Legal Question in Business Law in Texas

Re: Internet fraud

It may be, although most likely it is only a state matter.

Re: internet fraud

Your question utilizes an interesting phrase: "federal fraud" which could mean either

conduct defined by federal statute to be fraudulent, or conduct which is fraudulent under

state law but which is actionable in federal court under diversity or federal question rules.

I assume for this response that you intend to inquire about federal jurisdiction under

diversity rules as the federal government has not, generally, entered into the fray

of internet commerce by enacting specific statutes defining legality of commercial transactions.

Thus, I am assuming that the offending "internet company" is located in a state different

than your own. Further, I am assuming that "internet company" as used in your question

refers to a "company" doing business over the "internet" rather than to an internet service

provider.

In general, disputes regarding commercial transactions (not necessarily true for criminal

transactions, for which you are referred to the federal cybercrime site at

http://www.cybercrime.gov/ecommerce.html

for further information) conducted, either in whole or in part, over the internet are

analysed in the traditional fashion, the primary remainng issue being where suit may be brought.

That is, whether there is state or federal jurisdiction. As this response has assumed that

the "internet company" was in another state, the amount in controversy will determine

whether there is federal jurisdiction. If, as I believe, this is a consumer transaction,

the issue will become whether there are a sufficient number of like claims that may be

aggregated into a class action which may be brought in federal court.

In short then, while the conduct complained of may be part of a scam or "federal crime",

and may be the subject of aggregation into jurisdictional quantities that support federal

jurisdiction, in the context of a single business transaction for which the purchaser either

did not receive any of the paid for service or received inadequate quantity or quality of

service, the conduct may well be fraudulent but is not "federal fraud".

I recommend that victims of consumer fraud perpetrated at least in part over the internet

report such crimes as directed at the government website above-mentioned.