Wire fraud is one of the most prevalent and severe white-collar crimes in America.
It’s estimated that it costs consumers, businesses, and governments billions of dollars every year. Since more and more communications are done online in this digital era, wire fraud schemes are becoming increasingly high-tech.
Facing charges for white-collar crimes, such as wire fraud, is no laughing matter. So, it’s worth knowing how wire fraud works, the laws governing it, and how to avoid it. You’ll want to consult a wire fraud lawyer if you’re on the receiving end of such allegations.
What follows are five things about wire fraud in the United States that you should know.
1. What Wire Fraud Is
Wire fraud is a federal crime using electronic media — like the telephone, e-mail, text message, or website — to carry out a scheme to defraud an entity or person of money, property, or other items of value. It does not involve the use of force such as robbery or burglary.
To render a person guilty of wire fraud under 18 U.S. Code § 1343, the government must prove four elements:
- A scheme to defraud
- Intent to defraud
- Use of interstate wire communications
- A link between communications and schemes to defraud
2. Various Kinds of Wire Fraud
Wire fraud comes in different forms. Some of the most prevalent wire fraud schemes in America are the following:
Business Email Compromise: Adopting executives’ or suppliers’ personas and requesting employees to send funds through wire transfers to imposter accounts.
Phishing Scams: Phony messages or emails are sent to collect confidential financial or login credentials from recipients.
Real Estate Wire Fraud: Real estate transaction emails are stolen by identity thieves to wire funds into fraudulent accounts.
Investment Scams: Insider information or unusually high returns are used to convince victims to wire money.
Online Marketplace Scams: Sellers or buyers on online marketplaces, such as eBay, Craigslist, or Facebook Marketplace, may be encouraged to wire money but do not receive the goods or services.
The thread that weaves through all these hoaxes is the use of electronic communication to facilitate wire fraud.
3. Wire Fraud is a Federal Crime and Carries Harsh Penalties
Wire fraud is not only unethical — it’s a federal crime that can lead to prison time and fines if convicted. Sentences can include the following:
- 20 years in prison per count
- $250,000 per individual or $500,000 per entity forfeiture fine
- Orders of restitution to restore victims to their pre-theft condition
If wire fraud is perpetrated through a federal disaster relief program — such as FEMA benefits — or banks, the sentence is 30 years maximum and the fines are $1 million maximum.
4. Wire Fraud Investigations Take Time and Are Detailed
Owing to the fact that wire fraud has numerous victims, may be of international nature, or is complicated in nature, it takes a long time for investigations to proceed. The FBI, the Secret Service, and even the IRS are likely to be involved in making a case.
Evidence typically consists of emails and text messages, bank records of money transfers, tracking IP addresses, social media activity, and statements from witnesses or victims.
Yes, innocent individuals can get caught up in investigations. If it happens to you, contact a criminal defense lawyer right away. You don’t want to go toe-to-toe with federal investigators alone.
5. How to Guard Yourself From Wire Fraud
Preventing wire fraud starts with awareness and caution. These are steps individuals and companies can take to lessen the odds of anyone committing this white-collar crime:
Confirm Prior to Wiring Money: Always dial a known, verified number to confirm wire instructions.
Email Warning: Double-check sender email addresses thoroughly and never follow suspicious links.
Strong Passwords and Two-Factor Authentication (2FA): These practices make your accounts more difficult for thieves to access.
Employee Training: For businesses, routine employee training can help them identify and report phishing emails.
Secure Your Network: Update with fresh antivirus software, turn on firewalls, and limit access to sensitive data.
Inform your bank, the FBI’s Internet Crime Complaint Center (IC3), and local law enforcement authorities if you are a victim of wire fraud.
Wire fraud is a high-tech, costly hoax that robs millions of Americans every year. As a businessperson, homeowner, or simply as an online consumer, you must know about the risks.
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