Federal Wire Fraud Defense

The statute was written to be vague, and the government has spent sixty years exploiting that fact.

Section 1343 of Title 18 criminalizes any scheme to defraud that touches a wire. A phone call. An email. A text message sent from a parking lot in Newark to a recipient who never opened it. The wire itself need not carry the fraud; it need only be incident to the scheme. One imagines the drafters understood what they were authorizing. The result is a statute so elastic that federal prosecutors treat it less as a specific prohibition and more as a standing invitation.

Most of the clients who contact this firm did not think of themselves as criminals on the morning they were indicted.

What the Government Must Prove, and Where It Fails

A wire fraud conviction requires four elements: a scheme to defraud, material misrepresentations, intent to defraud, and the use of interstate wires in furtherance of that scheme. Each element presents a separate field of contest, though prosecutors prefer to collapse them into a single narrative of greed. The defense operates in the opposite direction. Disaggregation is the method.

Intent is where most cases are won or lost. The government must establish that the defendant acted with specific intent to deceive, not merely that a misstatement occurred. In United States v. Starr, the Second Circuit held that a misstatement does not, on its own, indicate fraud. The distance between an error and a crime is measured in state of mind.

Good faith remains a viable defense. A defendant who believed in the truth of the representations, however mistaken, has not committed wire fraud. This is not a technicality. It is the line between federal prison and acquittal.

And yet the line has grown thinner.

After Kousisis, the Ground Shifted

In May 2025, the Supreme Court decided Kousisis v. United States and in doing so handed prosecutors a weapon they had been requesting for years. The holding was unanimous: a defendant may be convicted of wire fraud for inducing a victim into a transaction through material misrepresentation, even where the victim suffered no economic loss. The bridge got painted. The contract was performed. Nobody lost a dollar. Conviction upheld.

The facts involved a Philadelphia contractor who misrepresented compliance with disadvantaged business enterprise requirements on a state contract. PennDOT considered the work satisfactory. The government argued, and nine Justices agreed, that fraudulent inducement alone satisfies the statute. The thing obtained need not come at the victim’s expense.

A thing is no less obtained simply because something else is simultaneously given in return.

That sentence will appear in indictments for the next thirty years.

Kousisis does preserve one constraint: materiality. The misrepresentation must be material to the victim’s decision to enter the transaction. For the defense bar, materiality is now the primary contested ground. It is a demanding standard. Whether it is demanding enough remains to be seen.

The Statute Contracts and Expands in the Same Decade

Two years before Kousisis, the Court moved in what appeared to be the opposite direction. Ciminelli v. United States eliminated the Second Circuit’s “right to control” theory, which had permitted prosecution where a victim was deprived of economic information rather than traditional property. Between 2010 and 2021, over one hundred defendants had been indicted under that doctrine in the Southern District of New York alone. All of that precedent was swept away in a morning.

Ciminelli narrowed. Kousisis expanded. Both were unanimous. Both claimed fidelity to the text.

One learns to read the statute not as written but as interpreted by whichever panel happens to be sitting on the day the brief is due.

Sentencing Is Where the Architecture Collapses

The statutory maximum for wire fraud is twenty years. Where the scheme affects a financial institution or involves a presidentially declared disaster, the ceiling rises to thirty. These numbers sound theoretical until the Sentencing Guidelines calculation begins, at which point they become concrete with unpleasant speed.

Loss amount is the engine of federal fraud sentencing. Under Section 2B1.1, the loss table adds offense levels in increments that feel almost punitive in their precision: a loss exceeding $550,000 but falling below $1,500,000 adds fourteen levels. Losses above $550 million add thirty. The 2024 amendments to the Guidelines moved the loss calculation methodology from commentary into the body of the guideline itself, a procedural change with substantive teeth (the Commission does not alter the location of provisions without reason, and the reason here was to give loss calculations greater binding force on sentencing courts).

In fiscal year 2024, the Sentencing Commission reported that 89 percent of all federal defendants received a prison sentence. The average fraud sentence was 23 months. That average conceals enormous variance. One in six fraud defendants received probation. Others received decades.

The number that matters is not the average. It is the number attached to your case.

What a Defense Looks Like Before Trial

By the time a wire fraud case reaches a courtroom, much of the outcome has already been determined. The investigation phase, which may last months or years before an indictment, is where the most consequential decisions are made. Whether to speak with agents. Whether to produce documents. Whether to engage counsel before or after the target letter arrives.

We have represented clients who retained counsel eighteen months before indictment and clients who called us from the lobby of the federal courthouse. The former group fares better. That is not a coincidence.

Pre-indictment intervention permits several forms of advocacy that vanish once charges are filed: presentations to the prosecuting attorney, cooperation frameworks negotiated from a position of relative strength, and the quiet correction of factual misunderstandings that, left unaddressed, calcify into allegations. A 302 interview memorialized by an FBI agent is not a transcript. It is a summary written by someone who was not neutral.

In March, in this city, one can walk past 26 Federal Plaza and not know that inside, on the seventh floor, a paralegal is assembling the binder that will become an indictment. Early engagement is not a guarantee. But silence in the face of an active investigation is a selection. You are selecting for the worst possible outcome.

The Government’s Preferred Instrument

Wire fraud is the most charged federal offense in white collar prosecution, and the reason is structural. The statute is broad. The wires are everywhere. The elements are familiar to juries. And the loss table does the sentencing work that might otherwise require a mandatory minimum.

In 2025, the DOJ Fraud Section charged 265 individuals and convicted 235, with an aggregate intended loss exceeding $16 billion. The Section grew by over thirty percent in a single year, ending 2025 with more than 200 prosecutors. That expansion was not symbolic.

But the government’s enthusiasm for wire fraud charges contains its own vulnerability. Broad statutes invite broad theories of prosecution. Broad theories produce reversible error. The appellate history of Section 1343 is littered with convictions that did not survive review: right to control, gone; honest services fraud, narrowed to bribery and kickbacks in Skilling; the intangible rights doctrine, dismantled and rebuilt twice since 1987.

Prosecutors overreach. They always have.

DEFENSE TEAM SPOTLIGHT

Todd Spodek

Lead Attorney & Founder

Featured on Netflix's "Inventing Anna," Todd Spodek brings decades of high-stakes criminal defense experience. His aggressive approach has secured dismissals and acquittals in cases others deemed unwinnable.

NY Bar Admitted Multi-State Licensed Federal Courts

Meet the Full Team

Intent, Materiality, and the Contested Middle

The viable defenses in a wire fraud case have not changed as much as the headlines suggest. Good faith. Absence of specific intent. Puffery (statements so exaggerated that no reasonable person would treat them as factual). The government’s failure to prove that a misrepresentation was material, as opposed to merely false. Jurisdictional challenges to the wire element. The statute of limitations, which runs five years from the last use of the wires in furtherance of the scheme, or ten years where a financial institution is affected.

What has changed is the weight assigned to materiality after Kousisis. If economic loss is no longer required, then the question of whether the victim would have entered the transaction but for the misrepresentation becomes the entire case. Materiality is not a checkbox. It is a factual determination, subject to cross examination, subject to reasonable doubt.

A misrepresentation about a credential on a bid submission is material. A misrepresentation about the color of the paint on the truck that delivered the materials is not. The contested middle is vast.

The Shape of Cooperation

In multi-defendant wire fraud cases, the government constructs its case from the inside out. Cooperators are the mortar. The first defendant to cooperate receives the most favorable treatment; the last receives functionally none. This is not a secret. It is a system.

The decision to cooperate is not principally legal. It is personal. It involves the defendant’s assessment of exposure, tolerance for risk, relationships with co-defendants, and capacity for the particular form of endurance that cooperation demands. We counsel clients on the mechanics: Section 5K1.1 motions, proffer agreements, queen for a day sessions, the exposure that proffers create. We do not counsel clients on whether to cooperate. That decision belongs to the person who will live with the consequences.

Some clients cooperate and receive sentences below the Guidelines range. Some clients proceed to trial and are acquitted. These outcomes are not predictable from the facts of the case alone.

Why the First Conversation Matters

Wire fraud investigations unfold on the government’s timeline, in the government’s preferred forum, according to the government’s theory of what the facts mean. The defense begins when someone decides it should begin. That decision, more than any motion or cross examination, determines the trajectory.

We have defended wire fraud cases in the Southern and Eastern Districts of New York, in the District of New Jersey, and in federal courts across the country. The patterns recur. The early engagement produces better outcomes. The specific intent element remains the most productive ground for defense. The loss calculation remains the most dangerous variable at sentencing. And the client who understands these realities before the first court appearance possesses something that cannot be manufactured later: time.

The first call to this office is not a commitment. It is a diagnosis. The situation is assessed, the exposure is estimated, and the available paths are described with the precision that the moment requires. Wire fraud carries weight. The response to it should carry equal measure.