Criminal Liability for Bank Fraud in New York

Bank fraud is a federal crime that involves many broad behaviors with the goal of obtaining money from either a bank or innocent customers through misrepresentation or false pretenses. 

This White Collar crime carries stiff punishment, including up to 30 years in prison and a $1 million fine. 

Heiferman & Associates, PLLC is a Queens-based criminal defense law firm with over 20 years of experience handling financial investigations and prosecutions. Founding attorney Justin Heiferman utilizes his experience working with nationwide banks and as an assistant district attorney in Nassau County to your advantage in mounting your defense. If you are facing criminal charges related to bank fraud, Heiferman & Associates, PLLC has the experience necessary to assist you in obtaining the best possible outcome in your case.

How is bank fraud specifically defined?

Bank fraud often is charged as a federal crime perpetrated against a financial institution that is federally insured or linked to the federal system of banks. Bank fraud can also occur when a defendant pretends to be a financial institution in order to obtain funds from innocent customers.

The federal criminal code states that bank fraud occurs when a defendant:

executes, or attempts to execute, a scheme or artifice–

  1. to defraud a financial institution; or 
  2. to obtain any of the moneys, funds, credits, assets, securities, or other property owned by, or under the custody or control of, a financial institution, by means of false or fraudulent pretenses, representations, or promises. 

18 U.S.C. § 1344.

“Scheme or Artifice”

This statute intentionally defines acts constituting bank fraud broadly. While there is no precise definition of “scheme or artifice,” it is commonly understood to mean a plan formulated with the intent to deceive others by false or fraudulent pretenses to obtain money, property, or services. One example of a scheme or artifice is impersonating another person to obtain funds from that person’s bank account.


Fraud is generally defined as a deceptive act intended to result in financial gain. In the prior example, impersonating another person is a fraudulent act because the intent behind it is to gain funds belonging to the other person’s bank account. 

“Pretenses, Representations, or Promises”

False or fraudulent pretenses, representations, or promises include many criminal behaviors equating to lying or creating a false narrative. In the prior example, the impersonation is a false pretense or representation because the intent is to make a bank teller believe the criminal is a bank customer. Other examples of false pretenses or representations include providing inaccurate or falsified financial documents or lying about assets. A false premise would include signing a promissory note to repay a debt with the knowledge that the debt will never be repaid. 

What is a financial institution?

Generally, a financial institution is a bank. The federal statute defines a financial institution as one of eight different types of institutions. These include banks with deposits insured by the Federal Deposit Insurance Corporation (FDIC), institutions that are members of the Federal Reserve, credit unions, home loan banks, broker-dealers registered with the Securities and Exchange Commission, and potentially foreign banks operating under the Federal Reserve.

Do I actually have to obtain money or property to be prosecuted?

Unfortunately, the answer to this question is no. Because the federal statute considers a person who executes or attempts to execute a scheme or artifice to defraud liable, a defendant does not have to successfully obtain money or property from a financial institution to be guilty of bank fraud. All that is necessary is that the defendant attempted to defraud a financial institution.

What is the punishment for bank fraud?

Federal law is harsh on criminals convicted of bank fraud. As mentioned earlier, the statute provides that a person convicted of bank fraud may be imprisoned for up to 30 years and/or pay a fine of up to $1 million. 

The severity of the punishment varies based on the circumstances of each case and the federal sentencing guidelines prescribe the level of punishment applied based on the value of the money or property involved and other mitigating or aggravating factors.

Additionally, financial crimes may also involve violations of other federal statutes, such as the Racketeer Influenced and Corrupt Organizations Act (RICO) or the Patriot Act, which could add to a defendant’s potential sentencing.

What are the defenses to bank fraud?

The10-year statute of limitations serves as a defense to bank fraud. This means the government must bring charges for bank fraud within ten years of the commission of the offense. This is important because many statutes of limitations begin running from the date the crime is discovered–often because crimes involving fraud are discovered well after the commission of the fraud. However, the federal statute specifically states the statute of limitations runs from the date the fraud is committed.

Other defenses may be discovered by reviewing law enforcement’s investigation of the crime. For instance, the Fourth Amendment to the U.S. Constitution protects citizens against unlawful searches and seizures, including electronic surveillance. If law enforcement conducted surveillance or other searches and seizures without obtaining court approval (a warrant), this can diminish the evidence against the accused. 

Finally, the most common defenses to charges for fraud is that a defendant did not have the intent to defraud. In the case of bank fraud, this could occur when a defendant submitted incorrect financial records that were not intentionally falsified. Thus, if the financial records were technically false as a result of inaccurate bookkeeping but the defendant did not intentionally falsify the records, there is no liability for bank fraud.

Can the State of New York bring charges?

New York statutes provide state prosecutors the ability to pursue criminal charges for crimes related to bank fraud as well. State law allows for the prosecution of a scheme to defraud, or any attempt to defraud another or obtain property by false pretenses, representations, or promises.

Additionally, state law recognizes the forgery of a written instrument as both a misdemeanor and/or a felony, depending on the magnitude of the crime. Other state crimes include identity theft; falsifying business records or creating a false financial statement; fraudulently selling real or personal property securing a debt; residential mortgage fraud.

Contact a Criminal Defense Attorney Today

Bank fraud is a serious crime that can result in a substantial prison sentence and millions of dollars in fines. If you are under investigation for bank fraud or other financial crimes, you need the expertise of an experienced law firm to protect your rights. As opposed to some crimes, when it comes to defending a bank fraud case, knowledge of the law isn’t always enough. The ability to work with massive amounts of bank documents and understand financial accounting is crucial. Several of our attorneys have accounting and mathematics degrees. We also work with forensic accountants, when necessary.

Heiferman & Associates, PLLC offers extensive experience representing defendants under investigation for and charged with bank fraud and other white-collar crimes. Our criminal defense lawyers understand state and federal investigations are daunting. We are here to guide you through the process, advising you of your best interest at every step of the way. Heiferman & Associates, PLLC operates first to absolve you as a suspect or get any charges dropped but also has experience negotiating reduced charges and sentencing or representing defendants at trial if necessary. We handle bank fraud matters all over the New York/New Jersey metropolitan area, including state and federal courts. We are the professionals by your side, working to preserve your freedom and reputation.