Cyber Fraud Attorney Arkady Bukh Explains the Consequences of Criminal Charges
Definition of Online Fraud
Internet fraud cases are often complex cases because alleged victims may be spread across the United States. It can be difficult for prosecutors to assemble witnesses from disparate locations during an Internet fraud trial. It can also be difficult for prosecutors to prove the extent of loss, which affects the type of penalties that may be applied.
Despite these challenges, prosecutors are often very aggressive at prosecuting people they believe violated the law and committed fraud online. If you are accused of an Internet fraud offense, you have legal rights.
Contact Internet fraud lawyers for help understanding the charges, exploring your options for defense, or negotiating a plea agreement.
Laws on Internet Scams
The Computer Fraud and Abuse Act was passed in 1986 to amend the Counterfeit Access Device and Abuse Act. The goal of the amendment was to make it easier for authorities to prosecute new crimes arising with the expansion of computer use. Many types of online fraud cases are prosecuted under provisions of the Computer Fraud and Abuse Act (18 U.S. Code Section 1030). Prohibited behaviors under this act include:
- Accessing a computer without authorization and obtaining information that the U.S. government has declared to be protected for reasons of national defense or foreign relations.
- Accessing a computer without authorization and obtaining information from any protected computer or any information from a department or agency of the United States.
- Accessing a computer to obtain information from a financial record, from a financial institution, from a card issuer, or contained in a file of a consumer reporting agency.
- Intentionally accessing a nonpublic computer of a department or agency that is exclusively for government use.
- Knowingly, and with the intent to defraud, accessing a protected computer without authorization in order to further a fraud and/or to obtain something of value.
- Knowingly causing harm or damage to a protected computer through the transfer of a program, information, code, or command.
- Knowingly trafficking in passwords or similar information to make accessing a computer possible, with the intent to defraud. The computer must be used by or for the government, or the trafficking must affect interstate commerce for you to face federal charges.
- Making threats to obtain protected information or damage a computer in order to extort something of value, if interstate commerce is affected
Depending upon the nature of the Internet scams, you may also be charged with an offense under:
- 18 U.S. Code Section 2028, which prohibits fraud in connection with identification documents, authentication features, and information
- 18 U.S. Code Section 1029, which prohibits producing, using, and trafficking in counterfeit access devices.
- 18 U.S. Code Section 1343, which criminalizes fraud using wire, radio, or television communications.
- 18 U.S. Code Section 2511, which makes it a crime to intercept, or try to intercept, oral, wire, or electronic communications.
- 18 U.S. Code Section 2701, which prohibits intentionally accessing store communications or intentionally accessing a facility where electronic communication service is provided in order to obtain, alter, or prevent unauthorized access to a wire or communication.
General federal fraud laws and New York fraud laws may also apply to online fraud. In many cases, a single act of Internet crime could potentially give rise to myriad federal and state charges. The different charges that you face will depend upon the type of online fraud you are accused of committing.
Internet Banking Fraud
Internet banking fraud has become increasingly common as banks move away from branch banking and move more functionality online. Internet banking fraud can take myriad forms, but typically starts with phishing to obtain account information from customers. Email and telephone scams can be used to obtain pin numbers, login information for online banking, and account numbers. Once account information or login information has been obtained, money can be transferred out of the customers account.
Internet banking fraud can lead not only to charges for computer crimes, but also for other offenses including:
- Wire fraud: If you used a telephone service or other wire communications to obtain account information, you may be charged with wire fraud under 18 U.S. Code Section 1343. A first offense for a single count of wire fraud can result in a term of incarceration up to 20 years.
- Bank fraud: Bank fraud can result in a term of imprisonment as long as 30 years, as well as a fine up to $1,000,000 under 18 U.S. Code Section 1344. In Loughrin United States, the court ruled that you could be charged with bank fraud if one objective of your actions was to obtain funds from a financial institution. Accessing bank information and diverting funds from an online account could fall within the definition of bank fraud.
Internet bank fraud offenses are common crimes, and with banks reporting more than $11 billion each year in fraudulent transactions.
Prosecutors are aggressive at going after defendants who may have committed bank fraud offenses. It is important to be represented by an experienced bank fraud lawyer who can help you to respond to an investigation or try to avoid conviction for serious criminal offenses.
Internet Identity Fraud
Cyber identity fraud is another common type of online fraud. Internet identity fraud usually involves using phishing websites or email scams in order to obtain personal identifying information from online web users. The information may be used to obtain credits or secure benefits or services. Personal identifying information obtained through online fraud can also be sold.
The Identity Theft and Assumption Deterrence Act of 1988 imposed tough new penalties for identity theft offenses, which were previously prosecuted under statutes prohibiting false personification. The Identity Theft Assumption and Deterrence Act amended 18 U.S.C. Section 1028, which prohibits fraud in connection with identification documents. Under the amended law, it became a federal crime to knowingly transfer or use any means of identification without lawful authority to do so in order to commit, aid, or abet an unlawful act.
Penalties for identity theft can include 15-years imprisonment and substantial monetary fines. The offense is an offense against the victim whose identity was stolen, and you can be charged for each person whose identifying information was taken and/or for each instance in which unlawful identifying information was used in connection with an unlawful act.
Internet Auction Fraud
Online auction fraud generally involves fraud schemes on eBay, although you can also be charged with this offense for crimes related to other online auction services as well. Internet auction fraud can include:
- Shill bidding: Shill bidding is having someone bid on an item in order to artificially inflate the price, with no intention of purchasing that item. Bidding on your own items or having others bid on those items, can constitute Internet auction fraud.
- Bid shielding: Bid shielding involves placing a low bid on an online auction and then having another buyer enter a very high bid to discourage other people from bidding. Just before the action closes, the high bid is withdrawn, and the auction is won for the low bid amount.
- Misrepresentation: Providing dishonest material facts about items for sale at online auctions, such as pretending that forged art is actually authentic art.
- Credit card fraud: Bidding on and purchasing items at auction using stolen credit card information or using a credit card without valid authorization.
These and other methods of Internet auction fraud can result in charges for computer crimes, wire fraud, postal fraud, and myriad other federal and state offenses. Your actions may also be considered a violation of the Federal Trade Commission Act. 15 U.S. Code Section 45 empowered the Federal Trade Commission to take action against unfair methods of competition or unfair deceptive acts affecting commerce. The FTC can pursue civil and criminal remedies, and you could face significant fines even for relatively minor instances of online auction fraud.
Internet Sales Fraud
Internet sales fraud may include misrepresenting products that are for sale, selling counterfeit products, selling stolen products, or failing to deliver the promised merchandise or rebate. Internet sales fraud may also be used to obtain personal identifying information. A consumer could be offered a product at very favorable terms on a legitimate website and then asked to complete a transaction at an alternate site. When the buyer goes to the new site, his personal identifying information could be collected.
Internet sales fraud can result in similar sanctions to Internet auction fraud, as the FTC can also pursue unfair competition cases and cases involving deceptive acts that affect commerce. If the sales fraud was used to obtain identifying information, bank information, or credit card details for use in an identity theft crime, you could also face charges for identity theft and bank fraud.
Internet Dating Fraud
Dating scam typically takes the form of creating a false online dating profile in order to gain someone’s trust and then begin asking for money and gifts. It is also possible to become involved in an Internet dating scam that involves obtaining someone’s personal identifying information and misusing that information as part of an unlawful act. Reshipping scams, which involve sending materials paid for by a stolen credit card to the person you are “dating” and then having them sent to your address can also be a form of Internet dating fraud.
Depending upon the nature of the Internet dating fraud, criminal charges may include computer crimes charges; identity theft or criminal impersonation; wire fraud; mail fraud; theft; dealing in stolen property; and bank fraud.
Prosecution of Internet Crime
The Federal Trade Commission has created a consumer complaint database called Consumer Sentinel that collects information from more than 150 organizations including the FBI and the Internet Crime Complaint Center and makes this information available to law enforcement nationwide. Some of the different types of Internet fraud behaviors that the FTC and other federal agencies may investigate include
- Internet identity fraud
- Internet auction fraud
- Advance-Fee loan cyber scams
- Lotteries, sweepstakes, and prizes
- Work-at-home schemes or Internet job scams
- Internet banking fraud
- Internet marketing scams
The Cyber Crime Commission and other local and state organizations within New York are also dedicated to investigating Internet scams and cyber crime.
If you are suspected of violating computer access laws or online fraud laws, you could find yourself facing investigation by myriad state and local agencies.
You have the right not to incriminate yourself and the right to a fair trial. An Internet fraud lawyer will help you to protect your freedom by defending against charges.
How Online Fraud Lawyers Can Help
An Internet crime lawyer will help you explore defenses and options for responding to allegations of Internet fraud. Available defenses depend upon the type of offense you have been accused of committing as well as the type of evidence that prosectors have to use against you. You could potentially avoid conviction in a number of ways:
- If an illegal search turned up evidence on your computer or in your home, your attorney can fight to keep the information out of court. Without this evidence that you committed a computer crime or any type of Internet fraud offense, a prosecutor cannot make a case against you.
- A prosecutor may have insufficient proof of intent or insufficient proof of your participation in an online fraud scam.
- Your identity may have been mistaken for someone else’s, or someone else may have used your computer system or online credentials to commit fraud offenses.
If your defense attorney can successfully help you to prove a defense or introduce doubt into the prosecutor’s case against you, you should not be convicted of Internet fraud. Avoiding conviction allows you to keep a clean record, stay out of jail, and avoid significant financial loss associated with paying restitution and fines.
In some cases, negotiating a plea bargain is also an option in Internet fraud cases if you do not wish to plead not guilty and take a chance on a court trial. Your attorney may be able to help you reduce the severity of charges and penalties.
To learn more about how Internet fraud lawyers can help, call an attorney today .
