Federal Wire Fraud Defense Lawyers
Wire fraud allegations are common in many different types of federal criminal investigations. Our defense lawyers have extensive experience helping clients avoid the substantial penalties imposed under the federal wire fraud statute.
The federal wire fraud statute is extraordinarily broad. First codified in 1952 and originally intended to facilitate the prosecution of cases involving fraudulent schemes perpetrated through cold calls and radio and television ads, federal prosecutors now use the statute to pursue additional penalties in cases involving use of the Internet in any fashion. While this includes activities such as sending fraudulent email solicitations and publishing websites and social media posts with false or misleading information, it also includes using private electronic communications to discuss alleged fraudulent activity.
Due to the federal wire fraud statute’s extraordinary breadth, it can potentially be applied in almost any case involving substantive allegations of fraud. In fact, the statute’s application is so broad that the U.S. Department of Justice (DOJ) has issued guidance to federal prosecutors for when the statute should be utilized. As stated in Section 9-43.100 of the DOJ’s Justice Manual (which is entitled, “Prosecution Policy Relating to Mail Fraud and Wire Fraud”):
“Prosecutions of [wire] fraud ordinarily should not be undertaken if the scheme employed consists of some isolated transactions between individuals, involving minor loss to the victims, in which case the parties should be left to settle their differences by civil or criminal litigation in the state courts. Serious consideration, however, should be given to the prosecution of any scheme which in its nature is directed to defrauding a class of persons, or the general public, with a substantial pattern of conduct.”
However, even this policy statement leaves a huge number of cases ripe for federal wire fraud prosecution. Allegations of health care fraud (including Medicare and Medicaid fraud), securities fraud, government contract fraud, tax fraud, bank and insurance fraud, RICO violations, money laundering, and consumer fraud schemes can all trigger federal wire fraud charges. In these cases, allegations of mail fraud and conspiracy are common as well, and these charges alone can expose federal targets to hundreds or millions of dollars in criminal fines and decades behind bars.
What Types of Communications and Activities Constitute Wire Fraud?
The federal crime of wire fraud is defined in 18 U.S.C. § 1343. Under this statute, federal prosecutors can pursue charges against anyone who:
“[H]aving devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communication in interstate or foreign commerce, any writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice . . . .”
In 18 U.S.C. § 1343, the word “wire” encompasses use of the phone or the Internet, and the incorporation of, “any writings, signs, signals, pictures, [and] sounds,” has been interpreted to cover essentially all forms of telephonic, cellular, digital, and online communication. Furthermore, as acknowledged by the DOJ, the terms “scheme” and “artifice” have not been specifically defined, but instead are interpreted broadly to include acts such as the use of false pretenses, embezzlement, and other forms of “wrongdoing” that result in the deprivation of private or government property.
In other words, within the context of a federal fraud investigation, virtually any type of “wire” communication can trigger the application of 18 U.S.C. § 1343. This includes, but is not limited to, communications and transactions such as:
- Phone calls, text messages, emails, and other communications between alleged co-conspirators;
- Fraudulent communications used to collect personal or financial information;
- Spam, telemarketing, and phishing emails, phone calls, and text messages;
- Fraudulent and falsified invoices;
- Fraudulent billings under federal government benefit programs and federal government contracts;
- Websites, social media posts, and other media that misrepresent the nature or quality of products, services, or securities;
- Online sales, auctions, and other transactions, the terms of which are not fulfilled; and,
- Fraudulent lotteries and sweepstakes promotions conducted by phone or over the Internet.
When federal prosecutors pursue charges under 18 U.S.C. § 1343, then in addition to the penalties for the underlying substantive fraud offense, defendants can also face statutory fines and up to 20 years of imprisonment based solely on the wire fraud statute.
What are Potential Defenses to Allegations of Federal Wire Fraud?
Given the scope of the wire fraud statute’s prohibitions and the extremely wide range of scenarios under which it can be applied, defending against wire fraud allegations presents a challenge. However, there are defenses that can be used effectively to overcome allegations under 18 U.S.C. § 1343, and our lawyers have had significant success asserting these defenses on behalf of many of our clients. Some examples of potential defenses to allegations of federal wire fraud include:
- Constructive Fraud – Since 18 U.S.C. § 1343 requires evidence that the defendant either devised or intended to devise a scheme to defraud, demonstrating that you did not intentionally engage in fraudulent activity (which is referred to as “constructive fraud”) can be a complete defense to federal wire fraud allegations.
- Good Faith (Lack of Intent) – Similar to constructive fraud, the good-faith defense focuses on challenging the government’s evidence that you intended to engage in a fraudulent artifice or scheme.
- Lack of Authority – If an employee engaged in fraudulent conduct without company authorization, this can provide a complete defense to wire fraud at the corporate, executive, and ownership levels.
- Lack of Purpose – The federal wire fraud statute requires evidence that the communications in question were sent, “for the purpose” of perpetrating a fraudulent artifice or scheme. If you lacked this purpose (or if federal prosecutors cannot prove this purpose), then a wire fraud conviction is unwarranted.
- Statute of Limitations – If the statute of limitations for prosecuting federal wire fraud charges based on the underlying fraud allegations has expired, then you cannot be prosecuted.
Learn more about each of these potential defenses: Defense Strategies for Wire Fraud Allegations Under 18 U.S.C. Section 1343.
These defenses, which are all specific to the language and interpretation of 18 U.S.C. § 1343, are in addition to the common law and constitutional defenses that apply to federal criminal investigations and prosecutions generally. From challenging the constitutionality of the search that uncovered the communications in question to arguing that prosecutors have not brought your case to the court in a timely manner, there are many other ways to challenge federal wire fraud allegations as well.
In What Types of Cases Do Federal Prosecutors Pursue Wire Fraud Charges?
Wire fraud charges are common in many different types of federal cases. Our federal defense attorneys have significant experience defending clients against wire fraud allegations in investigations, grand jury proceedings, and trials targeting substantive offenses such as:
Health Care Fraud
Health care providers, telemedicine companies, testing laboratories, durable medical equipment (DME) suppliers, and other individuals and entities that bill Medicare, Medicaid, and other government benefit programs will often face wire fraud allegations in conjunction with allegations under the False Claims Act, Anti-Kickback Statute, and health care fraud statute.
Government Contract Fraud
Construction, military, and other government contractors are subject to extensive federal oversight. When allegations of product substitution, billing fraud, and other contract violations trigger federal investigations for government contract fraud, contractors will often also be at risk for fines and imprisonment under 18 U.S.C. § 1343.
Securities fraud allegations ranging from broker and financial advisor fraud to the filing of false and misleading statements with the U.S. Securities and Exchange Commission (SEC) can also implicate 18 U.S.C. § 1343. The promotion and sale of unregistered securities, insider trading, cryptocurrency fraud, and other securities law violations can trigger wire fraud allegations as well.
Other Fraud-Based Crimes
Many different forms of fraud are criminalized at the federal level, and all types of fraud allegations have the potential to lead to charges for wire fraud. In addition to the types of cases listed above, our federal defense attorneys also handle cases involving allegations of:
Similar to wire fraud, money laundering is a broadly-defined federal crime that can be implicated under a wide range of scenarios. We routinely handle cases in which our clients are facing allegations of money laundering, wire fraud, and multiple other financial and fraud-related crimes.
Public Corruption and Bribery
Public corruption and bribery investigations carry severe implications for all parties involved. By their nature, they will almost universally implicate the federal wire fraud statute in addition to statutes such as 18 U.S.C. § 201, 18 U.S.C. § 371, and 18 U.S.C. § 641.
Contact Oberheiden, P.C. for a Free and Confidential Consultation
Are you under investigation for federal wire fraud? If you need federal defense representation, we encourage you to contact us promptly to discuss your case. To speak with one of our senior federal defense attorneys in confidence as soon as possible, call 214-692-2171 or request a complimentary case assessment online now.