Are you a victim of or accused of business fraud in San Diego or anywhere in California?  Are you concerned about resolving business fraud litigation or defending allegations of fraudulent activity?  Business fraud occurs whenever a person or business employs deception or self-dealing to gain an unfair advantage or illegally obtain value or profit.  Business fraud is an essential element in any unfair business practices claim.

Key Takeaways about Business Fraud in San Diego or Anywhere in California:

• Business fraud is unfortunately quite common here in San Diego and across California.  Business fraud is a common component in any business dispute or lawsuit, often presented as an allegation of unfair business practices.
• Business fraud is based on a person with authority over another, who uses deception or self-dealing to gain an unfair advantage over another in order to achieve some form of profit or gain.
• Business fraud can be perpetrated by anyone in the company, from an owner to a payroll employee.  These actions open the door to extensive punitive damages, and represent a substantial civil and sometimes criminal risk.

Common Examples of Business Fraud

Business fraud in San Diego or anywhere in California usually includes allegations of intentional or negligent misrepresentation of fact(s), omissions, establish false pretenses or puffery to engage in business transactions and promissory fraud including, but not limited to:

• Using your position as an executive or director for self interest
• Misappropriation of cash, assets or inventory
• Theft or embezzlement
• Commingling
• Forgery
• Misrepresentation or contract fraud
• Accounting fraud or “cooking the books” (altering financial documents or accounts)
• Internet or billing related Fraud
• Unfair Competition
• Unfair Business Practices

The party committing fraud not only has to make false representations but they have to know at the time the representations were untrue, overblown or false.  The plaintiff in these cases must prove they relied upon the fraudulent information to make their decision(s) and must suffer harm or financial consequences.

Remedies for Business Fraud in San Diego

There are several civil remedies available for those who entered into a business contract based upon the reliance of fraud.  You may choose to rescind the contract, or you may affirm the contract and seek financial damages.  You may wish to seek an “injunction” to stop actions taken by other parties or wrongful unfair competition.

Defending fraud cases requires experience and extensive legal skill.  Negligent misrepresentation is a lower legal bar than fraud.  In negligent misrepresentation cases one party may not have purposefully mislead the other, they simply did not have a mastery of the facts or know their representations were fraudulent.  In these cases you don’t have to prove fraudulent intent, simply that the representations of the party were false.

The legal and evidentiary issues are quite complex and require proven and skilled attorneys.  The Watkins Firm has more than four decades of business litigation and resolving business fraud litigation in San Diego and southern California.  We pursue not only the financial damages associated with the business fraud but punitive damages as well.  Fraud is based upon intentional misrepresentation or deception, and California law allows for the potential of not only recovering your losses, but a financial punishment (punitive damages) for those who commit fraud.

Pro-Tip: “you should understand that the first thing you need to think about or ask, if you think that business fraud has occurred in your business or in your dealings, is have you lost money? Or have you lost the opportunity to earn or make money? And those things are not simple questions. Something may feel wrong, something may seem wrong, or you just may know it’s a gut instinct before you’ll go right to the law, go right to your damages. And in business fraud, we have a saying, if it’s off a penny, it’s off a million. If it doesn’t add up to the penny, there’s a reason.

And either it’s somebody added it up wrong or somebody’s ripping you off. And you should look into that and then listen to the rest of our podcast episode 32 – Business Fraud, and you’ll see all the laws that we think about when I think of business fraud. And before we dive into the specifics, this isn’t an issue. You want to investigate yourself, right? This is something you want someone from the outside taking a look at. First, you want to look right away at your own accounting, your business records as soon as you can. And then if you sense there’s anything wrong, then you know you have damages, you should reach out because many times those damages aren’t even close to what you think.

So, what is business fraud? 

This might be business to business fraud, unfair competition, false advertising practices, and just general common law fraud between businesses. Business to business fraud is a big topic. It happens. You’re in the marketplace, you are doing great, and all of a sudden no one’s coming to you anymore. And then you find out that the number one competitor has taken some of the elements of your website are saying bad things about you, or they’re doing a lost leader advertising bait and switch on the price. And they’re grabbing all your customers, but you have the best product and the best service. They are defrauding you out of your rightful profits. And you should, I’ll say it again, if for unknown reasons, all of a sudden you’re not making the money you used to, you might be the victim of fraud and don’t know it. Go see a lawyer who knows this stuff. We’ll spot it.

Business partner fraud. This never happens until you make money. When there’s no money. I rarely, in fact, I don’t know if I’ve ever heard of a case with business partner fraud until the business starts doing well. And then it’s so common. It’s crazy. People with all the greatest virtues you’ve ever seen in your life, you’ve known your whole life. All of a sudden your company expanding, doing well and money disappears. It’s just so tempting. It’s like gold fever. So that’s also includes shareholder fraud, officer fraud, director fraud, usurpation. That’s a fancy word for taking the company or corporate assets without any fair compensation or in secret.

Then there is sale of business fraud. We do a lot of that. We sell hundreds of millions of dollars in companies each year. We merge them, we create partnership agreements for them. And we see the hardest part is when you buy a business, you want to know you’re getting what you paid for. And when you sell a business, you want to make sure you get the money, the price you agreed to, because these things are complicated. And you also don’t want to get sued later for inaccurate disclosures, some contingent liability.” – Dan Watkins, Founding Partner

If you are concerned about resolving business fraud litigation in San Diego we invite you to review our podcast Episode 25 – Unfair Business Practice Overview, as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.

Meet Daniel Watkins:

Daniel W. Watkins is a true people person who sincerely listens. He cares deeply about what others are going through.  Dan enjoys digging into the facts and finding creative solutions to problems.  He contributes his insights candidly and constructively.

Dan’s interest in people make him deeply invested in every relationship and his exuberant personality makes him a true litigator. Dan fights for his clients with a fierce and calculated commitment.

Dan has practiced in the areas of business, medical practices and healthcare business, high tech/science, real estate and employment defense law since 1987. He is a trusted litigation strategist and true trial attorney with over 50 jury and bench trials to his credit. Dan has successfully represented both large companies and individuals and achieved substantial victories in well-publicized trials throughout California and the U.S.

He is experienced in business and corporate formation and administration, as well as all forms of alternative dispute resolution, including binding arbitration and mediation.

THE ROAD TO BECOMING A BUSINESS LAWYER AND LITIGATOR

Dan has almost 40 years of experience working with, for and against some of the largest insurance companies in the country. He has successfully tried and litigated cases in the areas of Healthcare Compliance, Commercial Litigation, Unfair Business Practices, Fraud, Breach of Contract, Battery, Premises Liability, Product Defect, Medical Malpractice, Discrimination, Sexual Harassment, Construction Defect, as well as Unfair Competition, Defamation, and Trade Secrets.

In December 2003, Dan commenced litigation against Health South Surgery Centers-West, Inc and its’ subsidiaries, exposing the company’s extensive mismanagement and misconduct of its’ surgery centers. Dan has also been asked by some of California’s largest municipalities and corporations to conduct legally required investigations into matters involving alleged employment discrimination and harassment.