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Many federal criminal cases are structured as so-called “conspiracies.” This article explains the concept of a federal criminal conspiracy, the elements that the government needs to prove beyond a reasonable doubt to establish a conspiracy among multiple defendants, as well as some of the defenses to successfully avoid or fight a criminal conspiracy. The article takes into account most recent case law from the United States Court of Appeals for the Fifth Circuit, which redefined federal conspiracy law in favor of accused defendants in 2018.
Oberheiden, P.C. Avoids and Fights Federal Charges
Oberheiden, P.C. is a federal criminal defense law firm that offers clients across the country proven defense strategies against federal investigations. We routine defend clients accused of:
- Conspiracy to Commit Health Care Fraud
- Conspiracy to Commit Bank Fraud
- Conspiracy to Commit Tax Fraud
- Conspiracy to Commit Violations of the Controlled Substances Act
- Conspiracy to Commit Computer Crimes
- Conspiracy to Commit Mail Fraud (and Wire Fraud)
- Conspiracy to Commit Money Laundering
- Conspiracy to Commit Medicare Fraud
- Conspiracy to Commit Securities Fraud
Dr. Nick Oberheiden: As the founding partner of Oberheiden, P.C., Nick has acquired a national reputation on TV and radio for his work accomplishments in the areas of federal criminal defense, federal litigation, and defense of federal fraud allegations. Nick is an attorney with a PhD and he is licensed to practice in federal courts across the United States.
Two Examples of a Federal Conspiracy
Example 1: Armed Robbery. Imagine two people robbing a bank. One carries a gun, the other does not. In fact, the second bank robber does not even know that there is a gun involved. Can the second bank robber nonetheless be convicted of armed robbery? Imagine further that the bank robbery results in a fatal shooting of a security guard during the course of the robbery. Can the second bank robber be held liable for murder that was committed by the robber that carried and used the gun without the second defendant’s knowledge?
The two answers are yes. Federal conspiracy law is both broad and strict, and it is a deviation from standard criminal law. In the examples, how can the co-defendant that did not know about the gun, nor would he have approved a gun, nor would he even have participated had he known that a gun is involved, how can he be held responsible for armed robbery? The answer is: he participated in a criminal conspiracy. Even though he did not knowingly and willfully support the idea of a gun during the robbery, his participation in the robbery contributed to the robbery (or attempted robbery) and that is all that’s needed to also charge him with armed robbery. Partners in crime share the same consequences.
Example 2: Health Care Fraud. Business owner defrauds Medicare. She uses a physician to sign off on the paperwork needed to get the claims submitted and paid. Business owner makes $ 2m over time, the physician $ 10k. Can the physician be held liable by way of a criminal health care fraud conspiracy? If so, for how much? For $2m? For $10k? Or even for the entire amount the clinic tried to collect (and that billed amount is typically larger than the actual collection)? The answer is: the physician can possibly be held liable for the entire billed amount. Since sentencing in fraud cases is based on the damage amount, the difference between $ 10k, $ 2m, and the even higher billed amount can be many years of incarceration.
The Elements of a Conspiracy Charge
Under federal law, a conspiracy is an agreement between two or more people (some states only require one person, notably New York) to join together to attempt to accomplish some unlawful purpose. It is irrelevant whether the conspiracy plan worked out and whether the conspiracy was successful. The key is that at least two people have combined, or mutually agreed, to do something illegal. Iannelli v. United States, 420 U.S. 770, 777 (1975). To find a defendant guilty of conspiracy, the Government must prove beyond a reasonable doubt that:
- Two or more persons agreed to try to accomplish a common and unlawful plan, as charged in the indictment; and
- That the defendant knew the unlawful purpose of the agreement and joined in it willfully, that is, with the intent to further the unlawful purpose.
One may become a member of a conspiracy without knowing all of the details of the unlawful plan or the identities of all of the other alleged conspirators. That is very important to remember. In the examples above, the respective co-conspirator (second bank robber, the physician) did not know the entire plan, nor did they know the person who provided the gun (example 1) or who submitted the fraudulent bills (example 2). If the defendant, with an understanding of the unlawful character of a plan, knowingly joins in an unlawful scheme on one occasion, that act alone is sufficient to convict him of conspiracy, even though he had not participated before and even though he played only a minor part in the conspiracy. Blumenthal v. United States, 332 U.S. 539, 557 (1947).
Elements of Conspiracy Explained
Agreement: The essence of a conspiracy is that two or more people agree between themselves to commit a crime. While many conspiracies involve an express agreement, in which people meet or talk on the phone and discuss their criminal plans and agreement, such as a plan to commit a robbery of a casino, the government may also prove what is called an indirect conspiracy, in which the circumstances make clear that the participants were all planning to and/or did commit a crime, even in the absence of any express agreement.
While it is not required that each member of the conspiracy knows every detail of the criminal plot, each person must at least implicitly agree to the same, illegal purpose. Moreover, the members of a conspiracy do not all need to know one another. Instead, in many conspiracies, the people charged in the indictment have never even heard of many of their co-defendants, never done any business with them, and never met them. But in such conspiracies, the members are all connected through the common goal to commit a crime or through other individual members of the group. Often all the members work for, or are contractors for, one company. Even a one-time single agreement establishes a conspiracy, though there may be several different criminal objectives of that conspiracy.
In the Fifth Circuit, which covers Texas, Louisiana, and Mississippi, the Court recently entered an opinion emphasizing that the burden is on the government to prove a conspiracy beyond a reasonable doubt. In United States v. Ganji. No. 16-31119 (5th Cir. Jan. 30, 2018), the Court explained: “[c]onspirators do not enter into an agreement by happenstance, and because an agreement is the essential element of conspiracy, an agreement to commit a crime cannot be lightly inferred.” Id. at 9. In other words, the government must prove an agreement to commit a crime existed beyond a reasonable doubt. Id. at 10. “The actions surrounding the defendant and the co-conspirators’ conduct, taken together, must show they intentionally entered into an agreement.” Id. And although a conspiracy may be shown by indirect or circumstantial evidence, in such cases, “the Government must present evidence of the conspirators’ individual actions that, taken together, evidence an agreement to commit an unlawful objective beyond a reasonable doubt.” Id. (emphasis in original).
Intent: In order to prove a conspiracy, the government must prove specific intent. In other words, the defendant must have intended to agree to commit a crime, not merely approve someone else’s commission of that crime. The defendant must have the specific goal to commit the crime that is the subject of the alleged conspiracy.
Frequently, defendants ask whether the government must prove that each member of the conspiracy intended to execute the crime that is the target of the conspiracy, or whether it is sufficient for the government to prove the intention to enter into an agreement to commit some crime. The answer is the latter: the federal conspiracy law only requires the prosecution to show intent to engage in some type of forbidden conduct, and not evidence that the defendant was aware of the specific circumstances of each element of the crime. In other words, “a corrupt motive or intent to do wrong” is enough to create a conspiracy, regardless of the details of the crime that is actually committed. See United States v. Feola, 420 U.S. 671 (1975) (affirming conviction of multiple defendants for conspiracy to assault a federal agent despite defendants’ lack of knowledge that drug buyer was federal agent).
One special problem that sometimes arises in conspiracy cases is what to do when one of the members of the conspiracy only participates by providing legal goods and/or services. Most courts agree that such a person can still be held liable for conspiracy if he or she knew that someone is going to use those goods and/or services to commit a crime. The government does not have to prove that the goods or services were provided with the specific intent of supporting or advancing criminal activity.
Overt Act: Finally, under general federal conspiracy law, at least one overt act must have been committed in furtherance of the conspiracy. At least one of the conspirators must have taken some action to actually set the conspiracy in motion, in addition to the agreement to commit a crime.
However, not every conspiracy charge requires that an overt act to further the conspiracy be taken in order for a conspiracy conviction to be obtained. For example, the government commonly charges health care fraud conspiracies under a special statute that doesn’t require an overt act – the mere agreement to commit a crime is sufficient. See United States v Jones, 733 F.3d 574, 584 (5th Cir. 2015) (“Section 371 contains an overt-act requirement, but Section 1349 does not contain an overt-act requirement”); see also United States v. Ellis, NO. H-10-416-S, 2011 U.S. Dist. LEXIS 95302, at *23 (S.D. Tex. Aug. 25, 2011) (“Since the conspiracies in question were both charged under 18 U.S.C. § 1349, no overt acts were required to be alleged or proven.”). In addition to health care fraud, conspiracies to commit wire or mail fraud are often charged under this section.
Disadvantages to Conspiracy Defendants
Conspiracies offer prosecutors enormous advantages in criminal cases. Unlike other crimes, conspiracy is punishable even if the target crime remains unfinished (or unproven). Conspiracy is a powerful and popular weapon for prosecutors because it allows the government to take advantage of the evidentiary rules to obtain convictions.
First, each co-conspirator is deemed to have authorized other members of the conspiracy to act and speak on their behalf. That means that any statements that co-conspirators make in furtherance of the conspiracy can be admitted later at trial to prove the defendant entered into a conspiracy. See Bourjalily v. United States, 483 U.S. 171 (1987) (allowing hearsay statements by a co-conspirator as admissible evidence if the prosecutor first proves by a preponderance of the evidence that a conspiracy exists).
Second, prosecutors may try all co-conspirators in a single trial. Doing so is far more efficient than having to select a new jury and hold a separate trial for each defendant. The defendant may move to sever his trial, but typically, doing so is disfavored by the court.
Third, each co-conspirator can be held liable for any reasonably foreseeable crime committed by another co-conspirator in furtherance of the conspiracy. In other words, the prosecutor does not have to prove that the defendant intended to add or otherwise facilitate or encourage the commission of the crime. The prosecutor only has to prove that a crime was foreseeable. Each conspirator is vicariously liable by entering into an agreement and authorizes every member of the conspiracy to act as an agent of the others to commit a crime. Pinkerton v. United States, 328 U.S. 640 (1946).
Defenses to Conspiracy Charges
In some instances, persons charged with conspiracy may be able to defeat the charges by raising a specific affirmative defense recognized by federal conspiracy law. If the defendant can show that he renounced the conspiracy or withdrew from it, or that the conspiracy was impossible, he or she may be found not guilty.
Renunciation: Under most laws, defendants are afforded the defense of renunciation. The affirmative defense of renunciation requires that the defendants must have hindered the success of the conspiracy and that abandonment must be complete and voluntary. One example of successful renunciation is to inform law enforcement prior to the commission of a crime as long as the renunciation is not too late, and the success and completion of the crime can be avoided. Simply abandoning because a defendant realizes that he will get caught otherwise is not enough.
Withdrawal: A second defense is if a co-conspirator tells the other members of the conspiracy that he will withdraw and cease and desist from the conspiracy. This notice to all co-conspirators, to no longer intend to take part in the criminal plan in time for the other conspirators to also abandon the conspiracy, allows the avoidance of criminal sanctions for all future crimes but never for past crimes. Withdrawal from a conspiracy cannot undo already committed crimes. Federal courts explicitly permit the defense of withdrawal as long as the defendant takes affirmative acts inconsistent with the conspiracy’s goal and effectively takes reasonably steps to effectively communicate his abandonment to his co-conspirators U.S. v. U.S. Gypsum Co., 438 U.S. 422, 464-465 (1978).
Impossibility: Although legal and factual impossibilities rarely occur, a defendant cannot be convicted of conspiracy if the parties agree to commit an act that they believe is a crime, when in fact it is not a crime to commit the planned act. When there is no law prohibiting conduct, a conspiracy cannot exist despite the members’ willingness to break the law. Prosecutors are prevented from using conspiracy laws to punish the conduct of an individual whose participation in the target offense is logically required, but whose behavior is not made criminal by that offense.
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