Bank Fraud: Easyloan Bank Ltd and ABC Pty Ltd

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Table of Contents

Introduction
Punishment of mortgage Fraudsters
The fraud case of ABC Pty Ltd and Easyloan Bank Ltd via David
Conclusions
Reference List

Introduction

The transaction presentation between Easyloan Bank Ltd and an Australian based ABC Pty Ltd, which is headed by Chen, Sarah and David who are directors to ABC, is a case of bank fraud which is carefully and selectively carried out by David through forgery and impersonation. Bank fraud has been defined by Thomas (2008, p. 4) as the engagement of deceit or fraudulence to obtain or get assets, money, or property possessed or held by a monetary institution. Bank fraud is usually an offence and a crime in most places under different laws. The case under review is considered under Australian criminal law; where specific fraud laws are articulate and applicable.

In the United States, bank fraud is defined under the federal laws to emphasize theft or robbery, and then as white-collar crime punishable under Title 18 of Code 18 U.S.C. 1344. In the Far East, China frowns at bank related fraud. Examples of China’s non tolerance to fraud include the cases of Liang Shihan of the Bank of China, Wang Xiang, Miao Ping, and Wang Liming who in September 2004 were executed for carrying out fraudulent acts.

The case under review is particularly distinctive and clear. Otherwise, bank fraud sometimes includes stolen checks; check kiting, alteration of checks, account frauds, uninsured deposits, demand draft frauds, wire fraud, Bill discounting fraud, payment card fraud, Booster checks, Skimming or duplication of card information, and Empty ATM envelope deposit. Elements of Fraudulent loan, fraudulent loan applications, and Forged or fraudulent documents; the last instance is found in the said case concerning David.

This paper presents strong legal argument against bank fraud, as carried out by David of ABC Pty Ltd, yet it condemns the laxity in the business if banks. Suggestions are made to improve financial fraud security, especially in Australia.

The global Challenge of Mortgage fraud constitutes a global problem recently with the advancement in access to information, especially in Developed countries like the US A where the crime is termed The White Collar. A loan obtained in a fraudulent way is one gotten from the bank with total dishonesty, with no intension for repayment. The borrower gets the money with deliberate intensions for no repayments. The applier thus gives false or fake information to the bank that is to provide the money. Fraudulent documents or forged documents are produced for getting the funds, through thefts. Particularly, in the United States, Canada and Australia, more awareness is growing to the combat of Mortgage fraud. Special departments have become very necessary to combat the menace of mortgage fraud. According to Iaana, (1995)

“The white collar practitioner should be aware that mortgage fraud is generally investigated by the United States Federal Bureau of Investigation (FBI), although other agencies routinely assist the FBI and/or take the lead in investigating a case. Some of the other federal agencies which investigate mortgage fraud crimes for criminal prosecution include, but are not limited to, the Internal Revenue Service-Criminal Investigative Division (IRS-CID), United States Postal Inspection Service (USPIS), U.S. Secret Service (USSS), U.S. Immigration and Customs Enforcement (ICE), U.S. Department of Housing and Urban Development-Office of the Inspector General (HUD-OIG), Federal Deposit Insurance Corporation-Office of the Inspector General (FDIC-OIG), the Department of Veterans Affairs-Office of the Inspector General (DVA-OIG) and U.S. Bankruptcy Trustees”(p.7).

To adequately combat mortgage Crime in Australia, an intensive machine, such as the one in the US is not out of place. The Australian Government can create an agency such as the FBI that work be a special force as a system to work intensively on combating crime. The agency would as necessary regulate the legal frame work of the banking sector and ensure stiffer and stringent yet friendly ways of relating the customer and the bank. The monetary regulation agency would be equipped against terrorist financing, money laundering and mortgage fraud and as well provide a network that would the information of people together the fight the complex criminal challenges of financial transactions.

Punishment of mortgage Fraudsters

In Australia, the prosecution of mortgage fraud is carried out federally. This is similar to the situation in the US where the office of the Attorney and a section of the Criminal Fraud Department of Justice handles mortgage prosecution cases. Forgery and fraud in Arizona is an offence that can stretch to two and half years, for a first offender. Serious charges of mortgage crime are theft identical and require Attorney aggressive defense to set free the offender.

For example, a credit card theft is viewed under AZ laws and Penalty. One who takes or possesses the credit card of another without the latter’s consent is found guilty under the law. According to Panama (2009, p.3), the same charges hold when one holds onto the credit card of another as a security for assessing a debt or for credit card sell on the internet with the motive of defrauding.

This is a Class five felony offence. It potentially carries a one and half years jail term for first offenders. And the offend stands even when the credit card has not been used. The offence is referred under the Arizona statute ARS 13-2102 as Theft of a Credit Card, which varies significantly from the penalty for Fraudulent Use of a Credit Card.

Forgery in the Arizona is a felony in Class 4,and it is accrued to four years jail term for first offenders. This is figured under Forgery statutes-ARS 13-2002; whereby a misdemeanor is considered.

In Australia, taking the identity of another is as much a crime, and criminal impersonal and taking another’s identity can be applied with stiffer penalties to discourage perpetrators to the maximal. Undocumented worker or even documented one -like David here consider- can become more conscious of the need to abstain from mortgage crimes.

What the Corporate Acts 2001 is The Corporations Act 2001 is very often referred to as the Corporation Act. Informally, it is referred to as the ‘Corps’ Act, and is an act constituted from the Commonwealth of Australia. The slaw brings forward the various laws dealing with the activities of all entities in Australia both at interest as well as the federal level.

The Act is currently the largest statutory corporation in the world (Forga, 2001. P 56). It is simplified by the CLERP.Gagah(2003) in his work revealed that” At thousands of long pages, the statute of the law dwarfs or slinks other nations including a country like Sweden- whose statutory corporations is less than two hundred pages long, comparatively”(p.67). Principally, the Corporations Act regulates Australian based companies. The Act controls such functionalities as the operation and the formation of companies that are constitutionally in conjunction with those adopted by company. It monitors the assignments of officers in case of fundraising and takeovers.

Gagah (2003, p56) Indicated in his work that,”the Corporation Act 2001 demands the chief, or direct, or other official to a company should exercise and discharge their powers to their duties with outmost diligence and care”(p.4). Adu, (2009). Revealed that,” this duty is topical of a business of the judgment rule which demands a director or a chief to making a judgment to:

make the judgment in good faith and for a proper purpose;
not to have a material personal interest in the subject matter of the judgment;
inform themselves about the subject matter of the judgment to the extent they reasonably believe to be appropriate;
Rationally believe that the judgment is in the best interests of the corporation”(P. 45).

In addition, directors to companies and institutional top officers must take power in worthy faith in the corporation’s best interest. These heads are prevented from using their position improperly to gain advantages for some else, themselves, or bringing about detriment to the corporations they head.

These two provisions from the Act also are true and applicable to employees of the companies. The provisions permit a rise to the civil obligation. There are as much provisions for civil penalty. In a case whereby a legal institution, a court, determines the provisions for civil penalty as has been properly contravened.

The court possesses all rights to disqualify the ailing management of the corporations for as much as the period as considered appropriate by the court.

Under the Act, a provision is made to check acts of intentional recklessness due to dishonesty as would occur in their inability to cushion and discharge responsible duties within their reach. Director have the responsibilities to making frank and full disclosure and dissemination of information within reach of knowledge to enable shareholders make proper judgments on resulting matters (Adadu,1998,p.3).

The fraud case of ABC Pty Ltd and Easyloan Bank Ltd via David

The transaction between ABC Pty and Easyloan Bank Through a director of ABC Pty Ltd, Mr David, is a clear case of fraud and impersonation. David signed a mortgage and a guarantee in favor of himself, in indirectly through the vehicle of ABC Limited. David mortgages a piece of landed property that belongs to ABC Ltd. Both the documents he has been forged with fake appendages, with include the signature of two of his colleagues Sarah and Chen. His colleagues have do not have the dimmest knowledge of the transaction between the company that they both direct with David. And without a proper system, or frame work, to check the authenticity of the document signed by David, the bank goes ahead and transacts business with David. It is proper to point out the faultiness in the structure of the bank that carries financial transactions. This fault can be traced to in appropriate confidence in a serious transaction as in consideration. It was only appropriate for the bank to realize that if ABC Pty Ltd is headed by three individuals and a singular member of the management should not be singled out to carry a transaction, such as this.

Secondly, the fault and failure on the side of the bank can be traced to total confidence in the recent trend of computerization in the financial industry; where individuals transact financial business via wire, cable and electronic mediums. These modes of transactions do not always necessary have the ability to check transactions with a human sense of inspection. As such, faults are liable in such transactions.

Thus, in the transaction between ABC Pty Ltd and Easyloan Bank Ltd was not appropriately followed due to the earlier mentioned reasons. Since, the unconstitutional transaction between the two bodies proceeded.

In a similar case of bank and fraud between a secondary school principal, Mr Ujah (here after referred to as the man) and Union Bank of Nigeria Plc(here after referred to as the bank) in Makurdi, Nigeria, a case of fraud was pronounced by the Makurdi High Court of Justice when the man took a lone from the bank with a claim to refurbish the school, which he was support to take in the company of the treasurer of the school but however the man took the lone alone and embezzled the withdrawn money and did not refund the bank. So, the bank took the man to court. The court deliverance was as below:

“After due investigation, the following judgment according to the criminal laws of Nigeria Section 3 (1) and 14 (2) Mr Ujah is to refund Union bank completely, or his property confiscated And then, Ujah would serve a six month jail term. ‘

It is necessary to emphasize that the bank had every right to take the man to court on charges of defraud, but however the bank was at fault for haven given the lone without proper signatory(Gagah,2003,p.5).

Conclusions

The Corporations Act of 2001 is a Commonwealth grand jury highly responsible for monitoring criminal activities perpetrated by organizational heads, managers of institutions, and management. It is similar to the FBI in the United States. Its target to alleviate financial crime is Australia is enhanced by its formidable structure, and system that is carefully put together by the government.

In the case presented above regarding fraudulence by one David of ABC Pty Ltd and Easyloan Bank Ltd, the Act is not silent. It states the following as some of the reasons necessary for enacting of the Act: Entries or statements generally; HUD and Federal Housing Administration Transactions; Credit and Loan applications generally; Fraud and related activity in connection with identification documents; Swindles and Frauds by Mail; Fictitious name or address; Fraud by wire; Bank Fraud; Abetting and Aiding; Conspiracy; False Social Security Number.

In my judgment, the Easyloan Bank Ltd has every right to take ABC Pty Ltd to court; until the latter would prove that the signatures are fake and that David was a fraud. But the court must be careful to caution the bank against its non genuine and non stringent measures to financial transactions. Notwithstanding this position other jurist could argue that what measures the bank took in ensuring that the signatures on the papers were real. And another important question is were they parties present who claimed to have signed or did David capitalize on his relationship with the bank to commit the crime in such cases the bank stands to loose.

Reference List

Adu, S. (2009). Crimes and Industries. Kaduna: Ihomver.

Adadu, u. (1998). Organizational Fraud. Cairo: Naca.

Doowuese,U. (1998). Public Safety Employer Employee Co-operation Act 2001.Abwa:sese.

Gagah,A. (2003). A Review of the 2001 Co-operations Act. Abuja:Aboki.

Iaana, F. (1995). Partnership Business and the Law. Jos: Carna.

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