what is honest services fraud

what is honest services fraud

1 year ago 62
Nature

Honest services fraud is a crime defined in 18 U.S.C. ยง 1346, added by the United States Congress in 1988. It is a scheme or artifice to defraud another of the intangible right to honest services through a scheme to violate a fiduciary duty by bribery or kickbacks. The term "honest services" refers to the duty of an individual to provide services honestly and impartially, without conflicts of interest or self-dealing. Honest services fraud can be committed by public officials, corporate officers, and private individuals with fiduciary duties to another person or entity.

To prove honest services fraud, the prosecutor must show that there was a scheme or artifice in place intending to defraud others, that it was meant to deny them "the intangible right of honest services," and that it was reasonably foreseeable that the scheme or artifice could cause more than de minimis monetary harm to the victim or victims, even if it did not. The court has the discretion to decide what "honest services" are in each instance, and since there are no hard and set rules, an experienced criminal defense attorney can be priceless to those accused of honest services fraud.

Honest services fraud is generally more easily proven in the public sphere than in the private, because honest services fraud by public officials can include most unethical conduct, whereas honest services fraud by private individuals only includes some unethical conduct. The statute grants jurisdiction to the federal government to prosecute local, state, and federal officials, and it is frequently used to fight public corruption because it is easier to prove than bribery or extortion. If convicted of honest services fraud, an individual can face up to 20 years in prison and sometimes up to 30 years, along with a fine of up to $250,000 for individuals, and three years of supervised release.

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