An air loan is a fraud scheme in which a mortgage broker invents both a property and a borrower in order to earn false profits. The lending bank ends up losing everything, because the home it would normally hold as collateral on which to foreclose does not exist.

An air loan is a type of mortgage fraud that seeks to profit from unsuspecting lenders. An air loan is a fraud scheme in which a mortgage broker invents both a property and a borrower in order to earn false profits. The broker must also convince as to the property’s title history and appraisal value, fabricating land title records, fake ownership documents, and other records to indicate that the false property exists. A mortgage broker invents both a property and a borrower in order to earn false profits on completed loan transactions. As the borrower is not real, the broker must set up a system of phony phone numbers and mailboxes that are used to “verify” a false identity through employment records, home address, credit history, Social Security number, and so on.

Air Loan

Barings Banks was a British merchant bank that collapsed in 1995 after one of its traders lost over $1 billion in unauthorized trades.

Barings Banks was a British merchant bank that collapsed in 1995 after one of its traders, 28-year-old Nick Leeson operating in its Singapore office, lost $1.3 billion in unauthorized trades. The Dutch bank ING Group, purchased Barings Bank in 1995 for the nominal sum of £1.00, assuming all of Barings' liabilities and forming the subsidiary ING Barings. Barings Banks was a British merchant bank that collapsed in 1995 after one of its traders, 28-year-old Nick Leeson operating in its Singapore office, lost $1.3 billion in unauthorized trades. Barings Bank was a UK-based merchant banking firm that failed after a trader named Nick Leeson engaged in a series of unauthorized and risky trades that went sour in 1995. The bank's assets were subsequently acquired by the Dutch ING Groep, forming ING Barings.

Barings Bank

Carding is a form of fraud that uses stolen credit card information to charge prepaid cards that are sold off.

Carding is a form of credit card fraud in which a stolen credit card is used to charge prepaid cards. The United States is a significant target for credit card fraud because it is a large market in which credit card and debit card use is common, and because the types of cards that are used either only contain a magnetic stripe or employ a chip and signature technology, rather than the chip and personal identification number (PIN) technology found in most of Europe. Most credit card companies offer cardholders protection from charges made if a credit or debit card is reported stolen, but by the time the cards are canceled, the carder has often made a purchase. Carding is a form of credit card fraud in which a stolen credit card is used to charge prepaid cards. Carding is a form of credit card fraud in which a stolen credit card is used to charge prepaid cards.

Carding

Card-not-present fraud is a type of scam that is committed without a physical card being presented to a merchant.

Table of Contents
What Is Card-Not-Present Fraud?
Understanding Card-Not-Present Fraud
How Card-Not-Present Fraud is Committed Under credit card terms and conditions, the credit card issuer will not hold the cardholder liable for any fraudulent charges, whether through card-present or card-not-present fraud. The theft of credit card data for use in card-not-present fraud most commonly occurs through online phishing or through theft of a business’s customer credit card information by dishonest employees. The theft of credit card data for use in card-not-present fraud most commonly occurs through online phishing or through theft of a business’s customers’ credit card information by dishonest employees. Card-not-present fraud is a type of credit card scam in which the customer does not physically present the card to the merchant during the fraudulent transaction.

Card-Not-Present Fraud

Card-present fraud is a transaction in which the fraudulent party physically presents the counterfeit credit card to the merchant.

Payment Card Fraud Rates in the United States Relative to Other Countries since Migrating to Chip Cards

Card-present fraud is a transaction in which the fraudulent party physically presents the counterfeit credit card to the merchant. For example, all MasterCard (MA) credit card account numbers begin with a 5, all Visa (V) credit card account numbers begin with a 4, all American Express (AXP) credit card account numbers begin with 37 or 34, and all Discover Financial Services (DFS) credit card account numbers begin with a 6. In addition, the first or last four numbers of the credit card account number will usually be printed in a second place on the card, such as directly below the embossed account number or on the back of the card on the signature panel, with the location varying by card issuer. A simple example of card-present fraud would be when a thief steals a credit card and then simply uses that card in-person at a store to make a purchase. Card-present fraud has become less common because credit card thieves have shifted their attention to online forms of credit card fraud.

Card-Present Fraud

A credit card dump is a type of crime in which the criminal makes an unauthorized digital copy of a credit card.

The 15 biggest data breaches of the 21st century

A credit card dump is a type of crime in which the criminal makes an unauthorized digital copy of a credit card. These include refraining from sharing their credit card information with others, keeping their credit cards close at hand when in public places, checking for any suspicious objects on or around ATMs, gas pumps, and POS machines; and regularly reviewing their credit card statements for any unfamiliar transactions. A credit card dump is a type of crime in which credit card information is stolen from customers. A credit card dump is a type of crime in which the criminal makes an unauthorized digital copy of a credit card. Although measures such as personal information numbers (PINs) and security chips can help make this theft more difficult, hackers nonetheless continue to find new ways to exploit weaknesses in the electronic payments system in order to capture valuable credit card information.

Credit Card Dump

The LIBOR scandal, which came to light in 2012, involved a scheme by bankers to manipulate the London Interbank Offered Rate (LIBOR) for profit.

The LIBOR Scandal was a highly-publicized scheme in which bankers at several major financial institutions colluded with each other to manipulate the London Interbank Offered Rate (LIBOR). During the LIBOR Scandal, traders at many of these banks deliberately submitted artificially low or high interest rates in order to force the LIBOR higher or lower, in an effort to support their own institutions’ derivative and trading activities. The LIBOR Scandal was a highly-publicized scheme in which bankers at several major financial institutions colluded with each other to manipulate the London Interbank Offered Rate (LIBOR). Following the exposure of the LIBOR collusion, Britain’s Financial Conduct Authority (FCA) took the responsibility for LIBOR supervision away from the British Bankers Association (BBA) and turned it over to the Intercontinental Exchange's Benchmark Administration (IBA). The LIBOR is used to determine everything from the interest rates that giant corporations will pay for loans, to the rates individual consumers will pay for home mortgages or student loans.

The LIBOR Scandal

The intention of mortgage fraud is typically to receive a larger loan amount than would have been permitted if the application had been made honestly. 

More Than 400 Defendants Charged for Roles in Mortgage Fraud Schemes as Part of Operation 'Malicious Mortgage'

The intention of mortgage fraud is typically to receive a larger loan amount than would have been permitted if the application had been made honestly. Aside from lying on a loan application, other types of mortgage fraud include:
Straw buyers are loan applicants used by fraud perpetrators to obtain mortgages and are used to disguise the true buyer or the true nature of the transaction.
An air loan is a loan to a straw or non-existent buyer on a non-existent property.
A double sale is the sale of one mortgage note to more than one investor.
Illegal property flipping occurs when property is purchased and resold quickly at an artificially inflated price, using a fraudulently inflated appraisal. In addition to individuals committing mortgage fraud, large scale mortgage fraud schemes are not uncommon. In short sale fraud, the perpetrator profits by concealing contingent transactions or falsifying material information, including the true value of the property, so the servicer cannot make an informed short sale decision. The FBI and other enforcement agencies charged with investigating mortgage fraud, particularly in the wake of the 2008 housing market collapse, have broadened the definition to include fraud targeting distressed homeowners.

Mortgage Fraud

PIN cashing is a type of cybercrime in which stolen debit or credit card information is used to gain access to bank or credit accounts.

FICO Data: 10 Percent More Debit Cards Were Compromised in U.S. Last Year

PIN cashing is a type of fraud in which the use of stolen debit or credit card information allows a thief to gain access to the cardholder’s bank or credit account. PIN cashing is a type of fraud in which the use of stolen debit or credit card information allows a thief to gain access to the cardholder’s bank or credit account. Typically, PIN cashing involves the use of an automatic teller machine (ATM) to withdraw funds once the card’s personal identification number (PIN) is known. When the card owner inserts or swipes the debit card at an ATM, or makes a purchase at a store, they enter the PIN into the terminal for a transaction processing. PIN cashing takes advantage of one of the most basic security features of debit cards, the use of a multi-digit PIN number.

PIN Cashing

A structured transaction is a series of smaller transactions, which are broken up to avoid the $10,000 reporting requirements for the Bank Secrecy Act (BSA).

A structured transaction is a series of transactions broken up from a larger sum in order to avoid reporting requirements under the Bank Secrecy Act (BSA), which requires financial institutions to report all transactions of $10,000 or more.﻿﻿ Because of its usage, restructuring transactions (or layering) is a red flag for possible money laundering. A structured transaction is a series of transactions broken up from a larger sum in order to avoid reporting requirements under the Bank Secrecy Act (BSA), which requires financial institutions to report all transactions of $10,000 or more.﻿﻿ Because of its usage, restructuring transactions (or layering) is a red flag for possible money laundering. To ensure compliance, the Bank Secrecy Act requires financial institutions to record and report information on their customers’ transactions if those transactions involve a large amount of money. The USA Patriot Act gave law enforcement agencies broader powers to curb money laundering by terrorists, putting in place reporting requirements for any deposits, withdrawals, or currency exchanges exceeding $10,000. A structured transaction is a larger transaction that has been broken into smaller pieces to avoid the Bank Secrecy Act, which requires reporting of all transactions exceeding $10,000.

Banking Fraud

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