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The Spodek Law Group understands how delicate high-profile cases can be, and has a strong track record of getting positive outcomes. Our lawyers service a clientele that is nationwide. With offices in both LA and NYC, and cases all across the country - Spodek Law Group is a top tier law firm.

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Federal Blackmail And Extortion

By Spodek Law Group | February 14, 2023
(Last Updated On: July 28, 2023)

Last Updated on: 28th July 2023, 07:22 pm

Don’t Let the Law Catch You: The Seriousness of Blackmail and Extortion

The Practice of Blackmail and Extortion: More Than Just Threats and Demands

Blackmail and extortion are crimes that strike fear into the hearts of their victims. It’s the practice of using threats, force, or coercion to persuade someone to provide you with benefits or to compel them to behave in a certain manner.

It’s not just limited to demands for money, but can also involve keeping embarrassing information about the individual secret. Blackmail and extortion can lead to severe criminal charges under state laws. However, when the crime crosses state lines or otherwise implicates federal law, the perpetrator can face federal criminal charges with even more severe penalties.

In fact, federal extortion cases require a high level of expertise in federal criminal defense, as they are often complex cases. Defense attorneys must have an in-depth knowledge of federal criminal law and experience handling federal cases to provide effective representation.

Understanding Blackmail and Extortion under Federal Law

Under Title 18 of the United States Code, Section 873, a more specific subset of blackmail or extortion is prohibited as a federal crime. Specifically, 18 U.S.C. § 873 criminalizes anyone who either demands or receives money or any other valuable thing under the threat of informing, or as consideration for not informing, against any violation of United States law. This statute criminalizes blackmail related to the victim’s own violations of law.

In other words, extortion cases often involve someone calling a person or actually meeting them and then attempting to extort them into giving some money, valuable consideration, or doing something for them. In some cases, tape-recorded conversations are used, but there are many different angles used in order to carry out the extortion.

A Federal Extortion Case Example

Consider the scenario of a high-powered executive at a financial firm who has been engaging in insider trading, which is a crime under United States law. If the defendant, his subordinate, learns about this activity, they could report it to the appropriate regulatory agency.

However, instead of doing the right thing, the defendant decides to blackmail the boss. They send an e-mail to the boss demanding $1,000,000 in exchange for their silence about the boss’s own criminal activity.

In this scenario, the defendant employee has violated 18 U.S.C. § 873 by attempting to extort $1,000,000 from the victim, even though they never actually received the payment.

However, suppose that the employee is altruistic and not interested in extracting a payment from their employer. In that case, they threaten to expose the boss if they do not turn themselves in voluntarily for their securities law violations. The boss refuses, so the employee reports them to federal authorities.

Although the employee threatened to reveal the employer’s violation of United States law, no blackmail or extortion occurred because the threat of exposure had no connection to a demand for or receipt of money or any other valuable thing.

Federal Laws on Extortion and Threats

It’s worth noting that while state law, including in California, may prohibit a wider variety of blackmail or extortion-related activities, 18 U.S.C. § 873 only covers threats to expose, or consideration for not exposing, violations of federal law.

As a result, if the employee in our example threatened to expose their boss for a purely state law crime, such as petty theft, they could potentially be charged under California’s extortion statute, but not under the federal blackmail statute. However, many crimes have both state and federal law analogues.

The federal government would only commit to prosecuting someone under 18 U.S.C. §

The Thrilling Difference Between Blackmail and Extortion

When it comes to criminal conduct, blackmail and extortion are two sides of the same coin, both involving the use of force or coercion. From a disgruntled employee threatening to reveal a company’s confidential information to an individual seeking payment for keeping quiet about illegal activity, these acts have the potential to cross the line from tough business tactics to criminal behavior.

What is “Blackmail” Under Federal Law?

Under the federal statute found at 18 U.S.C. § 873, blackmail is defined as the act of demanding or receiving money or valuable property in exchange for not informing against a violation of federal law. The prosecution must prove beyond a reasonable doubt that the defendant made such a demand, acted under threat or consideration, and had knowledge of the illegal activity.

It’s crucial to note that the crime of blackmail only applies to threats involving the disclosure or non-disclosure of violations of federal law. Threats to reveal embarrassing or salacious information, while unethical, do not qualify as federal blackmail.

For example, an employee who is aware of their company’s violation of federal environmental laws and threatens to reveal it in exchange for payment can be convicted of blackmail. On the other hand, threatening to reveal an extramarital affair would not be considered federal blackmail.

What is “Extortion” Under Federal Law?

The federal crime of extortion requires the government to prove that the defendant obtained something of value or compelled action through illegal means such as force or coercion. The primary statute for federal extortion cases is 18 U.S.C. § 1951, also known as the “Hobbs Act.”

The Hobbs Act defines extortion as obtaining property from another through the wrongful use of actual or threatened force, violence, or fear, or under the guise of official right. The act imposes severe penalties, including a prison term of up to 20 years per extortionate act.

An important element of the Hobbs Act is that it requires some act that obstructs, delays, or affects commerce or the movement of any commodity in commerce, even if the effect is minimal. The Supreme Court has also held that the Hobbs Act can apply to reputational harm.

A well-known example of the Hobbs Act being applied to reputational harm is the case of attorney Michael Avenatti, who was charged with extorting money from Nike, Inc. through threats of economic harm.

The Hobbs Act has evolved over the years to become a widely applied statute, as demonstrated in the case of Sekhar v. United States. In this case, the Supreme Court ruled that attempting to compel a person to make a favorable recommendation does not qualify as extortion under the Hobbs Act because the “property” in question must be transferable in the same manner as cash.

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