Utah May Get More Serious About Affinity Fraud

Utah May Get More Serious About Affinity Fraud

Utah has had more than it's share of affinity fraud cases over the years. Authorities say that in the past year alone, more than 4,000 Utahns have lost over $1.5 billion due to fraud. In many cases, the fraudsters engage in what is known as "affinity fraud" which refers to any type of fraud involving the exploitation of a relationship of trust. We naturally trust those we go to church with or those who are like us in some way including ethnicity. If exploits that trust to commit fraud, it is referred to using this phrase.

In Utah, the religious community provides an easy target for someone who wants to commit fraud. As such, fraud perpetrators build trust among a group of individuals in a social setting such as at church and then they exploit those relationships by getting people to invest in bogus business opportunities. Affinity fraud was involved in many fraud cases including Bernie Madoff's famous $50 billion Ponzi scheme. In that case, the Jewish community was exploited by Bernie.

Affinity fraud has been found in every religious community but also exists in other communities such as racial or ethnic groups. A large Ponzi scheme in Florida involved affinity fraud among the Haitian community. The deaf community also has been exploited by fraud perpetrators who developed relationships of trust and then exploited them to commit fraud.

Read the article in its entirety on Mark and Aaron Zimbelman's blog, FraudBytes.