I have been representing people in federal criminal cases for over 20 years, and many of those cases have involved charges of mail or wire fraud. so if you or someone you know is going through a case like that, you might find it helpful to learn a little more about the basics. What is a mail or wire fraud prosecution and what are some possible defenses? so let’s start with the basics.
What does the government have to prove to convict someone of mail or wire fraud? well, the first thing the government has to prove is that the person made false promises or misrepresentations. they have to prove that the person lied. now the lie has to be an important lie, a material lie. it is not a trivial matter, but something that the person telling the lie or false statement intends the other person to trust. it has to make a difference.
Reading: Conspiracy to commit mail fraud
Let’s use an example of a telemarketer trying to present an investment opportunity. If that telemarketer gets on the phone and makes false statements about the company, about the investment opportunity, let’s say, the returns have averaged over 1,000% every year for the last 10 years. and if that’s a false statement, it’s obviously a material statement. the person says that statement so that the other guy will send the money for this particular investment. therefore, it is material, it is false, and it qualifies as a false promise or statement.
and that’s true even if the statement is crazy and almost unbelievable. So let’s say the same telemarketer gets on the phone, calls someone else, and says, “This is a great investment. If you send me $10, you’ll have a million dollars by the end of the year.” Now, most people wouldn’t believe that I hope. but that can still be the basis for a mail or wire fraud case because it’s fake, and the government can probably prove it’s fake.
See also: 932 Uniform Requirements
The next thing the government would have to prove is that there is intent to defraud someone. You are not just lying to the person, but you are lying to them for a reason. and usually that reason is to get them to send you some money. So the intent to defraud is the basis, it’s really the heart of these types of cases. the government is not going to prosecute all the lies. they will only focus on lies intended to get someone to send them something, usually money.
The next element is that, it makes sense, in a wire or mail fraud prosecution, the case must involve mail or electronic communication. And mail may include not only drop off letters at the post office, but also fedex, or any other private overnight carriers. and wired communication can of course be telephone, radio, television, and nowadays mainly email, websites and even chats. and the reason there is an element like this in this statute is because it gives jurisdiction to the federal government.
If it was just one person talking to another person, face to face, and the person was committing fraud, the federal government would have no jurisdiction over it because it was local. it had nothing to do with interstate commerce. so the federal government included this element so that it would have jurisdiction over this type of fraud crime.
now the schema doesn’t have to work. I mean, let’s say the telemarketer is making this misrepresentation about the investment opportunity. and the person on the other end of the line decides that I am not going to send money. I will not fall into the trap. they can still be prosecuted for mail or wire fraud because it is the intent to deceive someone. it is that intent to mislead someone that is the focus of this type of case.
now, if someone is convicted of this crime, the sentences can be quite high, up to 20 years. unless it involves money from disaster relief or a financial institution, and then it can be up to 30 years in prison. the exact sentence will generally depend primarily on the amount of money involved in the case. and would like to start calculating the potential sentence for a case like this based on the federal sentencing guidelines. and I have a separate video on the federal sentencing guidelines that you can probably find on this page. there should be a link to it.
Now, what are some of the defenses to a mail or wire fraud charge? well, the most obvious is that there is no false statement, what the telemarketer said on the phone was true or simply an exaggeration. I mean, let’s say the telemarketer is talking about this investment. they do not give specific numbers about their earnings or returns. but they say, “This is one of the best companies I’ve seen in this particular industry. It is a type of investment without losses. It’s a once-in-a-lifetime opportunity.” all those statements may be technically false, but in reality they are more exaggerations, more opinions. and for the most part, the government does not prosecute that type of false statement under the mail or wire fraud statute. the statement can also be an error. Let’s say the telemarketer is on the phone. give them this information about these annual returns. the information is false. not true, but the telemarketer got that information from what he or she believed to be a reliable source, either your employer or some other company, and relied on that information to tell someone else about it. they made a mistake. the information is not true, but they did not know it. they had no intention of getting on the phone and lying to someone. And, of course, you cannot have a prosecution for mail or wire fraud if there is no scheme to defraud. if the purpose of the lie is not to try to take money or something of value from another person.
and of course, finally, and this is the most successful defense we’ve used because it’s the most common. the person accused of the particular crime did not know about the scheme. I mean, let’s say the salesperson is on the phone, and his employer gives him a script, and he’s reading it, and he has no reason to believe that the information he’s providing is false. now he has to be careful because the courts say that if he, you know, turned a blind eye, or if he doesn’t investigate at all, that he had a reckless disregard for the truth, he can still be prosecuted. but if you had no reason to believe the information was false, even if you gave it to someone else, and even if it was not true, and even if money was sent to you in return, you are not guilty of mail or wire fraud.
so I hope this was helpful. We review the basics of this type of offense, the possible defenses. but if you have any additional questions about these types of cases, feel free to call us. we’ve been down this road many times and will do our best to help.