Fraud crimes are aggressively prosecuted in California. Though these crimes don't involve any substantial bodily injury or death, they can cause some form of financial loss to the target victim. Therefore, a conviction for a fraud crime in California can result in serious prison time and fines, depending on the amount involved.

If you or your loved one is facing charges for violating fraud laws in California, you should seek an attorney who will review your case for the best possible outcomes. Schedule an appointment with the Chula Vista Criminal Attorney today for expert legal advice about your case.

Definition and Types of Fraud Crimes in California

Fraud refers to any false representation, for a matter of fact, whether by conduct, words, misleading allegations or by concealing something that you're supposed to reveal. It also refers to deceiving someone or an institution for unfair monetary gain or causing that person or institution to suffer a loss.

Several types of fraud crimes fit the description provided above. Below are some of the common types of fraud and laws in California.

Auto Insurance Fraud

Several statutes define auto insurance fraud in California. Automobile insurance refers to any false insurance claim that's made knowingly. It also refers to any form of deceit made to an insurance company to receive benefits you aren't legally entitled to. Some of the common forms of California auto insurance fraud are as follows:

Penal Code 548: Damaging or Abandoning a Motor Vehicle

Under California Penal Code 548, it's illegal to injure, hide, abandon, dispose of an insured motor vehicle to defraud or prejudice its insurance company.

You can still be liable for this crime even after attempting to injure, destroy, hide, or abandon the vehicle doesn't lead to the intended monetary gain. You can also be liable for this crime even if the car in question isn't yours.

California Penal Code 550: Making Fraudulent Claims

Penal Code 550 involves several forms of car insurance fraud. Under Penal Code 550(a)(4), it's a crime to present a fraudulent or false claim for destruction, damage, conversion, or theft of a motor vehicle.

Like Penal Code 548, the target insurance company doesn't necessarily need to suffer a financial loss to be guilty of this crime. However, you must know that your claim is fraudulent to be liable for this crime.

Other forms of auto insurance fraud crimes covered under this statute include:

  • Penal Code 550(a)(3): causing an accident to defraud an insurance company
  • Penal Code 550(b) (1-4): Making false statements
  • Auto insurance fraud made by employees and business owners

Penalties for Auto Insurance Fraud

The penalties for auto insurance fraud in California depend on the specific crime that you're alleged to have committed. Below is a breakdown of penalties for common fraud crimes in California.

  1. Penalties for Abandoning or Damaging a Motor Vehicle

Destroying, damaging, abandoning, or hiding an insured vehicle to defraud an insurance company is a felony in California punishable by:

  • Formal or felony probation
  • Custody in county jail for 2, 3, or 5 years
  • A maximum fine of $50,000

You can also face a two-year sentence enhancement for every previous auto insurance fraud conviction under California Penal Code 548 or 550.

  1. Penalties for Fraudulent Claim or Multiple Claims

Submitting false claims under California Penal Code 550(a)(4) or multiple claims under Penal Code 550(a)(2) is a felony punishable by:

  • Formal or felony probation
  • Custody in county jail for 2, 3, or 5 years
  • A maximum fine of $50,000 or double the amount involved in the fraud, whichever is greater

You can also face a two-year sentence enhancement for every previous felony conviction under California Penal Codes 548 and 550. You aren't eligible for a suspended sentence or probation if you have a prior felony conviction for auto insurance fraud.

  1. Penalties for Causing an Accident to Defraud an Insurance Company

An auto insurance fraud associated with causing an accident is a felony punishable by:

  • Formal or felony probation
  • Custody in county jail for 2, 3, or 5 years
  • A maximum fine of 50,000 or double the amount involved in the fraud, whichever is greater

You can also face several sentencing enhancements in this specific form of auto insurance fraud as follows:

  • A sentence enhancement of two years for every previous felony conviction for auto insurance fraud under Penal Code 548 and 550
  • A sentence enhancement for five years if you have two or more previous felony convictions for fraud by causing an accident
  • A two-year sentence enhancement for every person other than the accomplice who suffers substantial bodily injury due to your actions
  • A sentence enhancement for three or more years if you inflict significant bodily injury on someone while causing the accident

  1. Penalties for Making False Statements

Making a false statement is a wobbler. The penalties for a felony penalty are similar to fraudulent claims under Penal Code 550(a)(4) or under Penal Code 550(a)(2). However, if the false statement is charged as a misdemeanor, the potential penalties include:

  • Summary or misdemeanor probation
  • A maximum fine of $10,000
  • A maximum of one year in county jail

  1. Penalties for Accepting or Soliciting Auto Insurance as a Business Owner or Employer

Soliciting, referring, or accepting business from someone who intends to commit auto insurance fraud is a wobbler. A felony is punishable by:

  • Formal or felony probation
  • Custody in county jail for 16 months, two years, or three years
  • A maximum fine of $50,000 or double the amount involved in the fraud, whichever is greater

A misdemeanor is punishable by:

  • Summary or misdemeanor probation
  • A maximum of one year in county jail
  • A maximum fine of $1,000

A subsequent or second conviction for this auto insurance fraud is a felony punishable by the felony penalties described above.

  1. Penalties for Accepting Kickbacks from Vehicle Repair Shops

Auto insurance fraud that involves kickbacks from vehicle repair shops to a vehicle broker, adjuster, insurance agent carries several penalties that depend on the amount of money involved. Kickbacks involving $950 or less are misdemeanors with a maximum of six months of custody in county jail and a fine of up to $1,000.

If the amount involved is more than $950, the crime becomes a wobbler. A misdemeanor carries a maximum of one year of custody in county jail and a maximum fine of $1,000. A felony carries 16 months, two years, or three years of custody in county jail and a maximum fine of $10,000.

California Penal Code 467, Check Fraud

Under Penal Code 467, it’s a crime to pass, write, or make a fraudulent or fake check in California. You must know about the fictitious nature of the fraud check to be liable for this crime. The prosecutor must also prove that you possessed the fake or fraudulent check and intended to pass it as a genuine document.

Please note that the target person doesn't need to suffer any loss to be liable for this crime.

Penalties for Check Fraud in California

A person convicted of check fraud is guilty of forgery. This violation is a wobbler. A misdemeanor carries a maximum of one year of custody in county jail and a maximum fine of $1,000. A felony carries a maximum of three years in county jail and a maximum fine of $10,000. Check fraud can also affect your immigration status, meaning that you might end up being deported or marked inadmissible into the United States.

California Penal Code 332: Gambling Fraud

California Penal Code 332 defines gambling fraud as fraudulently obtaining another person's property by games of tricks, gambling, a pretense of fortune-telling, or card games.

You should note that this statute doesn't prohibit bookmarking or gambling. It only prohibits using stacked decks, cards, or other schemes that trick people into "sure things" in betting or other similar activities. In most cases, gambling fraud laws apply when a person uses a device or technique against gambling rules to gain an unfair advantage on a player. It also refers to acting with bad faith, lack of integrity, or acting dishonestly.

Penalties for Gambling Fraud in California

The penalties of gambling fraud are similar to the penalties for grand and petty theft in California. Therefore, a defendant will face specific penalties based on the property's value obtained from the victim.

If you intend to defraud someone of property worth more than $950, this crime becomes a wobbler. A misdemeanor is punishable by:

  • Summary or misdemeanor probation
  • A maximum of one year in county jail
  • A maximum fine of $1,000

A felony carries the following penalties:

  • Formal or felony probation
  • A maximum of three years of imprisonment
  • A maximum fine of $50,000 for a first-time offense or $10,000 for a second or subsequent crime

If the money intended to be stolen in your gambling fraud scheme is $950 or less, you'll be charged with a misdemeanor and face the sentences mentioned above.

California Penal Code 550: Health Care Fraud

Health care frauds in California are part of California insurance fraud laws. It involves making fraudulent payment benefits to governmental or private health insurance programs. Under this statute, health care fraud involves the following:

Submission of a Claim for the benefit of a Service that You didn't deliver

Under this statute, it's illegal to make a fraudulent claim to a procedure or service that you didn't deliver to the person named in the claim. In simpler terms, submitting a claim to a health insurance company for services you did not render is a health care fraud.

Submission of False or Fraudulent Claims

You can also be charged under Penal Code 550 if you submit a fraudulent or false claim for health care benefits. For instance, performing a service that a patient doesn't need and billing the service through insurance is a health care fraud.

Making Multiple Claims

Making multiple claims for the same medical service or double-billing an insurance provider is also referred to as health care fraud.

Submitting Undercharges without Overcharges

This statute also makes it a crime to submit both undercharges and overcharges made at the same time.

Preparation of a Writing that Supports a Fraudulent Claim

Writing a fraudulent health care claim is also a health care fraud. The facts of this case mean that people like a doctor's secretaries can be held liable for initiating a process in writing that supports a fraudulent claim.

Penalties for Healthcare Fraud in California

The penalties for health care fraud in California depend on whether the value of the fraudulent claim is more or less than $950.

Claims of $950 or less are misdemeanors and are punishable by:

  • A maximum fine of $1,000
  • A maximum of six months of custody in county jail

Claims of more than $950 are wobblers. Misdemeanors are punishable by:

  • A maximum of one year of custody in county jail
  • A maximum fine of $10,000

If you're charged as a felony, the potential penalties include:

  • Probation with a maximum of one year in county jail
  • Custody in county jail for 2, 3, or 5 years

The court may instead or in addition fine you for a felony conviction. Fines can go up to $50,000 or double the amount involved in the fraud, whichever is greater.

Apart from the sentences described above, professionals involved in health care fraud are at risk of losing their professional license through a suspension or revocation.

Real Estate Fraud

Real estate fraud is an umbrella term used to describe different forms of fraud associated with real estate transactions. There are several laws used to prosecute offenders for real estate fraud. These laws include:

Fraud by False Pretense

A real estate fraud by pretense occurs when someone defrauds another person out of property or money by false representation. For example, a prosecutor must prove that you intentionally deceived a mortgage lender or a real estate owner by making a false promise.

Foreclosure Fraud

A foreclosure fraud occurs when helping a homeowner who's facing foreclosure. A defendant can be held liable for this crime by:

  • Charging a homeowner for a service that you previously provided
  • Collecting excessive fees for a particular service
  • Taking an interest in a property that's about to be foreclosed
  • Taking money from a third party for particular services without telling the homeowner
  • Taking power of attorney from a homeowner
  • Defrauding a homeowner to sign an illegal contract

Rent Skimming

A defendant can be liable for rent skimming in the following two ways:

  • Renting a property during the first year of its acquisition and failing to apply its mortgage proceedings
  • Pretending to own a property and fraudulently renting it without the permission to do so and keeping its rental proceeds

Dealing with Forged Documents or Deeds

Forging deeds or documents refers to knowingly filing, recording, or registering a false deed or document with a government.

Apart from the description provided above, here are some common types of real estate and mortgage fraud in California.

Foreclosure Fraud

As stated above, foreclosure fraud is any form of fraud associated with the foreclosure process. Some of the examples of foreclosure fraud include:

  1. Title Transfer

Title transfer occurs when a person persuades homeowners facing foreclosure to sign over their home's title. In this form of fraud, defendants usually persuade homeowners to remain in the homes as a tenant and can repurchase them in the future. The defrauder later evicts the homeowner and acquires it through its existing equity.

  1. Bait and Switch

Bait and switch is a form of title transfer where the homeowner is unaware of the transfer of the title. In this form of fraud, victims are made to believe that signing particular documents would help them acquire new loans, while in reality, the documents are meant to transfer the home to the defendant.

  1. Phantom Help Scams

In a phantom help scam, a company assisting in foreclosure promises to help a homeowner avoid foreclosure after paying an upfront fee, only to perform zero services. Unfortunately, when the homeowner is aware of the scam, it's too late to avoid a foreclosure.

Straw Buyer Scheme

A straw buyer scheme involves a situation where a person buys a home on behalf of another person to defraud that person or when it's unlawful to make the purchase.

Illegal Property Flipping

Illegal property flipping occurs when a person wrongfully inflates a property due to a fraudulent appraisal, and an unsuspecting buyer buys the property at an inflated price. It can also occur when a bank lends money or property to an unsuspecting buyer for more than the actual value.

Predatory Lending

Predatory lending occurs when a mortgage broker creates a loan for a potential buyer and loads the loan with unnecessary fees non-beneficial to the borrower.

Penalties for Real Estate Frauds in California

Prosecutors can use four main statutes to prosecute and charge a defendant for real estate fraud. These statutes include:

  1. Penal Code 487: Grand Theft

Grand theft is charged for offenders who gain advantage through a real estate property through pretense. The property's value must be worth more than $950 to fit the definition of grand theft. A crime under this statute is a wobbler. A misdemeanor is punishable by a maximum of one year in county jail, while a felony is punishable by a maximum jail sentence of three years.

  1. Civil Code 2945.4: Foreclosure Fraud

Foreclosure fraud is prohibited under Civil Code 2945.4. Under this statute, foreclosure is a wobbler with the same penalties as grand theft.

  1. Civil Code 890: Rent Skimming

Civil Code 890 is the California statute that prohibits rent skimming as defined above. This law makes it a crime to commit multiple rent skimming acts. A one-time act does not result in criminal charges, but the skimmer can face civil penalties.

Multiple rental skimming actions are wobblers with the same penalties as those in grand theft or foreclosure fraud.

  1. California Penal Code 115: Filing Forged Documents

California Penal Code 115 makes it a crime to file forged real estate documents in California. Violation of this statute is a felony punishable by:

  • A maximum of three years of custody in county jail
  • A maximum fine of $10,000

California Welfare and Institution Code 10980: Welfare Fraud

California welfare and institution code 10980 is the statute in California that addresses both recipient and internal welfare fraud. Recipient fraud occurs when you make incomplete or false information to obtain benefits that you are not legitimately entitled to.

Internal welfare fraud refers to assigning or distributing benefits to a recipient who's ineligible for the benefit.

Penalties for Welfare Fraud in California

The penalties for welfare fraud in California depend on the specifics of your case. You might be charged with a straight misdemeanor, a felony, or a wobbler. Let's have a closer look at the possible penalties associated with this crime.

  1. Penalties for Welfare Fraud Associated with Filing Fraudulent Documents

Filing fraudulent documents in a welfare fraud is a wobbler if you have:

  • Made multiple applications for the same beneficiary
  • Applied welfare benefits for a fictitious person
  • Applied for a welfare benefit using a false identity

A misdemeanor is punishable by a maximum of one year of custody in county jail and a maximum fine of $1,000. A felony is punishable by 16 months, two years, or three years in county jail and a maximum fine of $5,000.

  1. Penalties for Obtaining or Retaining Benefits in a Welfare Fraud

Retaining or obtaining benefits in a welfare fraud is a misdemeanor if the benefits are $950 or less. As a misdemeanor, the penalties include a maximum of six months in jail and a fine of up to $500.

If the fraud involves more than $950, you'll face a felony that's punishable by 16 months, two or three years in jail, and fines of up to $5,000.

  1. Penalties for Welfare Fraud Regarding Food Stamps

A welfare conviction that involves fraudulent participation in a food stamp program is a felony punishable by 16 months, two, or three years of custody in county jail and a fine of up to $5,00. This offense becomes a wobbler if you sell, possess, transfer, or purchase food stamps or electronically transferred food stamps authorization illegally.

In addition, thisA misdemeanor charge applies if the value of the food stamp is $950 or less with penalties that include a maximum of six months of county jail sentence and a fine of up to $500. If the value of the benefits exceeds $950, you'll be charged with a felony. The penalties include 16 months, two years, or three years in jail and a fine of up to $5,000.

Find a Fraud Crimes Attorney Near Me

It's recommendable to seek professional legal help when you find out that you're facing a fraud crime. A reasonable fraud crimes attorney will help you review your situation and help you achieve the best possible results. At Chula Vista Criminal Attorney, our team of highly experienced lawyers can offer you the expertise needed for a successful legal representation for your fraud case. Call us any time at 619-877-6894 for a quick review of your case and learn how we can help you.