Our client was charged with Conspiracy to violate the Foreign Corrupt Practices Act (FCPA). The case was dismissed by the government after it was made clear that the government had prosecuted the case incorrectly.
Understanding Fraud Charges
Fraud offenses cover a wide range of activity, from something relatively simple — like issuing a bad check or minor credit card fraud — to more sophisticated wire, mail, or securities fraud charges. In brief, a fraud case the government has to prove that you lied or misrepresented something with the intent to deceive, and that the lie or misrepresentation caused legal or financial injury to someone else. In many situations the big question the government must decide before deciding to prosecute a fraud case is whether it can prove that the accused had the criminal intent necessary to satisfy the required elements for fraud.
Bankruptcy is a way to allow destitute people or businesses to wipe out debt and make a fresh start. The prospect for abusing bankruptcy proceedings can be tempting and, indeed, many individuals, small business owners, and CEOs each year are accused of bankruptcy fraud. The Department of Justice’s U.S. Trustees Program monitors bankruptcy proceedings and refers suspected cases of fraud to the FBI and the U.S. Attorney’s office.
In bankruptcy fraud cases most often the accused person or business is alleged to have filed for bankruptcy and lied, produced false documents, or otherwise tried to hide financial assets – typically with the objective of preserving such assets from the bankruptcy process. However, as with all criminal investigations, anyone investigated, accused, and charged with bankruptcy fraud must be proven guilty beyond a reasonable doubt in a court of law.
The federal government is expending an enormous amount of resources to investigate health care fraud cases. As a health care provider, the potential consequences of a mere health care fraud investigation are extremely serious and long lasting. As with other white collar offenses, prison time is a real possibility for those who are convicted. Suspension or revocation of a medical license and/or being barred from future government reimbursement programs such as Medicare or Medicaid, which can end a career.
Most often, the government pursues health care fraud under two basic theories. Sometimes health care providers are accused of “upcoding,” or using a different billing code for a procedure that pays more than the code for the procedure justifies. In other situations, providers are accused of billing for procedures that weren’t performed at all or procedures for alleged fictitious patients.
Mortgage fraud is a new focus of federal agencies, one that has attracted a lot of attention since the housing market crash of 2008 and the resulting economic crisis thereafter. Since the crash, the number of loan organizations has substantially decreased as a result of better underwriting standards while the number of foreclosures, delinquencies, and underwater mortgages has skyrocketed. Distressed loan organizations are sometimes accused of targeting homeowners who are desperately trying to save their home. This type of fraud involves loan refinancing and/or modification.
The FBI’s Financial Institution Fraud Unit (FIFU) investigates several different types of mortgage fraud, such as:
- Alleged illegal foreclosure rescue schemes
- Alleged illegal loan modification schemes
- Alleged illegal property flipping
- Alleged illegal equity skimming
- Alleged illegal “silent” second mortgages
Sentencing in Fraud Cases
In recent years, following the uproar that occurred after huge white collar scandals like WorldCom and Enron came to light, Congress adjusted the sentencing guidelines to increase the recommended guideline ranges for people convicted of white collar offenses, including fraud offenses. The Voluntary Sentencing Guidelines are only advisory but it helps overcome tough hurdles if the guideline range is favorable.
There are a few key factors that drive the potential sentence in a fraud case. One key factor is called the “loss amount,” which is defined in Section 2B1.1 of the guidelines. The guidelines indicate that this means the reasonably foreseeable financial loss, not the actual money that people lost or the money made by those convicted. This definition can result in loss amounts that are much greater than the actual, or precise, amount of money that was involved in the offense.
There are several other characteristics of the offense that the guidelines contemplate that can increase the offense Level. These characteristics include, but are not limited to, the number of victims involved, whether sophisticated means were used, and if the person convicted was in a position of trust.
No matter what the alleged crime may entail, an experienced and aggressive criminal defense lawyer is essential if you find yourself targeted by the federal government. Price Benowitz represents clients facing fraud and a variety of other white collar criminal charges, including Foreign Corrupt Practices Act (FCPA) and RICO matters. For more information on the best approach to take in your case, click here to schedule an office consultation with an attorney who has a strong track record defending against allegations of fraud.
Terry Eaton in His Own Words
Below are several links to question-and-answer pages excerpted from an interview with Terry Eaton in which he discusses mail and wire fraud cases.