Federal Criminal Defense Lawyer - Wire Fraud

Wire fraud is a federal crime (18 USC 1343) which makes it illegal to use wires (such as emails, text messages, or phone calls) to defraud someone out of money. Mail fraud is a similar crime but requires the use of the U.S. mail in carrying out the fraudulent scheme. Both wire fraud and mail fraud carry serious penalties, including up to 20 years in prison. If you've been charged with wire fraud or mail fraud, you should contact an experienced federal criminal defense lawyer to receive the best possible defense.

How does the Government prove wire fraud?

The Government has to prove several different elements beyond a reasonable doubt to convict someone of wire fraud. These basic elements are explained below:

1. A plan to defraud. The Government has to prove that there was a plan or scheme to cheat victims out of their money.
2. Material and false representations. The plan must have included representations that were both false and material. The term "material" means that the representation could have had the ability to influence the victim. One example would be promising a specific rate of return on an investment. 
3. Intent. The Government has to show that that a defendant actually intended to defraud his or her victim. If the defendant did not intend to lie to or deceive anyone, there can be no intent.
4. Interstate or foreign commerce. In many federal cases, the Government has to show that the goods or, in this case, the electronic communication flowed through foreign or interstate commerce.  This element is usually satisfied anytime someone uses email or the phone to communicate with someone else.

What if the email or phone call did not contain any misrepresentations?

To win a conviction for wire fraud, the Government does not have to show that the actual email, phone call, or wire contained a misrepresentation. The Government only needs to show that a defendant used email, a telephone, or other wire to help carry out the fraud.

Example: Let's say John met with Alice in person and pitched an investment opportunity which promised Alice a 100% return within one year. John, however, had no intention of actually investing Alice's money or providing the promised return. This act, in and of itself, would not be wire fraud. But if John later emailed Alice to arrange the transfer or Alice's funds to start the investment, John could be charged with wire fraud.

When does the Government charge wire fraud?

The Government uses the wire fraud statute to cover a vast array of different types of fraudulent conduct, and there are several other offenses that may overlap with wire fraud, including bank fraud, healthcare fraud, identity theft, credit card theft, tax crimes, racketeering, and money laundering. The Government will often charge a defendant with both the more specific offense (e.g., bank fraud) along with wire fraud. 

When more than one person is involved in a fraudulent scheme, the Government will also charge a defendant with conspiracy to commit wire fraud. A conspiracy charge is typically brought under 18 USC 1349 and 18 USC 371. As discussed on other parts of this website, the Government will almost always charge a conspiracy if it can. While there are several reasons for this, an individual charged with conspiracy will be held responsible for all reasonably foreseeable acts of any co-conspirators. 

By charging a defendant with conspiracy, the Government can hold the defendant responsible for someone else's conduct if that person was a member of the conspiracy. In wire fraud cases, an individual's sentence is largely driven by the loss amount (the amount of money that was taken). Conspiracy charges therefore allow the Government to obtain higher sentences by using the bad conduct of other people. 

What are the defenses to wire fraud?

The defenses to wire fraud cases can vary drastically from case-to-case. As mentioned above, wire fraud covers a whole host of different types of cases. Below are a few of the defenses that could be raised in a wire fraud case.

• No intent to defraud. White collar fraud cases are often not black and white. When it comes to financial investments, loan applications, and the like, not every misstatement is intentionally made. It is quite common for someone to think that they are making an accurate statement about a complex set of numbers when it actually isn't true. In these cases, the mistake was honest and there was no intent to defraud. For instance, we had one client who worked for an investment company and made promises to investors that he thought would be kept. In reality, our client did not have the proper training to fully understand the intricacies of the investment world. As he had no intend to deceive anyone, he could not be convicted of wire fraud.

• Immaterial misrepresentations.  The representation at issue must be able to influence someone to do something. If the alleged lie was so minor or irrelevant that it would not have influenced anyone, a defendant cannot be convicted of wire fraud.

• An agreement in conspiracy cases. The Government loves to cast a wide net and charge as many people as it can with conspiracy. But the Government has to show that an individual knowingly joined a conspiracy to defraud others out of money. We have seen many cases where a defendant never agreed to join any illegal scheme but was nonetheless charged because his friends, co-workers, or employers had engage in illegal dealings.

What kind of sentence can I expect if I'm convicted of wire fraud?

Wire fraud typically carries up to a 20 year sentence, but if the fraud involved a financial institution, the maximum sentence can go up to 30 years. The length of the sentence is usually driven by the loss amount in a particular case. The loss amount is calculated by the amount of money that was taken or the amount that the defendant intended to take.

In federal court, the judge calculates your sentence by first finding the Federal Sentencing Guidelines range. This is a range of months recommended by the U.S. Sentencing Commission for each defendant in a case. The range of months corresponds to a defendant's total offense level, which is the total of a defendant's base offense level and any enhancements that may apply under the Guidelines.

For wire fraud, the base offense level is 6, which carries a recommended range of zero to six months in prison. The offense level then increases dramatically based on the loss amount. For instance, a defendant with a loss amount of $10,000 would have a potential Guidelines range of four to ten months while a loss amount of $100,000 would have a Guidelines range of  18 to 24 months. The Guidelines range can then increase even more if enhancements apply such as a large number of victims, using a sophisticated means to carry out the fraud, or the use of mass marketing. It is important to remember, however, that federal judges have a tremendous amount of discretion and that many judges routinely impose sentences below the Guidelines recommendation in fraud cases (if sentencing is appropriately handled by the criminal defense lawyer).

Looking at sentencing statistics for 2021 shows that nearly 30% of individuals convicted of fraud and theft offenses received some type of probation sentence. For those who received a prison sentence, the average sentence was 20 months in prison and the median sentence was 12 months in prison. Remember that every case is different and that you should consult with your attorney to better understand how a judge might sentence you.

Our firm has successfully represented many individuals accused of wire fraud charges. If you would like to speak with an experienced federal criminal defense lawyer, give us a call. The initial consultation is always free of charge.