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Guide to fraudulent misrepresentation in New York

On Behalf of | Aug 2, 2022 | Criminal Defense |

If you are accused of fraudulent misrepresentation in New York, there’s a potential of facing a felony charge or even having your company shut down. Therefore, it is important to understand its elements and what to do in case your client files a lawsuit.

Understanding fraudulent misrepresentation

In general, misrepresentation is an untrue statement that’s made about something with the intention of inducing someone else to rely on it. When this misrepresentation leads to damages, it may be considered fraud. In New York, there are three types of fraudulent misrepresentation: common law fraud, statutory fraud, and civil RICO (Racketeer Influenced and Corrupt Organizations) fraud.

Common law fraud occurs when someone makes a material misrepresentation with the intention of inducing reliance and causing financial damages. For example, if you’re selling a car and lie about its mileage to make your client pay more.

Statutory fraud occurs when a person or business makes a material misrepresentation while applying for a professional license, such as a real estate broker’s license. The accuser must show that they relied on your misleading information when deciding to grant the license.

Civil RICO fraud is a federal law that prohibits racketeering activities, such as bribery, wire fraud, money laundering and embezzlement. To be convicted of civil RICO fraud, the government must prove that you were part of an ongoing criminal enterprise and committed at least two acts of racketeering.

What to do when accused

You or your criminal defense attorney can use defenses such as:

  • Not knowing that the statement you were giving was false
  • Proving that your statement was indeed true
  • You didn’t make the statement with the intention of defrauding anyone
  • If you are facing a civil RICO fraud accusation, you can also argue that you weren’t part of a criminal enterprise

A fraudulent misrepresentation conviction in New York can lead to 25 years in prison with hefty fines and financial restitution to the victim. On top of that, you may have a harder time getting the licenses and certifications you need for your business or career.

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