Federal charges for wire fraud are broadly applied to schemes and scams that involve the use of interstate wires to intentionally commit any type of fraud. The same statute also criminalizes schemes that look to obtain money or anything else of value through falsities or intentional misrepresentations, once again, when these acts are carried out by interstate or international wires.

Examples of wire fraud include:

• Creating a fraudulent charity and sending an email that request donations for this charity, when any funds raised are going straight into the pockets of the email sender; or
• Calling businesses and claiming there is a problem with their bank accounts, then using the information obtained to hack a checking or savings account.

What are Interstate Wires?

The term interstate wires may sound confusing and complicated, but the legal term actually relates to a straightforward concept. Wires refer to any electronic form of communication or capability. The types of technology that is included in the definition is a range of items, such as some of the older technology the radio, and extends through to the more recent inventions like the Internet and computer networks.

Wires go further than just speaking about the radio, television, or internet. It would also include devices and programs or applications that allow you to communicate. For example, emails and texting could be a way that you have communicated with people in other states or countries. An even broader method could be one of the many social networks.

Interstate refers to the crossing of state lines. In today’s world, a scheme to defraud by wire fraud is rarely confined to a single state – in fact, most wire fraud crosses international borders, but when wire fraud was criminalized in the 1950’s the use of phones and radio was far more local. To qualify as a federal offense, wire fraud has to involve individuals or actions in more than one state.

Find A Federal Criminal Defense Attorney

Because of the seriousness of federal charges, you will want to seek the advice of a federal criminal defense attorney. While criminal charges and their penalties may look simple, there are many different factors that are taken into consideration at all stages. A federal criminal defense attorney will be aware of the law and its nuances. Do be aware that a U.S. Attorney looks at the seriousness before charging you with wire fraud. Even if you feel you have an understanding of the charges, an experienced federal criminal attorney will be able to look at your case with an unbiased view to give to the best advice.

What Law Criminalizes Wire Fraud?

The Federal Statute:

Under 18 U.S.C § 1343, it is a federal crime to use any form of electronic communication to defraud or scheme to defraud another individual or entity. The precursor to this federal offense was the statute prohibiting mail fraud, which was passed in 1872. The original wire fraud statute was enacted by Congress in 1952.

Today, fraud by telephone (under a different statute), radio, or television communication are specifically prohibited; this also ensures that wire fraud is also applicable to computer cables and modems.

The Elements of Wire Fraud:

There are four elements of wire fraud, and a prosecutor must prove each beyond a reasonable doubt to win a conviction in federal court. Wire fraud is:

(1) the intent

(2) to defraud an individual, entity, or the government

(3) by making false representations

(4) carried out across a form of electronic communication.

Additionally, as part of the prosecutor’s case, it must be evident that the use of television, radio, or wire/internet crossed interstate lines or was utilized for foreign correspondence. For specific facts that do not involve federal agencies, it is this interstate or foreign component of the crime that gives a federal court interest in the case. However, in the instance that you are defrauded by the federal government or some sort of federal program, the federal government will have jurisdiction over the case in one way or another. Over time, some federal courts have also imposed an obligation on prosecutors to show that it was reasonably foreseeable that wire communication would be used to carry out the scheme.

What do the elements mean?

(1) the intent

In criminal cases, there are different types of intent. In this case, the intent is specific intent. Therefore, rather than the government proving that you intended to do something that was against the law, you acted with a purpose to specifically defraud an individual.

(2) to defraud an individual, entity, or the government

This is the goal that you are trying to achieve. The government must prove that in your actions you were trying to obtain something illegally from an individual, entity, or the government. While it seems to be an easy and clear element to prove, it could be that your actions even though someone lost money or goods in the long run, were not to defraud at all. It could be that you were doing your job as you understood it.

(3) by making false representations

This element refers to your alleged untruthfulness to one of the three persons above in (2). This can happen in various ways.

For example, the Department of Justice investigated a Veterans Affairs (VA) official who was also involved in a business that was working with the VA. He told the VA that there was no conflict because he had no involvement with the company since it was managed by his wife. However, it turned out that the official was actually involved in the company and on various occasions took part in meetings where they decided to raise the cost for the services they were providing to the VA.

Another example involved an individual who was employed with the office of Homeland Security. She used a straw (a person acting as the owner to conceal the true owner) to purchase her home and asked for forgiveness on the $40,000 remaining balance due to hardship. The banks agreed, and the transaction was completed including the forgiveness. The problem arose when further investigation showed the money to purchase the home was actually the defendant’s money that she fronted the money to the straw. Therefore, there was no actual sale of the home; rather the individual made it seem like she was selling her home to be forgiven for the remaining balance.

(4) carried out across a form of electronic communication.

Like mentioned above, this can come in various forms; some of them include television, radio, and the internet. The communication that is included in wire fraud is very broad, most likely in order to cover the developing technology.

What are the methods of investigating Wire Fraud?

How detected:

At a more basic level, banks can detect wire fraud. This generally happens because bankers may notice that an account holder’s type and level of activity has changed significantly. However, the alleged scheme could be more complicated and would include more investigative agencies.

What happens if suspected?

The actions taken by the government or investigating agency can vary. However, it is likely that they will try to get information from the accounts in question and also from the accounts of the individual who is suspected. If you are asked to agree to this inspection, you do not have to. In fact, it is recommended that you contact a federal defense attorney. Regardless of your ability to agree, law enforcement agencies can subpoena your records. It is unlikely that law enforcement will seek your permission to see your bank records since they can get access to these records with the subpoena.

It is likely that you will be called law enforcement and asked if you want to be interviewed. Regardless of the fact that you may feel either guilty or innocent, you should seek legal advice about speaking to law enforcement.

Investigative measures:

In a situation where you are accused of a  federal crime, the investigation will involve multiple agencies. These could include the Federal Bureau of Investigation (FBI), the Securities and Exchange Commission, and sometimes the United State Postal Service.  In addition to these federal agencies, any entity that you may have been working with could also be involved in the investigation.

The reason for the many different types of agencies being included in the investigation is that the crime of wire fraud can be widespread. Even though your actions may seem simple, it reaches to a lot of people behind the scenes.

Seriousness of a federal charge:

Penalties

All crimes come with some sort of penalty whether it is a fine or prison. As for federal crimes, the penalties are likely to be more severe. The types of fines are likely to be larger amounts. In the area of fraud, the type of fine will vary drastically. While many statutes give a specific amount, they also give another fee that would be double the size of the profit made due to the fraud. The statute will require that you pay for whichever one is higher.

Further, for federal crimes, the likelihood of prison is greater, with higher term limits. Practically all of the federal criminal statutes give a maximum prison term. Some of the statutes do not give a minimum, meaning that you could possibly not go to prison if convicted. However, there is still a higher chance of prison. For example, in the early 2000s, the Department of Justice was investigating wire fraud involving the Federal E-Rate program (a program that benefited economically disadvantaged schools) and the misuse of the funds. During that time 20 individuals were being investigated, were found guilty, took a plea, or had civil settlements. 15 of those individuals were ordered to serve a prison sentence.

Specifically, the sentence for wire fraud is a fine or a maximum of 20 years in prison or both.

Unforeseen penalties

In addition to the penalties that the government enforces, there are penalties that you may not have seen as consequences to a crime. Having a felony, especially a federal felony, on your criminal record could really harm your abilities in life. Generally, a criminal history is frowned upon in places of business. Felony level crimes even more.

What makes wire fraud even worse is the fact that fraud is considered a crime of dishonesty. You could be painted as an untruthful person. If your background deals with money or entering into agreements, employers are likely to pass you over for employment.

Finally, regardless of all of the fines that may come with a crime, your actions may cause your belongings to be subject to forfeiture. This happens if you purchased something from the profits of the fraud. Even further, if you purchased a gift for a family member, that gift could be included as well.

Additional charges

Even though you might be charged with wire fraud, there are additional charges that could also be brought against you. The number of additional crimes is extensive because it includes federal crimes, federal programs, local crimes, and foreign crimes. For now, it is important that you know some of the main additional charges:

• Bank fraud because it is alleged that part of your scheme included you posing as a bank.
• Conspiracy could be charged in the instance that you are alleged to have been working with one or more persons.
• Mail fraud in the instance that you sent mailings out to contact you through the internet or phone.
• Money laundering is a possibility because if you are alleged to have participated in a large wire fraud scheme, then it is likely you will be getting a lot of money in return, you would need to do something with that money upon receipt or in order to not be detected.
• Racketeering Influenced and Corrupt Organization (RICO), which is similar to conspiracy but is specific to a larger group of people or enterprise or association. This group of people has a goal and activities that affect interstate commerce.

Possible Defenses

Good faith defense.

Because this is a case that requires specific intent, the good faith defense is available. This defense essentially means that your acts even though they qualify as wire fraud, were consistent with and within your duties, that you were following through on your obligations.

Statute of Limitation

This defense applies to most cases in a sense most cases have a statute of limitation. Essentially, it stops the government from trying to proceed on a case when they have waited too long to file charges.

How Courts Have Affected Wire Fraud

The biggest way that courts have affected wire fraud is the change in elements. Even though the elements were provided and explained to you earlier, those elements could be changed depending on the jurisdiction where you are being prosecuted. Part of the reason for this is because each court interprets the statute differently.

For example, in the early to mid-1990s there was a court that determined that there are four elements to the crime of wire fraud and based this decision on the Model Criminal Jury Instructions. Those elements were similar to those given above. They included: 1) intentionally devised/participated in a scheme to defraud, 2) intent to defraud, 3) foreseeability that interstate communications would be used, and 4) interstate wire communications were used.

However, at about the same time, there two courts that said there were only two elements of wire fraud, which each essentially required: 1) a scheme to defraud, and 2) with the use of interstate wire communications.

Additionally, earlier it was explained to you that courts have been putting more emphasis on the requirements of use of electronic communications and interstate communications. They are essentially adding another element. Regardless of these different theories on what elements are required to be found guilty, the statute itself and the prohibited act remain the same.

Because of the possibility that these elements being different, the case is likely not as simple as you may think. But an experienced federal defense attorney will have the skills and knowledge of the correct elements to be applied and how to correctly focus on your case.

What to Do If Accused of Wire Fraud?

Wire fraud is a serious federal offense. It is a felony and those convicted face a lengthy sentence in federal prison. Therefore, fighting these charges is pertinent, if not imperative – and if accused of wire fraud, you should act swiftly.

First Steps if Accused of Federal Wire Fraud:

1. Cease any actions that may resemble or appear to be wire fraud, even if innocent or unintentional.
2. Contact legal counsel that is eligible to practice in the federal court and has prior experience with wire fraud cases in the applicable district court.
3. Only speak with federal investigators, including the FBI, when a federal defense lawyer or other counsel is present.
4. Do not agree to any search, seizure, or interrogation without discussing the matter with your lawyer.
5. Limit your communication with the media, news outlets, company outreach, or other publicity, unless specifically advised otherwise by your federal defense counsel.

Finding Qualified Counsel for Your Defense

Choosing a federal defense lawyer is a crucial part of your defense to any federal crime. It is not a decision to take lightly, and you deserve qualified counsel to advise and represent you in all stages of your defense.