Mail and wire fraud.

I. INTRODUCTION II. ELEMENTS OF THE OFFENSE A. Scheme to Defraud B. Intent to Defraud C. Use of Mailing and/or Interstate Wires in Furtherance of a Scheme to Defraud 1. Causing the Mails and/or Wires to Be Used 2. The "In Furtherance" Requirement D. Loss of Money, Property, or Deprivation of Honest Services 1. Money or Property 2. Honest Services III. DEFENSES A. Good Faith B. Statute of Limitations IV. VENUE V. SENTENCING I. INTRODUCTION

The federal mail (1) and wire (2) fraud statutes are powerful and broad prosecutorial tools. (3) Among the statutory weapons available to the government to prosecute individuals, the mail and wire fraud statutes "rank by analogy with hydrogen bombs on stealth aircraft." (4) The statutes have often been used as a "first line of defense," or "stopgap" device, which permits prosecution of new forms of fraud until Congress enacts particularized legislation to combat the new fraud. (5) Consequently, the mail and wire fraud statutes have been referred to as a prosecutor's "secret weapon." (6)

Congress enacted the mail fraud statute with the initial purpose of securing the integrity of the United States Postal Service ("USPS"). (7) Similarly, the wire fraud statute was enacted to respond to the need to protect against schemes that began to utilize wires, specifically radio and television. However, now the mail (8) and wire (9) fraud statutes have been expanded to include a number of modes of communication such as facsimile, telex, modem and Internet transmissions. In addition, the statutes provide federal jurisdiction over a broad array of frauds, (10) covering "not only the full range of consumer frauds, stock frauds, land frauds, bank frauds, insurance frauds, and commodity frauds, but [also] ... such areas as blackmail, counterfeiting, election fraud, and bribery." (11) Moreover, prosecutors use these statutes to prosecute money laundering and Racketeer Influenced and Corrupt Organizations Act ("RICO") violations. (12)

Recent Congressional action has both broadened the scope of the mail and wire fraud statutes and enhanced the criminal penalties for mail and wire fraud offenses. In 1994, Congress expanded both the mail and wire fraud statutes to respond to an ever-increasing threat of new schemes, which often bypassed the USPS and instead utilized private carriers, by amending the federal mail fraud statute to cover mailings delivered by private interstate commercial carriers. (13) In addition, Congress expressly criminalized telemarketing fraud, (14) and enhanced the criminal penalties for any mail and/or wire fraud scheme that specifically targeted senior citizens. (15) Even more recently, Congress passed the Sarbanes Oxley Act of 2002, which quadrupled the maximum punishment for both mail and wire fraud offenses from five to twenty years imprisonment. (16)

This Article provides information about mail and wire fraud offenses. Because the character, language, and scope of the mail and wire fraud statutes are similar, legal analysis and case law discussing mail fraud offenses is equally applicable to wire fraud offenses. Likewise, legal analysis and case law that concerns wire fraud offenses generally can be applied to instances of mail fraud. (17)

Section II of this Article outlines the elements of a mail or wire fraud offense. Section III examines available defenses. Section IV reviews venue considerations. Finally, Section V addresses sentencing issues.

II. ELEMENTS OF THE OFFENSE

For more than a century, mail and wire fraud jurisprudence has evolved through both Congressional action and court decision. Currently, to be convicted of a mail or wire fraud offense the government has to show beyod a reasonable doubt that the defendant perpetuated: (i) a scheme to defraud that includes a material deception; (ii) with the intent to defraud; (iii) while using the mails, private commercial carriers, and/or wires in furtherance of that scheme; (iv) that did result or would have resulted in the loss of money or property, or the deprivation of honest services. (18) Parts A through D of this Section review each of these elements in order.

The wire fraud statute, 18 U.S.C. [section] 1343, further requires that the communication at issue crosses state lines. (19) This interstate requirement applies only to the wire fraud statute because of Congress' reliance on its Commerce Clause (20) power to assert jurisdiction. (21) In contrast, exclusive congressional jurisdiction over the USPS (22) provides the necessary constitutional foundation for federal prosecution under the mail fraud statute. (23) Courts have also determined that a mailing sent through a private commercial carrier that deals in interstate business gives rise to congressional jurisdiction, even when the particular mailing does not actually travel interstate. (24)

Each ...

If you are already a vLex customer, Access Here