Wire fraud is a white-collar crime that has consistently grown in today's digitally-based world. In 2022, for instance, bank transfer or payment fraud resulted in losses amounting to $1.59 billion.
Equally important, it targets consumer and business accounts. Consumer account attacks happened more frequently than business attacks last year.
What is Wire Fraud?
Committing wire fraud involves using electronic communications to deceive individuals or entities for financial gain. The schemes use wire or electronic transfers to carry out the activity.
Communication can involve phone calls, faxes, texts, social media, or emails.
Because interstate commerce generally applies to these forms of communication, the crime is a federal offense. However, some states, including Pennsylvania, charge for the offense.
As a result, investigations can happen at multiple levels. The Federal Bureau of Investigation (FBI) generally heads the investigation. However, investigations can include the Federal Trade Commission (FTC), U.S. Department of Homeland Security, and state governments where applicable.
How Does Wire Fraud Work?
Wire fraud takes many forms, but the schemes generally take the same approach.
The fraudster often uses a story that creates an urgency to rush the target's decision. They use various communication channels like email, phone calls, text messages, social media, or fake websites.
Typically, the wire fraudster presents themselves as legitimate, working banks, reputable companies, or government agencies. They promise high investment returns, offer too-good-to-be-true deals, or create false emergencies to exploit the victim's trust.
The fraudster convinces the victim to wire money into a bank account they control. Wire transfers are difficult to reverse, making it challenging for victims to recover their funds.
The victim provides personal or financial information the fraudster can use to steal money or commit identity theft. Generally, that information includes bank account numbers, credit card details, or login credentials.
Elements of Wire Fraud
According to the U.S. Department of Justice (DOJ), these four elements are essential in wire fraud cases:
- That the defendant voluntarily and intentionally devised or participated in a scheme to defraud another out of money;
- That the defendant did so with the intent to defraud
- That it was reasonably foreseeable that interstate wire communications would be used;
- And that interstate wire communications were used.
What is Wire Fraud Conspiracy?
Wire fraud conspiracy occurs when two or more individuals conspire or agree to commit wire fraud. It requires a collaborative effort when planning the crime.
Charges can apply even if the fraudulent scheme is unsuccessful. Equally important, you needn't be the mastermind to face charges.
Requirements for Wire Fraud Conspiracy
The DOJ includes these requirements for a conspiracy to defraud:
- An agreement between two or more persons;
- To commit mail fraud or wire fraud;
- It was an overt act committed by one of the conspirators to further the conspiracy.
The conspirators don't need an agreement on using mail or wire communications. For prosecution, only one of the conspirators must have the intent to do so, but all parties can face charges.
What is the Penalty for Wire Fraud?
Because wire fraud is a Class C Felony and federal crime, wire fraudsters face severe penalties:
- Fines up to $250,000 for individuals
- Fines up to $500,000 for organizations
- Imprisonment of not more than 20 years
Some cases involving national disasters or financial institutions carry penalties of 30 years imprisonment and a million-dollar fine.
Moreover, these penalties apply per count. For example, sending five emails with fraudulent intent constitutes five counts. And each is subject to maximum fines and prison terms.
Examples of Wire Transfer Fraud
Wire transfer scams target entities of all types, including individuals, businesses, financial institutions, real estate, healthcare providers, etc.
One notable example is the noted Nigerian Prince scam. The scammer sends an email claiming to be a Nigerian prince who can't access their fortune sitting in a bank account. They ask the target to hold the money in exchange for a sum. Their goal is to access financial information to steal the target's money.
Other tactics include:
Phishing: Fraudsters attempt to acquire bank accounts, credit cards, phone numbers, or other sensitive information through emails or websites. They present themselves as a legitimate business or person.
Investments: The perpetrator offers high returns or profits using emails or phone calls.
Identity Theft: Wire fraudsters steal a person's social security or bank information and send money to themselves.
Hiring Scams: Scammers present high-paying jobs on employment platforms like LinkedIn and Indeed. Their goal is to steal birthdays or social security numbers.
How to Report Wire Fraud
If you suspect you're a victim of wire fraud, take these steps immediately:
- Alert Your Bank. They might be able to stop the transfer or help contest charges.
- Report the Crime. Contact your local FBI office. Call the Fort Washington satellite office at (215) 641-6059 for Bucks and Montgomery counties. Call the Newtown Square in Delaware County at (610) 353-4500.
- Review Insurance: Contact your carrier to see if you have coverage.
- Engage an Attorney: An attorney can help determine who to contact and what actions to take. They can also help determine potential third-party liabilities.
Ensure you capture details like dates, times, names, companies, money lost, and supporting evidence.
What to Do If Accused of Wire Fraud
Contact a criminal defense attorney specializing in white-collar crimes and wire fraud. Remain silent and wait for that attorney to be present before any discussions.
Remember: This is a serious situation. You face severe consequences if convicted. Consulting with an experienced attorney is crucial to protect your rights.
7 Red Flags for Wire Fraud
Scammers often pose as a colleague, client, or someone you or your company has done business with recently. They may pretend to be a vendor asking you to wire funds to an account.
Understanding how fraudsters attack is the best way to help prevent wire fraud. Here are some red flags to look for:
- Unsolicited requests for money or personal information.
- The sender insists on communicating only via email.
- The return email looks odd or doesn't include the company name.
- Urgent or time-sensitive offers that seem too good to be true.
- Pressure to act quickly without proper verification.
- Misspellings, odd phrases, or grammatical errors in communication.
- Requests to wire money or send payments through unconventional methods.
Criminal Defense Lawyers for Bucks, Delaware, and Montgomery Counties
Wire fraud is all too common today. Talk with a local attorney who can help recover your money. Or, if accused, reach out to a criminal defense attorney quickly.
Our attorneys support clients in Bucks, Delaware, and Montgomery County. More importantly, you can count on their experience to get results.
John S. Han serves as a trial and criminal defense attorney, representing clients facing investigation and prosecution by State and Federal Law Enforcement authorities throughout the Philadelphia metropolitan region, with a particular focus on Montgomery and Bucks Counties.