Legal Definitions - fraudulent banking

Definition: Fraudulent banking refers to the act of a banker knowingly accepting a deposit when they are aware that the bank is insolvent, or unable to meet its financial obligations.

Example: A customer deposits $10,000 into their savings account at a local bank. The banker who accepts the deposit knows that the bank is in financial trouble and may not be able to return the customer's money if they were to request a withdrawal. This is an example of fraudulent banking.

Explanation: In this example, the banker is aware that the bank is insolvent and cannot meet its financial obligations. By accepting the deposit, the banker is committing fraud and putting the customer's money at risk. This type of behavior is illegal and can result in severe consequences for the banker and the bank.