Business email compromise (BEC) is a growing cybercrime that targets companies and individuals, often leading to serious legal consequences, including wire fraud charges. In BEC schemes, attackers gain access to or impersonate legitimate business email accounts to trick individuals into authorizing fraudulent wire transfers or revealing sensitive financial information. These schemes are costly for businesses and can result in criminal charges for those involved.
At Griffin Durham Tanner & Clarkson LLC, our Atlanta wire fraud defense lawyers specialize in defending individuals and businesses facing fraud-related charges, including wire fraud that arises from business email compromise cases. In this blog, we’ll explore how BEC schemes work, the legal implications of wire fraud, and how our firm can help defend against these serious allegations.
Common types of BEC schemes
Common types of BEC schemes include:
- CEO fraud: Attackers impersonate executives, instructing employees to transfer funds to fraudulent accounts.
- Vendor/Invoice fraud: Criminals intercept legitimate email communications between businesses and suppliers, altering invoice payment details to divert funds.
- Account compromise: Hackers access a company’s email system and use it to request fraudulent wire transfers from vendors or customers.
How business email compromise leads to wire fraud charges
Wire fraud is a federal crime that involves using electronic communication—such as email or phone calls—to defraud someone of money or property. Under 18 U.S.C. § 1343, wire fraud occurs when someone uses interstate wire communications, such as emails, to further fraudulent schemes. When business email compromise is used to trick victims into transferring funds or divulging sensitive information, it directly ties into wire fraud.
Here’s how BEC can escalate into wire fraud charges:
- Use of electronic communication: In BEC schemes, email is the primary tool used to perpetrate fraud, which qualifies as wire communication under federal law.
- Intent to defraud: Prosecutors must demonstrate that the perpetrator intended to deceive the victim and secure financial gain through false pretenses.
- Loss of money or property: The crime becomes wire fraud when victims are tricked into wiring money to fraudulent accounts.
In white-collar crime cases like this, wire fraud charges are often severe and carry significant penalties, including up to 20 years in prison and heavy fines. The involvement of BEC schemes only intensifies the legal complexity, as these cases typically involve multiple jurisdictions, international entities, and digital evidence.
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Federal and Georgia statutes related to wire fraud
Wire fraud is prosecuted under 18 U.S.C. § 1343, which defines wire fraud as any scheme to defraud that involves wire, radio, or television communication across state lines. If convicted of wire fraud, individuals can face steep penalties, including fines, restitution, and imprisonment of up to 20 years. If the fraud involves a financial institution or federal disaster relief, the sentence can be even harsher, with prison terms of up to 30 years.
In Georgia, the Racketeer Influenced and Corrupt Organizations Act (O.C.G.A. § 16-14-1), also known as RICO, can be used to prosecute fraud cases involving a pattern of criminal activity, such as multiple BEC scams. The state’s RICO statute is designed to combat organized crime and allows for additional penalties if BEC schemes are part of a broader criminal enterprise.
Both state and federal authorities take business email compromise and related wire fraud cases seriously, and these charges can result in aggressive prosecution.
Consequences of business email compromise and wire fraud charges
The financial and legal fallout from BEC-related wire fraud cases can be devastating. Companies that fall victim to these schemes can lose large sums of money, suffer reputational damage, and face legal action from affected clients or partners. Meanwhile, individuals implicated in these schemes, whether knowingly or unknowingly, may face severe criminal charges.
Potential consequences of a wire fraud conviction include:
- Prison time: As mentioned, wire fraud can result in up to 20 years of imprisonment, with enhanced penalties if the scheme involves a financial institution.
- Financial penalties: Fines can be significant, potentially reaching hundreds of thousands of dollars, along with restitution to victims.
- Civil lawsuits: Companies or individuals harmed by BEC schemes may file civil lawsuits against those responsible, further complicating the legal situation.
How to protect your business from business email compromise
While defending against wire fraud charges is critical, preventing business email compromise in the first place is the best course of action. Companies should implement strong cybersecurity practices to safeguard their communications and protect sensitive financial data.
Best practices include:
- Training employees: Regularly educate employees about BEC schemes and how to recognize phishing emails or suspicious requests for wire transfers.
- Implementing verification procedures: Always confirm payment requests or changes in bank account information with a phone call or in-person verification.
- Using multi-factor authentication: Securing email accounts with multi-factor authentication (MFA) can prevent unauthorized access by cybercriminals.
- Monitoring financial transactions: Keep a close eye on financial transactions and quickly investigate any irregularities.
By taking proactive steps, businesses can significantly reduce the risk of falling victim to business email compromise and avoid the associated legal risks.
Defending against business email compromise and wire fraud charges
Facing wire fraud charges related to business email compromise is a serious matter that requires expert legal representation. At Griffin Durham Tanner & Clarkson LLC, we have extensive experience in defending clients against white-collar crime allegations, including wire fraud. Our team is skilled at handling the unique challenges that BEC cases present, including digital evidence and complex financial transactions.
Our defense strategies include:
- Challenging the evidence: BEC cases often involve complicated digital forensics. We work with experts to scrutinize the electronic evidence and challenge its admissibility or accuracy.
- Proving lack of intent: Wire fraud requires proof of intent to defraud. In some cases, defendants may not have knowingly participated in the fraudulent scheme. We work to demonstrate our clients’ lack of intent or awareness of the scheme.
- Negotiating with prosecutors: When appropriate, we negotiate with prosecutors to reduce charges or seek alternative penalties, such as probation or restitution, rather than imprisonment.
If you are facing allegations of business email compromise or wire fraud, contact us today at (404) 891-9150 to discuss your case and how we can help defend your rights.