In the United States v. Ballard et al., 1943, Guy and Edna Ballard were charged with mail fraud for soliciting funds through the mail under false pretenses. The Ballards claimed to have divine healing powers and founded a religious group called "The Mighty I AM." They argued that their beliefs were sincerely held and thus protected by the First Amendment's guarantee of freedom of religion. The Supreme Court ruled in favor of the defendants, stating that while it was not within its purview to determine whether or not a religious belief is true, it could judge whether claims made about such beliefs are sincere or fraudulent. Therefore, even if their followers believed in them genuinely but they themselves did not believe in what they preached (which constituted fraud), then they could be prosecuted for defrauding people via mails.

In the dissenting opinion for United States v. Ballard et al., Justice Robert H. Jackson argued that the court should not have decided whether or not a religious belief is true, as it goes beyond their jurisdiction and expertise. He believed that by ruling on this case, they were essentially deciding what constitutes legitimate religion and faith, which he saw as an infringement upon freedom of religion. Furthermore, he contended that if people are defrauded under the guise of religion, they should be able to seek redress in courts without having their beliefs scrutinized or judged for truthfulness. In his view, fraud should be punishable regardless of its context within religious practices.