Financial Crimes

Financial Crimes

The financial crimes which KAPLAN AND KAPLAN defends are most often embezzlement, insurance fraud and banking/identity related crimes.

 

Embezzlement:

Embezzlement is by far the most common financial crime we see. Embezzlement occurs when a person is responsible for money belonging to another person or business and the person uses that money for his or her own purposes. Embezzlement can also include taking property rather than money but that is much more rare. Our past clients facing embezzlement charges have included a wide range of employees, bookkeepers, treasurers, care-givers and the like. The ususal scenario is that our client faced some financial pressure in her or her personal life, felt desperate and used someone else’s money as form of bridge loan. Almost always, our clients started with the intention of paying the money back promptly but, inevitably, their financial problems were greater or more lasting than expected and one small “loan” turned into a series of transactions in which the other person or entity’s money became a regular source of income and the problem snowballed into amounts that the client has no means to repay.

Embezzlement cases present some specific challenges. First, our clients charged with embezzlement have tended to be people with no significant past criminal record and little or no experience with the criminal justice system. Our clients have often been living with the stress of guilt and the fear of discovery for a long time so their nerves are already frayed by the time the crime is uncovered. Embezzlement crimes are very newsworthy and almost always get press coverage so the already anxious client is abruptly confronted with a serious criminal charge which is highly publicized as he or she is thrust into an unfamiliar and intimidating forum. All of this means that our first job is generally to manage the client’s anxiety so that the client can remain functional and assist us in defending their case by helping the client to engage in counseling and reach out for support from family and friends despite the natural desire to withdraw and isolate in the face of public shaming. The second regular challenge in embezzlement cases is that the victim of the theft is almost always very angry. Embezzlement necessarily involves a breach of trust and tends to occur in the context of relationships which are close and quite personal. The feelings of violation and betrayal of the victim don’t always correlate to the amount of money that was taken. The victim’s strong feelings can make these cases much harder to resolve because the victim can be expected to put pressure on the prosecutor to punish the defendant harshly. Related to this, there are often civil claims which run in parallel to the criminal prosecution.

Our approach to defending embezzlement cases depends on the particular circumstances of the case. If the client has not admitted to taking money, we begin the defense by examining the evidence in the possession of the State on which a claim of embezzlement is being made. In some instances, the client has made admissions to the victim of the theft and/or law enforcement prior to contacting KAPLAN AND KAPLAN which make it difficult to defend against criminal responsibility. In those cases, our initial focus shifts to examining the claims as to how much money was taken in order to protect our client against the victim overstating the amount of the financial loss which can work to the victim’s benefit for insurance and income tax purposes. The next step, which applies to all embezzlement cases, is for us to understand the client’s unique life challenges which led to the theft so that we can humanize the client to the prosecutor and the Court and accurately portray the full tapestry of the client’s circumstances for consideration in assessing an appropriate judicial response to the conduct. Finally, we work with the client to ascertain whether there is any ability to repay the theft and to manage the criminal restitution and civil claims so that the client is left with a workable plan to begin repaying the loss.

Embezzlement cases are difficult cases which require deftness and flexibility to resolve in the best possible way for the client. We have experienced generally favorable outcomes for our embezzlement clients, particularly for first time offenders. Facing an embezzlement charge is a trying moment for a criminal defendant but there is usually no reason to see a person’s life as being over or to adopt a hopeless view of the future.

 

Insurance Fraud:

Insurance fraud cases tend to arise from either casualty losses from the destruction of property or a claimed theft of property. These cases often begin with an investigation by an insurance company that then gets reported to the police for follow up. This type of case arises most frequently in connection with an arson investigation or criminal charge for arson but we have also seen motor vehicle and personal property theft cases which are charged as insurance fraud. When an insurance company suspects fraud, the insurance company will devote tremendous resources into an investigation of the loss. One part of the insurance investigation is usually a statement by the insured given under oath to an insurance company paid lawyer so there can be perjury concerns with these cases if the client has given false statements under oath.

Our approach to defending insurance fraud cases depends entirely on the circumstances of the particular case and whatever statements have been made by the client prior to our engagement. Insurance fraud is one area in which it is not uncommon for the defense to be and remain that the client did not do what has been accused which can make it harder to resolve these cases by negotiated agreement.

 

Bank Fraud/Identity Theft:

In the last twenty years, bank fraud has evolved from washing checks and tricking bank tellers into complex schemes involving identity and credit crimes. We have defended clients who were caught up in large conspiracies in which vast sums of money were stolen from banks and credit card issuers through stolen credit and debit card numbers. These cases are very complicated, require understanding of banking and credit processing protocols and can present high stakes for the client. The more common scenario we encounter is when one person uses another person’s credit or debit card without authorization for small purchases. While these cases have little practical similarity to the large conspiracies, the punitive consequences can be equally serious at least as far as the client being forever branded a felon. Our best work on these cases is often in negotiating a non-felony outcome for the client, especially where there is security footage showing the client using the credit or debit card at issue.

The other area in which we commonly encounter bank fraud is in the area of fraudulent loan origination. Most commonly we seen real estate and vehicle loan applications as the documents which are claimed by the government to give rise to criminal liability. These are notoriously complicated cases both factually and legally because the prosecution will invariably attempt to reconstruct the conditions in existence at the time the loan application was submitted to attempt to prove that the loan application included important representations which the client knew to be false at the time. These representations often surround valuations of other assets of the applicant at the time the loan application was made and pertain directly to market conditions in existence at that time. These cases are paper heavy and detail intensive projects which require both experience in the area of law and the ability to identify and work with outside experts in the related fields of accounting and appraising. A person facing this type of charge absolutely requires a law firm with both the experience and the infrastructure to be able to formulate an effective defense as does KAPLAN AND KAPLAN.

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