Falsifying Business Records, Mortgage Fraud, And Conspiracy

falsifying business records mortgage fraud conspiracy paul manafort

If you can learn anything from the Paul Manafort conviction, it is what not to do in your business. Sure, he was knowingly falsifying business records, right and left–but it is all too common for business owners to fall into the same trap by mere negligence. Don’t accidentally commit crimes. 

Find out where Paul Manafort went wrong, and how unwitting business owners find themselves in the same shoes. Manafort knowingly committed tax and mortgage fraud. Read more below and learn how to avoid doing it by accident with your business or personal finances. 

A Lesson In Business Ethics From Paul Manafort 

Paul Manafort is convicted of falsifying business records, mortgage fraud, and conspiracy by the Manhattan district attorney. Needless to say, his business practice was a little more than flawed. 

But, it presents you with a wonderful learning opportunity. 

Paul Manafort's indictment stemmed out of an investigation that prosecutors began back in 2017. The indictment came from evidence of two questionable loans from different banks that Manafort received. 

Article 175 of New York Penal Law lays out the terms upon which an individual may be convicted of falsifying business records. Falsification of business records in the first degree is indicative of a conviction of falsifying records in the second degree. 

It is the act of falsifying records with the intent to commit another criminal act. The other criminal act could be to conceal your first criminal act–of knowingly falsifying business documentation records. 

And, whereas a conviction in the second degree is a class-A misdemeanor in the state of New York, a conviction in the first degree is a class-E felony. Manafort falsified business records in order to cover up or conceal another crime. 

Robert Mueller testified for the prosecution, presenting evidence of Manafort's illegal dealings. 

The evidence overwhelmingly pointed to tax evasion by hiding millions in off-shoar accounts. The evidence, also pointed to mortgage fraud committed by Manafort to defraud banks into giving him millions in loans. 

Manafort seems to be a little confused as to civilized business ethics in a capitalist democracy. Don’t follow in his dirty footsteps. Learn how to avoid these foibles in your own business, so you don’t become a total business burnout, like him. 

How To Avoid Falsifying Business Records 

The best way to avoid falling into the same traps as Mr. Manafort is to stay out of dirty dealings and tax evasion. Paul Manafort was falsifying business documents in order to hide money that was being funneled through his shell company. 

Manafort was, likely funneling money through real estates in Manhattan, like these places and Trump Tower. 

A shell company is a front for illegal activity. Paul Manafort used his business dealings to ‘secretly’ put funds in an off-shore account that would not be subject to taxation in the United States. Obviously, it wasn’t secret enough. 

If he wasn’t trying to get away with tax and mortgage fraud he would not have needed to falsify anything. But, sometimes business owners don’t know what they need to track for their business in order to avoid committing fraud. 

What Is A Business Record In The Eyes Of The Law? 

The law around what can and cannot be admitted as testimony in court requires a witness to be available to testify. That is not true, however, in the case of business records. Business records act as their own witness in the eyes of the law. 

The Federal Rules of Evidence exempt business records from the category of out-of-court documents and most states in the US follow suit. 

A court accepts a document as a legally admissible business record, under several qualifications. A business record is made in the day-to-day routine of business. An admissible business record is, also, made by an individual with employment and knowledge as to the nature of the information therein contained. 

A business record can be made inadmissible in court if the entry time of the record lies too far from the time of the matter which it regards. 

An admissible business record must be deemed by the court to have been made in normal business routine, by a qualified individual, without suspicion of an ulterior motive. 

What Does The Law Consider ‘Falsifying’ A Record? 

Again, most state laws follow Federal Legal Statute in dealing with business fraud. In the case of Paul Manafort, he is convicted for falsifying business records, mortgage fraud, and conspiracy by the Manhattan district attorney. So, the laws of New York state dictate how falsifying business records are defined. 

New York delineates the charge in two ways: falsifying records, or doing it to cover up something else. The former is a misdemeanor, whereas the latter is a felony. 

Falsifying business records in the second degree is a class-A misdemeanor, and must meet all qualifications being considered for a first-degree felony. To be convicted in the second degree, prosecutors must prove that false entries were made with the intent to defraud. 

It includes altering, omitting, or misrepresenting the facts on an official business record or document. 

You can also be indicted for falsifying records if you prevent a correct entry from being entered into documentation. 

Once sufficient evidence is presented to a court showing that the falsification of records was with the intent to conceal additional illegal activity, you are going down with a class-E felony. Manafort is facing over 25 years in prison because of the mountain of dirt he is covering up. 

Final Thoughts 

It just goes to show you–everyone gets theirs, eventually. Get yourself started out right, by keeping clean records. Make sure your financial documentation is accurate, digitally stored, and timestamped. And, of course, try not to go around committing tax fraud. If you like this article on how to avoid falsifying business records like former Donald Trump campaign member Paul Manafort, share it on social media and use the hashtag #BootstrapBusiness .

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