What Counts as Bank Fraud in a Federal Case?

 Posted on June 28, 2026 in White Collar Crime

Bank fraud is one of the most aggressively prosecuted white collar crimes in the federal system. It covers a wide range of conduct — some of it obvious, some of it less so — and federal prosecutors have many tools at their disposal to build cases that can result in decades of time in prison.

If you are under investigation or have already been charged with federal bank fraud, you need an outstanding Chicago federal criminal defense lawyer now.

What Is the Federal Bank Fraud Statute?

Federal bank fraud is defined under 18 U.S.C. § 1344. The statute makes it a federal crime to knowingly execute, or attempt to execute, a scheme to defraud a financial institution. This law also makes it illegal to obtain money or property from a financial institution through false or fraudulent pretenses, representations, or promises.

A conviction under § 1344 carries a maximum sentence of 30 years in federal prison and fines of up to $1 million per count. Because federal prosecutors frequently charge multiple counts arising from the same course of conduct, the sentencing exposure in these cases can be enormous even for defendants who allegedly played a relatively limited role.

Two other things about this statute are important to understand. First, an attempt is enough — you do not have to succeed in defrauding anyone to be charged. Second, the financial institution itself does not have to suffer an actual loss. The government only needs to prove that you intended to deceive it.

What Are the Most Common Federal Bank Fraud Schemes?

People often get very creative when it comes to fraudulent financial transactions, but certain types of bank fraud are more common than others.

Check Fraud

Check fraud is one of the most frequently charged forms of bank fraud in recent years. It includes writing checks on accounts with insufficient funds, altering the payee or amount on a legitimate check, forging signatures, and creating counterfeit checks using account information obtained through theft or data breaches.

What often surprises people is how quickly check fraud can become a federal crime. A pattern of fraudulent check activity across multiple accounts or institutions can result in a multi-count indictment, with each transaction charged as a separate count.

Loan Application Fraud

Lying on a loan application about your income, your assets, your employment status, or the intended use of the funds to a federally insured bank is also covered by the bank fraud statute.

This includes mortgage fraud, where borrowers or brokers inflate property values or falsify income documentation to obtain loans that would not otherwise be approved. This often surprises people, who don’t think inflating their income a little to get a nicer house is such a big deal. Unfortunately, mortgage fraud is a claim often brought against high-profile politicians and public servants whose income is well-known to the public.

Federal investigators look closely at a mortgage loan file when fraud is suspected. Inconsistencies between what was submitted and what financial records actually show are often the starting point for a prosecution.

PPP Loan Fraud

The Paycheck Protection Program, created during the COVID-19 pandemic, produced a significant wave of federal fraud prosecutions that federal prosecutors in Chicago and across the country are still actively pursuing in 2026. Applying for a PPP loan using fabricated payroll records, inflated employee counts, or fictitious businesses constitutes bank fraud. In many cases, wire fraud is involved as well.

The federal government has dedicated substantial resources to investigating and prosecuting PPP fraud cases, and the paper trail left behind by electronic applications and bank records makes these cases relatively straightforward for prosecutors to build. People who believed their conduct was minor or that the program's size made detection unlikely have found themselves facing serious federal charges.

Account Takeover and Identity-Based Schemes

Using another person's identity or account information to access funds, open new accounts, or get credit is another common basis for federal bank fraud charges. These schemes often involve additional charges under the identity theft statutes, which can add mandatory minimum sentences on top of the bank fraud exposure.

How Do Bank Fraud Cases Become Multi-Count Indictments?

Each individual transaction and each use of a wire or mail communication in furtherance of the scheme can be charged as a separate count. A defendant who submitted three fraudulent loan applications, sent supporting documents by email, and made follow-up calls to loan officers may find themselves facing a dozen or more counts. These might include charges of:

• Bank fraud
• Wire fraud under
• Money laundering charges 

Federal sentencing guidelines then calculate a recommended range based on the total loss amount and the number of victims, which can push sentences significantly higher even for first-time offenders.

Bank fraud cases also frequently involve parallel civil proceedings. The FDIC, the SBA, and other federal agencies may pursue civil remedies alongside the criminal case, meaning defendants face potential liability on multiple fronts simultaneously.

What Should You Do if You Are Under Federal Investigation for Bank Fraud?

The moment you become aware that federal investigators are looking at your finances, you need to speak with a federal criminal defense attorney before saying anything to anyone.

Federal investigations often go on for months or years before charges are filed. By the time most people find out they are a target, investigators have already gathered substantial evidence. Statements made to agents without counsel, even ones that seem harmless or explanatory, frequently become part of the government's case against the person who made them.

Do not wait to see whether charges actually get filed. Working with a federal criminal defense attorney early in a case can actually affect how the investigation unfolds, whether charges are filed at all, and what the charges look like if they are.

Call a Chicago Federal Criminal Defense Lawyer Today

At the Law Offices of Hal M. Garfinkel LLC, Chicago Criminal Defense Attorney, Attorney Hal M. Garfinkel brings nearly 20 years of experience defending clients against federal charges in Chicago and throughout Illinois. We offer free consultations and are available 24 hours a day, including evenings, weekends, and off-site appointments. We can meet you at a police station or jail and are available for bail and bond hearings when the timing is urgent.

Call a Chicago bank fraud defense attorney at the Law Offices of Hal M. Garfinkel LLC, Chicago Criminal Defense Attorney today at 312-629-0669 to confidentially discuss your situation.