Wire fraud and mail fraud
To convict for wire fraud or mail fraud, the government must prove that:
- you knowingly took part in a scheme to defraud, or to get money or property by false or fraudulent statements or promises,
- you acted with intent to defraud, and
- an interstate wire, such as an email, text, phone call, or online transfer, or the mail, was used to carry out the scheme.
Because nearly every modern transaction uses the internet or a phone, these charges can reach a wide range of conduct. Related federal charges include bank fraud, health care fraud, program fraud, and loan fraud, including fraud tied to pandemic relief programs.
Money laundering
Money laundering charges focus on what happens to money that came from certain unlawful activity. The government may charge a person who conducts a financial transaction with that money while knowing it came from crime, and who meant to hide where it came from, to promote more crime, or to avoid reporting requirements. A separate law makes it a crime to engage in larger monetary transactions with criminally derived property, even without an intent to hide it.
Structuring, which means breaking up cash deposits or withdrawals to avoid bank reporting rules, is its own federal crime, even when the money came from a lawful source.
How these investigations unfold
Federal fraud cases often begin with a bank report, a complaint from a customer or business partner, an audit, or a tip from an employee. Agents may gather bank records, emails, and phone data for months. You may first learn of the case through a grand jury subpoena, a target letter, a search warrant, or a visit from agents.
At that stage, do not answer questions about the matter without a lawyer. A false or incomplete statement to a federal agent can be charged as its own crime. Do not delete emails, files, or messages, because that can lead to obstruction charges.
Loss, restitution, and forfeiture
In federal fraud sentencing, the amount of loss can have a large effect on the guideline range. The government’s loss figure can be challenged, and we check how it was measured.
A conviction usually brings an order to pay restitution to victims and may include forfeiture of property linked to the offense. The government may also seek to freeze or seize assets early in the case. These money issues need attention from the start.
The path of the case
- Initial appearance before a magistrate judge. Many fraud defendants are released on conditions.
- Detention hearing if the government asks to hold you before trial.
- Discovery, which in fraud cases can include large volumes of bank records, emails, and spreadsheets.
- Motions challenging searches, the indictment, or the government’s theory.
- Plea or trial.
- Presentence report prepared by a U.S. probation officer, including the loss calculation, which we review and challenge.
- Sentencing by the district judge, using the guidelines as a starting point along with other factors in federal law.
Possible defenses
- Good faith: you honestly believed your statements were true or the venture would succeed.
- No false statement: the statements were true or were opinions.
- Lack of knowledge: you did not know others were committing fraud, or did not know money came from crime.
- Loss amount: the government’s loss figure is overstated or measured the wrong way.
- Unlawful searches of devices, email accounts, or premises.
How we work
We investigate rather than process. We don’t accept the police report as fact. We trace the money ourselves and, when it helps, work with an outside accountant to test the government’s numbers. We tell clients the hard truth about the evidence and the sentencing exposure, and we prepare every case as though it is going to trial. Attorney Micah E. Huggins practices in the Middle District of North Carolina and the Fourth Circuit. Call us at (336) 281-2008 or request a consultation. Hablamos español.
This page is general information about North Carolina law, not legal advice. Every case is different, and no lawyer can promise a result.
Questions people ask us
What makes something wire fraud instead of state fraud?
Wire fraud requires a scheme to defraud and the use of an interstate wire, such as an email, call, text, or electronic transfer, to carry it out. Because most transactions now cross state lines electronically, many fraud schemes can be charged federally.
Is a failed business deal fraud?
Not by itself. Fraud requires a scheme to defraud or a false statement made with intent to defraud. A business that fails, or a promise that could not be kept, is not a crime unless the government proves the deception was intended.
Can I be charged with money laundering if I did not commit the fraud?
Yes, in some cases. A person who knowingly handles money from certain crimes in a prohibited way can be charged even without taking part in the original crime. The government must prove you knew the money came from unlawful activity.
What is structuring?
Structuring is breaking up cash deposits or withdrawals to avoid bank reporting requirements. It is a federal crime even if the money came from a lawful source.
I received a grand jury subpoena. What should I do?
Do not ignore it, and do not destroy any records. Contact a lawyer before you respond. A lawyer can help you understand whether you are a witness, a subject, or a target, and how to comply.