BUSINESS AND COMMERCIAL FRAUDS

KRS tit. L, ch. 517

in effect

KRS 517.010 Definitions for chapter

517.010. Definitions for chapter The following definitions apply in this chapter, unless the context otherwise requires: (1) "Adulterated" means varying from the standard of composition or quality prescribed by statute or lawfully promulgated administrative regulation or, if none, as set by established commercial usage. (2) "Business record" means any writing or article kept or maintained by an enterprise for the purpose of evidencing or reflecting its condition or activity. (3) "Enterprise" means any entity of one (1) or more persons, corporate or otherwise, public or private, engaged in business, commercial, professional, industrial, eleemosynary, social, political, or governmental activity. (4) "Fiduciary" means a trustee, guardian, executor, administrator, receiver, and any person carrying on fiduciary functions on behalf of a corporation or other organization which is a fiduciary. (5) "Mislabeled" means: (a) Varying from the standard of truth or disclosure in labeling prescribed by statute or lawfully promulgated administrative regulation or, if none, as set by established commercial usage; or (b) Represented as being another person's product, though otherwise labeled accurately as to quality or quantity. (6) "Sham or front company" means any business established or in existence which falsely represents that business to be a minority business enterprise, or disadvantaged business enterprise, as defined in 79 C.F.R. 23.5 or 15 C.F.R. 1400.2, operated or operating for the purpose of obtaining funds, contracts, subcontracts, services, or other benefits from any local government, local government agency, or special district of this Commonwealth from the Commonwealth, or any state government agency or public corporation of this Commonwealth, or from the United States government or any federal government agency. Effective: July 15, 1994 History: Amended 1994 Ky. Acts ch. 476, sec. 2, effective July 15, 1994. -- Created 1974 Ky. Acts ch. 406, sec. 145, effective January 1, 1975.

KRS 517.020 Deceptive business practices

517.020. Deceptive business practices (1) A person is guilty of deceptive business practices when, in the course of engaging in a business, occupation or profession, he knowingly: (a) Uses or possesses for use a false weight or measure or any other device for falsely determining or recording any quality or quantity; or (b) Sells, offers or exposes for sale, or delivers less than the represented quantity of any commodity or service; or (c) Takes or attempts to take more than the represented quantity of any commodity, thing or service when as a buyer, agency or receiver he furnishes the weight, measure, or weighing or measuring device by means of which the amount of the commodity, thing or service is determined; or (d) Sells, offers or exposes for sale adulterated commodities; or (e) Sells, offers or exposes for sale mislabeled commodities. (2) Deceptive business practices is a Class A misdemeanor. Effective: January 1, 1975 History: Created 1974 Ky. Acts ch. 406, sec. 146, effective January 1, 1975.

KRS 517.030 False advertising

517.030. False advertising (1) A person is guilty of false advertising when, in connection with the promotion of the sale of or to increase the consumption of property or services, he knowingly makes or causes to be made a false or misleading statement in any advertisement addressed to the public or to a substantial number of persons. (2) False advertising is a Class A misdemeanor. Effective: January 1, 1975 History: Created 1974 Ky. Acts ch. 406, sec. 147, effective January 1, 1975.

KRS 517.040 Bait advertising

517.040. Bait advertising (1) A person is guilty of bait advertising when in any manner, including advertising or other means of communication, he offers to the public or a substantial number of persons property or services as part of a scheme or plan with the intent not to sell or provide the advertised property or services: (a) At the price at which he offered them; or (b) In a quantity sufficient to meet the reasonably expected public demand, unless the quantity is specifically stated in the advertisement; or (c) At all. (2) Bait advertising is a Class A misdemeanor. Effective: January 1, 1975 History: Created 1974 Ky. Acts ch. 406, sec. 148, effective January 1, 1975.

KRS 517.050 Falsifying business records

517.050. Falsifying business records (1) A person is guilty of falsifying business records when, with intent to defraud, he: (a) Makes or causes a false entry to be made in the business records of an enterprise; or (b) Alters, erases, obliterates, deletes, removes or destroys a true entry in the business records of an enterprise; or (c) Omits to make a true entry in the business records of an enterprise in violation of a duty to do so which he knows to be imposed upon him by law or by the nature of his position; or (d) Prevents the making of a true entry or causes the omission thereof in the business records of an enterprise. (2) Falsifying business records is a Class A misdemeanor. Effective: January 1, 1975 History: Created 1974 Ky. Acts ch. 406, sec. 149, effective January 1, 1975.

KRS 517.060 Defrauding secured creditors

517.060. Defrauding secured creditors (1) A person is guilty of defrauding secured creditors when he destroys, damages, removes, conceals, encumbers, transfers, or otherwise deals with property subject to a security interest with intent either to lower the value of the secured interest or unlawfully to hinder enforcement of that interest. (2) Defrauding secured creditors is a Class A misdemeanor unless the value of the property subject to the security interest is: (a) Five hundred dollars ($500) or more up to ten thousand dollars ($10,000), in which case it is a Class D felony; or (b) Ten thousand dollars ($10,000) or more, in which case it is a Class C felony. Effective: July 12, 2012 History: Amended 2012 Ky. Acts ch. 93, sec. 3, effective July 12, 2012. -- Amended 1978 Ky. Acts ch. 342, sec. 1, effective June 17, 1978. -- Created 1974 Ky. Acts ch. 406, sec. 150, effective January 1, 1975.

KRS 517.070 Defrauding judgment creditors

517.070. Defrauding judgment creditors (1) A person is guilty of defrauding judgment creditors when he secretes, assigns, conveys or otherwise disposes of his property with intent to defraud a judgment creditor or to prevent that property from being subjected to payment of a judgment. (2) Defrauding judgment creditors is a Class A misdemeanor. Effective: January 1, 1975 History: Created 1974 Ky. Acts ch. 406, sec. 151, effective January 1, 1975.

KRS 517.080 Fraud in insolvency

517.080. Fraud in insolvency (1) A person is guilty of fraud in insolvency when, knowing that proceedings have been or are about to be instituted for the appointment of a receiver or other person entitled to administer property for the benefit of creditors, or that any other composition or liquidation for the benefit of creditors has been or is about to be made, he: (a) Destroys, removes, conceals, encumbers, transfers or otherwise deals with any property with intent to defeat or obstruct the claim of any creditor, or otherwise to obstruct the operation of any law relating to administration of property for the benefit of creditors; or (b) Knowingly falsifies any writing or record relating to the property; or (c) Knowingly misrepresents or refuses to disclose to a receiver or other person entitled to administer property for the benefit of creditors, the existence, amount or location of the property, or any other information which the actor would be legally required to furnish to such administrator. (2) Fraud in insolvency is a Class A misdemeanor. Effective: January 1, 1975 History: Created 1974 Ky. Acts ch. 406, sec. 152, effective January 1, 1975.

KRS 517.090 Issuing false financial statement

517.090. Issuing false financial statement (1) A person is guilty of issuing a false financial statement when, with intent to defraud, he: (a) Knowingly makes or utters a written instrument which purports to describe the financial condition or ability to pay of himself or of some other person and which is inaccurate in some material respect; or (b) Represents in writing that a written instrument purporting to describe a person's financial condition or ability to pay as of a prior date is accurate with respect to that person's financial condition or ability to pay, knowing the instrument to be materially inaccurate in that respect. (2) Issuing a false financial statement is a Class A misdemeanor. Effective: January 1, 1975 History: Created 1974 Ky. Acts ch. 406, sec. 153, effective January 1, 1975.

KRS 517.100 Receiving deposits in failing financial institution

517.100. Receiving deposits in failing financial institution (1) A person is guilty of receiving deposits in a failing financial institution when, as an officer, manager or other person participating in the direction of a financial institution, he knowingly receives or permits the receipt of a deposit or other investment, knowing that the institution is insolvent. (2) A financial institution is insolvent within the meaning of this section when it is unable to pay its obligations in the ordinary or usual course of business for any reason. (3) Receiving deposits in a failing financial institution is a Class D felony. Effective: January 1, 1975 History: Created 1974 Ky. Acts ch. 406, sec. 154, effective January 1, 1975.

KRS 517.110 Misapplication of entrusted property

517.110. Misapplication of entrusted property (1) A person is guilty of misapplication of entrusted property when he applies or disposes of property that has been entrusted to him as a fiduciary, or property of the government or of a financial institution in a manner which he knows is unauthorized and involves substantial risk of loss or detriment to the owner of the property or to a person for whose benefit the property was entrusted. (2) Misapplication of entrusted property is a Class A misdemeanor. Effective: January 1, 1975 History: Created 1974 Ky. Acts ch. 406, sec. 155, effective January 1, 1975.

KRS 517.120 Operating a sham or front company

517.120. Operating a sham or front company (1) A person is guilty of operating a sham or front company when he knowingly: (a) Establishes; (b) Assists in the establishment of; (c) Operates; or (d) Assists in the operation of; a sham or front company. (2) Operating a sham or front company is a Class D felony. Effective: July 15, 1994 History: Created 1994 Ky. Acts ch. 476, sec. 1, effective July 15, 1994.

KRS 517.130 Possession of automated business record falsification device

517.130. Possession of automated business record falsification device (1) A person is guilty of possession of an automated business record falsification device when he or she knowingly possesses any device or software program that falsifies the business records created by a point-of-sale system, such as any electronic device or computer system that keeps a register or supporting documents designed to record retail sales transaction information, by eliminating or manipulating true retail sales transaction information in order to represent a false record of transactions. These devices may also be referred to as "zappers" or "phantom-ware." (2) Possession of an automated business record falsification device is a Class D felony. (3) In addition to any other penalty provided by law: (a) Any person guilty of possession of an automated business record falsification device shall forfeit all proceeds associated with its creation, sale, or usage; and (b) An automated business record falsification device, and any device containing an automated business record falsification device, is contraband and shall be seized and forfeited to the state to be disposed of as provided in KRS 500.090. Effective: July 15, 2014 History: Created 2014 Ky. Acts ch. 9, sec. 1, effective July 15, 2014.

Source: Kentucky Legislative Research Commission (legislature.ky.gov)URL: https://apps.legislature.ky.gov/law/statutes/chapter.aspx?id=39383Fetched: 10/20/2026