Mail versus wire: Understanding fraud charges and penalties

Fraud is defined as wrongful or criminal deception intended to result in financial or personal gain for the deceiver. Fraudulent acts involve misrepresentation, falsified information or deceit to gain a commodity or something of value. In criminal law, fraud offenses are most commonly associated with mail and wire fraud, both of which are federal crimes.

Fraud via a postal carrier

The definition of mail fraud is purposefully broad and includes various examples of activities that constitute mail fraud. However, in order to commit mail fraud, two elements must be present. A person must have devised a scheme to defraud others and used the mail system to advance their efforts. Acts such as mailing contracts, loan paperwork or false statements would constitute mail fraud.

It is important to note that mail fraud does not only apply to the U.S. Postal Service; the use of commercial mailing services such as FedEx and UPS applies as well.

Over the wire

The concept of wire fraud evolved as modes of communication advanced. Wire fraud is similar to mail fraud in that it involves a scheme to defraud others out of something of value, but the deceiver uses wires to commit the fraud instead of the mail system.

When wire fraud is committed, the fraudulent acts typically involve a telephone or fax machine, the Internet or other modes of electronic communication. Since nearly all communication involves wires of some kind, wire fraud is one of the most common among federal white collar criminal charges.

Potential penalties

Although mail and wire fraud can take place in a single state and fall under state fraud laws, the U.S. Constitution’s Commerce Clause grants the federal government jurisdiction, so charges may be prosecuted at the federal level. Both mail and wire fraud are punishable by up to 20 years in prison, in addition to significant fines. Fraudulent crimes against a financial institution carry a prison sentence of up to 30 years and fines of up to $1 million.