We Settle For Nothing Less Than Excellence

Why is wire fraud a federal and not a state offense?

On Behalf of | Feb 8, 2022 | Criminal Defense

Most forms of theft result in state charges for the person accused of taking someone else’s property. Shoplifting, burglary and even armed robbery will often lead to state charges, although some people will face federal charges or theft crimes.

Wire fraud charges are a perfect example. Although wire fraud frequently involves an offense in a specific place, possibly involving a worker embezzling from their employer or taking advantage of other local companies, it will be the federal government and not the state of Texas that brings charges against them for wire fraud.

Wire fraud involves someone altering wiring instructions so that funds go to the wrong destination or tricking someone into sending funds via wire transfer for fraudulent purposes. Even if the victim and defendant are both local, wire fraud will usually result in federal charges. Why is wire fraud a federal offense?

Wire fraud violates crucial federal laws

State lawmakers create their own definitions for crimes ranging from assault to drug possession. What is legal in one state may be a crime in another. Federal law helps create a unified standard for prosecution as a baseline for state laws. It also allows for the prosecution of offenses that cross state lines, utilize federal infrastructure, involve federal agencies or occur on federal property.

In the case of wire fraud, those committing the fraud will use the wire transfer system overseen by the Federal Reserve to commit their crime. Through the use of wire transfer, they obfuscate the criminal act and make it very hard for someone to recover any funds transferred. Often, transfers go to a financial institution in another state, which makes it an interstate offense and therefore also eligible for federal prosecution.

Wire fraud charges can lead to significant personal consequences

You don’t necessarily need to have personally reaped the benefits of wire fraud to face charges. Being the one to transfer funds even if you were not the recipient could implicate you. Arranging for the transfer of funds by tricking people, manipulating information or altering paperwork could also lead to wire fraud charges.

The amount of money involved and the details of the situation will determine the possible penalties that someone accused of wire fraud will face, but incarceration in a federal penitentiary is possible. Recognizing when actions may violate federal law could help you avoid potentially criminal mistakes.