WHAT ELEMENTS MUST THE PROSECUTOR PROVE IN A FEDERAL FRAUD-RELATED CASE?

Each criminal statute, including fraud-related statutes, contain all of the elements that the prosecutor must prove at trial beyond a reasonable doubt. There is no single fraud statute, and fraud is a very general term that describes many different types of forbidden activities. When someone is charged with fraud, they are actually charged with violating a specific statute, or the law. Once the statute that the person was charged with is known, it will be easy to look it up, and it will contain all of the elements that must be proven.

For example, one statute that the government often uses to charge people with fraud is called Fraud by Wire, Radio, or Television, codified as 18 U.S. Code § 1343: “Whoever, having 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, shall be fined under this title or imprisoned not more than 20 years, or both.” That prison sentence increases up to 30 years if the fraud was related to a financial institution. All of the elements of the statute are found in the statute, including that the government must prove beyond a reasonable doubt that the defendant devised a scheme to defraud using wires (Internet). This definition can include such activities as cybercrime, hacking, bank fraud, mail fraud, and many other types of fraud.

Can the Fact That Someone Was Not Aware of Their Involvement in a White-Collar Crime Serve as Their Defense?

Lack of awareness, intent, or knowledge can serve as a defense, and that is true not just for fraud crimes but for many crimes. The only exception to this rule relates to crimes of strict liability, where intent or knowledge does not have to be proven. A strict liability crime is any crime where someone can be found guilty even though that person had no intention of committing the crime. Strict liability crimes usually relate to having a sexual relationship with a minor. In such cases, even if the minor lied to the defendant and showed them a fake ID that gave the impression the victim was of age, the defendant can still be found guilty of statutory rape if the victim later turns out to be a minor. It is called a strict liability crime because, in a sense, there is strict liability for committing it, meaning even though you had no intention of committing the act, you are still guilty if you did.

The majority of crimes require a showing of intent to commit the crime. While crimes involving negligence (i.e., negligent homicide) do exist, when we are talking about fraud, proving intent will always be required to establish guilt. However, it is important to remember that not knowing the law is not a defense. A defendant cannot say, “I am not guilty because I did not know that this was illegal.” But having no intention to commit fraud usually can be a defense in a fraud case, as well as in many other cases.

What Are Some of the Penalties Associated with Federal Fraud-Related Convictions?

The potential recommended prison sentence will depend on the federal sentencing guidelines. When a person is charged and convicted with violating any statute, that statute usually will have a wide range in terms of the potential sentence that the defendant faces, very often from zero to ten years or zero to twenty years. In order to help judges decide on the exact sentence, Congress comes up with what is called the United States Sentencing Guidelines, which are renewed annually. Though these guidelines are extraordinarily complex and complicated and come in a book that is hundreds of pages long, they provide recommendations to judges regarding specific sentences that defendants face, and many judges follow those recommendations very closely.

There are different factors that Congress tells judges to consider in fashioning a fair and just sentence. In fraud and cybercrime cases, the usual factors that the judges consider pursuant to those guidelines are the intended or actual loss amounts, the number of victims, how the fraud was committed, whether the person used sophisticated means to commit the fraud, and the defendant’s role. For example, if somebody was convicted of wire fraud where the minimum sentence is zero and the maximum sentence is 30 years, they would likely get probation if there was only one victim and the loss amount was $50,000. If, in contrast, there were 100 victims and the loss amount was $100 million, the person would likely get a significant prison sentence.

It’s also important to remember that guidelines are advisory, although, until 2005, they were mandatory, which explains why many judges still closely adhere to them. In 2005, the United States Supreme Court found that making guidelines mandatory is unconstitutional because it took away too much discretion from the judges. Because of that case, called United States v Booker, the guidelines became advisory, which means that a judge can look toward the guidelines to get an idea as to what a fair sentence is, but ultimately, the judge may ignore the guidelines and give whatever sentence they feel is fair, as long as the sentence is within the minimum or maximum statutory requirements.

In addition to the factors listed in the guidelines, the judges also will often look to other things, such as whether the defendant was convicted at trial or took a plea and whether the person cooperated. Other factors can include the defendant’s personal characteristics, including life achievements, support from family and/or community, educational level, and their level of remorse, and their willingness and ability to rehabilitate.

For more information on Prosecuting a Federal Fraud-Related Case, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (718) 989-2908 today.

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