If you’re under investigation for fraud in California, one of the first things you need to understand is whether you’re facing state charges, federal charges, or both. While the word “fraud” might sound straightforward, the jurisdiction handling your case can dramatically affect everything—from the potential penalties to how your case is investigated and prosecuted.
At Simmons Wagner, LLP, we represent clients across Southern California facing serious fraud allegations at both the state and federal levels. Here’s what you need to know if you’re caught in the crosshairs of a white-collar criminal investigation.
What Makes a Case “Federal”?
A case may be prosecuted federally if it involves:
- Interstate activity (e.g., wire transfers, communications across state lines)
- Federal agencies such as the IRS, FBI, SEC, or Department of Justice
- Federally regulated industries (banking, healthcare, securities)
- Large-scale fraud with significant financial losses or multiple victims
Examples of common federal fraud charges include:
- Wire fraud
- Bank fraud
- Mail fraud
- Securities fraud
- Tax fraud
- Health care fraud
- PPP loan fraud
Even a seemingly local business dispute can escalate to the federal level if electronic communications or banking systems were used across state lines.
Key Differences Between Federal and State Fraud Charges
Understanding the differences in how these cases are handled is critical to building an effective defense.
1. Investigative Power
Federal investigators have more resources, time, and tools than state law enforcement. Agencies like the FBI or IRS conduct lengthy investigations—often months or years—before making an arrest.
2. Sentencing Guidelines
Federal charges are subject to the U.S. Sentencing Guidelines, which use a point-based system factoring in the amount of financial loss, number of victims, and whether you accepted responsibility. Federal prison time can be significantly longer than state sentences for similar conduct.
3. Plea Negotiations and Cooperation
Federal prosecutors are often less flexible when it comes to dismissing or reducing charges unless you provide meaningful cooperation or agree to a structured plea deal. Tools like proffer agreements and deferred prosecution agreements are more common in federal court.
4. Trial Process and Evidence Rules
Federal courts operate under a separate set of procedural rules. Discovery can be more limited, and the burden of proof remains high—but federal prosecutors are typically very well-prepared, and convictions are harder to reverse.
5. Reputation and Future Impact
A federal conviction carries heavier stigma and harsher consequences when it comes to professional licensing, immigration status, and background checks. Even accusations alone can jeopardize careers and reputations.
Why You Need a Defense Team with Federal Experience
If you’re facing potential federal charges, it’s not enough to hire just any criminal defense attorney. You need a legal team that:
- Understands federal procedures, investigators, and court dynamics
- Has experience negotiating with U.S. Attorneys’ Offices
- Can anticipate aggressive tactics used by agencies like the IRS, DOJ, or FBI
- Knows how to challenge the loss amount, intent, and evidentiary thresholds that define your sentence
At Simmons Wagner, LLP, we’ve helped clients across Orange County, Los Angeles, and beyond navigate both state and federal charges—often successfully preventing indictments or minimizing consequences.
Act Quickly—Before Charges Are Filed
Federal investigations often move slowly—but once charges are filed, the case speeds up quickly. That’s why getting ahead of the investigation is key. If you’ve received a target letter, been contacted by a federal agent, or suspect you’re under scrutiny, now is the time to act—not later.
Call Simmons Wagner, LLP today at (949) 439-5857 to schedule a confidential consultation. We’ll help you understand your legal exposure, your options, and how to protect your rights in the face of serious fraud allegations.