Federal fraud is best described as fraud on the federal government. People receive services or money from the government under false pretenses when this time of fraud is committed. This is a criminal activity, and those who are responsible for this type of fraud can be severely punished in a court of law. Federal fraud can be many different types of crimes, such as tax fraud, mail fraud, and wire fraud. Fraudulent banking law violations are also considered as types of federal fraud. Aliens who register for government services are committing federal fraud, sometimes without even knowing it. Most states in the United States use the same statute when it comes to punishing those who have taken place in a federal fraud scheme. It basically states that anyone who knowingly participates in some sort of scheme to defraud the government and receive any sort of benefit will be guilty of a felony. Penalties for federal fraud vary, but the fines are large and the time in jail long.