Special Prosecution Division
The Special Prosecution Unit investigates and prosecutes a variety of crimes dealing with economic loss. These crimes include violations of fiduciary responsibilities (misappropriation of funds), financial exploitation of the elderly, theft/embezzlement by employees, attorney misconduct (including unauthorized practice of law), fraud schemes involving investments, mortgages, identify theft, and internet scams, and matters dealing with misconduct in office by public officials. The unit also reviews all incidents involving the use of deadly force by a police officer in the line of duty. Along with the special Victims Division, this division contributes staff to the crimes Against Seniors and Vulnerable Adults unit (CASVA). CASVA is a unit designed to focus on the protection of seniors from financial and physical crimes.
What are Financial Crimes?
Financial crimes are crimes against property, involving the unlawful conversion of the ownership of property (belonging to one person) to one's own personal use and benefit.
Investment Fraud
A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ponzi schemes often share common characteristics, such as offering overly consistent returns, unregistered investments, high returns with little or no risk, or secretive or complex strategies. This arrangement gives investors the impression there is a legitimate, money-making enterprise behind the subject’s story, but in reality, unwitting investors are the only source of funding.
Ponzi Schemes
Advance fee schemes require victims to advance relatively small sums of money in the hope of realizing much larger gains. Not all advance fee schemes are investment frauds. In those that are, however, victims are told that in order to have the opportunity to be an investor (in an initial offering of a promising security, investment or commodity, etc.), the victim must first send funds to cover taxes or processing fees, etc.
Advance Fee Fraud
Advance fee schemes require victims to advance relatively small sums of money in the hope of realizing much larger gains. Not all advance fee schemes are investment frauds. In those that are, however, victims are told that in order to have the opportunity to be an investor (in an initial offering of a promising security, investment or commodity, etc.), the victim must first send funds to cover taxes or processing fees, etc.
Promissory Notes
These are generally short-term debt instruments issued by little-known or nonexistent companies. The notes typically promise high returns with little or no risk and are typically not registered as securities with the appropriate regulatory agency.
Commodities Fraud
Commodities fraud is the sale or purported sale of a commodity through illegal means. Commodities are raw materials or semi-finished goods that are relatively uniform in nature and are sold on an exchange (e.g., gold, pork bellies, orange juice, and coffee). Most commodities frauds involve illicit marketing or trading in commodities futures or options. Perpetrators often offer investment opportunities in the commodities markets that falsely promise high rates of return with little or no risk.
Mortgage Fraud
Mortgage fraud is a crime characterized by some type of material misstatement, misrepresentation, or omission on a loan which is then relied upon by a lender, an example of mortgage fraud would be a person lying on a mortgage loan. There are two types of mortgage fraud—fraud for profit and fraud for housing.
Fraud for Profit
Mortgage fraud for profit often involves industry insiders using their specialized knowledge or authority to commit or facilitate the fraud. Reports indicate that a high percentage of mortgage fraud involves collusion by industry insiders, such as bank officers, appraisers, mortgage brokers, attorneys, loan originators, and other professionals engaged in the industry.
Fraud for Housing
Mortgage fraud for housing typically involves illegal actions conducted solely by the borrower, who is motivated to acquire and maintain ownership of a house under false pretenses such as misrepresented income and asset information on a loan application.
Embezzlement
Embezzlement involves the fraudulent taking of personal property by someone to whom it was entrusted. Most often associated with the misappropriation of money. Embezzlement can occur regardless of whether the defendant keeps the personal property or transfers it to a third party.
Mass Marketing Fraud
Mass marketing fraud is a general term for frauds that exploit mass-communication media, such as telemarketing, mass mailings, and the Internet. They share a common theme: the use of false and/or deceptive representations to induce potential victims to make advance fee-type payments to fraud perpetrators. The most common form of fraud encompasses a broad variety of schemes that are designed to induce their victims into remitting upfront payments in exchange for the promise of goods, services, and/or prizes.
Money Laundering
Money laundering refers to a financial transaction scheme that aims to conceal the identity, source, and destination of illicitly obtained money. The money laundering process can be broken down into three stages. First, the illegal activity that garners the money places it in the launderer’s hands. Second, the launderer passes the money through a complex scheme of transactions to obscure who initially received the money from the criminal enterprise. Third, the scheme returns the money to the launderer in an obscure and indirect way. With the advent of terrorists who employ money-laundering techniques to fund their operations, the risk expands to encompass the safety and security of the nation.
Identity Theft and Identity Fraud
Identity theft and identity fraud refer to all types of crimes where someone wrongfully obtains and uses another person’s personal data in some way that involves fraud or deception, typically for economic gain. Personal information such as your Social Security numbers, bank account or credit card numbers, telephone numbers, and other valuable identifying data can be used, if they fall into the wrong hands, to personally profit at your expense. In many cases, a victim’s losses may include not only out-of-pocket financial losses, but substantial additional financial costs associated with trying to correct false information for which the criminal is responsible.
Check and Credit Card Fraud
Check and credit card fraud can happen in a variety of ways, from low tech dumpster diving to high tech hacking. A thief might go through the trash to find discarded billing statements and then use account information to buy things. A retail or bank website might get hacked, and your card number could be stolen and shared. Perhaps a dishonest clerk or waiter takes a photo of your credit card and uses your account to buy items or create another account. Or maybe you get a call offering a free trip or discounted travel package. But to be eligible, you have to join a club and give your account number, say, to guarantee your place. The next thing you know, charges you didn’t make are on your bill, and the trip promoters who called you are nowhere to be found.
Health Care Fraud
Health care fraud involves the filing of dishonest health care claims in order to turn a profit. Fraudulent health care schemes come in many forms. Practitioner schemes include: individuals obtaining subsidized or fully-covered prescription pills that are actually unneeded and then selling them on the black market for a profit; billing by practitioners for care that they never rendered; filing duplicate claims for the same service rendered; altering the dates, description of services, or identities of members or providers; billing for a non-covered service as a covered service; modifying medical records; intentional incorrect reporting of diagnoses or procedures to maximize payment; use of unlicensed staff; accepting or giving kickbacks for member referrals; waiving member co-pays; and prescribing additional or unnecessary treatment. Members can commit health care fraud by providing false information when applying for programs or services, forging or selling prescription drugs, using transportation benefits for non-medical related purposes, and loaning or using another’s insurance card.
Disbarred Attorney Swindled Elderly Maryland Woman Out of $1.8M
A Montgomery County jury found Jonathan Robbins guilty on several financial crimes' charges, prosecutors said. He took $1.8 million over the course of several years from 91-year-old victim Helen Nutt. Courtesy of News4’s Darcy Spencer reports.
A Montgomery County jury found Jonathan Robbins guilty on several financial crimes' charges, prosecutors said. He took $1.8 million over the course of several years from 91-year-old victim Helen Nutt. Courtesy of News4’s Darcy Spencer reports.
Links to additional resources:
- Financial Industry Regulatory Authority (FINRA)
- https://www.finra.org/about
- Federal Bureau of Investigations (FBI)
- https://www.fbi.gov/investigate
- Federal Trade Commission (FTC)
- https://www.ftc.gov/
- United States Postal Inspection Service
- https://www.uspis.gov/
- United States Securities and Exchange Commission (SEC)
- https://www.sec.gov/
- Office of the Comptroller of the Currency (OCC)
- https://www.occ.gov/topics/supervision-and-examination/bank-operations/financial-crime/index-financial-crime.html
- United States Department of Justice (DOJ)
- https://www.justice.gov/criminal/criminal-fraud
- Commodity Futures Trading Commission (CFTC)
- https://www.cftc.gov/LearnAndProtect/FraudAwarenessPrevention/index.htm
- Crimes Against Seniors and Vulnerable Adults Unit
- https://www.montgomerycountymd.gov/SAO/units/family/casva.html