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Rapid Response Team: 0800 559 3500
Switchboard: +44 (0)203 947 1539
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Rapid Response Team: 0800 559 3500
Switchboard: +44 (0)203 947 1539
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Business crime specialists Rahman Ravelli examines for Fraud Intelligence the Department of Justice’s approach to wire fraud in relation to spoofing

20 January 2021

Posted in: Market Manipulation.

The offence of wire fraud has been used extensively by US federal prosecutors. Rahman Ravelli wrote an article questioning whether applying it to spoofing cases is going too far.

In an article, published by Fraud Intelligence, Rahman Ravelli details the federal wire fraud statute prohibiting “any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises” via an electronic communication.

They argue that the wording of the statute means that it can be applied to a wide range of behaviour. Rahman Ravelli also emphasises that the Department of Justice (DOJ) has been criticised for trying to “stretch the reach” of the wire fraud statute.

In their article, they assessed the US government’s attempts to secure convictions using the wire fraud statute, even when there was no direct financial harm done (or intended) to the victim. In cases brought under the controversial “right to control” wire fraud theory, the government has pushed for criminal convictions although the alleged scheme did not - and was not created to - cause direct financial injury to the purported victim.

The government’s typical allegation in such cases is that a defendant withheld or misstated “information that could impact on economic decisions” and could, therefore, deprive a victim of their “right to control” their own assets. Rahman Ravelli considers a number of such cases and the strength of prosecution arguments.

The article featured on Fraud Intelligence

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