Procurement Fraud Defense: On the Law-Enforcement Horizon

With DOGE and fraud, waste, and abuse at the forefront of most public statements by Trump Administration officials, it is a near certainty that an uptick in federal investigations and indictments for procurement fraud cases will follow. Defending procurement fraud cases requires knowledge of the relevant statutes, know-how in deconstructing them, and trial skills.

Investigated Conduct

Procurement fraud covers a range of conduct in connection with government contracting, which is defined broadly. Common examples include:

• Billing the U.S. government for goods or services not provided;

• Overcharging the U.S. government for goods or services;

• False certifications that goods or services conform to federal requirements, when in fact the goods do not or are otherwise defective; and

• Paying bribes to government officials in exchange for confidential information or contract awards.

Federal Criminal Statutes in Procurement Fraud Cases

Here’s a list of the most commonly charged federal offenses in indictments for procurement fraud:

• Conspiracy: 18 U.S.C. § 1349 or 18 U.S.C. § 371, generally criminalize the “agreement” to commit an offense under Title 18 (normally wire fraud)

• Wire Fraud: 18 U.S.C. § 1343, generally criminalizes a “scheme to defraud” or using false or fraudulent representations to obtain money and doing so with the intent to defraud

• Major Fraud against the United Sates: 18 U.S.C. § 1031, similarly criminalizes a “scheme to defraud” the United States involving a contract (or other identified financial arrangement) over $1,000,000

• False Claims: 18 U.S.C. § 287, criminalizes knowingly presenting a false or fraudulent claim to a department or agency

• Theft of Government Property: 18 U.S.C. § 641, which criminalizes the theft or misuse of U.S. government property or funds, with the intent to deprive the government of its use or value

• Kickbacks: 41 U.S.C. § 8702, criminalizes knowingly and willfully providing, offering, soliciting, or accepting any kickback (anything of value) in connection with a federal contract

Defending Procurement Fraud Cases

Defending a procurement fraud case is similar to defending any other white-collar fraud case. A successful defense strategy often turns on putting forward evidence on the following issues:

• Attacking Fraudulent Intent: Most of the above-referenced statutes require an “intent to defraud.” Proving this intent is the most difficult part of any procurement fraud case and where many prosecutions falter.

• Attacking False Representations: The false representation in a procurement fraud case is often not black and white, especially hwere the representation relates to contracting terms or vague or open-ended obligations.

• Attacking “Materiality”: The representation must have been material to the government agency. And government officials are susceptible to effective cross-examination that the underlying fraud was either blessed by government, ignored or not important in the grand scheme of things.

• Lack of Motive: A “target” of the investigation may not have benefitted financially in a meaningful sense from the alleged fraud, either because the contracting benefit flowed to the individual’s company or because the contract did not directly benefit the individual’s compensation

Trial Skills

Ideally, a skilled advocate can point out the above flaws in a procurement fraud case and convince DOJ to decline to proceed on one or more of those bases. If not, showing these issues to the jury is critical and is generally done through skilled cross examination of government witnesses.

Warrantless “Border Searches” of Cellphones: A Decision on Deck with the Second Circuit

On June 24, 2025, the Second Circuit in United States v. Smith, No. 24-1680 (2d Cir.) will take up the Constitutionality of a “border search” of an iPhone. The Second Circuit will decide whether federal agents can search a mobile device at the border without obtaining a warrant. And if agents conduct such a search without a warrant, whether evidence from such a search should be suppressed. There is currently a “circuit split” about level of due process that must be provided before agents can search a cellphone at the border.

By way of background, on March 2, 2021, Jatiek Smith attempted to travel from Newark to Jamaica but was denied entry upon arrival and sent back to the United States. Upon his return to Newark International Airport, federal agents—including Customs and Border Protection (CBP) officers and agents from the FBI and Homeland Security Investigations (HSI)—seized Smith’s cellphone without a warrant. After demanding his passcode under the threat of detention, agents accessed Smith’s phone and made a forensic copy of its contents. Agents then sought a warrant to search and seize the same iPhone.

Smith moved to suppress the iPhone evidence and argued that agents violated his Fourth Amendment rights by reviewing the contents of his iPhone without a warrant. The District Court agreed and found that a Fourth Amendment violation had occurred. In other words, the District Court found that the agents needed a warrant before reviewing the contents of Smith’s iPhone. Nonetheless, the District Court ultimately declined to suppress the evidence because of the “good faith” exception to the exclusionary rule. Both of these issues are now teed up for the Second Circuit.

Constitutional Implications as to Warrantless Cellphone Border Searches

The case presents significant Constitutional questions about the intersection of “border search” authority and modern digital privacy. Historically, the “border search exception” allowed government agents to conduct warrantless searches at the border or its functional equivalents, such as international airports. Courts justified this exception based on the United States’ interest in protecting national security and regulating the import and export of goods.

However, as the Supreme Court recognized in Riley v. California, modern smartphones are materially different from traditional physical containers, like luggage. A smartphone can store vast quantities of sensitive personal information, including medical records, financial data, private communications, and photographs. Searching a cellphone is far more intrusive than searching a suitcase. It therefore raises substantial privacy concerns that were previously inapplicable to border searches.

The decision in Smith could have profound implications beyond Smith’s individual case. Requiring a warrant for a “border search” would essentially gut the “border search” exception and tee in a sharp circuit split, especially between the Second and 11th Circuit. The issue would then be ripe for Supreme Court review.

Broader Implications for International Travelers

Travelers crossing international borders often carry their entire personal and professional lives in their pockets. At a time when courts and policymakers are grappling with the balance between security interests and digital privacy, Smith presents an important opportunity for the Second Circuit to reinforce Constitutional principles in the face of technological change.

The Second Circuit’s decision in United States v. Smith will be closely watched by privacy advocates, legal practitioners, and government agencies. Updates will be provided following the June 24 oral argument.

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If you have had your electronic devices searched and seized at the border or international airport, you may be a target of a criminal investigation and should consult with a federal defense attorney as soon as possible.