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On January 4th, 2022, Elizabeth Holmes was found guilty on three accounts of wire fraud (plus a conspiracy).

The concept strikes me as odd: Why would the communication medium make a difference in the case of fraud? Whether I mail a letter (mail fraud per 18 U.S.C. § 1341), send an email (wire fraud per 18 U.S.C. § 1343, even if no wire whatsoever may be involved) or use a bush drum (none of the above): The fraudulent intent, act and damage is the same, hence the punishment should be the same.

Why this oddity of paying attention to the medium?

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The law as you see it today is the product of its history. 18 USC 1343 descends from the Communications Act of 1934 which created the FCC, as an amendment to an existing law that regulated wire and broadcast communications is criminalizing acts which take place in this newly carved-out chunk of federal authority, "by means of wire, radio, or television communication in interstate or foreign commerce". Previously, the federal government had carved out authority to criminalize mail fraud. The original purpose of the act that led to 18 USC 1343 is precisely "the medium", and as an amendment to that law, the medium is essential.

Of course Congress could have thought "maybe we should gather together all of the federal laws pertaining to fraud and and have just a single law", but that is a burdensome political process. Instead, what typically happens is that the original substance of laws remains in place, until a compelling reason emerges to substantially revise the law.

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  • Well, even that process seems odd. Fraud by other means than mail or "wire" is certainly a criminal offense as well, just on the respective state level. Why was it deemed necessary to have an additional federal law just because somebody chooses to use the USPS instead of, say, the Pony Express? Why establish a competing federal law? I understand that the federal government wants to protect the USPS infrastructure, that is, prevent attacks on human and material resources and prevent mail theft. But making a special law for using the USPS (or a "wire") for fraud?
    – Peter - Reinstate Monica
    Commented Jan 4, 2022 at 13:19
  • @Peter-ReinstateMonica Perhaps state investigators were found not to be in a position to pursue fraudsters who were active in interstate or foreign commerce.
    – phoog
    Commented Jan 4, 2022 at 13:34
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The medium is the source of Congress’s power to create a federal offence. The Commerce Clause gives Congress the power “To regulate Commerce with foreign Nations, and among the several States.” So, the wire fraud statute prohibits frauds committed “by means of false or fraudulent pretenses, representations, or promises … transmitted by means of wire, radio, or television communication in interstate or foreign commerce.”

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  • Whether a fraud is interstate or foreign is in principle orthogonal to the medium used. Sure, the use of mail and wire is most likely highly correlated with interstate fraud, but again: Why the focus on the medium? If Holmes lured investors from state A to invest in her company in state B it does not matter much whether she convinced them in person, by private courier dispatches or however else. I mean, the same act is a federal crime if the letter was mailed, but not if it is sent by courier?
    – Peter - Reinstate Monica
    Commented Jan 4, 2022 at 4:38
  • Additionally it is odd and quirky to use the mail/wire thing as a handle to make something a federal crime. What if the federal government could only regulate alcohol? Would it be only fraud if drinks were consumed during the conversation? If there is a pressing perceived need to make something a federal crime congress should be given the proper authority.
    – Peter - Reinstate Monica
    Commented Jan 4, 2022 at 4:52
  • @Peter-ReinstateMonica "If there is a pressing perceived need to make something a federal crime congress should be given the proper authority": congress was given that authority.
    – phoog
    Commented Jan 4, 2022 at 13:44
  • @phoog Oh, I didn't make myself clear: With "something" I meant (general) "fraud". The effect of this wire and mail fraud law is that virtually any interstate fraud today is prosecutable under this law because especially (non-)"wire" media are ubiquitous these days. So the effect of this law is to create a backdoor that makes virtually all interstate fraud a federal offense because virtually all of them involve an email or phone call -- something that was not the case in 1934. That authority to criminalize all fraud though has never been granted to congress, apparently....
    – Peter - Reinstate Monica
    Commented Jan 4, 2022 at 13:58
  • @phoog Or maybe it has been granted, and then it should be used to explicitly criminalize interstate fraud per se, not only per "wire" or mail.
    – Peter - Reinstate Monica
    Commented Jan 4, 2022 at 13:59

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