Conspiracy is one of the most routine charges seen in federal court. Especially in white-collar crime cases because the significant fraud cases, the ones that typically reach the federal level, cannot be committed by just a single person.
There are two criminal elements to look at here: white-collar crimes and conspiracy.
Below, we will discuss:
- What is white-collar crime?
- What does conspiracy mean?
- Potential penalties for conspiracy charges
- Possible defenses for a conspiracy charge
Our team of criminal defense lawyers focuses on white-collar crimes, including charges of conspiracy, and government investigations.
If you have been charged with a federal crime, or are under investigation by the government, contact an experienced attorney as soon as possible to make sure your rights and interests are adequately represented.
The term “white-collar crimes” is a category of crimes, not just a single crime. White-collar crimes are non-violent criminal offenses that often have some financial element to them. Though a financial element is not necessary for a crime to be considered “white-collar.”
Common white-collar crimes include, but are not limited to:
- Identity theft;
- Computer crimes, including hacking;
- Copyright infringement;
Federal Criminal Charges
There is no one thing that brings a white-collar crime from state jurisdiction to federal jurisdiction. Each white collar crime has a different threshold or element that makes it fall within the federal government’s criminal jurisdiction and thus makes it a federal crime.
In addition, each separate federal white collar crime has different elements that a prosecutor must prove in order for the defendant to be found guilty. For a more in-depth look at and an explanation of, all of the different white-collar crimes, please visit our practice areas page.
Conspiracy is a crime that cannot exist on its own. It is the agreement between two or more people to commit an illegal act, with the intent to actually met the agreement’s goal. Essentially, conspiracy is the act of planning to commit another crime. In addition to the agreement, there must also be an overt act taken by one of the parties that is made in furtherance of the crime.
There are many federal statutes that aim to criminalize conspiracy. These include, but are not limited to:
- 21 U.S.C. § 841 (conspiracy to violate the Controlled Substances Act)
- 18 U.S.C. § 2384 (seditious conspiracy)
- 18 U.S.C. § 1962(d) (conspiracy to violate RICO)
- 18 U.S.C. § 1349 (conspiracy to commit fraud)
- 18 U.S.C. § 371 (conspiracy to commit any offense against the United States or to defraud the United States)
- 18 U.S.C. § 286 (conspiracy to submit fraudulent claims to the United States)
- 18 U.S.C. § 241 (conspiracy to deprive a person of their civil rights)
- 18 U.S.C. § 24 (conspiracy to commit a federal health care offense)
- 15 U.S.C. § 1 (conspiracy to restrain trade)
In order to best explain conspiracy, we are going to begin with an example. Say John and Tom work in a doctor’s office that accepts a few different insurances including Medicare. Tom would like to make himself some more money, so he decides to bill insurance companies for procedures that were not actually performed. This is healthcare fraud.
John knows what Tom is trying to do. He asks him to compile a list of patient names to file the fake claims. The next day Tom receives a surprise inheritance, quits his job, does not file the fake insurance claims. Since he did not file any of the claims, it seems they committed no crime here, yet the law disagrees. Tom and John conspired together to commit healthcare fraud.
Does the agreement between the parties need to be in writing?
No, the agreement does not have to be in writing; it does not even need to have been an explicit agreement.
In the above example, because John knew what Tom was doing and provided him with the list of patient names, there is a conspiracy. This would be the case even if the two had never discussed the criminal activity.
Circumstantial evidence is allowed, by courts, to show that there was an agreement between the parties to a conspiracy. This means that juries may take into consideration evidence such as the fact that the two parties spent a lot of time together when deliberating on the verdict of a case.
What if the “overt act” is not illegal, can I still be charged with conspiracy?
Yes. The overt act does not have to be illegal for it to be a part of a conspiracy. If the act, on its own, is legal then it must be done in furtherance of the underlying crime. In the example above, the mere act of handing over patient names is not illegal. Since John knew what the list was going to be used for, though, that makes it an overt act in furtherance of a crime.
Another example of an overt act in a conspiracy case would be if two people planned to commit a bank robbery. If one person goes to a firearms store and legally purchases a gun, but has the intention that it be used in the robbery – that is an overt act in furtherance of a crime.
In many federal statutes, though, the requirement for an overt act has been expressly written out by Congress. For example, conspiring to launder money (a violation of 18 U.S.C. §1956) does not require an overt act in order for guilt to be found.
I do not understand, if I have not committed an actual crime how can I be charged with one?
While it may seem odd to be criminally liable for an act you never actually committed, but, under federal law, conspiracy is considered a crime of its own right. Even if you were unsuccessful in completing the underlying crime, the act of conspiring to commit that underlying crime is criminal activity.
If you, and your accomplices, had been successful in completing the underlying crime and were ultimately caught the prosecutor could choose to charge you with both the crime itself and conspiracy to commit that crime.
In the example above, while Tom and John had not actually submitted the false claims and did not make any profit, they could still face criminal conspiracy charges. If they had submitted the claims, they could be prosecuted for both healthcare fraud and conspiracy to commit healthcare fraud.
Conspiracy is what is known as an “inchoate” offense. This means that it is the crime of planning or preparing to commit another crime.
Additional examples of an inchoate crime include:
An attempt is usually charged when a defendant has the actual intent to commit a crime and takes direct action toward completing the crime.
An example of intent would be if Tom, above, had actually submitted the fake insurance claims but was caught by another employee or the insurance company.
Attempt differs from conspiracy because, for an attempt charge, you must go past the mere planning stages of committing the crime.
Incitement is the act of persuading, instigating, or moving another person to commit a crime.
For example, if you were giving a speech on the steps of Congress encouraging people to go inside and attack a congressman/congresswoman “right now,” and someone in the crowd actually does attack a congressperson – that would be considered incitement.
The speech here is not protected by the first amendment right to free speech because it encourages imminent lawless action.
Solicitation is the act of offering another person money, or other rewards, in order to induce them to commit a crime. You must also have the specific intent that the person solicited will commit that crime.
The most common example of solicitation is when someone hires another to have sex for money.
Another example of solicitation would be the hiring of a hitman with the intention for them to actually kill their assigned “target.”
Investigation and Enforcement
There is no one agency tasked with the investigations into claims of conspiracy. There are so many crimes that can be conspired to and, so, there is a broad range of investigative agencies who may look into the crimes.
These agencies include, but are not limited to:
- Federal Bureau of Investigation (FBI)
- Department of Justice (DOJ)
- Homeland Security
- Securities and Exchange Commission (SEC)
- Internal Revenue Service (IRS)
- United States Postal Service (USPS)
- Drug Enforcement Administration (DEA)
- United States Immigration and Customs Enforcement (ICE)
Potential Penalties for Conspiracy
The possible penalties for conspiring to commit a white-collar crime depend heavily on the exact statute you have been charged under. The underlying crime of the conspiracy charge also is a factor, and carries with it, its own sets of fines and prison sentences, such as:
- If you have been charged under 18 U.S.C, §371, Conspiracy to Commit Offense or Defraud the United States, and the underlying crime is a felony you may be sentenced to up to 5 years in prison, fines to the tune of millions of dollars, or both a combination of a fine and a prison sentence.
- If you have been charged under that same statute but the underlying crime is a misdemeanor the penalty changes. In this case, the maximum punishment allowed may only be as great as the punishment for the crime itself.
- If you have been charged with conspiracy, or are under investigation for a crime, it is in your best interest to contact a lawyer as soon as possible. An experienced, knowledgeable attorney will be able to advise you on the ins and outs of your personal situation or case.
Potential Defenses to Conspiracy Charges
The most common defenses to white-collar conspiracy charges are withdrawal or abandonment, and entrapment.
Withdrawal or Abandonment
Withdrawal is an affirmative defense to any charge of conspiracy. This means that the burden will be on you, and your attorney to prove that you withdrew from the conspiracy. There are several key elements a defendant must prove when putting forward a withdrawal defense, like:
- The defendant must have taken affirmative action when withdrawing. This may mean something like removing whatever service or element you had provided for the commission of the crime or contacting authorities with the information that a crime may occur.
- The defendant must have informed all other co-conspirators of his withdrawal.
- The defendant must have withdrawn prior to the completion of the underlying crime of the conspiracy.
In addition, after withdrawal, the defendant must not have re-initiated contact with their fellow co-conspirators. A withdrawal defense will not be successful if you simply failed to participate further in the conspiracy.
Another potential defense to conspiracy charges is entrapment.
Essentially, the entrapment defense poses that you would not have committed the crime, or conspired to commit the crime, if it had not been for a law enforcement agent convincing you to do so. This defense is most commonly used when an undercover law enforcement agent was involved in the conspiracy and, if not for their job, would have been considered a co-conspirator.
White Collar Conspiracy Charges in the News
The famous TV personality and businesswoman, Martha Stewart, was sentenced to 5 months in prison and 2 years of supervised release in July 2004 after being found guilty on charges of conspiracy, obstruction of an agency proceeding, and making false statements to federal investigators.
The investigation into Stewart began in 2002 after she came under fire for selling all of her stock in a pharmaceutical company just one day before the stock’s value fell 16%. Stewart avoided a loss of over $45,000 because of the timely sale.
Stewart was indicted in 2004 and charged with nine counts of criminal misconduct including insider trading, alongside her stockbroker at Merrill Lynch, and obstruction of an agency investigation.
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