Category:Consumer Fraud

Consumer fraud encompasses criminal schemes that target ordinary consumers through deceptive business practices, misleading advertising, predatory lending, and other tactics designed to extract money from victims through dishonest means. Federal prosecutors pursue consumer fraud cases under various statutes, with sentences often reflecting the scale of harm caused to victims and the vulnerability of the populations targeted.

Consumer fraud cases frequently involve sophisticated operations that exploit gaps in regulatory oversight or use complex corporate structures to evade accountability. These schemes can devastate victims financially and emotionally, often targeting those least able to afford losses—elderly individuals, low-income communities, and people in financial distress seeking quick solutions to their problems.

Lending operations that use deceptive practices to trap borrowers in high-cost debt cycles. This includes:

• Payday loans with hidden fees and automatic renewals
• Misleading interest rate disclosures
• Loans structured to maximize fees rather than help borrowers
• Use of legal loopholes (such as tribal immunity) to evade consumer protection laws

The Scott Tucker case, resulting in a 16-year, 8-month sentence, demonstrated how predatory lenders can extract billions from vulnerable consumers through systematically deceptive practices.

Schemes conducted over the phone targeting consumers with:

• Fake prize notifications
• Fraudulent investment opportunities
• Bogus charity solicitations
• Tech support scams

Online schemes including:

• Fake e-commerce websites
• Phishing and identity theft
• Romance scams
• Advance fee fraud

Selling products or services through deception:

• False advertising
• Fake reviews and testimonials
• Counterfeit goods
• Services never delivered

Consumer-oriented investment schemes such as:

• Ponzi schemes
• Pyramid schemes
• Fake cryptocurrency investments
• Unregistered securities offerings

Consumer fraud is prosecuted by multiple federal agencies:

The DOJ's Consumer Protection Branch specializes in prosecuting fraud affecting consumers, including cases involving:

• Deceptive trade practices
• Unsafe consumer products
• Healthcare fraud affecting patients
• Financial fraud targeting individuals

The FTC pursues civil enforcement against consumer fraud, often working in parallel with criminal prosecutors.

The CFPB regulates consumer financial products and refers criminal matters to the DOJ.

Sentences in consumer fraud cases are influenced by:

• Total financial loss to victims
• Number of victims affected
• Vulnerability of victim population (elderly, low-income)
• Sophistication of the scheme
• Defendant's role (leader vs. participant)
• Efforts to evade detection

Large-scale consumer fraud operations can result in sentences exceeding 15-20 years in federal prison.

Consumer fraud causes significant harm:

• Financial devastation for families
• Loss of retirement savings
• Emotional trauma and stress
• Damage to credit scores
• Bankruptcy and loss of homes

Many victims never fully recover from serious consumer fraud schemes.

• Wire Fraud
• Mail Fraud
• Bank Fraud
• Identity Theft
• RICO Violations