An Introduction to the Basics of Counterfeiting & Forgery
The federal government has strict and definite laws against the creation of intentionally or knowingly false currency, banknotes, credit cards, and other government documents. These laws aren’t applicable to every forgery or counterfeit, but just those made and used to defraud the federal government. For example, a counterfeit DVD or purse wouldn’t be criminalized under these specific laws.
However, the counterfeit and forgery statutes of the U.S. Code do cover a number of different actions and types of fake documents, including:
- Printing false or fake currency, whether U.S. currency or foreign money;
- Falsifying a security or other documentation of other obligation;
- Altering or falsely modifying a government document, such as a deed or public record; and
- Creating fake credit cards or other devices meant to imitate currency or the value of a currency.
What Is the Difference Between Counterfeiting and Forging?
While forgery and counterfeiting are intertwined in the federal statutes, the concepts are significant, if not substantially, distinct. Counterfeit is a more narrow definition, making all counterfeits a type of forgery, but not all forgeries are counterfeits.
Forgery is the process of making a modification to an otherwise genuine document or creating an entirely false document. The term used in federal statutes and in federal court for actually passing off a forgery as real is referred to as “uttering.” The falsified replica or document is made with the express intent to defraud another individual or entity.
In contrast, a counterfeit is an imitation that is done with criminal intent or purpose. The counterfeit is intended to exactly replicate a legitimate and existing document. Most often counterfeits are associated with the replication of bank notes and other currency. However, you can also make a counterfeit security, bank card, check, or another obligation of the United States government.
Federal Statute on Counterfeiting & Forging
Acts of copying, imitating, falsifying, misrepresenting, and producing fake documents are criminalized under a set of statutes found in Chapter 25 of the U.S. Code. These federal laws are broken down into a multitude of different acts that include falsifying public records, coins, military documents, securities, and credit cards.
A Break Down of Federal Statutes
Each federal statute in Chapter 25 of the U.S. Code has a separate set of acts or elements that create criminal liability. Therefore, to understand the specific charges against you, it is necessary to know the specific statute with which you are charged.
These are the most commonly used federal statutes for the prosecution of counterfeiting and forgery:
- Obligations or securities of the United States: it is unlawful to falsify, forge, or counterfeit any security of the United States. This includes altering any bond, Federal Reserve note, certificate of indebtedness, or national bank currency.
- Dealing in counterfeit obligations or securities: Not only are acts of creating false or forged securities illegal under federal law, so are acts involving the possession and dealing of these items. Dealing in counterfeit obligations or securities includes the buying, selling, exchange, transfer, or receipt of any counterfeit or forged security.
- Foreign banknotes: The statute on foreign currency specifically covers the use of a false, altered, forged or counterfeit banknote with the intent to defraud. Under this statute, a banknote is any currency or document that is created by a foreign government or entity and intended to be used as money.
- Tokens or paper used as money: The statute on creating a fake currency of the United States is unique to the statutes on counterfeiting and forging because it is confined to individuals aged 18 or older. Anyone meeting this age qualification who creates, issues, or utilizes a token, coin or other devices in lieu and intending to be used as the currency of the United States can be charged under this statute.
- Seals of courts: All courts in the United States have a specific steal or stamp to denote an official document processed by that court. The creation or forgery of any document bearing these stamps, but not issued by that court, is an offense under the counterfeiting and forgery laws.
When Is There a Federal Case for Forgery or Counterfeiting?
Criminal prosecution for forgery or counterfeiting is most likely to occur at the state level. It is easier for entities at the state level to investigate a single instance of counterfeiting or passing a forgery. Plus, the state laws around the offenses are broader than at the federal level.
However, extensive forgery or counterfeiting schemes and instances of identity theft are generally handled by federal agencies.
Counterfeiting any U.S. or foreign currencies are always investigated and prosecuted by the federal authorities. It is also a federal matter if a forgery or counterfeiting crime is carried out across state lines or at an international scale. The federal government has a vested interest in preventing widespread activity that involves multi-state organized crime or international criminal organizations.
Federal Agencies That Investigate Counterfeit and Forgery Operations
The detection, investigation, and strategy for building a federal counterfeit or forgery case are handled by a wide range of government agencies. What is the reason for this division of labor and resources for a forgery or counterfeit case? The federal charges in these particular cases are often alleged in conjunction with a separate federal offense. Many forgery and counterfeit operations are uncovered as a result of an investigation into this separate matter.
A great example of separate federal charges leading to the detection of a possible forgery or counterfeit operation is an immigration, shipping, or customs violation. Many counterfeit operations begin overseas, with the production of cheap devices and goods in China, India, or Southeast Asia. These goods are brought to the United States for sale. In the process of shipping or illegally trafficking these items, counterfeit operations must take the risk of several federal violations, often involving visas or customs forms.
This involves agencies such as the U.S. Customs and Border Patrol and Immigration and Customs Enforcement (ICE), who may investigate the following counterfeit charges. Other federal agencies involved in detection and investigation include:
- U.S. Postal Service;
- Federal Bureau of Investigations;
- U.S. Secret Service
- Drug Enforcement Administration, and
- Department of Homeland Security.
Repercussions of a Forgery or Counterfeiting Conviction
Charges for counterfeiting or forgery are less common than those for similar fraud and identity theft crimes, but they are no less serious or worrisome. No matter what your role is in a suspected forgery scheme or counterfeiting operation, you need to immediately address the charges or face the possibility of federal charges – and down the road the chance of a criminal conviction
Criminal Punishment for Forgery or Counterfeiting
Under federal law, a criminal conviction for forgery or counterfeiting is subject to all forms of criminal punishment: incarceration in federal prison, probation, criminal fines, and restitution to victims of the defendant’s criminal activity.
- Federal Prison Term: The length of a prison term for forgery or counterfeiting is dependent on the type of forgery made and how extensive the scheme. Acquiring greater financial gain from a forgery or counterfeiting operation will, logically, result in a longer prison term. More surprising to many defendants is that forgery or counterfeiting certain items will result in a much longer prison term under federal criminal laws.
In general, the length of a federal prison sentence for forgery or counterfeiting is 20 years. For example, counterfeiting a U.S. obligation or security carries up to a 20-year prison sentence under Section 471 of the U.S. Code. While forgery of a U.S. obligation or security carries the same maximum prison term, criminal prosecution falls under Section 471 of the U.S. Code.
Certain lesser offenses, such as counterfeiting or forgery of U.S. postage or postage stamps only has a maximum sentence of five years. Similarly, the maximum prison term for altering or removing a motor vehicle identification number, considered a form of forgery, carried a maximum five-year sentence under Section 511.
- Criminal Fines: In contrast to many federal criminal statutes, the criminal fines for forgery or counterfeiting aren’t delineated or specified by the statute. Most of the sections under Chapter 25 simply state that a federal defendant convicted of such forgery or counterfeiting, “shall be punished.” The result is some leeway to the federal judge to impose the appropriate criminal fine, but the certainty that some financial repercussion should be levied.
- Probation: In the event, there are mitigating circumstances underlining a conviction for counterfeiting or forgery, then a federal judge may impose probation, rather than a federal prison sentence. Of course, the availability of probation as a criminal punishment is wholly dependent on the sentencing judge and circumstances of the federal case. Probation could also be imposed at the conclusion of a federal prison term under the 20 or five-year maximums.
- Restitution: Often forgeries and counterfeiting operations result in a financial windfall to the actor at the expense of another individual or entity. Identity theft is the clearest example of a forgery that results in financial losses to another person; in this case, the victim of identity theft. In this case, a federal judge may impose payment of restitution. The amount of restitution can vary but is frequently the amount lost by a victim of forgery or counterfeiting.
Reputational Harm from a Crime of Deceit
One of the reasons the federal government treats forgery or counterfeiting as a serious offense, and a reason for any defendant to seek legal counsel, is both forgery and counterfeiting are crimes involving deceit and frauds. Crimes that involve deceit and lies are believed to indicate the character of an individual and are prosecuted under this pretense both in federal court and the court of public opinion. Yet, this reputational harm is frequently overlooked when considering the repercussions of a forgery or counterfeiting conviction.
One reason it is necessary to engage a federal defense lawyer for charges of forgery or counterfeiting is the protection of your reputation and professional standing. Once convicted of forgery, counterfeiting, fraud, embezzlement, identity theft, and other federal white-collar crimes, it is very difficult to regain standing in a profession or community.
How to Build a Defense to Forgery Charges
Building a defense to forgery or counterfeiting charges is a strategic matter. It requires expertise in the area of federal crimes, the process, and tools required to make a forgery or counterfeit currency, and knowledge of the federal courts. Your source of knowledgeable advice and representation against counterfeiting or forgery charges is a federal defense lawyer with past experience handling similar cases.
Possible Defenses to Accusations of Forgery or Counterfeiting
What can a federal defense lawyer do for your case? To start, a defense lawyer is responsible for deciding the framework for your defense; this includes the underlying strategy of your case. There are two ways to fight charges of forgery or counterfeiting: with factual evidence that shows no crime was committed or by proving an error in procedure and due process by federal law enforcement or the federal prosecutor. We’ll look at defense strategies specific to the circumstances and facts of a case.
- Lack of intent to commit a crime: A defendant must have the requisite intent to commit forgery or counterfeiting. This is legally called mens rea or criminal intent. As a critical element to any forgery case, it is necessary that the prosecutor establish criminal intent beyond a reasonable doubt. Evidence that counters this criminal intent can be persuasive before a jury.
- No knowledge of a forgery or counterfeit: There are several separate actions that can lead to forgery or counterfeiting charges, including the act of passing a forgery or counterfeit off as genuine. Of course, this is only an offense if the defendant knew the item or document was a counterfeit or forgery. Evidence that shows the defendant had an honest belief the document or item was genuine disrupts the prosecutor’s case.
In some instances, a defense alleging no knowledge of a forgery or counterfeit is called acting like an innocent third party. In these cases, the defendant received a counterfeit or forged document, and have no reason to believe it was false or fraudulent, furthered the criminal offense. For example, a landlord receives a counterfeit check from a tenant and without knowing the check is a fake endorse it to another party. Eventually, it is found to be a counterfeit check, and the landlord is wrongly implemented in the crime.
- Duress or coercion to commit the offense: If a defendant acted under fear of future violence or threats of violence, then the forgery or counterfeiting wasn’t a federal criminal offense. Both duress and coercion allow a federal prosecutor to argue that yes, the defendant created a counterfeit or used a forgery, but did so only under duress or coercion by another party.
Charges for Forgery or Counterfeiting and Other Crimes
Forging and counterfeiting cases are often connected to other federal criminal charges. A perfect example is the relationship between forgery or counterfeiting and identity theft. Often, in order to create a fake driver’s license, passport, or credit card to co-opt the identity of another individual, you must commit identity theft online, by skimming credit cards or taking someone’s mail. This is the first federal offense.
Then the stolen personal information is used to create a false identification. The creation of a fake ID, passport, or other item is the second offense under the federal counterfeiting and forgery laws.
Other federal offenses have a similar relationship with forgery and counterfeiting crimes. Wire fraud, mail fraud, and embezzlement are all charges frequently related to the creation of fake or counterfeit documents and identification. In many of these instances, the related offense is the means by which an alleged forger obtained the information or forms to create a copy.
Recent Charges for Forgery or Counterfeiting
Counterfeit of high-end goods and products are some of the most common federal counterfeiting charges in the United States. Not only do allegations of counterfeit goods represent a substantial number of federal counterfeiting cases, but also some of the biggest schemes in the country. For example:
- The United States Immigration and Customs Enforcement (ICE) charged 33 individuals with a major scheme to bring counterfeit luxury goods into the United States. The defendants were charged with passing millions of dollars, allegedly $500,000 worth, of Chinese-made fake goods into the county via New York City ports of entry. In addition to the counterfeit charges, these 33 defendants face allegations of conspiracy to traffic, trafficking, conspiracy to smuggle, smuggling, money laundering, and immigration charges. ICE originally became aware of the possible counterfeit conspiracy due to red flags on immigration applications and allegations of unlawful procurement of naturalization.
- In Boise, Idaho 16 people were charged with serious counterfeit charges in federal court for the production and sale of counterfeit cell phones. The alleged scheme involved the manufacture of fake phones in Hong Kong and the sale in the United States. Detection and investigation of the counterfeit operation was handled by the Federal Bureau of Investigation, the Drug Enforcement Administration, the Department of Homeland Security, the Internal Revenue Service, the U.S. Postal Inspector’s Service Office, and local law enforcement.
Taking Action in Your Defense to Counterfeit or Forgery Charges
The potential criminal punishments to counterfeit and forgery charges differ, for example, possession of a counterfeit banknote has separate consequences from creating a forged security document. Yet, in all instances, a conviction for counterfeiting or forgery is serious.
Your defense isn’t just important, it’s imperative – and it begins with hiring a tough and strategic forgery defense lawyer.
First Steps in Your Defense
Whether you are under investigation for counterfeiting or forgery or already facing charges, your lawyer is the first point of contact. Through your lawyer, you can establish a plan to:
- Cease activity that could be construed as forgery or counterfeiting;
- Implement a plan for communication with federal law enforcement;
- Determine what information to provide for government cooperation and what information to withhold in the absence of a warrant; and
- Establish communication and appropriate procedure with the federal court.
How to Hire a Defense Lawyer
Most federal defense lawyers will offer a free consultation to discuss accusations of counterfeiting or forgery. In this conversation, you’ll learn the specifics of the counterfeiting and forgery statutes and begin developing a plan for your defense.