18 U.S.C. § 1031 — Major fraud against the United States

Page 324 TITLE 18—CRIMES AND CRIMINAL PROCEDURE § 1031 ‘‘(B) modifies or impairs, or potentially modifies or impairs, the medical examination, medical diagnosis, medical treatment, or medical care of one or more in- dividuals; or’’. Subsec. (c)(3)(A). Pub. L. 103–322, § 290001(c)(2), in- serted ‘‘(A)’’ after ‘‘(a)(5)’’. Subsec. (c)(4). Pub. L. 103–322, § 290001(c)(1), (3), (4), added par. (4). Subsec. (g). Pub. L. 103–322, § 290001(d), added subsec. (g). Subsec. (h). Pub. L. 103–322, § 290001(e), added subsec. (h). 1990—Subsec. (a)(1). Pub. L. 101–647, § 3533, substituted ‘‘paragraph y’’ for ‘‘paragraph r’’. Subsec. (e)(3). Pub. L. 101–647, § 1205(e), inserted ‘‘com- monwealth,’’ before ‘‘possession or territory of the United States’’. Subsec. (e)(4)(G). Pub. L. 101–647, § 2597(j)(2), which di- rected substitution of a semicolon for a period at end of subpar. (G), could not be executed because it ended with a semicolon. Subsec. (e)(4)(H), (I). Pub. L. 101–647, § 2597(j), added subpars. (H) and (I). 1989—Subsec. (e)(4)(A). Pub. L. 101–73, § 962(a)(5)(A), substituted ‘‘an institution,’’ for ‘‘a bank’’. Subsec. (e)(4)(C) to (H). Pub. L. 101–73, § 962(a)(5)(B), (C), redesignated subpars. (D) to (H) as (C) to (G), re- spectively, and struck out former subpar. (C) which read as follows: ‘‘an institution with accounts insured by the Federal Savings and Loan Insurance Corpora- tion;’’. 1988—Subsec. (a)(2). Pub. L. 100–690 inserted a comma after ‘‘financial institution’’ and struck out the comma that followed a comma after ‘‘title 15’’. 1986—Subsec. (a). Pub. L. 99–474, § 2(b)(2), struck out last sentence which read as follows: ‘‘It is not an of- fense under paragraph (2) or (3) of this subsection in the case of a person having accessed a computer with au- thorization and using the opportunity such access pro- vides for purposes to which such access does not ex- tend, if the using of such opportunity consists only of the use of the computer.’’ Subsec. (a)(1). Pub. L. 99–474, § 2(c), substituted ‘‘or exceeds authorized access’’ for ‘‘, or having accessed a computer with authorization, uses the opportunity such access provides for purposes to which such author- ization does not extend’’. Subsec. (a)(2). Pub. L. 99–474, § 2(a), (c), substituted ‘‘intentionally’’ for ‘‘knowingly’’, substituted ‘‘or ex- ceeds authorized access’’ for ‘‘, or having accessed a computer with authorization, uses the opportunity such access provides for purposes to which such author- ization does not extend’’, struck out ‘‘as such terms are defined in the Right to Financial Privacy Act of 1978 (12 U.S.C. 3401 et seq.),’’ after ‘‘financial institution,’’, in- serted ‘‘or of a card issuer as defined in section 1602(n) of title 15,’’ and struck out ‘‘or’’ appearing at end. Subsec. (a)(3). Pub. L. 99–474, § 2(b)(1), amended par. (3) generally. Prior to amendment, par. (3) read as fol- lows: ‘‘knowingly accesses a computer without author- ization, or having accessed a computer with authoriza- tion, uses the opportunity such access provides for pur- poses to which such authorization does not extend, and by means of such conduct knowingly uses, modifies, de- stroys, or discloses information in, or prevents author- ized use of, such computer, if such computer is operated for or on behalf of the Government of the United States and such conduct affects such operation;’’. Subsec. (a)(4) to (6). Pub. L. 99–474, § 2(d), added pars. (4) to (6). Subsec. (b). Pub. L. 99–474, § 2(e), struck out par. (1) designation and par. (2) which provided a penalty for persons conspiring to commit an offense under subsec. (a). Subsec. (c). Pub. L. 99–474, § 2(f)(9), substituted ‘‘(b)’’ for ‘‘(b)(1)’’ in introductory text. Subsec. (c)(1)(A). Pub. L. 99–474, § 2(f)(1), substituted ‘‘under this title’’ for ‘‘of not more than the greater of $10,000 or twice the value obtained by the offense’’. Subsec. (c)(1)(B). Pub. L. 99–474, § 2(f)(2), substituted ‘‘under this title’’ for ‘‘of not more than the greater of $100,000 or twice the value obtained by the offense’’. Subsec. (c)(2)(A). Pub. L. 99–474, § 2(f)(3), (4), sub- stituted ‘‘under this title’’ for ‘‘of not more than the greater of $5,000 or twice the value obtained or loss cre- ated by the offense’’ and inserted reference to subsec. (a)(6). Subsec. (c)(2)(B). Pub. L. 99–474, § 2(f)(3), (5)–(7), sub- stituted ‘‘under this title’’ for ‘‘of not more than the greater of $10,000 or twice the value obtained or loss created by the offense’’, ‘‘not more than’’ for ‘‘not than’’, inserted reference to subsec. (a)(6), and sub- stituted ‘‘; and’’ for the period at end of subpar. (B). Subsec. (c)(3). Pub. L. 99–474, § 2(f)(8), added par. (3). Subsec. (e). Pub. L. 99–474, § 2(g), substituted a dash for the comma after ‘‘As used in this section’’, re- aligned remaining portion of subsection, inserted ‘‘(1)’’ before ‘‘the term’’, substituted a semicolon for the pe- riod at the end, and added pars. (2) to (7). Subsec. (f). Pub. L. 99–474, § 2(h), added subsec. (f). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2002 AMENDMENT Amendment by Pub. L. 107–296 effective 60 days after Nov. 25, 2002, see section 4 of Pub. L. 107–296, set out as an Effective Date note under section 101 of Title 6, Do- mestic Security. TRANSFER OF FUNCTIONS For transfer of the functions, personnel, assets, and obligations of the United States Secret Service, includ- ing the functions of the Secretary of the Treasury re- lating thereto, to the Secretary of Homeland Security, and for treatment of related references, see sections 381, 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganiza- tion Plan of November 25, 2002, as modified, set out as a note under section 542 of Title 6. REPORTS TO CONGRESS Pub. L. 98–473, title II, § 2103, Oct. 12, 1984, 98 Stat. 2192, directed Attorney General to report to Congress annually, during first three years following Oct. 12, 1984, concerning prosecutions under this section. § 1031. Major fraud against the United States (a) Whoever knowingly executes, or attempts to execute, any scheme or artifice with the in- tent— (1) to defraud the United States; or (2) to obtain money or property by means of false or fraudulent pretenses, representations, or promises, in any grant, contract, subcontract, subsidy, loan, guarantee, insurance, or other form of Federal assistance, including through the Trou- bled Asset Relief Program, an economic stim- ulus, recovery or rescue plan provided by the Government, or the Government’s purchase of any troubled asset as defined in the Emergency Economic Stabilization Act of 2008, or in any procurement of property or services as a prime contractor with the United States or as a sub- contractor or supplier on a contract in which there is a prime contract with the United States, if the value of such grant, contract, sub- contract, subsidy, loan, guarantee, insurance, or other form of Federal assistance, or any con- stituent part thereof, is $1,000,000 or more shall, subject to the applicability of subsection (c) of this section, be fined not more than $1,000,000, or imprisoned not more than 10 years, or both. (b) The fine imposed for an offense under this section may exceed the maximum otherwise pro- vided by law, if such fine does not exceed $5,000,000 and— Page 325 TITLE 18—CRIMES AND CRIMINAL PROCEDURE § 1031 (1) the gross loss to the Government or the gross gain to a defendant is $500,000 or greater; or (2) the offense involves a conscious or reck- less risk of serious personal injury. (c) The maximum fine imposed upon a defend- ant for a prosecution including a prosecution with multiple counts under this section shall not exceed $10,000,000. (d) Nothing in this section shall preclude a court from imposing any other sentences avail- able under this title, including without limita- tion a fine up to twice the amount of the gross loss or gross gain involved in the offense pursu- ant to 18 U.S.C. section 3571(d). (e) In determining the amount of the fine, the court shall consider the factors set forth in 18 U.S.C. sections 3553 and 3572, and the factors set forth in the guidelines and policy statements of the United States Sentencing Commission, in- cluding— (1) the need to reflect the seriousness of the offense, including the harm or loss to the vic- tim and the gain to the defendant; (2) whether the defendant previously has been fined for a similar offense; and (3) any other pertinent equitable consider- ations. (f) A prosecution of an offense under this sec- tion may be commenced any time not later than 7 years after the offense is committed, plus any additional time otherwise allowed by law. (g)(1) In special circumstances and in his or her sole discretion, the Attorney General is au- thorized to make payments from funds appro- priated to the Department of Justice to persons who furnish information relating to a possible prosecution under this section. The amount of such payment shall not exceed $250,000. Upon ap- plication by the Attorney General, the court may order that the Department shall be reim- bursed for a payment from a criminal fine im- posed under this section. (2) An individual is not eligible for such a pay- ment if— (A) that individual is an officer or employee of a Government agency who furnishes infor- mation or renders service in the performance of official duties; (B) that individual failed to furnish the in- formation to the individual’s employer prior to furnishing it to law enforcement authori- ties, unless the court determines the indi- vidual has justifiable reasons for that failure; (C) the furnished information is based upon public disclosure of allegations or transactions in a criminal, civil, or administrative hearing, in a congressional, administrative, or GAO re- port, hearing, audit or investigation, or from the news media unless the person is the origi- nal source of the information. For the pur- poses of this subsection, ‘‘original source’’ means an individual who has direct and inde- pendent knowledge of the information on which the allegations are based and has volun- tarily provided the information to the Govern- ment; or (D) that individual participated in the viola- tion of this section with respect to which such payment would be made. (3) The failure of the Attorney General to au- thorize a payment shall not be subject to judi- cial review. (h) Any individual who— (1) is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and condi- tions of employment by an employer because of lawful acts done by the employee on behalf of the employee or others in furtherance of a prosecution under this section (including in- vestigation for, initiation of, testimony for, or assistance in such prosecution), and (2) was not a participant in the unlawful ac- tivity that is the subject of said prosecution, may, in a civil action, obtain all relief nec- essary to make such individual whole. Such relief shall include reinstatement with the same seniority status such individual would have had but for the discrimination, 2 times the amount of back pay, interest on the back pay, and compensation for any special dam- ages sustained as a result of the discrimina- tion, including litigation costs and reasonable attorney’s fees. (Added Pub. L. 100–700, § 2(a), Nov. 19, 1988, 102 Stat. 4631; amended Pub. L. 101–123, § 2(a), Oct. 23, 1989, 103 Stat. 759; Pub. L. 103–322, title XXXIII, § 330002(a), (f), Sept. 13, 1994, 108 Stat. 2140; Pub. L. 111–21, § 2(d), May 20, 2009, 123 Stat. 1618.) Editorial Notes REFERENCES IN TEXT The Emergency Economic Stabilization Act of 2008, referred to in subsec. (a), is div. A of Pub. L. 110–343, Oct. 3, 2008, 122 Stat. 3765, which is classified prin- cipally to chapter 52 (§ 5201 et seq.) of Title 12, Banks and Banking. For complete classification of this Act to the Code, see Short Title note set out under section 5201 of Title 12 and Tables. AMENDMENTS 2009—Subsec. (a). Pub. L. 111–21, in concluding provi- sions, inserted ‘‘any grant, contract, subcontract, sub- sidy, loan, guarantee, insurance, or other form of Fed- eral assistance, including through the Troubled Asset Relief Program, an economic stimulus, recovery or res- cue plan provided by the Government, or the Govern- ment’s purchase of any troubled asset as defined in the Emergency Economic Stabilization Act of 2008, or in’’ before ‘‘any procurement’’, substituted ‘‘such grant, contract, subcontract, subsidy, loan, guarantee, insur- ance, or other form of Federal assistance’’ for ‘‘the con- tract, subcontract’’, and struck out ‘‘for such property or services’’ before ‘‘is $1,000,000’’. 1994—Subsec. (g). Pub. L. 103–322, § 330002(f), redesig- nated second subsec. (g) as (h). Subsec. (g)(2)(A). Pub. L. 103–322, § 330002(a), sub- stituted ‘‘a Government’’ for ‘‘a government’’. Subsec. (h). Pub. L. 103–322, § 330002(f), redesignated second subsec. (g) as (h). 1989—Subsec. (g). Pub. L. 101–123 added, after subsec. (f), subsec. (g) relating to payments by the Attorney General. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1989 AMENDMENT Pub. L. 101–123, § 2(b), Oct. 23, 1989, 103 Stat. 759, pro- vided that: ‘‘The amendment made by this section [amending this section] shall apply to contracts en- tered into on or after the date of the enactment of this Act [Oct. 23, 1989].’’ Page 326 TITLE 18—CRIMES AND CRIMINAL PROCEDURE § 1032 § 1032. Concealment of assets from conservator, receiver, or liquidating agent Whoever— (1) knowingly conceals or endeavors to con- ceal an asset or property from the Federal De- posit Insurance Corporation, acting as conser- vator or receiver or in the Corporation’s cor- porate capacity with respect to any asset ac- quired or liability assumed by the Corporation under section 11, 12, or 13 of the Federal De- posit Insurance Act, any conservator ap- pointed by the Comptroller of the Currency, the Federal Deposit Insurance Corporation acting as receiver for a covered financial com- pany, in accordance with title II of the Dodd- Frank Wall Street Reform and Consumer Pro- tection Act, or the National Credit Union Ad- ministration Board, acting as conservator or liquidating agent; (2) corruptly impedes or endeavors to impede the functions of such Corporation, Board, or conservator; or (3) corruptly places or endeavors to place an asset or property beyond the reach of such Corporation, Board, or conservator, shall be fined under this title or imprisoned not more than 5 years, or both. (Added Pub. L. 101–647, title XXV, § 2501(a), Nov. 29, 1990, 104 Stat. 4859; amended Pub. L. 107–273, div. B, title IV, § 4002(b)(13), Nov. 2, 2002, 116 Stat. 1808; Pub. L. 111–203, title II, § 211(a), (b), title III, § 377(7), July 21, 2010, 124 Stat. 1514, 1569.) Editorial Notes REFERENCES IN TEXT Sections 11, 12, and 13 of the Federal Deposit Insur- ance Act, referred to in par. (1), are classified to sec- tions 1821, 1822, and 1823, respectively, of Title 12, Banks and Banking. The Dodd-Frank Wall Street Reform and Consumer Protection Act, referred to in par. (1), is Pub. L. 111–203, July 21, 2010, 124 Stat. 1376. Title II of the Act is classi- fied principally to subchapter II (§ 5381 et seq.) of chap- ter 53 of Title 12, Banks and Banking. For complete classification of this Act to the Code, see Short Title note set out under section 5301 of Title 12 and Tables. AMENDMENTS 2010—Pub. L. 111–203, § 211(b), struck out ‘‘of financial institution’’ after ‘‘agent’’ in section catchline. Par. (1). Pub. L. 111–203, § 377(7), struck out ‘‘the Reso- lution Trust Corporation,’’ after ‘‘Federal Deposit In- surance Act,’’ and ‘‘or the Director of the Office of Thrift Supervision’’ after ‘‘Comptroller of the Cur- rency’’. Pub. L. 111–203, § 211(a), inserted ‘‘the Federal Deposit Insurance Corporation acting as receiver for a covered financial company, in accordance with title II of the Dodd-Frank Wall Street Reform and Consumer Protec- tion Act,’’ before ‘‘or the National Credit’’. 2002—Par. (1). Pub. L. 107–273 substituted ‘‘13’’ for ‘‘13,’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2010 AMENDMENT Amendment by section 211(a), (b) of Pub. L. 111–203 ef- fective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111–203, set out as an Effective Date note under section 5301 of Title 12, Banks and Banking. Amendment by section 377(7) of Pub. L. 111–203 effec- tive on the transfer date, see section 351 of Pub. L. 111–203, set out as a note under section 906 of Title 2, The Congress. § 1033. Crimes by or affecting persons engaged in the business of insurance whose activities af- fect interstate commerce (a)(1) Whoever is engaged in the business of in- surance whose activities affect interstate com- merce and knowingly, with the intent to de- ceive, makes any false material statement or re- port or willfully and materially overvalues any land, property or security— (A) in connection with any financial reports or documents presented to any insurance regu- latory official or agency or an agent or exam- iner appointed by such official or agency to examine the affairs of such person, and (B) for the purpose of influencing the actions of such official or agency or such an appointed agent or examiner, shall be punished as provided in paragraph (2). (2) The punishment for an offense under para- graph (1) is a fine as established under this title or imprisonment for not more than 10 years, or both, except that the term of imprisonment shall be not more than 15 years if the statement or report or overvaluing of land, property, or se- curity jeopardized the safety and soundness of an insurer and was a significant cause of such insurer being placed in conservation, rehabilita- tion, or liquidation by an appropriate court. (b)(1) Whoever— (A) acting as, or being an officer, director, agent, or employee of, any person engaged in the business of insurance whose activities af- fect interstate commerce, or (B) is engaged in the business of insurance whose activities affect interstate commerce or is involved (other than as an insured or bene- ficiary under a policy of insurance) in a trans- action relating to the conduct of affairs of such a business, willfully embezzles, abstracts, purloins, or mis- appropriates any of the moneys, funds, pre- miums, credits, or other property of such person so engaged shall be punished as provided in paragraph (2). (2) The punishment for an offense under para- graph (1) is a fine as provided under this title or imprisonment for not more than 10 years, or both, except that if such embezzlement, abstrac- tion, purloining, or misappropriation described in paragraph (1) jeopardized the safety and soundness of an insurer and was a significant cause of such insurer being placed in conserva- tion, rehabilitation, or liquidation by an appro- priate court, such imprisonment shall be not more than 15 years. If the amount or value so embezzled, abstracted, purloined, or misappro- priated does not exceed $5,000, whoever violates paragraph (1) shall be fined as provided in this title or imprisoned not more than one year, or both. (c)(1) Whoever is engaged in the business of in- surance and whose activities affect interstate commerce or is involved (other than as an in- sured or beneficiary under a policy of insurance) in a transaction relating to the conduct of af-