Justia White Collar Crime Opinion Summaries

Shawn Gorrell was an insurance salesman based in Tulsa, Oklahoma. His father was an accountant in Tulsa whose clients included several dentists and Gorrell sold insurance to some of them. In 2009, Gorrell began to pitch investments to these dentists that were outside of his typical insurance products. Some dentists initially gave Gorrell modest sums to invest, but later the amounts ballooned to hundreds of thousands of dollars. Gorrell would ultimately be convicted by jury on three counts of wire fraud and three counts of tax evasion. He appealed only the tax evasion charges, seeking a new trial on those counts. He argued the trial court plainly erred when it instructed the jury to consider “specified theories of an affirmative act (an element of tax evasion), which were legally invalid theories of guilt as a matter of law, the jury was instructed to be unanimous in finding an affirmative act, and the jury returned a general verdict of guilt.” The Tenth Circuit concluded the district court did not err, “much less plainly err,” in its instructions to the jury. Given the evidence elicited at trial, in light of those instructions, Gorrell’s convictions for tax evasion were supported. View "United States v. Gorrell" on Justia Law

Diana Merritt was convicted of ten counts of mortgage fraud in 2015. The actual crimes were committed between 2008 and 2009, but law enforcement did not discover the extent of those crimes until 2014. Merritt argued the charging document did not sufficiently provide information that the alleged charges occurred within the applicable statute of limitations. She also argued failure to comply with the statute of limitations constituted a violation of her due process rights. The Court of Appeals affirmed Merritt's convictions, and finding no reversible error, so too did the Washington Supreme Court. View "Washington v. Merritt" on Justia Law

In 2014, CNB auditors conducted a surprise audit of the Burlington, Kansas Central National Bank (“CNB” or “Bank”) vault. The vault was missing $764,000. When they began to suspect defendant Denise Christy, she forged documents to purport that she had sent the missing cash to the Federal Reserve Bank of Kansas City (“FRB”). A grand jury indicted her on one count of bank embezzlement, six counts of making false bank entries, six counts of failing to report income on her taxes, and 10 counts of money laundering. After a six-day trial, a jury found Christy guilty of all charges except four money laundering counts. On appeal, Christy argued: (1) cumulative prosecutorial misconduct violated her due process rights; (2) the evidence was insufficient for her money laundering convictions; and (3) the jury instructions improperly omitted a “materiality” element for the false-bank-entry charges. The Tenth Circuit: (1) rejected Christy’s prosecutorial misconduct challenge because she has not shown the prosecutor’s comments influenced the jury’s verdict; (2) reversed Christy’s money laundering convictions because the Government did not produce sufficient evidence of the intent to file a false tax return; and (3) affirmed Christy’s false-bank-entry convictions because, even assuming materiality was an implied element of 18 U.S.C. 1005, its omission from the jury instruction was harmless error. The matter was remanded to the district court with instructions to vacate the convictions for money laundering, resentence the defendant, and further proceedings. View "United States v. Christy" on Justia Law

After investigating complaints regarding the tax-preparation services of defendant Donald Iley, the Colorado Board of Accountancy (Board) issued an “Agreement and Final Agency Order” in which Iley admitted to engaging in professionally negligent conduct and agreed to accept certain disciplinary sanctions, including a $10,000 fine and a five-year probationary period. Among the acts for which the Board disciplined Iley was taking a client’s money, ostensibly to pay the client’s payroll taxes, but then failing to promptly and properly pay those funds to the IRS. While serving the Order’s probationary term, Iley executed a fraudulent scheme in which he fleeced his clients of more than $11 million. As part of this scheme, Iley fraudulently misrepresented to his clients that he was taking their funds to pay outstanding payroll taxes to the IRS but, instead, Iley used those funds for personal purposes. After this fraud was discovered, Iley pleaded guilty to wire fraud and aiding in the preparation of a false tax return. At sentencing, the district court enhanced Iley’s sentence under the U.S. Sentencing Guidelines, section 2B1.1(b)(9)(C). The question presented to the Tenth Circuit was whether the court erred in doing so. The Court held that under the particular circumstances of this case, the court did not err in Iley's sentence, and affirmed. View "United States v. Iley" on Justia Law

Melinda Strom appealed an amended criminal judgment and order for restitution. Strom pled guilty to misapplication of entrusted property in excess of $50,000 in violation of N.D.C.C. 12.1-23-07(1). Strom was sentenced to five years, all suspended for three years of supervised probation. Strom argued the district court abused its discretion in awarding restitution because it did not consider her ability to pay as required by N.D.C.C. 12.1-32-08(1). The North Dakota declared the statute unconstitutional in part and affirmed the restitution order and judgment. The Court concluded the district court did not abuse its discretion in fixing the amount of restitution without regard to the defendant's ability to pay. "To clearly state the scope of this decision, it is necessary to articulate what we do not decide here. In this matter, we examine only an award of restitution and not a contempt hearing or probation revocation for non-payment, and thus we limit consideration of ability to pay only in the context of setting the total amount of restitution. We do not completely preclude consideration of ability to pay. There may be times when such consideration may be appropriate, i.e., when determining the time or manner of payment or whether a defendant's failure to pay is willful." View "North Dakota v. Strom" on Justia Law

Defendant-Appellant, Gunther Glaub, was convicted of violating the criminal provisions of the False Claims Act. He argued on appeal that his act of submitting personal bills and invoices to the United States for payment was protected by the First Amendment. Furthermore, he challenged jury instructions given at trial on grounds that they failed to properly define "claim." Finding no support in the trial court record for either of Glaub's claims, the Tenth Circuit affirmed his conviction. View "United States v. Glaub" on Justia Law

Jared Cowen owned a semi-truck that needed extensive maintenance. To pay the $37,485.65 repair bill, Cowen borrowed $15,000 from his brother and wrote two checks from his company’s bank account, one for $9,327.65 and the other for $13,158.00. Cowen admitted at trial that he knew he did not have sufficient funds to cover the checks when he wrote them, and his bank records corroborated his testimony. Believing it had been paid in full when it received Cowen’s checks, the repair shop released the semi-truck to him. A few days later, it learned that both of Cowen’s checks had failed to clear and that Cowen had issued a stop-payment on them. Cowen was thereafter charged with two counts of fraud by check: one count for each of the checks. He defended against the charges by asserting that he did not intend to defraud the repair shop. The jury convicted Cowen of the charge related to the first check, but acquitted him of the charge related to the second check. As part of Cowen’s sentence, the State requested restitution in the amount of $22,485.65, the total amount of the two checks. Cowen objected to any restitution being imposed for pecuniary losses suffered by the repair shop as a result of the second check because he was acquitted of the charge involving that check. Following a hearing, the trial court granted the State's request, finding that they had proven by a preponderance of the evidence that Cowen had written both checks knowing he had insufficient funds in his company’s account to cover them. The trial court acknowledged Cowen’s acquittal of the charge related to the second check, but explained that it was “absolutely convinced . . . , by far more than a preponderance of the evidence,” that Cowen knew he had failed to secure the financing company’s loan to fund that check. The issue this case presented for the Colorado Supreme Court's review centered on whether Colorado’s restitution statutes authorized a trial court to order a defendant who has been acquitted of a charge to pay restitution for pecuniary losses caused by the conduct that formed the basis of that charge. A division of the court of appeals upheld the restitution order in an unpublished, unanimous decision. The Supreme Court disagreed with the appellate division, however, and reversed. View "Cowen v. Colorado" on Justia Law

In 2000 Balsiger took the helm of IOS, a large coupon processing companies. IOS contracted with large retail chains and small, independently owned stores to collect and sort coupons redeemed at their stores and to submit invoices for reimbursement either directly to the manufacturer or indirectly to the manufacturer’s agent. For his role in designing and implementing a scheme to defraud those manufacturers, Balsiger was charged with 25 counts of wire fraud and conspiracy both to commit wire fraud and obstruct justice. After a decade of litigation, Balsiger represented himself at a bench trial with the assistance of stand-by counsel. The district court convicted Balsiger on 12 counts and sentenced him to 120 months’ imprisonment. The Seventh Circuit affirmed, rejecting Balsiger’s argument that the court deprived him of his Sixth Amendment right to retain the counsel of his choice by failing to grant an 18-month continuance and by refusing to order the government to remove a lis pendens on his home—a notice to potential buyers that title to the property might be impaired by the outcome of his criminal prosecution. The court upheld the district court’s conclusion, following the death of Balsiger’s attorney, that Balsiger waived his right to counsel and its decision to require him, over his objection, to proceed pro se. View "United States v. Balsiger" on Justia Law

A federal grand jury indicted Steven DeLia on one count of healthcare fraud. But the government filed the indictment outside the ordinarily applicable statute of limitations. Notwithstanding this filing, the government argued the indictment was timely because: (1) the Wartime Suspension of Limitations Act suspended the limitations period from running in this case; and (2) DeLia waived his asserted statute-of-limitations defense. The Tenth Circuit rejected both reasons and concluded the prosecution was time-barred. DeLia’s conviction was vacated and the indictment was dismissed. View "United States v. DeLia" on Justia Law

Shannon Porter used over-the-counter tax preparation software to complete and electronically file 123 false tax returns with the IRS. Although the IRS rejected many of the returns and requested refunds, it paid out $180,397 to Porter, which she promptly spent. For this conduct, she pled guilty to making a false statement to the United States in violation of 18 U.S.C. 287 and was sentenced to imprisonment to be followed by a term of supervised release. She would be given two terms of prison-and-supervised release. The third time, no supervised release was recommended or approved by the trial court. Porter appealed the last sentence that did not include supervised release. The Tenth Circuit determined that each of Porter’s previous supervised release violations were punishable as a “breach of trust,” and as such, did not abuse its discretion in denying a request for supervised release upon Porter’s third revocation hearing. View "United States v. Porter" on Justia Law