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What is wire fraud?

On Behalf of | Jul 23, 2018 | Uncategorized

Wire fraud is a charge that frequently appears in many types of federal fraud cases, on its own or in addition to other charges. The wire fraud statute forbids the use of interstate or international wire or electronic communications in the course of a fraudulent scheme.

In many cases, federal prosecutors use wire fraud charges as a catch-all in cases where they suspect but cannot prove other, more specific types of fraud. Like other federal fraud offenses, a wire fraud conviction can result in substantial penalties.

Basic elements

To get a wire fraud conviction, prosecutors must prove three elements. First, that the defendant made a scheme in order to defraud. Second, that the defendant intended to fraudulently deprive someone of money or property. Third, that the defendant used interstate communications to further any part of the scheme.

Fraudulent schemes

In this context, it is important to understand what a fraudulent scheme is. Generally, the law deems a scheme fraudulent if it uses material misrepresentation as a tool to induce someone to give up property. A material misrepresentation is a lie where the issue the defendant is lying about influences the decision whether or not to give up the property. Usually, common exaggerations salespeople use to convince people to purchase their products do not count as fraudulent.

Types of communications that invoke the statute

Despite the title of wire fraud, wires do not have to be involved. Any interstate or international cellphone communications, emails, social media and online messages can all count as communications that trigger the statute.

Potential penalties

A wire fraud conviction can result in a prison sentence of up to 20 years and a fine of up to $250,000. A defendant found guilty of defrauding a financial institution can face even harsher penalties: as many as 30 years in prison with as much as $1,000,000 in fines. Plus, each use of a communication for one scheme can result in a separate count: this means every phone call, text, email, message or online post.