Criminal Liability for Accounting Fraud in Florida
Accounting fraud falls under Florida’s general prohibition against schemes to defraud, or ongoing conduct done with the intent to defraud another or otherwise obtain property by false pretenses, representations, or statements. Defendants may be charged with two types of fraud in Florida, organized fraud, or fraud related to a continued scheme, and communications fraud, or false statements made through the mail or other forms of communication intended to defraud.
Attorney Ron D. Herman is a former prosecutor with the experience and knowledge to establish a viable defense in accounting fraud cases. Driven by his skill and determination, Herman Law, P.A. will work tirelessly to help you achieve the best possible outcome if you are faced with charges for accounting fraud.
Schemes to Defraud
Under Florida statute, a Scheme to Defraud occurs when a person engages in:
- A systematic, ongoing course of conduct;
- With the intent to defraud or obtain property from another;
- By false or fraudulent pretenses, representations, promises, or willful misrepresentations of a future act.
Schemes to Defraud generally include two different offenses: (1) Organized Fraud; and (2) Communications Fraud. Communications fraud refers to the use of communications systems such as the mail or banking wires in furtherance of a scheme to defraud.
Organized fraud refers to any scheme intended to defraud or obtain property from another. Accounting or bookkeeping fraud is classified as an organized fraud if it is done through continuous and ongoing entries or ledgers for the purpose of defrauding or obtaining property belonging to another.
To obtain means to temporarily or permanently deprive any person of the right to property or a benefit therefrom, or to appropriate the property to one’s own use or to use the property of any other person not entitled to it.
Property means anything of value, including real property, personal property, rights, privileges, interests, or services.
Common examples include booking expected revenues or deferring losses, misstating inventories, or failing to disclose liabilities, all in an attempt to create the impression of profitability.
Communication fraud occurs when a person engaging in a Scheme to Defraud uses the mail, wire, radio or other systems to transmit information regarding the fraud. Charges for communication fraud are often brought in conjunction with charges for organized fraud as a person engaging in accounting fraud often communicates records to others either via mail or by wire. Each time a communication is made it is a separate crime, so a defendant may be charged with multiple counts of communications fraud.
The Florida communication fraud statute is intended to be similar to the federal mail and wire fraud statutes and build off of legal precedent established in federal cases.
Penalties for Schemes to Defraud
Possible sentences for a conviction for Schemes to Defraud vary based on the value of the property involved.
Value Obtained and Maximum Sentence
- $50,000 or more – Up to 20 years in prison
- Less than $50,000 but more than $20,000 – Up to 15 years in prison
- Less than $20,000 – Up to 5 years in prison
Value Communicated About and Maximum Sentence
- More than $300 – Up to 5 years in prison
- Less than $300 – Up to 1 year in jail
Because the Florida statute allows a defendant to be charged for each communication separately, these sentences are for each count of communications fraud. For example, a defendant that made three communications to obtain $500 each would be charged with 3 counts of communications fraud.
Defenses for Accounting Fraud
One of the most common defenses to charges for organized fraud is that a defendant did not intend to defraud the victim. In the case of accounting fraud, this could occur if a defendant was sloppy with bookkeeping but did not intend to deceive the victim in registering transactions. Intent is the hardest element for a prosecutor to prove because it involves knowing what was going on in the defendant’s mind at the time the supposed wrongful act occurred.
The five-year statute of limitations also serves as a defense to accounting fraud. In some instances, where the defendant is absent from the state for long stretches of time, the statute of limitations may be tolled, but may not extend one-year beyond the five-year statute of limitations. Determining whether the defendant was sufficiently absent from the state to toll the statute of limitations can be crucial to the application of the statute of limitations defense.
Related Crimes to Accounting Fraud
In some cases, the Scheme to Defraud may also result in additional charges such as those for money laundering or theft being filed. These are also serious crimes that depending on the amount of money involved carry felony sentences of up to 30 years in prison.
Contact Herman Law, P.A. Today
If you are facing questions from investigators about accounting practices or charges for organized or communications fraud, reach out to Herman Law, P.A. as soon as possible. Attorney Ron Herman will schedule a free consultation to review your situation. Hiring Herman Law, P.A. places you in the hands of a trusted and experienced advisor who will ensure your rights are protected throughout the legal process.