A financial adviser was sentenced to 10 years in prison and ordered to make $2.9 Million in restitution because his emails that furthered his activities were transmitted over state lines, thereby constituting federal wire fraud. The SEC alleged that the defendant used cross-border emails and a web-based portal to provide false account statements and Ponzi-like payments. The SEC asserts that he misappropriated client funds by stealing their checks and depositing them into his bank account. The U.S. Attorney brought a criminal indictment against him for wire fraud based on the emails.
OUR TAKE: Federal wire fraud crime carries big prison and financial penalties. In this case, the U.S. Attorney leveraged the SEC charges into a federal conviction based on his cross-state emails.