Corporate fraud can occur in many aspects of business transactions and within a business.

Common types of fraud include:

1. Financial statement falsification: a business falsifies its financial statements, such as accounting records, to dupe banks and investors into providing capital based on inflated numbers.
2. Skimming: incoming funds are intercepted before the funds can be recorded in a company’s accounting records.
3. Personal purchases: an employee uses corporate funds to purchase goods and services for his or her personal benefit.
4. Tax avoidance: a corporation alters its tax returns to reduce its taxable corporate income, resulting in lower tax remittances.
5. Misrepresentation and omissions: a seller misrepresents a material fact or fails to disclose a material fact that induces a corporation or person into purchasing an asset or investing.

When fraud occurs, litigation is likely. Fraud must be pleaded with particularity and requires proof by clear and convincing evidence. The reparational damages of a fraud claim plus the possible punitive damages increases the litigation’s importance. Punitive damages are available in addition to actual damages suffered. Fraud cases benefit from an experienced lawyer in this area.

If you are defending against a fraud claim or would like to pursue one, get in touch with us at (312) 223-1699 or email Thomas E. Patterson at tpatterson@pattersonlawfirm.com for more advice and information.

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