White Collar Defense Attorney for Travis County and Federal Courts
Police and prosecutors in Travis county and Austin federal courts take white collar crimes very seriously. White collar crime refers to non-violent crimes, which are often thought of as being committed in business settings by individuals, groups, or corporations for the purpose of financial gain. These crimes usually involve a fraudulent exchange or demand of money, and nowadays we frequently see computers and the Internet being used as part of the offense. White collar crimes can be prosecuted by state or federal authorities, depending on whether a state or federal law was broken, and where the investigation was originated. There is often significant overlap between the actions that can be prosecuted by state and federal white collar prosecutors, but federal prosecutors usually have more freedom to pick and choose what cases they accept.
Prosecutors in Travis county handle cases not just in Austin and the surrounding areas, but because Austin is the state capital they sometimes have statewide jurisdiction over unexpected matters. Many regulatory violations, including banking violations, securities violations and tax violations are prosecuted out of the white collar division of the Travis county DA's office.
White collar crimes are also not just limited to ‘professionals' anymore. Hacking and computer virus attacks are some examples of "white collar" crime that may involve teens and college-age kids. Something that started out as “fun” may have gotten out of control and became destructive. Computer hacking may lead to unauthorized access into protected computer systems, and even if these actions were not taken for financial gain, if detected by the authorities they can lead to a criminal investigation or prosecution.
If you or someone you know has been arrested for a white collar crime, you must hire a criminal attorney to craft a creative and strategic defense. Georgetown, Tx Board Certified Criminal Lawyer Russ Hunt Jr. always strives to provide quality criminal attorney representation in Williamson county, Travis county, and throughout the Central Texas area.
A White collar criminal charge can cause serious defamation of your reputation and character. You must get the criminal defense representation that you need to fight for your rights and help you to protect your reputation.
White Collar Defense Lawyer FAQ's
- Bank Fraud
- Blackmail and Extortion
- Bribery and Kickbacks
- Builder and Construction Fraud
- Computer and Cell Phone Fraud
- Counterfeiting and Forgery
- Credit and Debit Card Fraud
- Health Care Fraud
- Insurance Fraud
- Investment Fraud
- Money Laundering
- Nigerian Fraud Cases
- Securities Fraud and Insider Trading
- Tax Evasion
- Welfare Fraud
A broad range of federal and state agencies investigate fraud and other white collar crimes. A few of the law enforcement agencies that investigate white collar crimes in Williamson county and Travis county are: the Texas Attorney General's office, the Travis County District Attorney's Office who investigates fraud committed on many state agencies across the state, the U.S. Attorney's office, the FBI (Federal Bureau of Investigation), the SEC (Securities and Exchange Commission), the IRS, and the United States Secret Service.
There is a great amount of overlap in the prosecution of white collar cases. Many white collar cases can be prosecuted in either state or federal court. Because white collar cases tend to be complex and paper-intensive, they tend to be investigated by more specialized investigators with experience and training in dealing with financial matters. State court cases tend to deal with matters of more local importance like credit card abuse or a local fraudulent scheme. Federal court prosecutors tend to be choosy about what types of cases they take, and these cases are more likely to deal with specialized matters like health care fraud, tax evasion, interstate frauds or money laundering, and matters that have a broader, rather than purely local importance.
Why doesn't Texas have more specific laws defining white collar crimes like embezzlement, extortion, etc?
The Texas Penal code specifically defines theft as "unlawfully appropriating" anything belonging to another. This is a very broad definition, so the penal code indicates that it includes many former offenses without specifically spelling them out as separate offenses. From Penal code section 31.02:
Theft as defined in Section 31.03 constitutes a single offense superseding the separate offenses previously known as theft, theft by false pretext, conversion by a bailee, theft from the person, shoplifting, acquisition of property by threat, swindling, swindling by worthless check, embezzlement, extortion, receiving or concealing embezzled property, and receiving or concealing stolen property.
Thus, in Texas the general consideration is simply whether the property was obtained wrongfully, as in by threat or misrepresentation.
White Collar crimes are generally non-violent financial crimes that involve theft, lies or some form of misappropriation. They can also involve certain types of unauthorized computer network access. Extortion is thought of as a white collar crime, even though it can involve the threat of physical harm. White collar crimes can be investigated by agencies with narrow investigative missions, like the IRS or bank examiners, in more complex and specialized white collar areas which may have complicated statutes governing certain industries, and due to what can be the highly complex and specialized nature of the investigations.
Some common white collar crimes are described briefly below.
Bank Fraud is defined by18 U.S. Code section 1344 which requires the proof of a scheme to defraud a bank. It can also be used to prosecute a person who has fraudulently posed as a bank or other financial institution in order to divert the funds that should be deposited into that financial institution.
Blackmail and extortion are closely related offenses involving threats to do or say something unless the target of the threats confers some benefit on the threatener. Blackmail generally refers to threatening to embarrass or expose a person to criminal prosecution unless they pay off the threatener in some way. Extortion generally involves threats of violence or the misuse of official power against an individual. Texas laws incorporate blackmail and extoration into the general theft statute.
Blackmail in the federal law is defined by 18 U.S. Code § 873 which prohibits a person from demanding or receiving any money or other valuable thing, under a threat of informing, or as a consideration for not informing, against any violation of any law of the United States. So under federal law, a person cannot attempt to get money from someone by threatening to inform police of their law violations.
Extortion in the federal law is defined in 18 U.S. Code Section 31.03 which generally prohibits a person in an official or government capacity from obtaining property from another person by actual or threatened force, fear, or violence, or by misusing their office.
Bribery and kickbacks are closely related offenses. Bribery involves paying or offering to pay someone in an official capacity for a specific favor; kickbacks generally involve paying someone in charge of awarding a contract for favorable treatment in awarding the contract.
Chapter 36 of the Texas Penal Code deals with a range of bribery and undue influence offenses. Bribery occurs when a person accepts, proposes or offers a bribe both the person offering the bribe and the person accepting the bribe can be prosecuted. The central requirement for bribery is that there be a "quid pro quo" or a specific benefit in exchange for some payment. General campaign donations are to far removed from official action to qualify as bribery.
Federal statutes prohibit various types of bribery offenses; 18 U.S. Code Section 201 deals with bribing public officials and involves offering something of value to influence an act of the public official. This statute also prohibits paying witnesses in official proceedings for favorable testimony, although there is a specific exception for the payment of expert witnesses's fees.
Federal statutes also prohibit the payment of kickbacks in federal contracts, and prohibit the payment of kickbacks in Federal health care programs. The anti-kickback act requires a person to knowingly and willfully engage in the prohibited conduct to violate the statute.
Texas Property Code section 162 requires building contractors accepting written contracts to work on a residential property to deposit funds received for the construction work in a special trust fund or "construction account" in a financial institution. If the funds are not deposited in such an account or if they are diverted in some way, this is a third degree felony if the amount of loss is greater than $500.00. Home builders and contractors have been known to declare bankruptcy and leave homebuyers or homeowners holding the bag with uncompleted projects because they did not adequately safeguard unearned construction trust funds. Here is a news story from 2017 detailing a large homebuilder declaring bankruptcy and leaving million-dollar homeowners high and dry. Criminal prosecutors are generally interested in making homeowners whole and putting builders on restitution payment plans, rather than sending them to prison. Criminal restitution orders also cannot be discharged in bankruptcy.
The federal offense of computer fraud is defined in 18 U.S. Code Section 1030, and generally prohibits accessing protected computer systems and networks, trafficking in stolen passwords, extortion using computers.
Texas penal code chapter 33 deals with computer crimes. 33.02 specifically prohibits breaching secured computers and computer systems. Simply breaching a system is a misdemeanor, but if damage is done or information stolen the penalties can be enhanced up to a first degree felony punishable by life in prison.
“Cellular phone fraud” is prohibited by federal statues such as 18 U.S. Code Section 1029. This section deals with stolen phones, phone service, "access devices", as well as situations where a person is accused of signing up for service under false identification or of cloning a valid electronic serial number (ESN) by using an ESN reader. Also, as our cell phones get smarter they are more and more likely to be characterized as computers, and unauthorized access to or by these devices can be subject to prosecution as computer fraud.
Counterfeiting and forgery offenses again are closely related. Counterfeiting involves the creation of fake items like currency, bonds, coins and other official documents. Forgery generally involves the alteration of a legitimate official or financial document. The criminal offenses dealing with counterfeiting and forgery generally require the intent to pass of the document as real, but not the actual attempt or successful passing of the item to another person for a benefit.
The federal government is very concerned with counterfeiting activities, and 18 U.S. Code Chapter 25 prohibits a whole range of counterfeiting behavior of items such as currency, both foreign and domestic; coins; bonds; securities; military paperwork; and stamps. Counterfeiting essentially involves the copying or imitation of financial items or the attempt to pass off such false copies as real.
Texas Penal Code Article 32.21 defines forgery generally as altering a document in a way that it appears to be the authentic act of another person who in fact did not authorize the alteration. Depending on the value of the intended fraud, a forgery offense can range from a misdemeanor to a first degree felony with a possible prison sentence.
The federal fraudulent credit card statute is located at 15 U.S. Code Section 1644 which applies to the fraudulent use of another's credit card or otherwise using or transporting a credit card or the card network system in a way to fraudulently acquire money or goods.
Texas Penal Code Article 32.31 prohibits the fraudulent use of credit or debit cards, and is a State Jail Felony.
Federal law prohibits a range of embezzlement activities by government, bank and employee benefit workers in 18 U.S. Code, Chapter 31 . Embezzlement is generally thought of as employee theft, or where a person takes money or property for that person's own use when the person was entrusted with the that money or property by another. It essentially involves a breach of trust by a person in some official or employment-related capacity.
Embezzlement is specifically consolidated into the Texas Theft Statute.
Federal government social programs such as CHIP, Medicare, Medicaid, the VA, as well as private insurers spend many billions of dollars on the delivery of health care services. These large scale insurance programs employ many investigators and pattern-matching algorithms to attempt to root out fraud and abuse within the health care system. Health care fraud consists of many offense from doctors over-billing for procedures, to the payment of kickbacks for favorable consideration in health care delivery, to unlicensed health care providers providing services while pretending to be licensed, to theft of medical health information. 18 U.S. Code Section 1347 essentially prohibits anyone from defrauding any "health care benefit program," which includes any public or private health care insurance program that affects interstate commerce in any way.
Insurance fraud can be committed by insurance brokers, insurance companies, or consumers of insurance. The FBI estimates that over $40 billion is lost to insurance fraud every year through schemes such as Premium Diversion, Fee Churning, Asset Diversion, and Workers' Compensation Fraud. Premium diversion is where insurance brokers take payments from consumers and keep them rather than sending them in to the insurance company. Fee Churning involves brokers diluting coverage by diverting portions of the premium as their commissions. Asset diversion is theft of insurance company assets, often used to pay off debt taken in order to purchase the insurance company. Worker's compensation fraud involves companies pretending to provide low cost insurance but pocketing the premiums and not providing coverage.
Consumers can also defraud insurance companies by lying to an insurance company in order to obtain financial benefits from the insurance company.
Federal law does not directly prohibit "insurance fraud" but any fraudulent behavior done using the mail, the phone or the internet, that affects interstate commerce, can violate federal mail fraud or wire fraud statutes.
Texas Penal Code Section 35.02 deals with consumer insurance fraud whereby a person provides false or misleading information with the intent to defraud an insurer. The level of offense depends on the amount of the fraud and can range from misdemeanor to felony punishment.
Investment fraud usually involves false promises or false information distributed by someone seeking investment to potential investors. Investment fraud can be prosecuted by both state and federal agencies. Federal statute 15 U.S. Code Section 80b-6 specifically prohibits investment advisers from defrauding their clients, or engaging in practices such as self-dealing without disclosing this fact to the client. Texas statutes dealing with Securities Fraud, discussed below, are intended to protect consumers from unscrupulous investment advisers.
Money laundering is a both a state and federal criminal offense. The general import of money laundering is that the law criminalizes attempts to hide the true source of the proceeds of criminal activities. One federal criminal statute that prohibits money laundering is 18 U.S. Code Section 1956, which deals with several forms of money laundering involving financial transactions such as:
- Promoting an illegal enterprise, avoiding taxation for illegal proceeds,
- Concealing the nature, the location, the source, the ownership of the proceeds,
- Structuring as to avoid the reporting requirements for financial transactions,
- Unreported transfer of funds inside or outside the U.S. intending to promote illegal activity,.
18 U.S. Code Section 1957 prohibits a different type of money laundering, and is known as the "spending statue" and prohibits a person from spending more than $10,000.00 of illegally obtained funds. If a dope dealer buys a wide-rimmed Impala for $11,000.00 with drug money, this is a violation of the "spending statute."
Nigerian immigrants are among the most highly educated and intelligent of all immigrant groups. Austin, Texas is a high tech hub for the state of Texas and the southwestern U.S. region, and a significant amount of commerce flows through the state capital. Austin is also an educational center with over 50,000 college students in the area, which has attracted highly educated Nigerian immigrants to the area. Unfortunately, however, the seemingly prevalent incidence on the internet of various Nigerian fraud activities has caused law enforcement to be highly suspicious of financial dealings involving the large number of Nigerian nationals living in the Austin area.
Russ has represented Nigerian nationals accused of various violations of state and federal law including:
- Money Laundering
- Unlicensed international money transferring
- Inheritance fraud
- "Get out of Jail" fraud
- "Romance" fraud
- Marriage fraud
- Tax return fraud
The Racketeer Influenced and Corrupt Organizations Act (RICO) is codified in 18 U.S. Code Chapter 96. The basic premise of the law is that it is illegal to operate an enterprise that engages in unlawful activity. The definition of unlawful activity is expansive, and this crime is a powerful tool that federal prosecutors commonly use to go after criminal organizations like street gangs.
The federal offense of “Securities and Commodities Fraud” is detailed in U.S. Code Section 1348, and prohibits fraudulent dealing in securities and commodities.
Texas Securities Fraud is defined in Vernon's Civil Statutes Article 581-29 which prohibits the unlicensed, misleading and fraudulent sales of securities. The punishment for a violation of this section depends on the amount of loss and can be as much as a first degree felony with a possible life sentence in prison.
Insider trading is frequently investigated by the SEC, and it involves Section 10(b) of the Securities Exchange Act of 1934 and the Securities and Exchange Commission's Rule 10b-5, which prohibit undisclosed trading on inside corporate information by individuals who are under a duty of trust and confidence that prohibits them from secretly using such information for their personal advantage.
Federal tax evasion occurs when a person lies about the amount of income they received or otherwise attempts to defraud the federal government about the amount of taxes that he or she owes. Tax evasion requires willful behavior and the intent to defraud the government. Federal Tax evasion prosecutions generally involve complex tax evasion schemes rather than mere individual tax filers.
The federal government does not have a specific offense prohibiting "welfare fraud" but federal investigators may prosecute welfare fraud as violations of federal mail fraud and wire fraud statutes. If you are accused of attempting to obtain benefits from govern programs like welfare, food stamps or medicaid, then the federal government can prosecute you under these statutes.
Texas statutes specifically prohibit Medicaid Fraud, but welfare fraud or benefits fraud which depends on statements regarding a person's income generally are prosecuted under Penal Code Section 37.10 which prohibits making false or misleading statements in government documents such as public assistance applications.
White Collar Crime can result in significant punishments
While people sometimes have the misconception that a white collar crime yields minimal punishment, that is not true. As with any other type of crime, judgments can vary. You could be facing probation, and in some extreme cases, you could be facing life in prison. Look no further than the following examples of harsh punishments levied locally against "white collar criminals"
- In 2017, a 69 year old Austin real estate investor was sentenced to 15 years in prison for a 1.1 million dollar fraudulent investment scheme
- In 2016, Round Rock resident was sentenced to 160 months in federal prison for a $4.5 million Ponzi scheme
- In 2014, former University of Texas star kicker Russell Erxleben was sentenced to 90 months in federal prison for his role in a $2 million Ponzi scheme
If you or someone you know has been charged with a white collar crime in federal court in Waco, federal court in Austin, in Travis county or Williamson county, or is being investigated for a white collar crime, you need to have aggressive criminal attorney representation.
Russ Hunt, Jr. is known for powerful, intelligent representation.
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