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Wire Fraud, Charges and Penalties

fraud-7A false representation of a matter of fact—whether by words or by conduct, by false or misleading allegations, or by concealment of what should have been disclosed—that deceives and is intended to deceive another so that the individual will act upon it to her or his legal injury.

Fraud is commonly understood as dishonesty calculated for advantage. A person who is dishonest may be called a fraud. In the U.S. legal system, fraud is a specific offense with certain features.

Fraud is an independent criminal offense, but it also appears in different contexts as the means used to gain a legal advantage or accomplish a specific crime. For example, it is fraud for a person to make a false statement on a license application in order to engage in the regulated activity. A person who did so would not be convicted of fraud. Rather, fraud would simply describe the method used to break the law or regulation requiring the license.

Fraud resembles theft in that both involve some form of illegal taking, but the two should not be confused. Fraud requires an additional element of False Pretenses created to induce a victim to turn over property, services, or money. Theft, by contrast, requires only the unauthorized taking of another’s property with the intent to permanently deprive the other of the property. Because fraud involves more planning than does theft, it is punished more severely.

Federal and state criminal statutes provide for the punishment of persons convicted of fraudulent activity. Interstate fraud and fraud on the federal government are singled out for federal prosecution. The most common federal fraud charges are for mail and wire fraud. Mail and wire fraud statutes criminalize the use of the mails or interstate wires to create or further a scheme to defraud (18 U.S.C.A. §§ 1341, 1342).

What is Wire Fraud?

Wire fraud is an act of fraud that uses electronic communications, such as making false representations on the telephone, to obtain money. The federal Wire Fraud Act provides that any artifice to defraud by means of wire or other electronic communications (such as radio or television) in foreign or interstate commerce is a crime. Fraud is a knowing misrepresentation of the truth or concealment of a material fact to induce to another to act to his or her detriment. Id.

What Are The Essential Elements of Wire Fraud?

The essential elements of wire fraud are (1) devising or intending to devise a scheme or trick to defraud another by means of a material misrepresentation, with (2) the intent to defraud through (3) the use interstate or international electronic communications.

What Are The Possible Penalties for Violating the Wire Fraud Statute?

Violation of the Wire Fraud Statute can result in a fine, imprisonment of up to 20 years, or both. If the violation affects a financial institution, the fine will no exceed $1,000,000, nor will imprisonment exceed 30 years.

FBI Nabs Wannabe Broadway Financier On Fraud Charges For Folded Show ‘Rebecca’

This morning, FBI agents took Mark Hotton into custody on Fraud Charges (source). The arrest took place at 6 AM this morning when FBI agents took Mark Hotton into custody at his waterfront home in West Islip, Long Island. According to the U.S. Attorney’s Office for the Southern District Of New York in Manhattan, the 46-year-old stockbroker was supposed to help finance the $12M-$14M Broadway show Rebecca: The Musical which folded last month. But allegations are that Hotton fabricated four investors who were going to put up $4.5M in funds for the Broadhurst Theatre show based on the classic Daphne du Maurier novel. The criminal complaint unsealed today in Manhattan federal court describes ”stranger-than-fiction frauds both on and off Broadway… Hotton faked lives, faked companies and even staged a fake death, pretending that one imaginary investor had suddenly died from malaria.” Sounds like a page straight out of Mel Brooks’ The Producers. Hotton is charged with two counts of wire fraud and faces a max 20 years in prison on each count.

Excerpts from FBI Press Release:

Manhattan U.S. Attorney Preet Bharara said:

 “As described in the criminal complaint, Mark Hotton perpetrated stranger-than-fiction frauds both on and off Broadway. As part of one alleged scheme, Hotton concocted a cast of characters to invest in a major musical – investors who turned out to be deep-pocketed phantoms. To carry out the alleged fraud, Hotton faked lives, faked companies and even staged a fake death, pretending that one imaginary investor had suddenly died from malaria. As also alleged, Hotton enlisted his same cast of invisible men to carry out a real estate scam. Ultimately, Hotton’s imagination was no match for the FBI which uncovered, with lightning speed, his alleged financial misdeeds.”

FBI Acting Assistant Director-in-Charge Galligan said:

“In his alleged scheme to defraud investors, Mark Hotton wrote, directed and starred in the work of fiction he took to Broadway. He even allegedly played the supporting characters – phantom investors who existed only in fictitious emails and Hotton’s bogus assertions about them. A convincing portrayal on stage can earn you a Tony. A convincing act that fleeces a production’s backers can earn you a prison term.”

Read fully story.

West Palm Beach Fraud Defense Attorney

At the law firm of Andrew D. Stine, P.A., in West Palm Beach, we have extensive experience representing people charged with fraud crimes, including mortgage fraud, mail fraud, wire fraud, securities fraud, tax evasion, insider trading, theft by fraudulent means, writing bad checks, and organized schemes to defraud.

In Florida, most fraud changes involve the Economic Crimes Division (ECD) putting together a great amount of evidence for presentation before a grand jury. The best way to resolve these cases is for your lawyer to have a good working relationship with the prosecutor and to try to avoid any serious consequences by paying restitution. In Florida, restitution outweighs incarceration, so if your lawyer can persuade the victim to drop charges in favor of receiving their money back, you can usually avoid a conviction.

If you did not commit the fraud crime, we can prepare an aggressive defense and force the state to prove its case. In many cases, that can be a difficult thing for the state to do.

Free consultation 24/7: Call West Palm Beach criminal defense lawyer Andrew D. Stine, P.A. at 561.880.4300. Se habla español.

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