Federal Loan Fraud

In the current economy, many individuals and businesses do not have the financial resources for new ventures. However, to help these people as well as the community, the federal government offers loans for everything from housing developments to schooling. While this financial help is meant to benefit the community, not all individuals and businesses use this money as they should. This constitutes federal loan fraud.
First, there are several different types of loans that are backed by the federal government. One very common type of loan is for college students. These typically have lower interest rates than if the money was borrowed from the bank. Other forms of government loans include:

• Small business loans
• Loans for farmers
• Housing and Urban Development (HUD) loans
• Veteran's Administration (VA) home loans

Applying for this financial help is a strict process, and people and companies must meet certain requirements in order to gain approval to receive loans. For instance, for small business owners, the company must fit in a truly "small" category. Additionally, it must operate in the United States or plan to operate here. This also creates more jobs for the community.
However, sometimes entities will falsify this information in order to make it appear as if they qualify for federal loans. Also, they can use insider information or connections to move them ahead of other individuals or corporations applying for federal loans.
Sometimes, people will commit fraud after they receive the money. The government can regulate the way the loan is used, but some individuals or companies can turn around and use this money for other reasons than allowed by the loan's contract.
Federal loan fraud steals government money from legitimate individuals and businesses and instead gives it to people who may only use these finances for their personal benefit. If you are aware of any federal loan fraud, you can pursue justice on behalf of the government. Should your case prove successful, you can receive a portion of the damages awarded to the government. This is called Qui Tam law.