What, Exactly, Is the Crime of Mail Fraud?

Mail fraud – and its younger brother wire fraud – are the bread-and-butter of federal prosecutors.  A person commits mail fraud when he engages in a scheme to defraud, with intent to defraud, and uses the mails in furtherance of that scheme.

• A scheme to defraud means depriving someone of property by deceitful or dishonest means. The scheme need not involve an affirmative misrepresentation or lie.  And the property that is the target of the scheme can be tangible property (like money or real estate) or intangible property (like information or intellectual property).
• Intent to defraud means that the defendant intends to be deceitful or dishonest. An individual cannot commit wire fraud if he believes his statements and actions were truthful and honest.  Good faith is a defense.
• Use of the mails in furtherance of the scheme means only that a mailing form a component of the scheme. The mailing need not be an essential element of the scheme.  In other words, it’s not necessary that a fraudulent document be mailed or a false representation be made in a letter.  It’s enough if the mailing is “incidental” to an essential element.  And it is enough for the defendant to cause a mailing.  He need not actually deposit the mailing in the mail.

The mail fraud statute can apply to a wide range of corporate criminal conduct.  The statute’s simplicity and its severe penalties make it a favorite of federal prosecutors.  For example, from January through July of 2018, the Department of Justice indicted 292 cases with mail fraud as the lead charge.  And the Department of Justice has charged mail fraud in some of its most high profile prosecutions, including its prosecution of Bernie Madoff, former Illinois Governor George Ryan, and former U.S. Congresswoman Corrine Brown.

And, while the statute is called “mail fraud,” in 1994, Congress expanded it to include the use of “private or commercial interstate carriers,” such as FedEx and UPS.

To learn more about corporate and executive criminal liability, follow us on LinkedIn.  “Brilliant lawyers with courtroom savvy” – Benchmark Litigation.  Copyright MoloLamken LLP 2018.