Federal agencies step up fraud investigations

On Behalf of | Sep 24, 2018 | White Collar Crimes |

White-collar crime prosecutions may be on the rise as several federal law enforcement agencies emphasized their use of new, broad tools to detect what they allege to be an upswing in financial fraud. Online money transfers and other technologies allow funds to be passed quickly and easily, often with little record of who received these funds at the other end, said officials from the Department of Justice, the Federal Bureau of Investigation and the Securities and Exchange Commission. In particular, they highlighted the rising interest in cryptocurrencies as a hotbed for fraud and problematic transactions.

The growth in value of cryptocurrencies like Bitcoin or Ethereum has sparked a market in startup virtual currencies. Some of these initial coin offerings are essentially bogus, law enforcement officials warn. In addition, others noted that there are a number of cryptocurrency deposit or exchange schemes in which the perpetrator simply walks off with others’ money without providing the services promised. In the words of DOJ officials, this is mail or wire fraud updated for a new era.

The SEC is looking more deeply into different kinds of online trading and using advanced data analytics software to do so. This software looks to detect unusual trading activity, particularly around seemingly sudden upswings or downturns in the market. In particular, the agency is looking into activities that have an impact on the accounts and decisions of smaller retail investors.

When technology is used to detect fraud, it can be easy to get caught up in an investigation. Sometimes, victims of a fraud can even be accused of white-collar crimes themselves. People who are subject to a criminal investigation or facing charges of financial misconduct may work with a criminal defense attorney. A lawyer might dispute prosecution evidence and put forward a defense to avoid a conviction.


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