Justia White Collar Crime Opinion Summaries

Articles Posted in Constitutional Law
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Defendant appealed his sentence of 25 months' imprisonment plus five years of supervised release following his guilty plea to ten counts of embezzlement under 18 U.S.C. 656, and eight counts of bank fraud under 18 U.S.C. 1344. The eighteen counts defendant pleaded guilty to related to two schemes to defraud Wells Fargo: an embezzlement scheme and a check-kiting scheme. On appeal, defendant's primary contention was that because he did not know he was the subject of a pending criminal investigation at the time he committed perjury in a civil suit concerning the very same conduct later charged in the criminal indictment, the district court erred in applying U.S.S.G. 3C1.1 to enhance his sentence for willfully obstructing justice. The court held that because the district court applied the correct legal standard and relied upon probative evidence submitted by the government, the district court did not err in calculating the intended loss at being over $200,000. The court also held that "willful" meant only that defendant had engaged in intentional or deliberate acts designed to obstruct any potential investigation, at the time an investigation was in fact pending; it did not mean that defendant had to know for certain that the investigation was pending. Accordingly, the court affirmed the judgment. View "United States v. Gilchrist" on Justia Law

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Defendant, manager of a kosher meatpacking company, was convicted of 86 counts of bank, wire, and mail fraud; making false statements to a bank; money laundering; and violations of an order of the Secretary of Agriculture. Defendant appealed his convictions and sentence. The court held that there was no evidence in the record that the district court's decision to remain on the case prejudiced defendant's verdict and concluded that the district court did not err by denying defendant's motion for a new trial. The court also held that the district court did not abuse its discretion in trying the financial charges first where the district court's order was a practical solution given the nature and number of the charges. The court further held that, with the exception of one count of false statements to a bank which was premised solely on violations of immigration law, any error on this evidence would have been harmless because it would have had no effect on the verdict. Therefore, the district court did not abuse its wide discretion in excluding evidence. The court finally held that, because defendant's offense was falsely stating that the company was in compliance with its laws, the court did not commit plain error with its instruction on harboring illegal aliens; defendant's money laundering convictions were lawful and did not merge with any other of his crimes; there was no error in the district court's loss calculation; and the district court did not abuse its considerable discretion in imposing a 324 month sentence. Accordingly, the court affirmed the judgment of the district court. View "United States v. Rubashkin" on Justia Law

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Defendant, James Gansman, appealed from a judgment convicting him of insider trading under the so-called "misappropriation theory." At issue was whether the district court erred in declining to adopt an instruction proposed by Gansman setting forth a theory of the defense based in part on SEC Rule 10b5-2, 17 C.F.R. 240.10b5-2. The court held that Gansman was entitled to assert a defense theory that he did not have the requisite intent to commit securities fraud, and that in defining the nature of his relationship with Donna Murdoch, a woman with whom he was having an affair, to the jury, he had the right to use language found in Rule 10b5-2. The court held that, nevertheless, Gansman was not entitled to a new trial in the circumstances presented because the slightly modified instruction given by the district court was legally sufficient. Gansman raised a number of other challenges to his conviction, all of which were without merit. Accordingly, the court affirmed the judgment of the district court. View "United States v. Gansman, et al." on Justia Law

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Defendant pleaded guilty to multiple crimes related to his conduct in running a fraudulent Ponzi scheme. The district court disregarded the plea agreement's recommendation of an applicable sentencing range of 151-188 months imprisonment and imposed the statutory maximum sentence of 360 months. Defendant argued that the Government breached the plea agreement by providing the district court with facts and arguments supporting a longer sentence than the parties agreed upon. The court held that the Government did not breach the plea agreement where the district court exercised its discretion by disregarding the plea agreement's recommendations and independently deciding to impose the statutory maximum sentence. The court also held that defendant waived his right to appeal the sentence on grounds that the district court abused its discretion in imposing the statutory minimum. Accordingly, the sentence was affirmed. View "United States v. Pizzolato" on Justia Law

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Defendants, Brian Keith Ellefson and Mark Edward Ellefsen, were convicted of conspiracy to defraud the United States by obstructing the IRS in the assessment and collection of federal taxes. Brian was also convicted of three counts of filing false income tax returns while Mark was convicted of three counts of aiding and assisting the preparation of false income tax returns. Defendants appealed their convictions and challenged the restitution order. The court held that because the undisclosed information at issue was not material, there was no Brady violation. The court also held that, although the defense should have been allowed to cross-examine a certain government witness regarding a tax-loss calculation and whether she considered Brian's additional payments, any error in denying the cross-examination was harmless beyond a reasonable doubt. The court further held that the district court did not abuse its discretion in excluding defendants' proposed expert testimony under Federal Rule of Evidence 403. The district court also did not err in denying the motion for judgment of acquittal and did not abuse its discretion in denying the motion for a new trial where the record was replete with evidence to support the jury's finding that defendants acted willfully. The court finally held that there was no clear error in the district court's judgment of restitution where the government met its burden of proof and deducted Brian's additional payments from the amount of restitution owed to the IRS. Accordingly, the convictions and restitution orders were affirmed. View "United States v. Ellefsen" on Justia Law

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Defendant was convicted of filing a false joint income tax return with his wife for calendar year 2007 and sentenced to twenty-four months in prison. On appeal, defendant argued that there was insufficient evidence of willful false reporting, admission of unfairly prejudicial evidence of gambling expenses, and a substantively unreasonable sentence. The court held that the government's evidence was sufficient to permit a rational trier of fact to find the essential elements of the offense beyond a reasonable doubt. The court also held that defendant's casino activities were clear evidence that he personally spent a substantial amount of his business's reported income on expenditures that were not reportable as the business's costs of goods sold and that the evidence was unlikely to unfairly prejudice him. The court further held that the district court did not abuse its substantial sentencing discretion in imposing a presumptively reasonable sentence that was within the advisory guidelines range. Accordingly, the judgment of the district court was affirmed. View "United States v. Shrum" on Justia Law

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Defendant, a state court judge and former criminal defense attorney, was convicted of two counts of wire fraud and one count of making false statements, stemming from defendant's use of his position as a state judge to obtain money and sexual favors in exchange for assisting a criminal defendant. Defendant subsequently appealed his conviction and his 60-month concurrent sentences. The court held that the district court did not abuse its discretion in denying defendant's motion for a new trial; based on the record, the court concluded beyond a reasonable doubt that the verdict would have been the same absent any error in the jury instructions and the indictment; and defendant's sufficiency of the evidence challenged failed. The court also held that the district court properly applied the specific offense characteristic; the second uncharged bribe could be used to increase the offense level for defendant's bribery conviction; and any monies rendered for legitimate legal services could not be subtracted from the loss value under U.S.S.G. 2C1.1(b)(2) because defendant and his colleague provided these services after the offense was detected. Therefore, none of defendant's several challenges required a new trial, reversal of conviction, or resentencing.View "United States v. Barraza" on Justia Law

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Defendant was convicted for the theft or embezzlement of funds from his employee's IRA accounts in violation of 18 U.S.C. 664. On appeal, defendant argued that his conviction should be reversed because, at trial, the district court barred him from presenting evidence to the jury that he eventually repaid all of the embezzled funds. The court held that because the intent to permanently deprive was neither a required element of, nor a defense to, the conversion or stealing that section 664 criminalized, the district court did not abuse its discretion when it excluded evidence of defendant's eventual repayment of his employees' funds in a bankruptcy proceeding as irrelevant. View "United States v. Van Elsen" on Justia Law

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Defendant was convicted of wire fraud, money laundering, and failure to file tax returns. The district court sentenced him to 90 months imprisonment and ordered over eight million dollars in restitution. Defendant appealed, arguing that the evidence was insufficient for his wire-fraud and money-laundering convictions and that his sentence and the restitution were unreasonable. The court held that, based on the totality of the evidence, the jury reasonable returned a guilty verdict. The court also held that the district court was authorized to consider the charged and uncharged conduct in awarding restitution and that the district court did not abuse its discretion by ordering restitution in an amount greater than the loss calculation. The court further held that the district court specifically acknowledged the relevant sentencing factors, that they were advisory, and that it was for the district court to determine a sentence which was sufficient but not greater than necessary to comply with those factors. The court finally held that the 90 month sentence was substantively reasonable. View "United States v. Jefferson" on Justia Law

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Appellant was the target of a grand jury investigation seeking to determine whether he used secret Swiss bank accounts to evade paying federal taxes. The district court granted a motion to compel appellant's compliance with a grand jury subpoena dueces tecum demanding that he produce certain records related to his foreign bank accounts. The court declined to condition its order compelling production upon a grant of limited immunity, and pursuant to the recalcitrant witness statute, 28 U.S.C. 1826, held appellant in contempt for refusing to comply. The court held that because the records sought through the subpoena fell under the Required Records Doctrine, the Fifth Amendment privilege against self-incrimination was inapplicable, and appellant could not invoke it to resist compliance with the subpoena's command. The court also held that because appellant's Fifth Amendment privilege was not implicated, it need not address appellant's request for immunity. Accordingly, the judgment of the district court was affirmed. View "In re: Grand Jury Investigation of M.H." on Justia Law