How White-Collar Conspiracy Charges Work - An Example

Probably the most charged offense in federal court is conspiracy. Federal conspiracy charges are also the offenses most likely to be abused. Conspiracies are particularly frequent in white-collar cases, because, frankly, it’s hard to perform a significant fraud alone. If you, or a loved one, has been charged with conspiracy in federal court, here’s a basic and general explanation of how conspiracy charges work in federal court - state court may be different depending on the state.

There are a number of varieties of conspiracy. Most conspiracy charges require the government to prove that there was an agreement between two or more people to commit a crime and do something that is some step toward committing that crime - called an “overt act.” Put that way, it’s kind of nebulous. So let’s see how it works in practice.

Let’s say that two people, Frank and Mary, both work at a doctor’s office that treats people on Medicare. Mary decides that she wants to submit vouchers that say they treated people who they didn’t treat. To be clear, that would be health care fraud. Frank knows what Mary is going to do. She asks him to compile a list of people who she will falsely say they treated.

Then, let’s suppose Mary wins the lottery, and doesn’t need to commit health care fraud. Instead of filling out fake vouchers, she buys a yacht and sails off to someplace warm. No false vouchers are ever submitted.

Most people would think that Frank and Mary couldn’t be prosecuted for anything. But, unfortunately, the law is a little different. Under the way most federal courts interpret conspiracy law, Frank and Mary have conspired to commit health care fraud.

There are a few things to know about conspiracy law. And, again, these are general principles that some courts have accepted. Make sure to talk to a lawyer about your case specifically. But let’s see how conspiracy law works in the case of Mary and Frank.

The Agreement Needn’t Be Explicit

First, though an agreement to do something that’s a federal crime is an element of conspiracy, it doesn’t have to be explicit; it can be proven through circumstantial evidence. Part of this makes sense - if conspiracy law makes sense at all - very few people write down or say out loud their agreement to commit a crime. But the idea that the agreement to commit a conspiracy can be proven circumstantially gets stretched too far. Some courts have said that the jury can consider whether the two people accused of conspiracy have hung out together, or associated with one another. If one person knows that the other person is trying to commit a crime and goes along on a car ride that helps with that crime, in some cases that may be enough for a jury to be able to decide that they are conspiring.

The outer bounds of what evidence is enough to prove a conspiracy are not finely drawn, and they can lead to abuse by prosecutors who know that many people accused of a crime are afraid to go to trial.

In the case of Mary and Frank though, because Frank knew what Mary was up to and put together the list of names to help her commit health care fraud, most courts and prosecutors would say that Frank conspired with Mary to commit health care fraud. Even if Frank didn’t make any money and never would - or could - make money from the health care fraud, that doesn’t matter.

Overt Act Needn’t be Illegal

Second, keep in mind that the overt act - the step that moves the agreement to do the crime along - doesn’t have to be illegal itself. As long as it is something that shows the people in the conspiracy are taking some step, any step, in order try to make the conspiracy happen, that can be enough to count as an overt act.

So, in our example, Frank compiled a list of names. Putting together a list of names isn’t itself illegal, but because it would have helped Mary commit the fraud, that can be enough to satisfy the overt act requirement.

And, thin as that overt act requirement is, Congress has been aggressive in eliminating the requirement of an overt from many kinds of conspiracy statutes.

The Conspiracy Doesn’t Need to Be Successful

Frank and Mary never actually committed health care fraud. The Medicare program never paid a dime in false claims. But, under conspiracy law, that doesn’t matter. All that matters is whether the narrow elements of an agreement and an overt act are there.

While it would be stupid to prosecute Frank and Mary for this, it would be allowed by our current federal conspiracy law.

Prosecutors Have Broad Discretion

The bottom line in all of this is that prosecutors have broad discretion to decide who they want to try to put in prison. Conspiracy law is written to give them even more power, because it is so thinly circumscribed. Someone can be tried and put in prison for very little under our federal conspiracy laws.

This is beyond lousy. But, unfortunately, it’s also the way courts and prosecutors have interpreted the law.