In tax cases, the IRS and Department of Justice will generally prosecute cases under Title 26, the Internal Revenue Code. However, if a false statement is made outside of a tax document, they may utilize title 18. Section 1001 of Title 18 of the United States Code criminalizes willful false statements or concealment, providing:
(a)Except as otherwise provided in this section, whoever, in any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States, knowingly and willfully—
(1)falsifies, conceals, or covers up by any trick, scheme, or device a material fact;
(2)makes any materially false, fictitious, or fraudulent statement or representation; or
(3)makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry;shall be fined under this title, imprisoned not more than 5 years or, if the offense involves international or domestic terrorism (as defined in section 2331), imprisoned not more than 8 years, or both. If the matter relates to an offense under chapter 109A, 109B, 110, or 117, or section 1591, then the term of imprisonment imposed under this section shall be not more than 8 years.
One of the reasons prosecutors often prefer Title 26 criminal statutes is that the limitations period for prosecution is six years. The statute of limitations for bringing charges under 18 U.S.C. Section 1001 is set by 18 U.S.C. Section 3263 at only five years. “The statute of limitations begins to run when the crime is complete.” United States v. Smith, 740 F.2d 734, 736 (9th Cir. 1984). Under 18 U.S.C. § 1001, the crime is complete when the false statement is submitted or mailed to an agent or agency of the federal government, regardless of whether it is received or relied upon. Id.; United States v. Heacock, 31 F.3d 249, 257 n. 13 (5th Cir. 1994). This is the pertinent moment the limitations period commences due to the statute’s use of the words “in any matter within the jurisdiction of the executive, legislative, or judicial branch of the government,” as it does not fall into the jurisdiction of the federal government until it is submitted to a federal agency. See United States v. Lutz, 154 F.3d 581, 586-87 (6th Cir. 1998).
Notably, the statute of limitations can be waived by agreement. The court in United States v. Caldwell, relying on its holding in United States v. Akmakjian, held that the statute of limitations is waivable by agreement. Caldwell, 859 F.2d 805, 806 (9th Cir. 1988); Akmakjian, 647 F.2d 12, 14 (9th Cir.1981) ( holding that the Statute of limitations was not jurisdictional and was waivable by a defendant). The proper standard by which to judge the validity of waivers is whether they are entered into knowingly and voluntarily. Caldwell, 859 F.2d at 809 (citing United States v. Wild, 551 F.2d 418 (D.C. Cir. 1977)). Applying this standard, courts suggest that when an express agreement was entered into for the benefit of the defendant (for example, in hopes that further inquiry will lead to no indictment at all) with good faith on the part of the government, the defendant is unable to argue that the agreement was not knowingly or voluntarily entered into, even if the prosecution used that time to strengthen its case. United States v. Del Percio, 224 F.3d 847, 859 (6th Cir. 2000); Caldwell, 859 F.2d at 809; Wild, 551 F.2d at 423.
Further, several circuits hold that an agreement to waive the statute of limitations is to be interpreted by applying the same principles applicable to other contracts. See United States v. Spector, 55 F.3d 22, 25-26 (1st Cir. 1995)(applying the principles of estoppel); United States v. Richards, 925 F. Supp. 1097, 1101-02 (N.J. Dist. 1996). The sixth circuit has held, in addition, that the waiver must expressly waive the statute of limitations, not implied as a necessary part of another agreement. See United States v. Crossley, 224 F.3d 847, 859 (6th Cir. 2000) (following Benes v. United States, 276 F.2d 99, 108-09 (6th Cir. 1960). But see United States v. Doyle, 348 F.2d 715 (2nd Cir. 1965) (a plea of guilty implicitly waives a statute of limitations defense for that crime).
Posted on: 04/16/2019
By: Daniel W. Layton
Daniel W. Layton is a former federal prosecutor who worked on criminal tax matters and civil tax matters while at the U.S. Attorney’s Office in downtown Los Angeles. He has his own practice in Orange County, CA.