Did you know that mail fraud is one of the most common federal criminal charges? Committing a crime of deceit using the U.S. Postal Service (USPS) or a private interstate carrier provides federal law enforcement with an easy opportunity to claim jurisdiction, which can lead to a significant escalation in the severity of the consequences.
When facing mail fraud charges, it is important to understand what constitutes mail fraud. The term “fraud” refers to any scheme to obtain money or property under false pretenses or any scheme to sell, distribute, exchange, supply or use counterfeits. Mail fraud occurs when a scheme of this nature involves the mailing of something associated with the fraud. The item mailed can be anything: contracts, receipts, communication regarding a fraudulent deal, etc. All of these items can meet the law’s requirements resulting in a federal charge of mail fraud. Charges for mail fraud are not limited to fraudulent acts that use USPS. Mail fraud can be committed using other private and commercial interstate carriers.
The use of an interstate carrier is important because the federal government’s jurisdiction is limited to acts that are committed across state lines/that impact multiple states. If a crime occurs entirely within one state, the federal government does not have jurisdiction and the matter falls under the state’s laws, but the Constitution’s Commerce Clause grants the federal government jurisdiction over interstate matters.
What is the Punishment for Mail Fraud? If convicted of mail fraud, you could face a fine and imprisonment up to 20 years. Enhanced penalties apply if the crime involves benefits connected to a presidentially declared major disaster or emergency or if it affects a financial institution. Enhanced penalties can include fines up to $1 million and imprisonment up to 30 years.
The Case of Charles Ponzi: You may have heard of the famous mail fraud conviction, the case of Charles Ponzi. Ponzi was one of the most famous swindlers of all time resulting in the coinage of the term “Ponzi Scheme” for any financial scam based on a pyramid scheme. Ponzi’s scam was nationwide and involved extensive use of the postal system. He started his “business” in 1919, was making a million dollars a day by the summer of 1920 using a scheme involving postal reply coupons and was indicted on 86 counts of mail fraud by fall 1920. In November 1920, Ponzi pled guilty to a single count and was sentenced to five years in prison. Compared to contemporary prosecutions, the punishment Ponzi received seems slight.
The Case of Bernie Madoff: Ponzi’s contemporary, Madoff, didn’t get off so easily. Madoff was responsible for the largest Ponzi fraud scheme in history. He pretended to trade in securities. He actually just collected investment funds and used them to pay off victims who wanted to withdraw funds from the investment pool. Similar to Ponzi, Madoff’s scheme produced “returns” that were a mathematical impossibility. When the scam fell to pieces, Madoff was prosecuted for defrauding his “investors” for a total of $65 billion. Madoff was sentenced to 150 years in federal prison for 11 federal charges, including mail fraud. In addition, members of his family were also sent to prison and the courts continue to pursue his assets in order to compensate victims.
If you are facing mail fraud charges or any other federal crime, you should contact one of the experienced criminal defense attorneys at Aronow Law PC so we can protect your rights and help you prepare a strong defense.