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Common types of fraud

People in Arizona may not realize that the term fraud has a broad definition that actually encompasses a wide range of activities. According to FindLaw, the four keys that bind them all together are intent, deception, victimization and financial gain. The penalties vary widely but often include a prison sentence and heavy fines.

Fraud can be perpetrated by a single person, a group or an entity such as a corporation, according to the FBI, and there are a variety of methods, tactics and scams used to increase personal or corporate wealth. Here are some of the most common:

  • Business fraud could benefit a person or an organization, and is defined as illegal or dishonest activities that the individual or company intends for their own financial gain. Fake charities and merchandise paid for but never shipped are two forms of business fraud.
  • Identity theft involves using someone else's identity to do something illegal. Although this is a type of fraud in itself, it could also be used to perpetrate another fraudulent activity, such as credit card fraud.
  • Internet fraud could involve hacking, leaking data, downloading malicious software or a number of other criminal activities. A person could also use the internet to defraud others through fake auction sites, or through emails "phishing" for personal data.
  • Investment fraud often offers guaranteed or otherwise unrealistic returns for stocks, bonds or options that are typically forged or fake. Market manipulation and Ponzi schemes are two examples.

Other frequently identified fraudulent activities include reverse mortgage scams, pyramid schemes and telemarketing fraud.

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