Fraud

Fraud in United States

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Fraud Definition

The unlawful obtaining of another’s property by design, but without criminal intent, and with the assent of the owner obtained by artifice or misrepresentation. Any cunning deception or artifice used to circumvent, cheat, or deceive another. Story, Eq. Jur. § 186. Fraud is sometimes used as a term synonymous with covin, collusion, and deceit, but improperly so. Covin is a secret contrivance between two or more persons to defraud and prejudice another of his rights. Clollusion is an agreement between two or more persons to defraud another under the forms of law, or to accomplish an illegal purpose. Deceit is a fraudulent contrivance by words or acts to deceive a third person, who, relying thereupon, without carelessness or neglect of his own, sustains damage thereby. Co. Litt. 357b; Bac. Abr. Actual or positive fraud includes cases of the intentional and successful employment of any cunning, deception, or artifice, used to circumvent, cheat, or deceive another. 1 Story, Eq. Jur. § 186. Legal or constructive fraud includes such contracts or acts as, though not originating in any actual evil design or contrivance to perpetrate a fraud, yet by their tendency to deceive or mislead others, or to violate private or public confidence, are prohibited by law. Thus, for instance, contracts against some general public policy or fixed artificial policy of the law; cases arising from some peculiar confidential or fiduciary relation between the parties, where advantage is taken of that relation by the person in whom the trust or confidence is reposed, or by third persons; agreements and other acts of parties which operate virtually to delay, defraud, and deceive creditors; purchases of property, with full notice of the legal or equitable title of other persons to the same property (the purchaser becoming, by construction, particeps criminis with the fraudulent grantor) ; and voluntary conveyances of real estate, as affecting the title of subsequent purchasers. 1 Story, Eq. Jur. c. 7.. In the Civil Law. According to the civilians, positive fraud consists in doing one’s self, or causing another to do, such things as induce the opposite party into error, or retain him there. The intention to deceive, which is the characteristic of fraud, is here present; the definition of constructive fraud being the same as at common law. Fraud was also divided into that which has induced the contract, dolus dans causam contractui, and incidental or accidental fraud. The former is that which has been the cause or determining motive of the contract, that without which the party defrauded would not have contracted, when the artifices practised by one of the parties have been such that it is evident that without them the other would not have contracted. Incidental or afccidental fraud is that by which a person, otherwise determined to contract, is deceived on some accessories or incidents of the contract, for example, as to the quality of the object of the contract, or its price, so that he has made a bad bargain. Accidental fraud does not, according to the civilians, avoid the contract, but simply subjects the party to damages. It is otherwise where the fraud has been the determining cause of the contract, qui causam dedit contractui. In that case, the contract is void. Toullier, Dr. Civ. liv. 3, tit. 3, c. 2, note, § 5, note 86 et seq. See, also, 1 Mall. Anal, de la Disc, du Code Civ. pp. 15, 16; Bouv. Inst. Index. In Equity. It is sometimes Inaccurately said that such and such transactions amount to fraud in equity, though not in law; according to the popular notion that the law allows or overlooks certain kinds of fraud which the more conscientious rules of equity condemn and punish. But, properly speaking, fraud in all its shapes is as odious in law as in equity. The difference is that, as the law courts are constituted, and as it has been found in centuries of experience that it is convenient they should be constituted, they cannot deal with fraud otherwise than to punish it by the infliction of damages. All those manifold varieties of fraud against which specific relief, of a preventive or remedial sort, is required for the purposes of substantial justice, are the subjects of equity and not of law jurisdiction. The following classification of frauds as a head of equity jurisdiction is given by Lord Hardwicke (2 Ves. Jr. 155) : (1) Fraud, or dolus malus, may be actual, arising from facts and circumstances of imposition. (2) It may be apparent from the intrinsic nature and subject of the bargain itself, such as no man in his senses and not under delusion would make, on the one hand, and no honest or fair man would accept, on the other. (3) It may be inferred from the circumstances and condition of the parties; for it is as much against conscience to take advantage of a man’s weakness or necessity as of his ignorance. (4) It may be collected from the nature and circumstances of the transaction, as being an imposition on third persons. In Criminal Law. Without the express provision of any statute, all deceitful practices in defrauding or endeavoring to defraud another of his known right, by means of some artful device, contrary to the plain rules of common honesty, are condemned by the common law, and punishable according to the heinousness of the offense. Co. Litt. 3b; Dyer, 295; Hawk. P. C. c. 71.

Fraud in Foreign Legal Encyclopedias

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Fraud Fraud in the World Legal Encyclopedia.
Fraud Fraud in the European Legal Encyclopedia.
Fraud Fraud in the Asian Legal Encyclopedia.
Fraud Fraud in the UK Legal Encyclopedia.
Fraud Fraud in the Australian Legal Encyclopedia.

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Browse the American Encyclopedia of Law for Fraud

Scan Fraud in the appropriate area of law:

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Fraud Fraud in the Family Law Portal of the American Encyclopedia of Law.
Fraud Fraud in the IP Portal of the American Encyclopedia of Law.
Fraud Fraud in the Commercial Law Portal of the American Encyclopedia of Law.
Fraud Fraud in the Criminal Law Portal of the American Encyclopedia of Law.
Fraud Fraud in the Antritrust Portal of the American Encyclopedia of Law.
Fraud Fraud in the Bankruptcy Law Portal of the American Encyclopedia of Law.
Fraud Fraud in the Constitutional Law Portal of the American Encyclopedia of Law.
Fraud Fraud in the Tax Law Portal of the American Encyclopedia of Law.
Fraud Fraud in the and Finance and Banking Portal of the American Encyclopedia of Law.
Fraud Fraud in the Employment and Labor Portal of the American Encyclopedia of Law.
Fraud Fraud in the Personal Injury and Tort Portal of the American Encyclopedia of Law.
Fraud Fraud in the Environmental Law Portal of the American Encyclopedia of Law.

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Fraud in the Dictionaries Fraud in our legal dictionaries
https://lawi.us/fraud The URI of Fraud (more about URIs)
Fraud related entries Find related entries of Fraud

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Legal Issue for Attorneys

The unlawful obtaining of another’s property by design, but without criminal intent, and with the assent of the owner obtained by artifice or misrepresentation. Any cunning deception or artifice used to circumvent, cheat, or deceive another. Story, Eq. Jur. § 186. Fraud is sometimes used as a term synonymous with covin, collusion, and deceit, but improperly so. Covin is a secret contrivance between two or more persons to defraud and prejudice another of his rights. Clollusion is an agreement between two or more persons to defraud another under the forms of law, or to accomplish an illegal purpose. Deceit is a fraudulent contrivance by words or acts to deceive a third person, who, relying thereupon, without carelessness or neglect of his own, sustains damage thereby. Co. Litt. 357b; Bac. Abr. Actual or positive fraud includes cases of the intentional and successful employment of any cunning, deception, or artifice, used to circumvent, cheat, or deceive another. 1 Story, Eq. Jur. § 186. Legal or constructive fraud includes such contracts or acts as, though not originating in any actual evil design or contrivance to perpetrate a fraud, yet by their tendency to deceive or mislead others, or to violate private or public confidence, are prohibited by law. Thus, for instance, contracts against some general public policy or fixed artificial policy of the law; cases arising from some peculiar confidential or fiduciary relation between the parties, where advantage is taken of that relation by the person in whom the trust or confidence is reposed, or by third persons; agreements and other acts of parties which operate virtually to delay, defraud, and deceive creditors; purchases of property, with full notice of the legal or equitable title of other persons to the same property (the purchaser becoming, by construction, particeps criminis with the fraudulent grantor) ; and voluntary conveyances of real estate, as affecting the title of subsequent purchasers. 1 Story, Eq. Jur. c. 7.. In the Civil Law. According to the civilians, positive fraud consists in doing one’s self, or causing another to do, such things as induce the opposite party into error, or retain him there. The intention to deceive, which is the characteristic of fraud, is here present; the definition of constructive fraud being the same as at common law. Fraud was also divided into that which has induced the contract, dolus dans causam contractui, and incidental or accidental fraud. The former is that which has been the cause or determining motive of the contract, that without which the party defrauded would not have contracted, when the artifices practised by one of the parties have been such that it is evident that without them the other would not have contracted. Incidental or afccidental fraud is that by which a person, otherwise determined to contract, is deceived on some accessories or incidents of the contract, for example, as to the quality of the object of the contract, or its price, so that he has made a bad bargain. Accidental fraud does not, according to the civilians, avoid the contract, but simply subjects the party to damages. It is otherwise where the fraud has been the determining cause of the contract, qui causam dedit contractui. In that case, the contract is void. Toullier, Dr. Civ. liv. 3, tit. 3, c. 2, note, § 5, note 86 et seq. See, also, 1 Mall. Anal, de la Disc, du Code Civ. pp. 15, 16; Bouv. Inst. Index. In Equity. It is sometimes Inaccurately said that such and such transactions amount to fraud in equity, though not in law; according to the popular notion that the law allows or overlooks certain kinds of fraud which the more conscientious rules of equity condemn and punish. But, properly speaking, fraud in all its shapes is as odious in law as in equity. The difference is that, as the law courts are constituted, and as it has been found in centuries of experience that it is convenient they should be constituted, they cannot deal with fraud otherwise than to punish it by the infliction of damages. All those manifold varieties of fraud against which specific relief, of a preventive or remedial sort, is required for the purposes of substantial justice, are the subjects of equity and not of law jurisdiction. The following classification of frauds as a head of equity jurisdiction is given by Lord Hardwicke (2 Ves. Jr. 155) : (1) Fraud, or dolus malus, may be actual, arising from facts and circumstances of imposition. (2) It may be apparent from the intrinsic nature and subject of the bargain itself, such as no man in his senses and not under delusion would make, on the one hand, and no honest or fair man would accept, on the other. (3) It may be inferred from the circumstances and condition of the parties; for it is as much against conscience to take advantage of a man’s weakness or necessity as of his ignorance. (4) It may be collected from the nature and circumstances of the transaction, as being an imposition on third persons. In Criminal Law. Without the express provision of any statute, all deceitful practices in defrauding or endeavoring to defraud another of his known right, by means of some artful device, contrary to the plain rules of common honesty, are condemned by the common law, and punishable according to the heinousness of the offense. Co. Litt. 3b; Dyer, 295; Hawk. P. C. c. 71.

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Notice

This definition of Fraud Is based on the The Cyclopedic Law Dictionary . This definition needs to be proofread..

Practical Information

Note: Some of this information was last updated in 1982

A false representation of a fact, whether by words or by conduct, that deceives and is intended to deceive another so the other person will act upon it to his or her legal injury. For example, if a jewelry salesperson tells a customer that a piece of glass is a diamond, the salesperson is committing fraud. The elements of fraud are (1) a false and material misrepresentation made by someone who either knows it is false or is ignorant of the truth; (2) the maker’s intent that the representation be relied on by the person and in a manner reasonably contemplated; (3) a person’s ignorance of the falsity of the representation; (4) a person’s rightful or justified reliance; and (5) proximate injury to the person.

1. Constructive Fraud (Legal Fraud). All acts or omissions, contrary to equitable or legal duty, trust, or confidence and resulting in damage to another. There need be no evil intent.

2. Extrinsic Fraud. Fraud that is grounds for equitable relief from a judgment. Some intentional act or conduct by which the winning party has prevented the losing party from having a fair trial of all issues involved in a controversy.

3. Fraud in Fact (Positive Fraud). Actual fraud. Concealing something or making a false representation with an evil intent that causes injury to another. It is used in contrast to constructive fraud, which does not require evil intent.

4. Fraud in Law. Fraud inferred by law from the circumstances, where the one who commits it need not have any evil intent. Fraud in law is a constructive fraud.

5. Fraud in the Factum. Generally arises from a lack of identity between the instrument executed and the one intended to be executed, for example, when a blind or illiterate person executes a deed that has been read falsely to him after he asked to have it read. It renders the deed voidable through proper court action.

6. Fraud in the Inducement. Fraud that intended to and that does persuade one to execute an instrument or make an agreement. The person signing is induced to sign the instrument through fraudulent misrepresentation about what will be the results of his or her signing.

7. Intrinsic Fraud. Fraudulent representation that is presented and considered in rendering a judgment. Generally, it is not sufficient grounds for granting equitable relief from a judgment. For example perjury is intrinsic fraud, because it does not prevent a completely adversary proceeding. It only influences the judgment, so it will not be a ground for equitable relief from any judgment that results from it.

(Revised by Ann De Vries)

What is Fraud?

For a meaning of it, read Fraud in the Legal Dictionary here. Browse and search more U.S. and international free legal definitions and legal terms related to Fraud.

Religion and Fraud

United States Constitution

According to the Encyclopedia of the American Constitution, about its article titled 491 RELIGION AND FRAUDFew responsibilities are more sensitive and difficult to meet than drawing a line between punishable obtaining of property under false pretenses and constitutionally protected free exercise of religion. In the one major case to reach the Supreme Court, United States v. Ballard
(read more about Constitutional law entries here).

Some Constitutional Law Popular Entries

Fraud In the Sale of a Show Horse

This section examines the Fraud In the Sale of a Show Horse subject in its related phase of trial. In some cases, other key elements related to trials, such as personal injury, business, and criminal litigation, are also addressed.

Fraud (Causes of Action)

This section introduces, discusses and describes the basics of fraud. Then, cross references and a brief overview about Causes of Action is provided. Finally, the subject of Franchises in relation with fraud is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Fraud (Causes of Action)

This section introduces, discusses and describes the basics of fraud. Then, cross references and a brief overview about Causes of Action is provided. Finally, the subject of Distributorships in relation with fraud is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Fraud (Intellectual Property)

This section introduces, discusses and describes the basics of fraud. Then, cross references and a brief overview about Intellectual Property is provided. Finally, the subject of Antitrust, Trade Law in relation with fraud is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Fraud (Letters of Credit)

This section introduces, discusses and describes the basics of fraud. Then, cross references and a brief overview about Letters of Credit is provided. Finally, the subject of Commercial Law in relation with fraud is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Fraud (Nondischarge of Individual Debts)

This section introduces, discusses and describes the basics of fraud. Then, cross references and a brief overview about Nondischarge of Individual Debts is provided. Finally, the subject of Discharges in relation with fraud is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Fraud (Party Liabilities)

This section introduces, discusses and describes the basics of fraud. Then, cross references and a brief overview about Party Liabilities is provided. Finally, the subject of Negotiable Instruments in relation with fraud is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Fraud (Relief From Judgment)

This section introduces, discusses and describes the basics of fraud. Then, cross references and a brief overview about Relief From Judgment is provided. Finally, the subject of Judgments in relation with fraud is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.

Fraud (Remedies)

This section introduces, discusses and describes the basics of fraud. Then, cross references and a brief overview about Remedies is provided. Finally, the subject of Sales in relation with fraud is examined. Note that a list of cross references, bibliography and other resources appears at the end of this entry.For consumers in the United States, some of the most important topics on fraud are Securities Fraud, Telemarketing Fraud, Pyramid Schemes and Wire Fraud.

Finding the law: Fraud in the U.S. Code

A collection of general and permanent laws relating to fraud, passed by the United States Congress, are organized by subject matter arrangements in the United States Code (U.S.C.; this label examines fraud topics), to make them easy to use (usually, organized by legal areas into Titles, Chapters and Sections). The platform provides introductory material to the U.S. Code, and cross references to case law. View the U.S. Code’s table of contents here.

Resources

See Also

Internet Fraud.

Further Reading (Articles)

FRAUD AWARENESS WEEK CASTS SPOTLIGHT ON WHITE COLLAR CRIME, US Fed News Service, Including US State News; November 10, 2011

Fraud: the human factor; Many discount behavioral explanations for fraud, but as the incidence of fraud continues to grow, placing the spotlight on behavioral factors may be an important approach not only to detection, but to deterrence as well.(FRAUD), Financial Executive; July 1, 2007; Ramamoorti, Sri Olsen, William

FRAUD AWARENESS WEEK CASTS SPOTLIGHT ON WHITE COLLAR CRIME ASSOCIATION OF CERTIFIED FRAUD EXAMINERS TO KICK-OFF NOV. 7-13 AWARENESS CAMPAIGN., States News Service; November 4, 2010

Fraud statistics reinforce need for SOX requirements; preventative measures.(Corporate Finance)(Sarbanes-Oxley), Leader’s Edge; September 1, 2004

Fraud: The Price We Pay: Insurance Fraud Is Not a Victimless Crime, American Agent & Broker; November 1, 2013; Chamness, Chuck

Fraud Passes Pounds 1bn Mark, The Birmingham Post (England); January 4, 2007; Dean, Neville

Fraud Ills ‘Spreading like the Flu’ FRAUD, The Birmingham Post (England); January 14, 2008

Fraud Vulnerabilities and the Global Financial Crisis, Trends & Issues in Crime and Criminal Justice; July 1, 2011; Levi, Michael Smith, Russell G.

FINANCIAL FRAUD ENFORCEMENT TASK FORCE HOSTS MORTGAGE FRAUD SUMMIT IN MIAMI, US Fed News Service, Including US State News; February 25, 2010

Fraud for small business, Credit Management; April 1, 2002; Anonymous

Fraud and Error: Jobseeker’s Allowance and Income Support Overpayments at Lowest Levels Ever, States News Service; May 15, 2014

Fraud costs GBP 330 a year for everyone in UK, The Scotsman; March 8, 2007; SHN ROSS

Management Fraud Risk Factors: Ratings by Forensic Experts, The CPA Journal; October 1, 2001; Apostolou, Barbara Hassell, John M. Webber, Sally A.

Employee Fraud: Perpetrators and Their Motivations, The CPA Journal; November 1, 2001; Buckhoff, Thomas A.

Fraud Prevention, The CPA Journal; January 1, 2006; Adams, Gary W. Campbell, David R. Campbell, Mary Rose, Michael P.

Fraud: A Common Trend in a Unique Industry, Petroleum Accounting and Financial Management Journal; July 1, 2013; Wilks, Leslie Lozano, Felix J.

INSURANCE FRAUD PROSECUTOR POSTS 2005 REPORT AND REFERENCE MANUAL ON WEB, US Fed News Service, Including US State News; March 1, 2006

Detecting Fraud in Organizations: Tethniques, Tools and Resources, The CPA Journal; June 1, 2013; Love, Vincent J.

Fraud Requirements in SSARS 10, The CPA Journal; April 1, 2006; Akers, Michael D. Bellovary, Jodi L.

Fraud Analytics Software Is Designed to Aid Insurance Industry, Product News Network; June 25, 2014

Fraud in State Statute Topics

Introduction to Fraud (State statute topic)

The purpose of Fraud is to provide a broad appreciation of the Fraud legal topic. Select from the list of U.S. legal topics for information (other than Fraud).

Fraud In the Sale of a Show Horse

This section examines the Fraud In the Sale of a Show Horse subject in its related phase of trial. In some cases, other key elements related to trials, such as personal injury, business, and criminal litigation, are also addressed.

Resources

Further Reading

Definition of Fraud in the Uniform Securities Act (2002)

“Fraud,” “deceit,” and “defraud” are not limited to common law deceit.

Fraud in the Criminal Justice System

This section covers the topics below related with Fraud :

Fraud

Fraud Awareness

Fraud In the Sale of a Show Horse

This section examines the Fraud In the Sale of a Show Horse subject in its related phase of trial. In some cases, other key elements related to trials, such as personal injury, business, and criminal litigation, are also addressed.

Resources

See Also

  • Fraud
  • Fraud Awareness

Fraud: Open and Free Legal Research of US Law

Federal Primary Materials

The U.S. federal government system consists of executive, legislative, and judicial branches, each of which creates information that can be the subject of legal research about Fraud. This part provides references, in relation to Fraud, to the legislative process, the federal judiciary, and the primary sources of federal law (cases, statutes, and regulations).

Federal primary materials about Fraud by content types:

Laws and Regulations

US Constitution
Federal Statutory Codes and Legislation

Federal Case Law and Court Materials

U.S. Courts of Appeals
United States courts of appeals, inclouding bankruptcy courts and bankcruptcy appellate panels:

Federal Administrative Materials and Resources

Presidential Materials

Materials that emanate from the President’s lawmaking function include executive orders for officers in departments and agencies and proclamations for announcing ceremonial or commemorative policies. Presidential materials available include:

Executive Materials

Federal Legislative History Materials

Legislative history traces the legislative process of a particular bill (about Fraud and other subjects) for the main purpose of determining the legislators’ intent behind the enactment of a law to explain or clarify ambiguities in the language or the perceived meaning of that law (about Fraud or other topics), or locating the current status of a bill and monitoring its progress.

State Administrative Materials and Resources

State regulations are rules and procedures promulgated by state agencies (which may apply to Fraud and other topics); they are a binding source of law. In addition to promulgating regulations, state administrative boards and agencies often have judicial or quasi-judicial authority and may issue administrative decisions affecting Fraud. Finding these decisions can be challenging. In many cases, researchers about Fraud should check state agency web sites for their regulations, decisions, forms, and other information of interest.

State rules and regulations are found in codes of regulations and administrative codes (official compilation of all rules and regulations, organized by subject matter). Search here:

State opinions of the Attorney General (official written advisory opinions on issues of state law related to Fraud when formerly requested by a designated government officer):

Tools and Forms

Law in Other Regions

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