Wire and mail fraud are serious federal crimes and can have profound penalties, including  lengthy jail sentences.  The landscape of federal criminal law involving wire and mail fraud has seen significant changes in prosecutorial approaches.  The following is an overview of the  recent updates of these changes and how these changes can  affect those charged with these crimes.

Understating Wire and Mail Fraud

What constitutes federal wire and mail fraud? Federal mail fraud occurs when someone uses the US postal services (or another commercial mail carrier) with the intent to defraud.  Federal wire fraud is charged when one uses a cell phone, telephone, emails, or online transactions to perpetrate fraud. Both are federal crimes and both can carry harsh penalties in New York and New Jersey federal courts.

Changes in the Wire and Mail Fraud Legislation

In recent years, there has been an expansion of the scope of what constitutes federal wire fraud and the threshold for proving intent has lowered. Not only are courts  interpreting the definition of “schemes to defraud” more broadly but,  the sentencing guidelines have gotten harsher as applied to federal criminal defendants, especially for those alleged to be involved in sophisticated, large-scale frauds.

Furthermore, Kousisis v. United States has the potential to bring about more changes to the law. A case that originated in 2018 out of the Eastern District of Pennsylvania, Kousisis was recently argued in the Supreme Court of the United States (“SCOTUS”).  This case questions whether or not deceptive practices in government contracts causing no direct economic harm qualify as wire fraud.  The case concerns a contract with the Pennsylvania Department of Transportation (“PennDOT”) to complete a project by a disadvantaged business enterprise (“DBE”). The petitioners allegedly circumvented the agreement by subcontracting with a “pass-through” DBE that actually performed no work, putting millions of dollars at stake. The petitioner argued to have met all contractual requirements, and that they did no fraud as PennDOT suffered no economic damage. They also requested that the court adopt a “no harm, no foul” approach, as the statute isn’t applicable unless economic harm is involved.

In September 2023, the Third Circuit Court of Appeals rejected this argument, suggesting that doing only part of the work right does not excuse the fraud. This case has raised several legal questions: whether wire/mail fraud requires the intent to cause economic harm, whether the government’s interest qualifies as a “property” interest, and whether all contract rights are considered “property” under fraud laws.

While the SCOTUS has heard oral argument, no opinion has been issued as of yet.  This decision will  undoubtedly reshape the interpretation of federal fraud statutes. It will either narrow the scope to require demonstrable economic harm or affirm that deceptive practices suffice for prosecution. It can lead to serious ramifications for wire/mail fraud prosecutors, often charged individually and as predicate crimes.

You Can Contact Us for Help

If you’re facing wire or mail fraud charges in York and New Jersey, attorney Lorraine Gauli-Rufo at LGR Law, LLC can help. She will aggressively fight for your rights and protect your freedom.  Ms. Gauli-Rufo can explore alternatives to conviction (such as  plea bargains or negotiating lesser charges), or engage in motion practice to fight the charges.

The newer developments in the law can mark a significant shift in the federal criminal arena involving wire and mail fraud, and hiring a skilled federal criminal defense attorney, who is well versed in the constant changes in federal law can have a great impact on the outcome of your federal criminal charges.

Whether your matter involves threatened or actual charges; whether it is a simple fraud or a complex case; and whether it is in New York or New Jersey,  Ms. Gauli-Rufo can offer her educated legal advice, while she fights for your rights  and protects your freedom. Click here to get started.