Mail Fraud

"Now as through this world I ramble,
I see lots of funny men.
Some rob you with a sixgun
And some with a fountain pen." --- Woody Guthrie

Early History

(Charles II was also well-known for his leadership in the English Civil War, his restoration of the Church of England to religious supremacy, his abolition of the feudal rights of knight service, warship and purveyance, and a war with the Netherlands that netted England, ta da, the colony of New York.)

Benjamin Franklin was the first postal inspector in America, appointed in 1737. He was very concientious, too: in 1753, he managed to visit all of the post offices in America with the exception of the one in Charleston, South Carolina. (Considering the difficulties which attended travel at that time, it was a pretty amazing feat!)

Franklin, by all accounts, did a good job, but was fired by the Crown in 1774, for protesting (of all things) the Stamp Act. He was rehired as the first postmaster general by the Continental Congress a year later, though, and formed the first set of American postal inspectors.

The Nineteenth Century

One Congressional sponsor of the mail fraud bill said: "Thus all through the country thousands of innocent and unsophisticated people, knowing nothing about the ways of these city thieves and robbers are continually fleeced and robbed, and the mails are made use of for their nefarious designs."

Perhaps the most famous postal inspector was dry-goods-magnate turned guardian-of-public-morals Anthony Comstock. Comstock is perhaps best known for his crusades against gambling and obscene books. Political pressure forced the Post Office to give him an inspector-ship in 1873, and much to their embarassment, he hung onto it and trumpeted it to his death.

The nineteenth century was therefore not immune from mail fraud - in fact, some of the more ingenious scams have their origins in that time period. Authorities in England estimated that in the 1830s, some mail fraud operators made upwards of a thousand pounds a year (the average was about two hundred and fifty pounds a year - about ten times what an average honest working man made!) One particularly successful thief, "Blind William" had his own clerks working for him at fifty pounds a year, writing out the letters, and frequently hired messengers and fast carriages to bring his missives directly to the mark. The typical English mail fraud letter was a "sob story" directed at a member of the upper class, who would feel obliged to send 'a little something' to the scammer. Charles Dickens wrote a masterful expose on the frauds in 1850, "The Begging-Letter Writer" for the Morning Chronicle.

In 1839, Scotsman James Grant also wrote about the "impostors who ply their avocation by the means of letters and...who by the assumption of distress which they do not actually feel, endeavour...to enlist the sympathies of the charitable and humane in their behalf."

So people have used the mail for crime for centuries - today, the USPS continues to guard against this.

The Twentieth Century and the Modern Era

Even today, federal prosecutors love the mail fraud statute. As one said:

"To federal prosecutors of white collar crime, the mail fraud statute is our Stradivarius, our Colt .45, our Louisville Slugger, our Cuisinart--and our true love. We may flirt with RICO, show off with 10b-5, and call the conspiracy law 'darling,' but we always come home to the virtues of 18 U.S.C. 1341, with its simplicity, adaptability, and comfortable familiarity."

Scammers beware!

One final note about chain letters: According to one book by a postal inspector, chain letters come in cycles. In August, 1969, there were only 97 letters under investigation. In January, 1970, there were 559! These cycles seem to repeat "every few years".

Legislative History of the Mail Fraud Statute

In 1989, the act was expanded to encompass greater punishments for mail frauds against financial institutions (note that sometimes even passing bad checks can be construed as being "fraud against financial institutions"!) In 1990, the penalty for violating the statute was increased from 20 to 30 years. In 1994, the act was further expanded to include fraud perpetrated via private mail carriers like Federal Express.

The Statute

18 U.S.C.A. s 1341
  
UNITED STATES CODE 
TITLE 18. CRIMES AND CRIMINAL PROCEDURE
PART I--CRIMES
CHAPTER 63--MAIL FRAUD
SECTION 1341. Frauds and swindles
  
  TEXT

   Whoever, having devised or intending to devise any scheme or artifice
to defraud, or for obtaining money or property by means of false or
fraudulent pretenses, representations, or promises, or to sell, dispose
of, loan, exchange, alter, give away, distribute, supply, or furnish or
procure for unlawful use any counterfeit or spurious coin, obligation,
security, or other article, or anything represented to be or intimated or
held out to be such counterfeit or spurious article, for the purpose of
executing such scheme or artifice or attempting so to do, places in any
post office or authorized depository for mail matter, any matter or thing
whatever to be sent or delivered by the Postal Service, or deposits or
causes to be deposited any matter or thing whatever to be sent or
delivered by any private or commercial interstate carrier, or takes or
receives therefrom, any such matter or thing, or knowingly causes to be
delivered by mail or such carrier according to the direction thereon, or
at the place at which it is directed to be delivered by the person to whom
it is addressed, any such matter or thing, shall be fined under this title
or imprisoned not more than five years, or both.  If the violation affects
a financial institution, such person shall be fined not more than
$1,000,000 or imprisoned not more than 30 years, or both.

Yes, that's one million dollars and thirty years. That is not a misprint.