Under federal law, it is a crime to transmit “false or fraudulent pretenses, representations, or promises” by any electronic means in support of any “scheme or artifice to defraud.” Electronic means include television, radio, wire transfer, or any other mechanism within the nation’s interstate telecommunications networks. Each transmission may be charged separately, thereby escalating the sentence that may be assessed upon conviction.
If you are being investigated for selling counterfeit items by marketing them over the Internet, or for receiving fraudulent payment by wire transfer, you may be facing charges of wire fraud. A conviction for a single count of wire fraud carries a penalty of up to 20 years in prison, fine, or both.
The Department of Justice Criminal Resource Manual states that “Prosecutions of 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.” (USAM 9-43.100 Prosecution Policy Relating to Mail Fraud and Wire Fraud)
Key Cases Interpreting 18 U.S.C. § 1343 (2005)
United States v. Andrade, 788 F.2d 521 (8th Cir. 1986): Elements of wire fraud are the existence of a scheme to defraud and the use of electronic means to carry out the plan.
United States v. Stull, 743 F.2d 439, 442 n. 2 (6th Cir. 1984), cert. denied, 470 U.S. 1062 (1985): “It is well established that proof of every allegation is not required in order to convict; the government need only prove that the scheme to defraud existed.”
United States v. Rybicki, 287 F.3d 257 (2d Cir. 2002): Applying “honest services” fraud (18 U.S.C. § 1346 (2005)) to the wire fraud statute.