U.S. v. McNally, 483 U.S. 350 (1987) interpreted the mail fraud statute to protect against fraud, but not against bribing politicians. Congress afterwards amended the statute to include "a scheme or artifice to deprive another of the intangible right of honest services." 18 U.S.C. §1346.

The question of honest services turns on whether an actor owes a fiduciary duty to a party. Clearly, an executive has this duty to his company. He is entitled to his salary and not for a payment by a third party for his decisions. If he is paid by a third party to direct a decision of the company in its favor, he has violated the law. At least three difficult questions arise in other circumstance.

Firstly, is this duty owed to independent parties who pay a single agent to solicit business or services in their direction or their interests, in a situation in which the agent cannot successfully obtain favorable treatment for all. A final deal with a third party might involve the whole aggregate, some getting more and some less. Has the agent breached his duty to other clients if he takes extra payment from one in order to receive preferential treatment or advocacy in the deal if he does not offer the same opportunity to all of the others?

Secondly, do political bosses owe honest services to the public? The Second Circuit, in U.S. v. Margiotta, 688 F.2d 108 (2d Cir. 1982), held that a New York political boss, the party county chairman, owes honest services to the public. On the other hand, the Third Circuit in New Jersey could not “identify any clearly established fiduciary relationship or legal duty in either federal or state law between [defendant] Murphy and Passaic County or its citizens.” U.S. v. Murphy, 323 F.3d 102, 117 (3d Cir. 2003).

Thirdly, what is the difference between bribery of a public official, which is illegal, and a campaign donation, which is legal? The definition of bribery usually is a quid quo pro, you do something for me and I do something for you. Under normal circumstances, a bribe can be implied, as when a corporate or executive department official receives, or is promised, a payment or gift in return for a favor. The expected favors do not have to be spelled out. Evidence of the payment is often enough to imply an agreement. If a business contractor pays an unelected official, for instance, a building inspector, with the expectation of favoritism, he might be convicted of bribery, but not if he gives a donation to his boss, an elected official, under the same expectation. The difference is that payment to unelected officials is improper per se. It carries with it a rebuttable presumption of a quid pro quo because the official is not supposed to take money from anyone other than his lawful salary. The party offering the bribe would have a juridical claim, if not against public policy, for a return of his payment if the unelected official made no effort to return the favor. Elected officials, by contrast, are expected to receive money for campaign contributions. Payment of money to them is presumed to be part of the political process, protected by the first amendment. Buckley v. Valeo. 424 U.S. 1 (1976). No quid quo pro is assumed even though the payment might be made with the full expectation that the recipient should drive favors in the direction of the contributor. The contributor could have no juridical claim for his money to be returned if the favor is not carried out because the payment is a presumed political donation. More evidence than payment is thus needed.

This distinction is not always easy to draw.  In a New Jersey case, State v. Schenkolewski, 301 N.J. Super. 115 (App. Div. 1997), a politically influential member of a township planning board claimed he took a large payment, not as a bribe as he was accused by the state, but so that he could “’lobby’ the [Township] Committee members on how to vote. Such a claim, however, would be for a jury to determine at trial. That is, it would be for the jury to decide with what subjective intent these defendants accepted the money.” Id. at 141. This is puzzling. The defendant was effectively the political boss of the town, like the party chairmen in Margiotta and Murphy. No reasonable trier of fact could have thought that his influence was from his position of the planning board rather than the fact that he was the political boss.

Lastly, state legislators are not usually paid enough to support themselves and often do other work, including legal services. No doubt, their political influence serves the interests of their client. A New Jersey state senator secured a position at a school of osteopathic medicine (SOM), which stood to benefit from his influence on a commission recommending cuts to the school, for a job at the school in which he “did little or no legitimate and meaningful work. . . .” The dean of the SOM was also indicted for hiring the legislator “to protect the interests of SOM against the recommendations of the Vagelos Commission.” But the legislator also had a second school job, for which he did little or nothing, at a law school that received at grant of $11 million from the state for a new building. No official of the law school was indicted. The difference is that in the case of the law school, the legislator on his own, “had pushed for both the job and the honorary recognition.” The school was in involved in the scheme. The legislator’s conviction shows that a state legislator cannot legally be hired for his influence and do no work; it does not show that he cannot be hired and do some legitimate work for more money because of his influence, blurring the line between the honest services a state legislator owes to the public and to his employer.