You may have heard about the 50 people who were arrested following an FBI investigation called “Operation Varsity Blues.” Parents paid anywhere from $200,000 to $6.5 million for guaranteed admission into a school. Lori Loughlin and her husband, fashion designer Mossimo Giannulli, were initially charged with conspiracy to commit mail fraud and honest services mail fraud after allegedly paying William “Rick” Singer $500,000 to get their two daughters – Isabella Rose and Olivia Jade – into the University of Southern California.
How does a college cheating scandal become mail fraud?
Mail fraud is such a broad crime that federal prosecutors often think of it as their bread and butter. There are three things that must be present to constitute mail fraud (or wire fraud).
The statutes, Title 18 United States Code, Section 1349 proscribe (1) using the mail or other interstate carriers, (2) in conjunction with a scheme to intentionally defraud another of money, property, or honest services; (3) by means of a material deception.
What do you have to mail?
It’s important to note that while the use of the mail, or other interstate delivery services such as UPS, DHL, or Fed Ex, is essential to the prosecution; it doesn’t need to be an essential part of the scheme. In fact, you don’t need to be the person who physically mails the letter or package involved in the case. You simply need to have initiated the mailing, for example, by asking someone else to mail it. “It” could be anything related to the case. That’s why mail fraud is such a widely used charge. The chances of someone mailing something pertaining to the alleged crime are pretty high. So are the consequences.
Potential sentences for mail fraud
Charges of mail fraud are often combined with other charges. The mail fraud can result in up to 20 years in prison plus fines. If the mail fraud involves an emergency disaster and/or a financial institution, the sentence can include up to 30 years in prison and/or a fine of up to 1 million dollars.
What is “Honest Services” Mail Fraud?
Honest services mail fraud is a type of fraud that seeks to deprive someone of an intangible service, such as an even playing field for students who are applying for college admission. There are two main areas of honest services fraud that the courts have recognized: Bribery and failure to disclose a conflict of interest which could result in financial gain.
It is common for RICO (Racketeer Influenced and Corrupt Organizations Act) prosecutions to use the honest services statute because mail fraud is a natural part of racketeering and can form a pattern of racketeering activity.
What is Material Deception?
A representation, omission or practice is material. Deception may occur if you are misleading someone through words, silence or action.
All of these aspects of mail fraud make it easy to see how something can start out as a way to get your child into a good college without doing the work, and can result in prison time and fines. It’s also easy to see why prosecutors like the statute for many other situations, as well.
What if you are charged with mail fraud?
If you are charged with mail fraud or honest services fraud, it is important that you have a knowledgeable defense team on your side. Premier Federal Criminal Defenders are experienced in helping clients work with the court to resolve the issue. Contact us for a free consultation today.