Tricking the government into handing over government property is a crime. Federal authorities have zero tolerance for persons that steal or attempt to steal federal property and taxpayer dollars. It should come as no surprise then that federal prosecutors have a myriad of charges available to deploy against a person they suspect defrauded or attempted to defraud the United States government.
The most commonly used federal statutes deployed by United States Attorneys in cases involving fraud against the federal government include major fraud against the United States under 18 U.S.C. § 1031 and conspiracy to defraud the United States under 18 U.S.C. § 371. You might also see the more ubiquitous charges under 18 U.S.C. §§ 1341, 1343 for mail and wire fraud, which you can learn more about here. In addition, against weaker cases or for added leverage, an indictment might also include charges of false statements under 18 U.S.C. § 1001 or fraudulent claims under 18 U.S.C. § 287.
Although federal prosecutors use section 1031 and its closely related conspiracy charge under section 371 together often, the two charges have subtle differences that may have significant impacts to the investigation, legal proceedings, and everyday life for the defendant beyond the courtroom.
First, the criminalized acts are different. Section 371 criminalizes the act of conspiring, which you can learn more about and conspiracies generally here. Section 1031, in contrast, criminalizes executing or attempting to execute a scheme to defraud, and you can learn more about the requirements for fraudulent, false and misrepresentative statements here.
Second, section 371 offers prosecutors more flexibility. By alleging a section 371 conspiracy, the government may offer proof either that the goal of the conspiracy was to defraud the United States, or commit any offense against the United States. On the other hand, section 1031is limited only to acts and attempts to defraud the United States.
These nuances between the two charges affect the scope of the indictment and thus could dramatically impact the legal proceeds down the road, such as assets subject to pre-trial seizures and asset subject to forfeiture during sentencing. You can learn more about asset forfeiture and its immediate and significant impacts for you here.
The Federal Bureau of Investigation (FBI) and the Department of Justice (DOJ) are the most likely agencies investigating persons suspected of major fraud against the United States under section 1031 or participating in a conspiracy to commit an offense or to defraud the United States under section 371, as these two are the main law enforcement agencies of the federal government.
Considering that this charge applies to entire federal government, any part of the federal government might be involved in an investigation if the suspected false statement was within their jurisdiction.
Other federal agencies likely investigating making false statements include the Internal Revenue Service (IRS), Securities Exchange Commission (SEC), Federal Trade Commission (FTC) Department of Health & Human Services (DHHS), and the Federal Deposit Insurance Corporation (FDIC).
For allegations of fraud involving government contracting, you might see also see the Department of Defense (DOD) and other agencies engaging in government contracting bids.
The statutory punishment under both sections 1031 and 371 include an assessment of heavy fines and a term of imprisonment, but sentencing varies with each case’s unique set of facts, the presiding judge, and factors considered under the federal sentencing guidelines, which you can read more about here.
Yes, major fraud against the United States under section 1031 and conspiracy to commit an offense or to defraud the United States under section 371 are both federal felonies.
10 years is the maximum term of imprisonment for section 1031 fraud against the United States.
5 years, or the maximum imprisonment term of the offense you conspired to commit, is the maximum term of imprisonment for a section 371 conspiracy.
Every sentence in a federal cases is based on the federal sentencing guidelines, which considers a multitude of factors, such as prior criminal history, use of a gun, or position of trust, to calculate a recommended range that the federal judge may use as a guide for sentencing, however the presiding judge ultimately reserves final discretion at sentencing. Thus, as long as the judge provides a reasonable basis for their decision on record, the judge may make what is called a “departure from the guidelines” and sentence the defendant to a term of imprisonment outside the recommended range. You can learn more about the sentencing under the federal sentencing guidelines here.
Possibly, as it depends on the charges you are convicted of and the unique facts of your case. Ultimately, however, final discretion remains with the judge presiding over sentencing. Factors that also will help determine whether restitution will be required include whether there are victims of the convicted charges, whether those victims suffered compensable harm, the federal sentencing guidelines, and many more.
Possibly, as it again depends on the charges alleged in the indictment and the unique facts of your case As mentioned above, the charges and facts alleged in the indictment shape the scope of the entire criminal proceeding, including assets subject to pre-trial seizures and final forfeiture as part of sentencing, if convicted. You can learn more about the sentencing under the federal sentencing guidelines here.
See our news page for recent updates on COVID-19 fraud cases here.
You should only speak with law enforcement investigator regarding anything related to COVID-19 fraud or any other related crime after you have spoken to a criminal defense lawyer. Period.
A common question from people involved in a criminal investigation is at what point can they finally clear their name and share their part of the story.
You have probably heard investigators, prosecutors, and others taking the situation out of context, bending the truth, and misunderstanding what actually happened. They are relying on people who are lying, and the whole situation is outrageous and humiliating for you.
You should know that the Fifth Amendment exists to protect anyone accused of a crime from incriminating themselves, and the truth is it takes only one split-second mistake to get unnecessarily tied up in a prolonged criminal investigation that will place a heavy financial and time-consuming burden for you and loved ones. Do not go swimming with sharks alone and without a cage.
You need to speak with a COVID-19 fraud defense attorney to obtain sound legal advice before you speak with federal investigators, even if you think you have done nothing wrong.
You should contact a defense lawyer that has decades of experience handling criminal investigations before you engage with investigators. Balancing cooperation and protecting your constitutional rights and liberties requires a defense attorney that knows how to handle federal investigators.
If you have been contacted or anticipate contact from federal COVID-19 fraud investigators, then you should contact and speak with a COVID-19 fraud defense lawyer to protect yourself, your freedom, and financial stability. You will not be able to talk yourself out of the crosshairs – you’ll only be wound up in a web of investigation tactics.
You need a fraud defense lawyer who knows what they’re doing and has a proven track record of experience defending federal fraud cases. Schiffer law firm has over four decades of experience defending clients involved in federal criminal investigations and clients accused of federal crimes. The fraud defense lawyers at Schiffer law firm know how to handle federal fraud cases from first contact by investigators to overturning wrongful convictions on appeal.
Schiffer law firm attorneys have and continue to defend people needing fraud defense attorneys nationwide. Nobody is too small, and nowhere is too far. If you think you need to speak to a fraud defense attorney, give us a call today.