Wire Fraud
Wire fraud is one of the most widely used federal charges in white-collar prosecutions. Because almost every modern transaction involves phones, email, or the internet, prosecutors can use the wire fraud statute in a wide range of cases—from business-related fraud to tax investigations.
What is Wire Fraud?
Under 18 U.S.C. 1343, it is a crime to
Devise or intend to devise a scheme to defraud, or to obtain money or property by false pretenses, and
Use interstate wire communications (such as phone, email, internet, or electronic transfer) to further that scheme.
Each use of wires in furtherance of the scheme can be charged as a separate count.
Common Wire Fraud Schemes
Business Disputes Turned Criminal: Misrepresentations in contracts or negotiations, including via email, that prosecutors treat as fraud.
PPP Loan and Cares Act Fraud: False statements in application submitted online in connection with PPP Loans and the Cares Act.
Fraudulent Inducement: Obtaining money or property by using fraudulent pretenses, such as false statements in an application for funding or false statements made via wire, such as email or text message, to an investor.
Tax Cases: Using emails, bank wires, or electronic records to conceal income or promote abusive tax shelters. However, recent caselaw in the Northern District of Texas casts some doubt on tax matters being brought under the wire fraud statute in certain circumstances.
Investment Fraud: Misrepresenting returns, risks, or the nature of an investment to clients.
Sales: Misrepresenting material business items in a transaction sheet or failing to disclose certain information to a buyer.
Why Wire Fraud is Serious
Broad Reach: Almost any fraud involving email, phones, or bank transfers can be charged federally.
Severe Penalties: Wire fraud caries up to 20 years in prison per count. If the scheme involves a financial institution, exposure increases to 30 years.
Stacked Charges: Prosecutors often combine wire fraud with conspiracy, tax evasion, money laundering, or false-statement charges.
Multiple Counts: Because each email or transfer can be a separate offense, indictments often list dozens of counts.
Wire fraud is a go-to charge for federal prosecutors because of its breadth. But breadth cuts both ways—the defense can fight back by showing the absence of intent or any scheme to defraud, the legitimacy of disputed business practices, or the government’s exaggeration of alleged losses, among other potential defenses. When the stakes are high, Mendoza Defense is here to serve.