Public Corruption and the Limits of Federal Fraud Statutes, CRS Legal Sidebar LSB11025

Over time, Congress has shown consistent interest in policing public-sector corruption, enacting a number of criminal provisions aimed at holding corrupt officials and those who entice them accountable for their actions under federal law. Federal prosecutors’ most potent existing tools for combating such corruption include the federal mail and wire fraud statutes and a provision defining those crimes as including so called “honest services” fraud. This Sidebar provides an overview of the federal mail and wire fraud statutes and the development and codification of the “honest services” theory of fraud; surveys some of the major Supreme Court decisions limiting the reach of those statutes; and explores some considerations for Congress.

In summary, the mail and wire fraud statutes have been a source of contention between the courts and Congress for years. While Congress has passed broadly worded legislation to cover the self-interested actions of federal, state, and local officials, among others, the Supreme Court has repeatedly adopted narrow interpretations of the statutes, at times signaling that broad constructions could raise constitutional concerns about vagueness or federalism.

This trend continued in two cases the Supreme Court decided in May 2023—Ciminelli v. United States and Percoco v. United States. In those cases, the Court reversed two wire-fraud convictions: Ciminelli involved bid-rigging to obtain state-funded development projects, and Percoco involved bribery to assist a real-estate development company in its dealings with a state agency. The Court in both cases rejected statutory interpretations used by the lower courts that it viewed as “too vague” or as “vastly expand[ing] federal jurisdiction” to “an almost limitless variety of deceptive actions traditionally left to state . . . law.”

Public Corruption and the Limits of Federal Fraud Statutes,” CRS Legal Sidebar LSB11025, August 21, 2023 (7-page PDF)

Also see
– “The seven stages of the office seeker
Crony Capitalism / Rent-Seeking / Corporate Welfare / Revolving Door (