Financial statement fraud occurs when a company intentionally misrepresents its financial information to deceive stakeholders. This can involve overstating revenues, understating expenses, or manipulating other financial metrics to present a more favorable picture of the company's performance. Such actions can mislead investors, creditors, and regulators, leading to significant financial consequences. The motivations behind financial statement fraud often include pressure to meet financial targets, enhance stock prices, or secure loans. Common methods include creative accounting techniques and forging documents. Regulatory bodies like the Securities and Exchange Commission (SEC) actively monitor and investigate such fraudulent activities to protect the integrity of financial markets.