to be authentic to the recipient bank regardless of whether or not the account holder actually gave permission for that cheque to be paid. The elderly and those with disabilities are particularly vulnerable to this type of fraud. As the case made it through the courts, it became a gradually-established norm that the instrument used to defraud must be credible to an ordinary reasonable person. Hence where the forgery is almost comical in its design and presentation, the user may be able to escape a criminal charge.

file9961246478372The highest courts in the USA have considered this question and apparently found that to some extent the answer is no. Specifically, the higher courts objected to some of the provisions as they relate to identity theft and the constitutional rights of defendants. The Illinois Supreme Court consequently overturned a key provision of the state identity theft statute. The key contention was that this provision was effectively criminalizing conduct that would otherwise not be considered to be criminal. The case in question involved a Google search in where there was no evidence of criminal intent.  The internet has opened up so many opportunities but also a series of legal nightmares for the profession, particularly with regards to the world of social media, which seems to require laws unto itself. Consequently, there is a genuine fear about the escalating practice of identity theft. The state legislators felt that they had to act even at the expense of civil liberties.

Overkill in Regulating Internet Activity

As is often the case in legal cases, the cure can be as painful as the disease. The innocent end up suffering at the hands of lawmakers who are not as comfortable with new media as they ought to be. The temptation is to ban everything or alternatively to give room for suing over nothing. In the People v Madrigal, No 110194, 2011 WL 1074427 (Ill Sup Ct), the defendant successfully convinced the Illinois Supreme court that the law had become an unfair burden. Specifically, section 16G-15(a) (7) of the Identity Theft Law (720 ILCS 5/16G–1 et seq.) indicated that a criminal offense occurs if a person uses the identity of another in order to gain access to information online without the permission of the person whose identity is being used. The act is clear enough when it comes to criminal activity that involves overstepping identity verification procedures through impersonation in order to commit a crime. However the position is less clear if no criminal purpose is intended.

credit card
A combination of two ultimate fraud charges, identity theft and counterfeiting, resulted in a major potential felony bomb threat at the Midway Airport. All of these elements came to light when a Chicago woman attempted to smuggle counterfeit and stolen credit/debit cards out of the state, and ended up as what the authorities thought was a bomb threat. See DNAinfo Chicago.

The Identity Theft Incident, Now a Major Crime

Prior to 1998, identity theft was not considered a major crime. Identity theft and identity fraud is pretty much the same thing. This is a crime where one person obtains and uses the personal information of a victim to advance his or her own personal gain. The personal information used, such as birth date, social security number, etc., allows the perpetrator to pose as the victim for the purpose of obtaining a loan, buying merchandise or obtaining credit in the victim’s name. This fraud has far reaching consequences for the victim, because once the identity has been used, to run up credit debt, or for criminal activity, they will have major problems in trying to restore their good name.

Illinois takes all types of fraud seriously, and if you are being charged with credit card fraud, you may be facing a lengthy jail sentence. It is important to understand just what credit card fraud is and what to do if you are charged with that crime.

What is Credit Card Fraud in Illinois?

Under Illinois law, there are several crimes that are considered credit card fraud, including: