Justia White Collar Crime Opinion Summaries

The former mayor and the head of the engineering department were convicted of conspiring to embezzle and embezzling government funds, based on use of government funds and government employees to renovate the mayor's house. The mayor claimed that he was unaware of the scheme. The district court gave the jury a conscious avoidance instruction. The mayor had an initial offense level of 10 under the Guidelines, but the court applied enhancements for obstruction of justice, leadership role, and abuse of a position of trust, for a total offense level of 18. With a criminal history level of one, the guidelines range was 27-33 months' imprisonment. The district court imposed a sentence of 60 months, a $60,000 fine, more than $14,000 in restitution, a $200 special assessment, and three years of supervised release. The Seventh Circuit affirmed. The district court was within its discretion in issuing an ostrich instruction, in applying sentencing enhancements, and in its upward departure from the guidelines. View "United States v. Pabey" on Justia Law

Defendant and coconspirators stole clientele books from department stores and used personal information, including credit card numbers, to order merchandise, which was intercepted and sold or returned. She pleaded guilty to conspiracy to commit access device fraud, 18 U.S.C. 1029(b)(2), attempted possession of access devices, id. 1029(a)(3), and aggravated identity theft, id. 1028A(a)(1) (Count III). The district court calculated a four-level increase in her offense level because her crime had more than 50 victims, resulting in a guidelines range of 120-150 months. The court imposed a sentence of 120 months on Counts I and II (to run concurrently) and a consecutive 24-month sentence on Count III as required by 18 U.S.C. 1028A(b). The Seventh Circuit affirmed. Because the court sentenced defendant using the November 2009 guidelines, it included in the count of victims 40 stores and credit card companies that sustained actual loss as well as 65 victims whose credit cards were used, regardless of monetary loss. The court acted within its discretion in rejecting her argument that there was no evidence that cardholders were actually harmed or expended significant time or effort cancelling their credit cards and that the guidelines resulted in a sentence that was greater than necessary. View "United States v. Sandoval" on Justia Law

Defendant was sole owner of a corporation that was a contractor for several Illinois governmental entities. After an audit disclosed irregularities and falsified documents, defendant pled guilty to two counts of mail fraud and one count of submitting false documents; the corporation pled guilty to one count of mail fraud (18 U.S.C. 1001, 1341). Sentences included restitution of $10 million. The Seventh Circuit affirmed, rejecting a claim that defendants were entitled to a "full, dollar-for-dollar credit for the value of the monies and securities" deposited with the Clerk of Court at the time of their deposit, pre-judgment, and that the diminution in value of those securities after their deposit could not be attributed to defendants. Neither the court, the clerk, nor the government exercised authority to remove the funds or securities before sentencing and entry of judgment. Defendant chose to deposit securities, rather than cash, and the deposit did not constitute actual payment of restitution, but only security for eventual payment. View "United States v. Shah" on Justia Law

Defendants, four executives of Gen Re and one of AIG, appealed from convictions of conspiracy, mail fraud, securities fraud, and making false statements to the SEC. The charges arose from an allegedly fraudulent reinsurance transaction between AIG and Gen Re that was intended to cure AIG's ailing stock price. Defendants appealed on a variety of grounds, some in common and others specific to each defendant, ranging from evidentiary challenges to serious allegations of widespread prosecutorial misconduct. The court held that most of the arguments were without merit, but defendants' convictions were vacated because the district court abused its discretion by admitting the stock-price data. View "United States v. Ferguson, et al." on Justia Law

Defendant pleaded guilty to aiding and abetting a scheme to defraud Wal-Mart of more than $675,00 by the use of fictitious money transfers. Defendant was ordered to pay restitution to Wal-Mart, but just before her sentencing, defendant transferred a substantial portion of her cash assets to her boyfriend. Defendant subsequently violated a condition of supervised released by failing to make two scheduled restitution payments. Defendant's supervised release was revoked and she was sentenced to one year and one day in prison. The court affirmed and held that defendant willfully failed to make sufficient bona fide efforts legally to acquire the resources to pay her restitution obligation. Accordingly, the judgment was affirmed. View "United States v. Holt" on Justia Law

Brian and Debra Spurlin were convicted of concealment of bankruptcy estate assets, for knowingly and fraudulently withholding their interests in certain properties from their bankruptcy filings, and false oaths and statements in bankruptcy for a false answer they gave on a bankruptcy questionnaire. Mr. Spurlin was also convicted of bankruptcy fraud for filing bankruptcy to effect and conceal a fraudulent scheme whereby he took money he was supposedly holding in escrow for a company with whom he was doing business. Mr. Spurlin did not appeal his conviction of concealment, but the Spurlins appealed all other convictions. The court affirmed the conviction of Mrs. Spurlin on all counts; affirmed Mr. Spurlin's convictions of concealment of bankruptcy estate assets and of bankruptcy fraud; but reversed Mr. Spurlin's conviction of false oaths and statements in bankruptcy for insufficient evidence. Accordingly, the court vacated Mr. Spurlin's sentence and remanded for resentencing. View "United States v. Spurlin, et al." on Justia Law

Defendant operated what appeared to be convenience stores, but in fact were fronts that rang up phony sales for food-stamp recipients to exchange their benefits for discounted amounts of cash. When federal investigators discovered the scheme at one location, he obtained government authorization to accept food stamps at a different address and continued the operation. Defendant eventually pleaded guilty to eight counts of wire fraud, 18 U.S.C. 1343, and was sentenced to 60 months' imprisonment and ordered to pay almost $1.7 million in restitution. The Seventh Circuit affirmed. The district court properly imposed a 16-level sentencing increase under 2B1.1(b)(1)(I) for a loss of more than $1 million because. If anything, the court underestimated the loss. The court properly assessed a 4-level increase under 3B1.1(a) for leadership in an "extensive" scam; defendant ran the scam from multiple locations, traded cash for benefits with "probably hundreds" of customers, and supervised employees at his stores. View "United States v. Hussein" on Justia Law

Defendant was convicted of crimes related to his involvement in a multi-billion dollar Ponzi scheme and was sentenced to 50 years imprisonment and 3 years of supervised release. Defendant appealed, challenging his conviction and sentence. The court held that defendant's Sixth Amendment rights were not violated when the district court sealed a cooperating witness's United States Marshals Service's Witness Security Program (WITSEC) file, limited defendant's ability to reference the witness by name at a pretrial hearing, prevented defendant from introducing the file into evidence, and prohibited the use of the WITSEC file to impeach the witness. The court also held that the district court properly denied defendant's proffered jury instructions. The court further held that the district court did not abuse its discretion in denying defendant's motion to change venue. The court rejected defendant's argument that the district court committed procedural error in sentencing. Accordingly, the court affirmed defendant's conviction and sentence. View "United States v. Petters" on Justia Law

Defendant was convicted of one count of conspiracy to commit securities registration violations, securities fraud, and wire fraud in violation of 18 U.S.C. 371, and nine counts of wire fraud in violation of 18 U.S.C. 1343. Defendant raised several issues on appeal. The court concluded that the district court did not abuse its discretion in its ruling on defendant's motion in limine and when regulating the testimony of two expert witnesses during trial. Because the relevant legal regimes were complex, it assisted the jury to have them explained. The court also concluded that the district court acted well within its broad discretion in admitting lay opinion testimony of two co-conspirators under Rule 701. Defendant's challenges to two other rulings by the district court made during trial did not merit extensive discussion and were rejected. The court further concluded that defendant's sentence was reasonable. Accordingly, the court affirmed defendant's conviction and sentence. View "United States v. Offill, Jr." on Justia Law

Defendant was convicted of conspiracy to commit bank fraud, bank bribery, making false statements to a financial institution, and wire fraud and was sentenced to 78 months' imprisonment. Defendant appealed from his convictions and sentence. The court held that the district court adequately considered defendant's right to be represented by the counsel of his choice against the court's interest in the orderly administration of justice and that the district court did not abuse its discretion in denying a continuance for defendant to retain new counsel. In light of United States v. Hildebrand, the court could not say that the district court plainly erred in considering the statements defendant made at allocution. Accordingly, the convictions and sentence were affirmed. View "United States v. Robinson" on Justia Law