Fraud charges in Texas are not a single offense. The Penal Code splits fraud into several specific crimes — theft by deception, forgery, identity theft, credit and debit card abuse, and others — each with its own elements and a punishment range that usually scales with the dollar amount involved. Consequences run from a $500 fine for the smallest misdemeanors to life in prison for first-degree felonies, and the same conduct can produce a civil lawsuit and federal charges at the same time.
The Main Criminal Fraud Offenses
Texas does not have one general “fraud” statute. Prosecutors pick from a set of specific offenses based on what the defendant is alleged to have done.
Theft by Deception
The broadest fraud charge in Texas is theft, which includes taking property through deception. Under the Penal Code, “deception” means creating a false impression of fact to influence someone’s judgment in a transaction, failing to correct a false impression the person previously created, or promising to do something while knowing the promise will not be kept.1State of Texas. Texas Penal Code 31.01 – Definitions
The charge level tracks the value of what was taken:
- Less than $100: Class C misdemeanor
- $100 to $749: Class B misdemeanor
- $750 to $2,499: Class A misdemeanor
- $2,500 to $29,999: state jail felony
- $30,000 to $149,999: third-degree felony
- $150,000 to $299,999: second-degree felony
- $300,000 or more: first-degree felony
Some circumstances raise the charge regardless of value. Stealing a firearm is automatically a state jail felony, and stealing from a person’s body carries the same treatment.2State of Texas. Texas Penal Code Section 31.03 – Theft
Forgery
Forgery covers creating, altering, or possessing a fake document with intent to defraud. The baseline offense is a Class A misdemeanor. It becomes a state jail felony when the forged document is a check, deed, mortgage, credit card, or similar financial instrument, and a third-degree felony when the document is a government record, security, or currency.3State of Texas. Texas Penal Code 32.21 – Forgery
When forgery is used to obtain property or services, a separate value-based scale applies that parallels the theft ladder, from a Class C misdemeanor under $100 up to a first-degree felony at $300,000 or more.3State of Texas. Texas Penal Code 32.21 – Forgery
Identity Theft
Fraudulent use or possession of identifying information is graded by the number of items of identifying information involved, not by dollar amount:
- Fewer than 5 items: state jail felony
- 5 to 9 items: third-degree felony
- 10 to 49 items: second-degree felony
- 50 or more items: first-degree felony
If the victim is elderly, the charge is bumped up one level for offenses that would otherwise fall between a state jail felony and a second-degree felony.4State of Texas. Texas Penal Code Section 32.51 – Fraudulent Use or Possession of Identifying Information
Credit and Debit Card Abuse
Section 32.31 of the Penal Code covers using, possessing, or trafficking in stolen or expired cards with intent to defraud. Both a cardholder who fraudulently disputes legitimate charges and a vendor who overcharges a card can be prosecuted under this statute. Penalties depend on the value obtained and the specific conduct.
Punishment Ranges
Once the offense is classified, the sentence range comes from the Penal Code’s general punishment provisions:
- Class C misdemeanor: fine up to $500, no jail
- Class B misdemeanor: up to 180 days in county jail, fine up to $2,000, or both
- Class A misdemeanor: up to one year in county jail, fine up to $4,000, or both
- State jail felony: 180 days to two years in a state jail facility, plus a possible fine up to $10,000
- Third-degree felony: two to ten years in prison, plus a possible fine up to $10,000
- Second-degree felony: two to twenty years in prison, plus a possible fine up to $10,000
- First-degree felony: five years to life in prison, plus a possible fine up to $10,000
Courts can also order restitution, requiring the convicted person to repay the victim for financial losses caused by the fraud.5Office of the Attorney General. Texas Penal Code – Penal Code Offenses by Punishment Range
When Federal Charges Also Apply
Fraud that crosses state lines or uses federal infrastructure can trigger federal prosecution on top of, or instead of, state charges. Mail fraud covers any scheme to defraud that uses the U.S. Postal Service or private interstate carriers. Wire fraud applies the same framework to electronic communications. In each case, the government must prove the defendant knowingly participated in a scheme to defraud, acted with intent to defraud, and used the mail or wires to carry it out.
Federal penalties run considerably steeper than state ones. Standard mail or wire fraud carries up to 20 years in federal prison. If the fraud targeted a financial institution, the maximum rises to 30 years and a fine of up to $1,000,000.6United States Court of Appeals for the Third Circuit. Chapter 6 Fraud Offenses
A Civil Lawsuit Can Run Alongside the Criminal Case
The person who was deceived can file a private lawsuit for money damages independent of anything a district attorney does. Civil fraud only has to be proven by a preponderance of the evidence, meaning it was more likely than not to have occurred, while a criminal conviction requires proof beyond a reasonable doubt. Because the two systems are independent, a single act can produce both a civil judgment and a criminal conviction. An acquittal in criminal court does not block a civil suit, and losing a civil suit does not require a criminal charge.
Common law fraud in Texas has six elements: a material misrepresentation, that was false, made with knowledge of the falsity or reckless disregard for the truth, with intent to induce reliance, on which the plaintiff actually and justifiably relied, causing injury. A separate statutory fraud claim under Business and Commerce Code Section 27.01 applies specifically to real estate and stock transactions and does not require the plaintiff to prove the defendant knew the statement was false in order to recover actual damages. Exemplary damages under that statute require actual awareness of the falsity.7State of Texas. Texas Business and Commerce Code Section 27.01 – Fraud in Real Estate and Stock Transactions
Texas caps exemplary damages in civil cases at the greater of $200,000 or two times economic damages plus non-economic damages up to $750,000.8State of Texas. Texas Civil Practice and Remedies Code Section 41.008
Defenses to a Fraud Charge
Not every bad deal, broken promise, or inaccurate statement is fraud. Several defenses can defeat both civil and criminal claims.
No false statement of fact. Opinions, predictions, and sales puffery are not actionable misrepresentations. A seller saying “this is the best house on the block” is expressing an opinion. A seller saying “the roof was replaced last year” when it was not has stated a false fact. Courts look at whether a reasonable person would treat the statement as a verifiable claim.
No knowledge or intent. Common law fraud requires that the defendant knew the statement was false or made it recklessly. A genuinely mistaken statement made in good faith is not fraud. Criminal cases go further: the prosecution must prove the defendant intended to deceive.
No justifiable reliance. If the true facts were readily available and the plaintiff simply failed to look, courts may find the reliance was not reasonable. Failing to read a contract, skipping an available inspection, or ignoring financial disclosures can undermine the claim. This is where many civil fraud claims fall apart.
Statute of limitations. If the applicable deadline has passed and no tolling exception applies, the case is barred entirely.
Deadlines for Bringing Fraud Cases
Civil fraud has a four-year statute of limitations under the Civil Practice and Remedies Code.9State of Texas. Texas Civil Practice and Remedies Code Section 16.004 – Four-Year Limitations Period Because fraud is often hidden, Texas courts apply a discovery rule that delays the start of the clock until the plaintiff knew, or through reasonable diligence should have known, the facts giving rise to the claim. Someone who was actively deceived and had no reason to suspect wrongdoing gets more time. Someone who ignored obvious red flags does not.10Supreme Court of Texas. Discovery Rule
Criminal prosecutions face their own limits under the Code of Criminal Procedure. Most financial fraud offenses carry a seven-year window for the state to file charges. Identity theft also has a seven-year limit. Insurance fraud has a shorter five-year period. Misdemeanor fraud offenses generally carry a two-year limitation, and any felony not specifically listed defaults to three years.
If you have been contacted by investigators, served with a civil complaint, or arrested on a fraud allegation, the specific offense charged and the amount alleged drive everything that comes next. Consulting a Texas criminal defense attorney early — before making statements to investigators or responding to a lawsuit — is the single most important step you can take.