Overview of White Collar Crimes in California

Leon Mezzetti, White Collar Crimes Defense Attorney

The term "white collar crime" is generally used to describe any nonviolent crime involving dishonesty or fraud in commercial matters. Put more simply, white collar crimes are financial rather than physical crimes.

While the California Attorney General has focused recently on prosecuting mortgage fraud cases, law enforcement officials have also been targeting several other types of fraud, including insurance fraud, workers' compensation fraud, and Medicare fraud.

The details and circumstances of each one of these crimes vary, but each scheme has one goal in common: deliberate deception for unlawful gain. And no matter what the scheme, the potential punishment is severe: if convicted of a white collar crime, a defendant may face up to five years in state prison, up to $150,000 in fines and additional restitution costs. If the defendant has a previous conviction for a fraud crime, the court can further add to these penalties.

Real Estate and Mortgage Fraud

With the bottom falling out of the housing market and foreclosure rates reaching all-time highs, state and federal authorities have launched a massive initiative to uncover and prosecute those involved in real estate and mortgage and foreclosure fraud schemes. This includes investigations into fraudulent mortgage refinancing and loan modification.

These schemes may involve mortgage brokers, lenders, builders, real estate agents, attorneys, title companies, adjusters and others. Private homeowners also may subject to fraud charges. For example, if they used misleading, false or stolen information to secure the home loan or refinancing, they can be charged with mortgage fraud.

Insurance Fraud

Insurance crimes commonly involve an individual intentionally filing a false claim for benefits or compensation, but also may include insurance companies who wrongfully withhold benefits from policyholders. Insurance fraud can involve the work of just one person or well-organized groups of people. Insurance fraud can occur under any type of insurance policy, including car insurance, homeowner's insurance, fire and casualty insurance, life insurance and health insurance.

Insurance fraud schemes involving auto insurance policies are popular. For example, someone may orchestrate a car accident with vehicles that already had been damaged and then make a false claim for benefits under the insurance policy. Or someone may falsely claim that his or her car was stolen or claim that property was stolen from the vehicle that was never in the vehicle or, in some cases, never even owned by the policyholder.

Workers' Compensation Fraud

Workers' compensation fraud is another type of popular insurance fraud, so much so that California created the Workers' Compensation Fraud Task Force in 1991 specifically to investigate these types of fraud claims. Fraudulent workers' compensation claims involve workers who file false claims, employers who illegally interfere or deny injured workers their benefits and medical providers and pharmacies that inflate bills or purposefully use incorrect medical codes for billing. Employers also may be guilty of workers' compensation fraud if they misclassify workers or under-report workers' wages in an attempt to qualify for lower insurance premiums.

Medicare Fraud

Medicare fraud may involve individual physicians and other health care providers, hospitals, health care businesses and medical product providers. The majority of Medicare fraud cases involve improper or fraudulent billing. For example, a doctor or group of doctors may commit Medicare fraud by billing for services patients did not receive or "up-coding" for more procedures with higher reimbursements than the patient actually received. Medical product providers can be charged with Medicare fraud for providing illegal kickbacks to patients for trying a "free" product or consenting to a "free" exam and then billing Medicare for the services.

Medicare fraud also can involve the theft of Medicare I.D. numbers. For example, individuals sometimes sell their Medicare number to another person or allow them to use it. In other cases, the numbers may be stolen and used to file claims for health care services or products that were never provided or ordered.

Contact an Experienced Criminal Defense Attorney

If you have been accused or are under investigation for involvement in a white collar fraud scheme, it is imperative that you have a skilled criminal defense attorney working by your side to protect your interests. Contact an attorney today to learn more about your legal options to defend against fraud charges.

For further reading: White Collar Crime, Wikipedia