If you have been arrested and charged with a federal crime, you no doubt realize the potential repercussions could be severe. A conviction for a federal offense has the potential for a lengthy prison sentence, debilitating fines, and other repercussions tied to the specific statute the prosecution charges you. These are only a portion of the potential consequences, especially for business owners and operators.
In addition to the penalties that result directly from a conviction, there are also indirect repercussions that could impact your life. These are known as collateral consequences. Many of these consequences occur as a result of a federal statute. There are thousands of these statutes covering a wide range of effects. For business owners, some of the most severe consequences involve the suspension or loss of business licenses or certifications.
If you are facing federal charges, your livelihood could be at risk. While a conviction has the potential to turn your professional life upside down, you do have options for protecting yourself. To discuss your defense options, contact attorney Doug Murphy right away. During your consultation, Doug Murphy could advise you on strategies for avoiding the collateral consequences we review below.
Business Licenses or Certificates Issued by Federal Agencies
One collateral consequence of a federal conviction for bribery could involve the direction cancellation of business licenses, certifications, or contracts award to the defendant by the federal government. These consequences are governed by 18 U.S.C. § 218.
This statute is limited to crimes involving or obtaining a federal contract, license, certification, or another benefit through the use of bribery, graft, or a conflict of interest. Upon a conviction, the head of a federal department or agency is empowered to cancel any transaction obtained through the use of this bribery. There is no recourse following such cancellation.
Ineligibility for Federal Contracts or Licenses
Like with charges relating to bribery, there is also an array of steep collateral consequences for those convicted of federal drug offenses. According to 21 U.S.C. § 862, anyone convicted of drug trafficking or possession could lose their eligibility for federal benefits. The term “federal benefit” is broad, but specifically includes:
the issuance of any grant, contract, loan, professional license, or commercial license provided by an agency of the United States or by appropriated funds of the United States
It is worth noting that the courts have some say in this prohibition in certain cases. For example, a federal judge has the option to bar a person convicted of first-offense drug trafficking from any federal benefits within 5 years of the date of the conviction. For second offenses, the court still has discretion but could rule a person ineligible for 10 years. For a third offense, the loss of access to federal contracts or certifications is no longer in the court's discretion. This is because a third offense for drug trafficking results in an automatic, permanent ban from obtaining federal benefits.
The structure of penalties for a drug possession conviction is not quite as steep. For those convicted of drug possession for the first time, the court has the discretion to rule them ineligible for federal benefits for up to one year. For second or subsequent offenses, this ineligibility could last as long as five years. In any of these cases, a court that – at their discretion – finds a person ineligible for federal benefits could reinstate their rights.
Forfeit of Federal Savings Association Franchise
Federal savings banks, also known as federal savings associations, may only operate with the approval of the Office of the Comptroller of the Currency. In cases where a senior official or the federal savings association itself is convicted of money laundering, the association is at risk of forfeiting its franchise. The same is true for offenses related to cash transaction reporting offenses.
This potential forfeiture is governed by 12 U.S.C. § 1464. Upon a conviction, the Attorney General must notify the Comptroller, who will begin termination proceedings. This forfeiture is never guaranteed, however, if senior executives or shareholders can show they were unaware of any money laundering activities.
Revocation of a Federal Credit Union Organization Certificate
Much like with a federal savings association, there are also steep consequences for a conviction for money laundering or cash transaction reporting offenses for a federal credit union. According to 12 U.S.C. § 1772d, a federal credit union is at risk of forfeiting their franchise upon a conviction for either offense. The process for avoiding this collateral consequence is the same as with a federal savings association.
Termination of Petroleum Franchise
A person or entity holding a franchise to sell, distribute, or consign petroleum could find that franchise terminated following a conviction of certain federal crimes. According to 15 U.S.C. § 2802, there are limited grounds under which these franchises could be terminated. One of them is if a franchisee is convicted of a felony of moral turpitude.
A crime of moral turpitude involves “shameful wickedness” that is “so extreme a departure from ordinary standards of honesty, good morals, justice, or ethics as to be shocking to the moral sense of the community.” In practice, this can mean anything from murder to fraud or bribery.
Suspension or Revocation of Securities Transaction Transfer Agent Registration
A securities transaction transfer agent is an entity that manages registered shareholders that issue stock. It is possible for these transfer agents to see their registration suspended or revoked in certain circumstances. According to 15 U.S.C. § 78q-1, a transfer agent could face a suspension of up to a year or a permanent revocation if any person associated with the company commits unlawful trades in violation of federal law.
Suspension of Federal Archaeological Excavation Permit
Any excavation or removal that occurs on federal land must be done with the approval of the government. Before digging can begin, an archaeologist must obtain an excavation permit from the federal land manager.
However, this certification to excavate can be revoked upon a criminal conviction under 16 U.S.C. 470ee. According to this statute, it is unlawful to traffic in stolen artifacts. The statute also penalizes unauthorized digs as well as defacing or altering archaeological resources. It is at the discretion of the Federal land manager to suspend or revoke a permit.
Revocation of License to Import, Manufacture, or Deal in Explosives
Few industries are regulated as heavily as the import, manufacturing, or dealing in explosives. Any of these activities within the United States require strict licensing from the federal government. According to 18 USC § 843, any criminal violation regarding the possession or manufacturing of explosives could cost you your license.
According to the statute, the Attorney General is empowered to reject the application or revoke the license of anyone that has willfully violated the regulations pertaining to manufacturing, dealing, or importing explosives.
However, there is a process for fighting back against this revocation. The Attorney General is required to provide written notice of the revocation within 90 days. Upon request, the Attorney General must hold a prompt hearing related to the revocation. In many cases, the Attorney General will stay this revocation until the hearing occurs. You are entitled to a prompt response following the hearing, and you have the right to appeal the decision to the U.S. Court of Appeals for your circuit.
Suspension or Revocation of Registration to Manufacture or Dispense Controlled Substances
For the purposes of research or medicine, certain facilities are awarded the right to manufacture, distribute, or possess a controlled substance without fear of arrest. This permission is difficult to obtain, and it should be no surprise that a federal conviction could lead to the suspension or revocation of these rights.
According to 21 U.S.C. § 824, the Attorney General may revoke the registration necessary to manufacture, distribute, or dispense controlled substances following certain criminal convictions. These convictions could occur in state or federal court. These offenses must be felonies, and they must relate to controlled substances outlawed by the federal government. This could include charges of possession, trafficking, manufacturing, or distributing a controlled substance on the state or federal level.
Fighting Back with the Help of a Houston Federal Crimes Lawyer
Ultimately, any business license or certification offered by the federal government could be at risk following a criminal conviction. While some situations allow for a person to fight their suspension or revocation, the process is often time-consuming or difficult. Many jump through the hoops to fight back against a license revocation only to fall short in reversing the government's decision.
When it comes to protecting your licenses and certificates, it is generally in your best interest to fight back against the underlying offense. In many cases, you could defeat the charges against you and avoid triggering these collateral consequences.
Attorney Doug Murphy understands what is on the line when you face federal charges, and he is ready to help you defend yourself in federal court. To discuss your chances of success, schedule a free consultation with the Doug Murphy Law Firm, P.C. right away.