Conspiracy to Commit Fraud: Why You’re Charged Even If You Didn’t Profit

Being charged with fraud is serious enough. But many people are shocked to learn they can face federal felony charges for conspiracy to commit fraud, even if they didn’t personally receive any money, never submitted a claim, and never intended for the scheme to succeed. In federal court, just being part of an agreement to commit fraud—whether in healthcare, banking, taxes, or business—is enough to trigger severe penalties.

At Perlman Defense Federal Criminal Lawyers, we regularly defend clients who have been swept into conspiracy indictments. Often, these individuals had peripheral roles or were unaware of the full scope of the alleged scheme. But under federal law, conspiracy charges allow prosecutors to cast a wide net—and they are frequently used as leverage to secure guilty pleas and pressure co-defendants into cooperation.

This article will explain how federal conspiracy law works, what the government must prove in fraud-related conspiracy cases, and how our team builds effective defenses to protect our clients’ freedom and future.

What Is a Fraud Conspiracy Under Federal Law?

Federal conspiracy charges are based on 18 U.S.C. § 371, which makes it a crime for two or more people to agree to commit a federal offense—such as mail fraud, wire fraud, bank fraud, or healthcare fraud—and to take any overt act in furtherance of that agreement. The government does not need to prove the fraud was successful, only that the agreement existed and someone tried to carry it out.

In addition to § 371, other conspiracy statutes apply depending on the type of fraud involved:

• 18 U.S.C. § 1349 – Conspiracy to commit wire, mail, bank, or securities fraud
  
• 18 U.S.C. § 286 – Conspiracy to defraud the government with false claims
  
• 21 U.S.C. § 846 – Conspiracy in drug-related financial fraud
  
• 18 U.S.C. § 1956(h) – Conspiracy to commit money laundering
  

In all of these statutes, conspiracy is treated as a standalone crime. That means you can be convicted—and sentenced—regardless of whether the underlying fraud ever occurred.

What the Government Must Prove in a Fraud Conspiracy Case

To convict someone of conspiracy to commit fraud, federal prosecutors must prove the following elements:

1. There was an agreement between two or more people to commit fraud
   
2. The defendant knowingly and voluntarily joined that agreement
   
3. At least one person committed an overt act in furtherance of the scheme (for general conspiracy under § 371)
   

Let’s break that down.

Agreement
There doesn’t have to be a formal contract or even a detailed plan. The “agreement” can be inferred from conversations, conduct, or coordination—like emails, text messages, or mutual actions that show shared intent.

Knowledge and Voluntary Participation
The government must prove that you knew about the fraud and joined the conspiracy intentionally. Even if you played a small role—such as opening a bank account, managing communications, or submitting a form—you can be charged if the government believes you knew what you were participating in.

Overt Act
For general conspiracy under 18 U.S.C. § 371, at least one overt act must be committed to move the plan forward. This doesn’t have to be criminal itself. For example:

• Sending an email to coordinate
  
• Mailing an invoice
  
• Registering a shell company
  
• Making a phone call
  

Note: For many fraud-related conspiracies under § 1349, no overt act is required—only the agreement and intent.

Why the Government Loves Conspiracy Charges

Conspiracy charges are a favorite tool of federal prosecutors. That’s because they make cases easier to build and harder to defend. Here's why:

1. Lower Burden of Proof
Prosecutors don’t have to prove the fraud was successful—just that you agreed to try. Even failed attempts or vague associations can result in charges.

2. Expanded Evidence Rules
The government can introduce evidence that would normally be inadmissible—like hearsay—under the co-conspirator exception. That means emails or texts from other people in the group may be used against you.

3. Group Liability
Each member of the conspiracy can be held responsible for the foreseeable acts of others. So if someone else committed an overt act—like submitting false claims—you could be punished as if you did it yourself.

4. Intimidation Tactic
Conspiracy charges are often used to pressure people into cooperating, testifying, or pleading guilty—even if they had a minor role.

Real-World Examples of Conspiracy to Commit Fraud

Some typical scenarios where conspiracy to commit fraud charges are filed include:

• A medical clinic where the office manager is charged along with doctors and billers for participating in a scheme to defraud Medicare—even if the manager didn’t submit the claims themselves.
  
• An employee at a financial firm who followed instructions to process questionable transactions is charged for participating in a wire fraud conspiracy—even if they didn’t personally benefit.
  
• A business owner who accepted payment for referring patients to a diagnostic lab is indicted for a kickback conspiracy—even if the services were legitimate.
  

In each case, the key allegation is that the person knew about the fraud and intended to help it succeed, regardless of their actual profit or level of involvement.

Penalties for Conspiracy to Commit Fraud

Federal conspiracy convictions come with serious consequences. Sentencing depends on the specific fraud involved, the amount of financial loss, and your role in the conspiracy.

• Conspiracy under § 371: Up to 5 years in prison
  
• Conspiracy under § 1349 (mail/wire/bank/securities fraud): Up to 20 or 30 years depending on the offense
  
• Fines: Up to $250,000 per count for individuals
  
• Restitution: Mandatory repayment to victims or the government
  
• Asset forfeiture: Seizure of funds or property linked to the scheme
  
• Supervised release: Typically 3 years after incarceration
  
• Collateral consequences: Loss of professional licenses, immigration consequences for non-citizens, and a permanent federal felony record
  

Many conspiracy indictments involve multiple counts—so even if you’re charged with “just one” conspiracy, you may face decades of potential exposure.

How Perlman Defense Defends Fraud Conspiracy Cases

At Perlman Defense Federal Criminal Lawyers, we believe that a charge is not a conviction—and that every element of the government’s case must be challenged. In fraud conspiracy cases, we use multiple strategies:

1. Challenging the Agreement
We argue that no actual agreement existed or that our client was never part of it. Mere association is not enough to prove a conspiracy.

2. Disputing Knowledge or Intent
We present evidence showing that our client did not know the fraudulent nature of the plan—or was misled by others. Many employees simply followed instructions without criminal intent.

3. Severing from Co-Defendants
We may move to sever our client from co-defendants to prevent “guilt by association” or prejudicial spillover from others' actions.

4. Suppressing Illegally Obtained Evidence
We investigate how the government gathered its evidence. If emails, financial records, or surveillance data were obtained without proper warrants, we move to suppress them.

5. Undermining the Overt Act
If the conspiracy requires an overt act, we show that the alleged action was unrelated, insufficient, or not connected to our client.

6. Negotiating Pretrial or Pre-Indictment Resolutions
When appropriate, we work to reduce charges, avoid indictments, or negotiate plea deals that minimize sentencing exposure and avoid mandatory prison time.

What to Do If You're Under Investigation

If you’ve received a target letter, a grand jury subpoena, or suspect you’re under federal investigation for fraud, take these steps immediately:

• Do not speak to agents or investigators without your lawyer
  
• Do not discuss the case with co-workers or other parties
  
• Preserve all communications and records—but do not alter anything
  
• Hire a federal criminal defense attorney with experience in conspiracy cases
  
• Avoid social media posts or public comments about your case
  

Your early decisions can make the difference between indictment and resolution.

Contact Perlman Defense Federal Criminal Lawyers Today

Being charged with conspiracy to commit fraud is not a minor legal issue. It’s a federal felony that can destroy your reputation, your finances, and your future. But you’re not powerless—and you don’t have to go through it alone.

At Perlman Defense Federal Criminal Lawyers, we’ve successfully defended clients in high-profile, high-stakes federal conspiracy cases. We understand how these indictments are built—and how to fight back.

Let’s get started today.