Federal Fraud Crimes
The crime of “fraud” takes many forms. Yet, at bottom, fraud involves an accusation of lying or deception of some kind. As with virtually all crimes, charges in federal court are typically far more serious than charges in state court. Accordingly, if you have been charged with a federal fraud charge, you are likely facing much higher penalties and longer jail time than a similar fraud charge in state court.
That means that you need to be represented by an experienced attorney who practices in, and fully understands, the workings of federal court. That attorney is Jeremy Gordon, Attorney at Law. Jeremy has extensive experience successfully representing people against serious fraud charges in federal court. Let us fight for you. If you or a loved one have been charged with a federal fraud crime, then we welcome you to contact us. Schedule a free phone consultation today
Types of Fraud
To begin any discussion of a fraud-related federal crime, it is helpful to understand the different types of federal fraud crimes out there. Federal fraud crimes generally fall into the following types:
We will discuss the elements and defenses for each type of fraud in some detail. This information can be invaluable in determining whether you may have any defenses available to you in your own case. This discussion should also provide a good foundation as you discuss your case with an experienced federal criminal defense lawyer, like those at the Law Office of Jeremy Gordon
You have likely heard the term embezzlement before. It is normally characterized by people improperly using their position of trust, and access to information, in their job to enrich themselves at the expense of their employer.
The elements of the crime of embezzlement exist when a person:
- Has the specific intent,
- To knowingly steal,
- An employer’s property.
As you can see from the elements, a federal prosecutor must prove beyond a reasonable doubt that you had the specific intent to knowingly steal property that was entrusted to them by virtue of your job.
At first blush, you may think that “specific intent” and “knowingly” are saying the same thing. They are not. “Knowingly” stealing something refers to the notion that a person knew, i.e., was aware of, the fact that he or she was taking something. The notion of “specific intent,” however, refers to the need to prove that the accused had the “subjective desire” to commit an illegal act.
In other words, the federal prosecutor needs to prove that you were aware that you were taking something that was not yours, and that you knew it was illegal to do so to prove embezzlement.
Please note that there is no distinction between a public or private employer for purposes of embezzlement. Regardless of whether a person takes money from a government employer or a private company employer, it is still considered embezzlement.
The defenses that you can raise in response to an embezzlement charge are as follows:
- Entrapment. It is possible to argue that until a government actor – such as a confidential informant used in a criminal investigation – “entrapped” you into committing embezzlement. That means that you did not intend to steal anything until the government actor put the idea into your head.
- Lack of Knowledge. As noted above, “knowingly” is one of the elements that the government must prove in an embezzlement case. Thus, if you can show that you did not know the nature or source of the funds relevant to your case, then that will undermine the entire “knowingly” element.
- Insanity. Also as noted, the government must prove “specific intent.” If your mental state is such that you could not have formed the requisite intent to know that you were committing a crime, then the government would be unable to prove embezzlement against you
Theft of Mail, or Receipt of Stolen Mail
Messing around with U.S. mail is a federal crime because the U.S. Postal Service has the responsibility to deliver, and protect, items sent through the mail. Thus, the crime of mail theft actually encompasses hiding or destroying mail, in addition to stealing it.
The elements of the crime of mail theft exist when:
- A person steals, takes, or by fraud or deception obtains a piece of mail;
- The mail, when stolen, was under the U.S. Postal Service’s control; and
- The person acting knowingly with the intent to take the piece of mail.
The defenses to mail theft are as follows:
- Mis-labelled Mail. If mail is sent to the wrong place, and then subsequently stolen, it is possible to argue that the piece of mail was no longer in the U.S. Postal Service’s control, thereby removing the second element listed above.
- Mistake. Similarly, a mail theft defendant may claim that he or she did not have the requisite “knowledge” or “intent” to steal anything because the mail was taken due to carelessness or mistake.
As you can expect, insurance fraud involves fraud or deception with regard to insurance information or proceeds. The classic case is a doctor claiming that he or she performed a particular medical procedure to obtain the patient’s insurance proceeds for that procedure, when he or she never actually performed the procedure.
There are, actually, a number of different statutes covering various types of insurance fraud. Typically, insurance fraud cases involve some form of electronic/wire fraud as well.
Accordingly, the elements of insurance fraud generally exist when a person:
- Uses either the mail or wire communications to further,
- A scheme to defraud,
- Involving material deception,
- With the intent to deprive another of,
- Either property or honest services.
The defenses of insurance fraud include the following:
- Good Faith. One defense to insurance fraud is to argue that your insurance claim was genuine, with no intent to defraud.
- Statute of Limitations. The federal government generally has 5 years within which to bring an insurance fraud charge. If the federal government waited too long to charge you, then that is a complete defense to an insurance fraud crime.
- Abandonment. Many insurance fraud matters are charged as a conspiracy, in which you might be accused of working with others in connection with an insurance fraud scheme. However, if you clearly withdrew yourself from the conspiracy, then that may be a defense to any charges against you associated with the actions attributed to the conspiracy.
Mortgage fraud involves crimes typically associated with real estate documents. Some of the criminal charges you will see with mortgage fraud include bank fraud, loan fraud, mail and wire fraud, false statements, and money laundering charges. Recently, we have seen a prevalence of two examples of mortgage fraud-related crimes:
- Housing Fraud. Lying on a mortgage application about your income in order to obtain a mortgage loan.
- Fraud for Profit. Any number of mortgage assistance schemes – like foreclosure rescue claims, and reverse mortgage schemes – can be considered fraud for profit.
The common defenses to mortgage fraud crimes include:
- Lack of Intent. Most mortgage fraud requires proof of “willful” conduct. Thus, you can claim that the documents demonstrate genuine business conduct, and thus any mistake was not done willfully or intentionally.
- Internal Procedures Followed. A strong defense to a mortgage fraud charge is that a company’s common internal investigation processes and procedures were followed. Thus, you can rely on the fraud-prevention processes in place to again show that your conduct was not criminal, but at best an unintentional mistake.
Securities fraud covers a lot of different types of criminal activity related to the purchase and sale of investments like stocks and bonds.
Some examples of securities fraud scenarios of which you have likely heard include:
- Insider Trading. Someone uses confidential information not publicly available to enrich themselves or manipulate stock price.
- Churning. Advising or encouraging investors to engage in excessive trading to create more fees for the broker.
- Ponzi Schemes. Claim to have an investment fund, but in actuality, you are taking money from one investor and giving to another as if they were dividends from the investment.
- Accounting Fraud. Falsifying records to show that a business is doing better financially than it actually is.
The defenses to securities fraud crimes include:
- No Fraud in Statements. You can try to show that the government is wrong to argue that the relevant documentation contains false information.
- Entrapment. As with embezzlement, you can claim that the government coerced you into participating in fraud.
- No Intent. You can argue that the government cannot show that you had any intention to defraud investors. Sometimes market changes are beyond a person’s control
Conclusion: Federal Fraud Crimes are Serious
Any type of fraud, from embezzlement to mortgage fraud, and securities fraud to tax fraud, are white-collar crimes that are viewed to be as serious as violent crimes like murder. The penalties can be years in prison, thousands of dollars in financial fines, and loss of job opportunities in the future.
You need a seasoned federal criminal defense attorney to help you if you have been charged with any type of federal fraud-related crime