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What Is Business Fraud?


People are often encouraged to engage in illegal behavior due to one thing: money. Everybody wants more money and it can be hard to make a decent living. That’s why many businesses turn to fraud.

Many people trust the companies they do business with. And while most are honest, some are not. They will engage in fraudulent activity to make a few extra bucks. Some schemes can be lucrative, and many customers think these business practices are legitimate, resulting in lost money.

Types of Fraud

There are many types of fraud that companies may engage in to make money from unsuspecting customers. They include the following:

  • Non-payment of funds. This is when the company receives goods or services but never sends payment.
  • Non-delivery of merchandise. This type of fraud is just the opposite. It occurs when someone sends the company payment but it never sends the goods or services.
  • Overpayment scheme. This scheme is common on sites such as Craigslist. It occurs when a person is sent a payment significantly higher than what is owed. The person is then instructed to deposit the money in their bank account and then send the extra money via wire transfer back to the sender. The initial payment is found to be fraudulent after the wire transfer has occurred.
  • Internet auction fraud. This refers to a fraudulent transaction on an online auction website. The buyer may pay for an item that does not exist.
  • Charity fraud. This occurs when individuals are under the impression they are making donations to legitimate charities but they are scams in which the money goes to dishonest people.

How to Keep Yourself Safe

As a customer, you want to avoid business fraud, as it can cause severe emotional and financial harm. Here are some ways you can prevent it so you can stay safe:

  • Only shop and make purchases from reputable establishments.
  • Check a business’ information. Make sure to get a physical address and a working telephone number. Also, send the seller an email to ensure their email address is active.
  • Be wary of websites that sell items at super cheap prices. Remember, if it looks too good to be true, it probably is.
  • Never give out your personal information to emails, texts, or phone calls that request it. Be wary of spam and phishing attempts.
  • Never send payment by gift card or wire transfer unless you know the person.

Seek Legal Help

As long as a transaction involves money, there will be fraud. Fraud is a serious issue that costs individuals and businesses not millions, not billions, but trillions of dollars every year.

Fort Lauderdale business litigation lawyer Edward J. Jennings, P.A. can help resolve your business issues, whether they be fraud, torts, breaches of contract, or other issues. There are many scams out there, so let us help you with your case. Call our office at 954-764-4330 or fill out the online form to schedule a consultation.



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