Fraud

Throughout the 1990s and into the twentyfirst century, the incidence of “street crimes” such as robberies, burglaries, simple assaults, aggravated assaults, rapes, and homicides declined in the United States. During the same time period, however, the incidence of fraud increased. Fraud has not only emerged as a growing problem for individual citizens but also has become an increasing burden for private industry and state, local, and federal governments. All are potential victims of fraud. Unlike other crime victims, victims of fraud may not realize that they have been victimized until long after the criminal act is committed. Some victims lose substantial amounts of money to fraud, depleting savings and retirement accounts and, consequently, resulting in great emotional distress. For a variety of reasons, fraud remains one of the most underreported crimes, exacerbating the efforts of law enforcement authorities to effectively control fraud. Techniques for committing fraud are many, and the offenders often target potential victims based upon behavior patterns that may make one more susceptible to victimization. Advances in technology, particularly the arrival of the Internet, have permitted present-day “fraudsters” to conveniently reach enormous numbers of potential victims to ply their criminal trade.

Considering the amount of government funding allocated to the control of “street crime,” there has been relatively little funding set aside for the control of fraud. This is due in part to a long-standing belief that the public is apathetic towards fraud. Groups like the [Page 741]National Fraud Investigation Center have reported that government funding for the investigation and prosecution of fraud remained fairly flat from 1992 through 1998, despite a rise in financial costs and arrests associated with these crimes during the same time period. While it is difficult to precisely measure the sum of the financial losses attributed to fraud, criminologists generally agree that fraud exacts a cost that dwarfs that incurred from street crime. The Federal Bureau of Investigation's Uniform Crime Reports (UCR) national arrest statistics for the period from the beginning of 1979 through the end of 1999 show that while arrest rates for most crimes of violence and property crimes have declined, arrest rates for fraud have risen, peaking in 1996.