News & Insights

Recent Case of Interest Where U.S. Supreme Court Affirms Wire Fraud Conviction Despite No Economic Loss

May 30, 2025

In Kousisis v. United States, No. 23-909, 605 U.S. __, 2025 WL 1459593 (May 22, 2025), the Supreme Court unanimously held that a defendant may be convicted under the federal wire fraud statute, 18 U.S.C. § 1343, even if the victim receives the full economic value of the bargain. Writing for the Court, Justice Barrett explained that the statute criminalizes schemes to obtain money or property through materially false pretenses, regardless of whether the victim suffers economic loss. The case involved Stamatios Kousisis and Alpha Painting and Construction Co., who secured state contracts from the Pennsylvania Department of Transportation (PennDOT) by falsely representing compliance with requirements to use disadvantaged business enterprises (DBEs). Although Alpha completed the work to PennDOT’s standards, the defendants used a DBE as a pass-through entity and submitted false certifications to conceal the deception.

Rejecting the argument that economic harm is a necessary element of wire fraud, the Court affirmed that the statute’s plain text requires only a fraudulent scheme to obtain money or property. The opinion underscores that material misrepresentations can support a conviction under § 1343 even in the absence of financial loss. While Justice Gorsuch, concurring in part, warned that the ruling could criminalize “harmless lies” and depart from fraud’s historical requirement of injury, the majority responded that inducing a victim to part with property under false pretenses constitutes injury in itself. This recent case of interest marks a departure from the Court’s recent trend of narrowing the scope of federal fraud enforcement and signals a potential expansion in prosecutorial authority in future fraudulent inducement cases.

No information in this communication is intended to constitute specific legal advice. For specific legal advice, please contact an attorney, and if you have any such questions or would like more information about this issue, please contact William “Pat” Huttenbach at 713.752.8616, or email at phuttenbach@craincaton.com.

Thanks,

Pat

Kousisis v. United States