[ADiamond]

i fancy myself to be pretty sharp when it comes to catching fraudulent accounts. i've seen basic fraud attempts as simple as photoshopped statements, and very advanced methods as large as a merchant using a fake bank website and it actually got by lenders, allegedly. it's on the underwriter to do his due dilly - but i am constantly seeing lenders, even top tier ones who we would consider to be industry leaders, fund deals that have defaulted on competitors or even fund deals that clear as day are fraud. there are lenders who offer less stringent verification, and they may even be targeted by the merchant with the aid of sales reps who are in cahoots with the client. as we progress toward a more "fintech"/automated industry, these attempts will become more consistent and advanced. it seems to me that although lenders are losing money every day to fraud, charges are never fully pursued on their behalf. maybe for fear of publicity, maybe its easy to just write it off, maybe it's too costly and time consuming to go to court for that.

[Funder Mark]

And what is the solution? How much would it cost for a funder to actually sue a client? The only way it would make sense is if a lawyer would do a whole bunch of these deals on contingency, but how would that look to a jury?

[Collection Specialist]

Both the cost and burden of proof to seek and obtain damages in TORT law are so profound that unless a lender is out 75k or more, it's simply easier to sue as you would anyone else.

Unless you have such glaring proof where a summary judgment would be issued, it's very tough

[CreditGuy]

Why sue someone and waste your capital, when you can refer them to the FBI, AG, or US Attorney's office and use taxpayer funds to punish them? I've never pursued civil charges, but I have worked with state and federal AGs, FBI, postal inspectors, etc. to break up fraud rings, conspiracies, etc.. Feds especially love charging people with wire fraud and mail fraud.

[ridextreme]

And what is the solution? How much would it cost for a funder to actually sue a client?

fraud is a criminal offense, it won't cost anything besides the phone call to the detectives.

[Michael I]

fraud is a criminal offense, it won't cost anything besides the phone call to the detectives.

fraud to a bank yes . but what exactly are most of us . One of my lenders funded a total fraud like 2 years ago . the lender tried to file as criminal offense and got no where . i don't know the specific

[Funder Mark]

fraud is a criminal offense, it won't cost anything besides the phone call to the detectives.

But would you get your money back?

[ridextreme]

fraud to a bank yes . but what exactly are most of us . One of my lenders funded a total fraud like 2 years ago . the lender tried to file as criminal offense and got no where . i don't know the specific

you don't need to defraud only a bank to be charged with it. You can defraud anyone but the key is they are using a forged instrument in the process which is illegal.

I never understood why they funders never really move forward besides emailing us back saying "this file is fraud".

Written Instrument: Regardless of what degree of Forgery you are investigated or arrested for, your Forgery must be of a “written instrument.” According to the New York criminal code, this type of instrument or article includes a wide array of items that can be used to your advantage or the disadvantage of another person. Obviously, the scope is enormous and can include computer data or any other articles that convey or embody evidence of value, right, privilege or identification.

But would you get your money back?

if these merchants are stopped, maybe they won't keep doing it. And yes, if the judge orders restitution, you will get your money back.