Defraud Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Defraud, written in plain English, along with examples of how it is used.

What is Defraud?

History and Meaning of Defraud

The term "defraud" originated from the Latin word "fraudare," which translates to "to cheat or deceive." Defraud, as a legal term, refers to the act of knowingly and intentionally deceiving someone in order to obtain something of value or deprive someone of something legally entitled to them.

Defraud can occur in various forms, including financial fraud, insurance fraud, mail fraud, and wire fraud. These fraudulent acts can range from simple schemes such as writing bad checks to complex white-collar crimes such as Ponzi schemes.

Examples of Defraud

1. An individual inflates their income on their mortgage application to qualify for a larger loan than they could afford. The individual subsequently defaults and the lender suffers significant financial loss due to the individual's deceitful conduct.
2. A business owner falsifies their company's financial statements to attract investors and obtain funding. The misrepresentation leads investors to believe the business is financially successful, whereas in reality, the company is failing.
3. An individual intentionally sells fake artwork to art collectors under the pretense that it’s an original piece, knowing that the collectors are paying significant sums for the artwork.

Legal Terms Similar to Defraud

1. Misrepresentation - intentionally making a false statement or suppressing information that induces another party to act on incorrect information.
2. Embezzlement - the act of stealing or misappropriating funds entrusted to one's care, custody, and control.
3. Forgery - the creation or alteration of a document, signature, or other instrument that has legal significance, with the intent to defraud.