My question involves collection proceedings in the State of: Texas
Generally, will a bank prosecute for lying about income and defaulting?
My question involves collection proceedings in the State of: Texas
Generally, will a bank prosecute for lying about income and defaulting?
Banks don't prosecute anything but they can certainly report the fraud to the appropriate authorities and cooperate with the authorities in the prosecution.
Will the bank do that?
If I could foretell the future I wouldn't be sitting here answering questions I'd be at the race track raking in money.
Right, but, generally. Are banks known to prosecute for this? Wouldn't they first need proof that my income isn't as stated?
My experience with the banks in my area has been that if a bank finds out you lied on the loan application and the loan doesn’t look like it’s going to get paid thye they generally do make the complaint for criminal prosecution. They often need to do that to meet the requirements of any insurance they have to cover fraud losses. What the practice of the banks in your area is I cannot say. The prosecutor would, of course, have to have evidence to prove that the application was false. If they had information that you overstated your income, that would do. Note that bank fraud can be both a federal and state criminal offense, so this can turn out to be quite serious.
Yes, but it wouldn't be too hard to get.
I imagine that the bank could first sue you for the default and, during discovery, subpoena records from any income source you gave on the application.
Once your actual income is matched to your stated income the next call could be to the police.
What did you do?
I'm scared. I know that doesn't mean much, becuase I'm the one that did it, but is it only likely if the bank actually sues me? The amount I owe is only about 3k. I don't know if that means anything, but maybe it gives some type of idea. The only reason I feel a little safe, is becuase of the fact that it is done all the time, and banks aren't going to prosecute every person that Ioverstates their income. I'm not justifying what I did. But, before any charges are brought to me, would it be more likely to get sued for the balance?
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It's on a credit card, unsecured.
Most people do not overstate their income on loan applications, though some of course do. When it comes to criminal prosecution, the bank simply makes a complaint to the appropriate law enforcement agency (e.g. FBI, state or local police, or sheriff). The law enforcement agency then does whatever investigation it thinks is appropriate and if the officers believe there is a good case they give the information to the prosecutor who then decides whether to pursue criminal charges. In other words, there isn’t much effort on the part of the bank in the process. It’s pretty easy to make the complaint.
That said, you are talking about approximately $3,000 owed on an unsecured credit card. The bank isn’t losing much on this and it’s not likely to dig very deep to see if the income information on the application was correct. The bank will likely assign the debt to a collection agency and of course report the debt as delinquent to the credit bureaus. You might be sued at some point. The risk of criminal prosecution here is not real high, but it could happen if the bank does find out about the misstated income. How much income did you say you had and how much did you really have? In order to make the criminal case, the information on the application had to make a difference in the lending decision. In other words, if the bank would still have provided you the credit card knowing your correct income then there is no criminal case for fraud.
If the account is bought by a collection agency, can that agency press criminal charges?
A collection agency certainly can report a suspected crime but it's unlikely that a collection agency would even care about what was on the application because all the collection agency wants is the money.
Generally, when you apply for a credit card, the important criteria is your credit score and credit history. The income ranges that you generally have to check are more for marketing statistics than for eligibility and overstating the range isn't likely to be much of an issue but that's not saying that it'll never happen.
The collection agency isn’t likely to bother reporting it. After all, it is not the one that was victimized by the fraud. But certainly it could make the complaint if it wanted to. You don’t have to be a victim of a crime to report a crime.