White-Collar Crime Defense in California (PC 470, 503, 532, 487, BPC 17200)

The major California white-collar statutes

Forgery, PC § 470

Making, altering, or passing a false instrument with intent to defraud. Includes checks, contracts, deeds, public records. Wobbler. Felony exposure: 16 months / 2 / 3 years state prison (PC § 473).

Embezzlement, PC § 503

Fraudulent appropriation of property by someone to whom it had been entrusted. Classic scenarios: bookkeeper taking cash, manager diverting company funds, executor misusing estate assets. Charged as petty theft (≤ $950) or grand theft (> $950) under PC §§ 487/488/490.2. Wobbler at the felony level.

Theft by False Pretense, PC § 532

Obtaining property through a false representation of fact, with intent to defraud, where the victim relies on the falsehood. Investment fraud, contractor non-performance, and many consumer-facing scams fall here.

Identity Theft, PC § 530.5

Willful use of another’s personal identifying information without authorization for any unlawful purpose. Wobbler. Felony exposure: 16 months / 2 / 3 years state prison plus heavy restitution.

Insurance Fraud

Insurance Code §§ 1871.1, 1871.4 (workers’ comp), Penal Code §§ 549-550 (general insurance fraud). Most are felonies. Aggressive prosecutorial focus in California, the Department of Insurance Fraud Division actively investigates.

BPC § 17200, Unfair Competition

California’s Unfair Competition Law allows civil enforcement by district attorneys and the Attorney General for “unlawful, unfair, or fraudulent” business practices. Civil penalties up to $2,500 per violation. Often paired with criminal charges in major cases.

Federal exposure that runs in parallel

Most white-collar conduct that crosses state lines, uses the mails, or uses electronic communications gives federal prosecutors jurisdiction:

• Mail fraud (18 U.S.C. § 1341) — 20 years per count.
• Wire fraud (18 U.S.C. § 1343) — 20 years per count.
• Bank fraud (18 U.S.C. § 1344) — 30 years per count.
• Healthcare fraud (18 U.S.C. § 1347) — 10 years per count.
• Tax evasion (26 U.S.C. § 7201) — 5 years per count.
• Conspiracy (18 U.S.C. § 371) — 5 years, often charged in addition.

Sentencing under the Federal Sentencing Guidelines is heavily loss-amount driven, guideline calculations climb steeply with the size of the alleged loss. Federal cases often involve white-collar agents (FBI, IRS-CI, postal inspectors, USPIS) and result in much harsher sentences than state prosecutions.

Defenses that work

Lack of fraudulent intent

Every fraud-based offense requires specific intent to defraud. Good-faith belief in the truth of the representation, reliance on professionals (accountant, attorney), and absence of personal benefit are all powerful defenses. CALCRIM 1804 (theft by false pretense) and CALCRIM 1806 (embezzlement) describe the intent requirements.

Mistake of fact

An honest mistake about the truth of a statement, the authority to take property, or the ownership of funds defeats the fraudulent intent element. Documentation of the defendant’s belief at the time matters far more than what later turned out to be true.

Reliance on professionals

Good faith reliance on a CPA, attorney, or other professional negates fraudulent intent if the defendant gave the professional accurate information and followed the advice received.

Civil dispute, not crime

Many alleged frauds are actually contract disputes. Failure to perform a contract does not become criminal unless the prosecution proves the defendant entered the contract with no intent to perform. This distinction is often the cleanest defense.

Statute of limitations

PC § 801.5 gives 4 years from discovery for fraud-based felonies. Old conduct may be time-barred. For federal mail/wire fraud, the limitation is 5 years (18 U.S.C. § 3282) — 10 years for offenses affecting a financial institution (18 U.S.C. § 3293).

Lack of nexus / interstate commerce

Federal mail/wire fraud requires use of the mails or interstate wires. Purely in-state conduct without qualifying wires can defeat federal jurisdiction.

Restitution as resolution

Full restitution at or before charging often produces favorable resolutions, reduced charges, deferred prosecution, civil compromise (for petty thefts), pre-filing rejection.

Strategic priorities in white-collar cases

• Engage counsel before the interview. Investigators often request a “voluntary interview” — declining respectfully is almost always the right call.
• Preserve documents. Litigation hold on email, accounting records, contracts, and communications.
• Internal investigation. Where the conduct is corporate, a privileged internal review (Upjohn warnings to employees) can build the defense and limit the corporation’s exposure.
• Restitution architecture. Structure any restitution carefully, done wrong, it becomes evidence of guilt rather than mitigation.
• Parallel proceedings. Civil suits, regulatory actions, and tax matters all may be running. Coordinate defense strategy across all of them.

What to do right now

• If contacted by an investigator, decline to speak and refer them to counsel.
• Preserve every document, emails, bank statements, accounting files, contracts.
• Do NOT delete, shred, or “clean up” anything. Spoliation is a separate offense (PC § 135 or federal obstruction).
• Identify witnesses who can corroborate good-faith intent, the CPA, the attorney, the business partner.
• If there is a parallel civil case or regulatory matter, do not give discovery or testimony without coordinating with criminal counsel.

Related pages

• Criminal Defense overview
• Felony Defense
• Pre-Filing Intervention
• Theft Crimes Defense
• Expungement & Record Sealing