First Party Fraud

From Open Risk Manual

Definition

"First Party Fraud" means a fraud that is committed by an individual or group of individuals on their own account with no intention of any repayment of the loss caused.[1]

Lending Context

A first party fraud generally occurs when the party misrepresents its financial abilities on the application forms and by using another person's identifying information. Any fraud which is initiated at a later stage of the lifecycle of a credit product, such as the misstatement of financial reports, even when it is used to prolong or to extend an existing credit product does not fall within this definition

References

  1. EBA/CP/2014/08

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