Despite how many modern crimes it covers, wire fraud is one of the oldest federal crimes still used today. Committing “fraud by wire” has been illegal for over 150 years. First codified in 1872 after the proliferation of telegraphs, the definition has been expanded to include any fraud committed “over wire” or electronically. Today, that includes using interstate wires, television, radio, or the Internet to defraud someone.
For a crime to be considered wire fraud, the prosecution must prove four elements as named by the U.S. Department of Justice:
- “That the defendant voluntarily and intentionally devised or participated in a scheme to defraud another out of money;
- “That the defendant did so with the intent to defraud;
- “That it was reasonably foreseeable that interstate wire communications would be used;
- “That interstate wire communications were in fact used.”
Note that the actual transfer of money is not necessary. Wire fraud is a crime of intent. As long as someone intends to defraud another out of money and uses wired or electronic communications to make an attempt, they may be charged. If the four elements are proven, the defendant can face up to 30 years in federal prison and be held civilly liable for any funds that were actually stolen.
How Wire Fraud Charges Work (With Examples)
The charge of wire fraud is intentionally broad to ensure it covers the greatest possible number of crimes. But what makes it different from state charges like embezzlement and insurance fraud?
What sets it apart is the ease and damaging nature of the crime. Take the example of an employee intentionally embezzling funds by shorting the cash register. Cash register theft has a relatively limited scope – employees can only steal what the register contains – usually not very much. Furthermore, employee theft is a known risk employers face, and even a string of thefts is unlikely to undermine the general public’s trust in cash as a financial system.
Now consider an employee who wants to embezzle funds and has access to the business’s accounts. They could call the bank and ask to have those funds transferred to their personal accounts or go online and funnel funds out of the country to an overseas collaborator. This could cause much greater losses over time and even bankrupt the business. Furthermore, if reports of embezzlement by wire go unaddressed, people may lose faith in the safety of digital banking altogether.
That’s why the federal government takes such an interest in electronic fraud. These crimes could heavily undermine the U.S. financial system if allowed to go unchecked. Other examples of fraud by wire crimes include:
- Telemarketing scams: Scams by phone may include fake tech support calls, false warnings that your car or home warranty is about to expire, or anything else that seems trustworthy, urgent, and requires an immediate transfer of funds. The caller typically demands payment by wire transfer or gift cards to make tracing the funds as difficult as possible.
- Email schemes: The most well-known modern email scam is the “Nigerian Prince” scam, but other variations include fake tech support emails, donation requestions, and anything else that asks for money for a nonexistent cause over email.
- Phishing: Some schemes don’t attempt to get funds from the victim directly. Instead, they involve “fishing” for information. Phishing schemes can include phone calls or emails that claim to be from legitimate or legitimate-sounding agencies. The scammers will either directly ask for the victim’s information, such as their credit card details or Social Security Number, or send them to a site that installs malware on their device to collect the information without the victim knowing.
- Ransomware: Some hackers go a step further and place malware on a device that encrypts it and prevents it from being used. The malware typically informs the user the system has been encrypted and provides a link where they can pay the hacker a certain amount in “ransom” to unencrypt it again. This falls under the fraud by wire umbrella because it uses the Internet and defrauds the victim of money, even if it is more direct than most alternatives.
It’s important to note that these are just a few relevant examples. Any purposeful attempt to unlawfully acquire funds through electronic communication systems counts.
Potential Defenses Against Federal Wire Fraud Charges
If you have been accused of wire fraud, you must seek legal counsel immediately. Federal defrauding charges can be extremely serious, and having a skilled criminal defense attorney on your side is crucial to defending yourself. Depending on the circumstances, your attorney may craft your defense around the following:
- Lack of intent: Because wire fraud is a crime of intent, if you did not intend to defraud someone, you did not commit the criminal act. For example, if you did not intend to accept money from someone, you cannot have defrauded them.
- Mistake of fact: If you thought you were telling the truth about something, you are not committing fraud if your belief was false.
- Reckless business practices: If you fully intended to fulfill your promises but could not due to reckless business practices, you may be civilly liable but did not commit fraud.
- Statute of limitations: There is a five-year statute of limitations on wire fraud. If it has been longer than that since you last used electronic communications to defraud someone, you may no longer be criminally liable. However, you may still be civilly liable, so this defense must be used carefully.
The correct defense will depend on the facts of your case. That’s why it’s crucial to work with a skilled attorney like M. Gabriela Guraiib if you believe you may be at risk of wire fraud charges. The skilled defense team at the Law Offices of M. Gabriela Guraiib is available to help you defend yourself. Learn more by scheduling your consultation with our Redwood City criminal defense law firm today.
