In the air loan scenario, which description best fits an air loan?

• A. A fraudster files fraudulent property transfer documents with the owner's forged signature and then takes out a loan using the property as collateral.
• B. A property developer submits fictitious or unpartaken development experience.
• C. A loan is obtained to construct a building on a nonexistent property, with the proceeds kept by the fraudster.
• D. A borrower falsifies income sources to qualify for a mortgage.

Answer: (C)

Air loans involve getting loan funds for a project that doesn’t exist or will not be completed, so there’s no real asset to secure the loan and the proceeds go to the fraudster. This description fits the scenario where a loan is obtained to construct on a nonexistent property and the proceeds are kept by the fraudster, which is exactly the hallmark of an air loan. Other fraud types describe different schemes—for example, using forged deeds on existing property, misrepresenting qualifications, or falsifying income—none of which center on funds being issued for a non-existent property.