Did you know Americans have lost an average of $2,647 over their lifetime to scams? Meanwhile, 38% of Americans–almost one in four–have been scam victims.
Another source notes that younger folks tend to be more vulnerable to fraud than older ones. Specifically, 44% of those between the ages of 20 and 29 versus 25% of those between the ages of 70 and 79 reported losing money due to fraud.
Unfortunately, people from various demographics can become victims of financial crimes. It’s even more unfortunate that bad actors have various ways to achieve this objective.
Here are eight kinds of financial crimes that you should know about to avoid becoming a statistic.
- Fraud
Fraud is a term applicable to various kinds of financial crimes. It includes bank fraud, wire fraud, credit card fraud, healthcare fraud, and securities fraud. As you can see, criminals have various ways to commit fraud.
While some people are vigilant and avoid falling for traps set by bad actors, others unwittingly become victims. Some victims are too ashamed to report fraud.
- Identity Theft
According to one source, ID fraud cost Americans a whopping $43 billion in 2023. It adds, moreover, that these numbers likely fail to show the true magnitude of the issue since such crimes are underreported. Many victims are ashamed they fell for the traps and suffer in silence.
It’s important to safeguard your personal information to lower the risks of having someone use your personal data to apply for loans, open accounts, or pursue unauthorized transactions.
- Money Laundering
Money laundering is another financial crime to be aware of. It refers to fraudulently concealing money obtained from illegal activities like embezzlement, sex work, or drug dealing.
- Embezzlement
You’ve no doubt heard about the financial crime of embezzlement. It’s a white-collar financial crime that involves someone misappropriating or misusing money or property that they’ve been entrusted with. Bernie Madoff, Enron, Tyco, and Charles Ponzi were involved in high-profile embezzlement cases
- Insider Trading
Insider trading, according to Investopedia, refers to people leveraging material non-public data to trade stocks. Doing so is illegal. People can trade stocks using public or non-material information,. One source notes that as many as 25% of all M&A deals involving public businesses in the U.S. seem to be the targets of undiscovered insider trading by investors.
- Tax Evasion
Another financial crime is tax evasion, which refers to people purposefully underreporting income, exaggerating deductions, or hiding funds to avoid paying taxes. Tax evasion is a big problem. One source notes that America’s wealthy demographic evades north of $150 billion annually in taxes. But don’t let that fool you. People from all walks of life commit tax fraud. It’s a serious crime that comes with onerous penalties.
- Cybercrime
According to the U.S. Department of State, the FBI estimated north of $4 billion in 2020 was lost to cybercrime in the country. There’s no denying that cybercrime is a serious issue. Bad actors use tactics like phishing and ransomware attacks to trick or coerce people into disclosing personal information they should safeguard rather than give up.
- Counterfeiting
Counterfeiting is another financial crime to know about. It, of course, refers to the illegal production and sale of goods designed to resemble authentic products.
These are some financial crimes it pays to know about. If you’re ever accused of any of these financial crimes, you must hire a lawyer for proper representation. The penalties can be severe. Your best bet is to secure legal representation so you know what you’re up against and get the help you need.
