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New anti-fraud tools: Getting at where stolen funds are hidden

By Mark Shenefelt - | Apr 26, 2022

Photo supplied, AdobeStock

Fraud stock photo

A new state law targets the perpetrators of fraud schemes with harsher penalties and introduces a prosecutorial tool to recover more stolen funds.

According to an Ogden Police Department detective, House Bill 229 is especially important to aid elderly victims who are financially exploited and defrauded by relatives, caregivers or others.

Detective Rachel Walker, of OPD’s Major Crimes Bureau, has been investigating financial crimes for several years. She testified at the Utah Legislature in February in favor of HB 229.

Exploiters “are preying upon these elderly victims and paying restitution at a very nominal rate,” she said. “An elderly victim could be dead by the time they’ve paid a few thousand dollars.”

HB 229 makes it a third-degree felony for a fraud defendant to submit a false written statement after conviction and before sentencing. Under the previous, law, such an action was a class B misdemeanor, the maximum penalty being six months in jail. A third-degree felony conviction carries a sentence of up to five years in prison.

Further, the law directs the Utah Sentencing Commission to create a fraud sentencing matrix with proportionate escalating sanctions based on a victim’s loss. HB 229’s sponsor, Rep. Brady Brammer, R-Pleasant Grove, said that before HB 229, the punishment for a conviction of second-degree felony fraud was the same whether the amount stolen was $5,000 or $5 million: one to 15 years in prison. But the new sentencing matrix will mean longer sentences for high-dollar fraud perpetrators.

The new law also gives prosecutors the ability to subpoena financial information of a fraud convict to bring about a more complete restitution result. It also increases prosecutors’ ability to compel so-called “preservation of assets” edicts to identify ill-gotten gains and dissuade perpetrators from hiding stolen assets.

Walker told lawmakers the new law will make perpetrators more aware of “what they think they’re going to face” if caught in elderly exploitation crimes, “when they’re taking these risks of exploiting these victims.”

Regarding restitution, Walker said, the elderly victims “deserve to be made whole in a timely manner.”

Walker was the detective on a case now in progress in Ogden’s 2nd District Court in which a couple is accused of defrauding a 93-year-old blind woman of more than $500,000.

Brammer said HB 229 also effectively targets Ponzi scheme perpetrators and others who commit large-scale fraud.

“These people are slippery,” Brammer said during a legislative hearing. “Compared to the damage done, the penalties are a slap on the wrist” under the previous law.

He said Utah is “the fraud capital of America,” with $1.5 billion stolen in schemes from 2008 through 2018.

“These are crimes of deceit, concealment and violations of trust, often against the elderly who are unable to defend themselves,” said Brammer, who added that in his private law practice he has worked to recover assets for fraud victims.

He said little if any stolen money is recovered in many fraud cases. But under HB 229, he said, “now we really have a stick if someone lies about where they put the money.”


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