In a case that flew beneath the radar last year, a district court judge in D.C. dismissed a federal indictment against a government employee charged with wire fraud and obstruction after finding both statutes were applied too broadly in the case.
Paul Guertin was a Foreign Service Officer with the State Department when he allegedly lied on a background check form and interview as part of his security-clearance renewal. The Government charged him based on his alleged failure to disclose information about an inappropriate sexual relationship he had with a visa applicant, his gambling activity, and a loan agreement with foreign nationals.
The Government’s theory for wire fraud was that Guertin defrauded the government through these omissions, as the government would have fired him, and stopped paying him, had he told the truth. The district court rejected this basis for prosecuting wire fraud, however, holding that the “plain meaning of § 1343 and Supreme Court precedent both point to the same conclusion—a scheme to “maintain” a pre-existing salary cannot support a wire-fraud conviction.” The court noted the statute for wire fraud contains the word “obtain,” not maintain.
The court also dismissed the obstruction charge, holding that an “informal, routine agency action like clearance-adjudication, or here a “security-clearance process,” was not an “official proceeding” or “a proceeding before a Federal Government agency” under 18 U.S.C. 1512(c)(2) and 1515(a)(1)(A).
The court’s narrower reading of these notoriously overbroad statutes is an important development in federal government theft and fraud cases, especially if other district courts follow suit. Our firm has represented several government employees who were charged with wire fraud based on this exact kind of alleged conduct—the government claims they lied to get keep their salary (or sometimes get hired) and then it charges the case as fraud.
But lying and defrauding are not the same, as the court in Guertin’s case rightly recognized. Like the defendants did in the case above, our firm can prepare an aggressive defense to wire fraud charges in the government employment context based on using the language of the wire fraud statute to our clients’ advantage.
Call our firm if you or a loved one has been accused of wire fraud or other economic federal crimes in connection with government employment. We will fight hard for you.