Justia White Collar Crime Opinion Summaries

The dean of a school gave the New Jersey State Senator a "low show" well-paid job in exchange for the senator's efforts as Chairman of the Senate Appropriations Committee to obtain funding for the school. The senator also attempted to use a "no show" job as an attorney for county social services to increase his pension benefits. Both were convicted of honest services fraud (18 U.S.C. 1341, 1343 and 1346 and bribery in connection with a state agency that receives federal funds (18 U.S.C. 666(a)). The senator was also convicted of mail fraud (18 U.S.C. 1341) for the pension scheme. The senator was sentenced to 48 months and the dean to 18 months in prison. The court entered a joint restitution order for $113,187. The Third Circuit affirmed, finding sufficient evidence to support each conviction. The government's requests that grand jury witnesses voluntarily not disclose "any matters" that occurred during those proceedings did not interfere with defense access to witnesses so as to merit reversal. The court properly instructed the jury on honest services fraud or bribery, in light of the Skilling decision, and acted within its discretion in regard to testimony by the director of pension services. View "United States v. Bryant" on Justia Law

Defendant was convicted of obstruction of justice, witness tampering, and conspiracy and sentenced to 120 months in prison and payment of fines and assessments. In a separate trial he was convicted of conspiracy to commit securities fraud, wire fraud, and money laundering and sentenced to 360 months, to run concurrently. in a consolidated appeal, the Sixth Circuit affirmed. The district court properly denied an entrapment instruction; there was never any meeting of defendant and the government agents and, hence, no inducement. Wiretap evidence was properly admitted. There was no evidence that the warrant contained intentional or reckless falsehoods and there was probable cause. Evidence concerning the amount of loss was properly admitted with respect to both cases and sentencing was reasonable, regardless of the defense theories about other possible causes of the loss.View "United States v. Poulsen" on Justia Law

The former Pennsylvania State Senator was sentenced to 55 months' imprisonment, a $411,000 fine, and $2,340,839 in restitution, after conviction on 137 counts of fraud, tax evasion, and obstruction of justice. His former aide was sentenced to imprisonment of one year and one day, a $45,000 fine, and joint and several restitution of up to $792,802, after conviction on 45 counts. The Third Circuit affirmed the senator's conviction, but vacated both sentences. The court acted within its discretion in admitting evidence concerning the state Ethics Act. The content and enforcement of the Act were relevant to the claim that there were rules that the senator broke repeatedly, that those rules were clear enough for him to understand, and to show that he was deceiving the Senate when he misrepresented or omitted aspects of his actions and expenditures to avoid the perception that he had violated those rules. A juror's social media comments did not merit a new trial, nor did another juror's exposure to excluded evidence. The district court's failure to calculate a final guidelines range left the court unable to review the procedural and substantive bases of the sentence and affects the substantial rights of the parties; the court abused its discretion with respect to several aspects of sentencing. View "United States v. Fumo" on Justia Law

Defendant, convicted of obstruction of justice, witness tampering, and conspiracy, in connection with offering a bribe for favorable testimony in a business fraud case, was sentenced to 84 months' imprisonment. The Sixth Circuit affirmed. The district court acted within its discretion in refusing to give an entrapment jury instruction, in defining the corrupt intent required to convict as "characterized by improper conduct." Defendant acted for profit, was not reluctant to commit the offense, made the initial suggestion of the offense, and had little to no inducement from the government. The definition amounted to "invited error" and was not manifestly unjust. The sentence was reasonable; defendant knew the size and scope of the underlying crime at the outset. View "United States v. Demmler" on Justia Law

In 2004, defendant spent approximately $38,000 on home repairs for a Chicago alderman, a crucial player in defendant's attempt to have industrial property rezoned for commercial and residential development. Defendant also convinced business associates to donate, at his expense, to the alderman's aunt's congressional campaign. During an investigation, defendant fabricated an invoice for the home repairs, purportedly sent from his general contractor to defendant. The Seventh Circuit affirmed convictions for bribing a local official (18 U.S.C. § 666(a)(2)); exceeding federal campaign contribution limits through straw-man donations (Federal Election Campaign Act, 2 U.S.C. 441a(a)(1),441f & 437g(d)(1)(A)(ii)); and endeavoring to obstruct justice (18 U.S.C. 1503(a)). The government was not required to establish a specific quid pro quo of money in exchange for a legislative act. The district court acted within its discretion in holding an adversarial in camera hearing to determine the existence of the crime-fraud exception. Section 441f unambiguously proscribes straw man, as well as false name, contributions. View "United States v. Boender" on Justia Law

This case stemmed from appellant's participation in the Bayou Hedge Fund Group (Bayou), a classic Ponzi scheme masked as a group of domestic and offshore hedge funds. Appellant appealed from his sentencing, following a plea of guilty to misprision of felony in violation of 18 U.S.C. 4. At issue was whether the district court's order of restitution in the amount of $60 million was improper because it relied on events occurring outside the relevant time period and the putative victims' losses were neither directly nor proximately caused by his actions as required by the Mandatory Victims Restitution Act of 1996 (MVRA), 18 U.S.C. 3663A. The court found no error, much less plain error, in the district court's use of appellant's fraudulent 2003 faxes at sentencing. The court also found no error in the district court's conclusion that appellant's failure to report the Bayou fraud was both the direct and the proximate cause of the victim investors' losses. Accordingly, the judgment was affirmed. View "United States v. Marino" on Justia Law

Former investors with Bernard L. Madoff appealed from an order entered by the United States Bankruptcy Court in the liquidation proceedings of Bernard L. Madoff Investment Securities LLC under the Securities Investor Protection Act (SIPA), 15 U.S.C. 78aaa et seq. At issue was whether the Net Investment Method the trustee selected for carrying out his responsibilities under SIPA was legally sound under the language of the statutes. The court held that the trustee's determination as to how to calculate "net equity" under SIPA was legally sound in light of the circumstances of the case and the relevant statutory language. Accordingly, the court affirmed the order of the bankruptcy court. View "In Re: Bernard L. Madoff" on Justia Law

The United States brought this civil action under 26 U.S.C. 7408 to enjoin defendant from promoting several fraudulent tax schemes. After a court trial, the district court permanently enjoined defendant from promoting his schemes, ordered him to advise the IRS of any tax arrangements or business entities formed at his discretion, and required him to provide a copy of its order to his clients. On appeal, defendant argued that the injunction was not supported by adequate factual findings and legal conclusions, and that it was overbroad, an impermissible delegation of Article III power, and an unconstitutional prior restraint. The court rejected defendant's hypertechnical criticisms of the district court's order where section 6700 was a linguistically complex and intricate statute and where the district court need not include the entire statutory language in each of its findings and conclusions. Therefore, the court held that the district court's exhaustive order more than satisfied each of the requirements in section 6700 and affirmed the judgment of the district court.

Count One of the multi-count indictment in this case charged Robert and Patrick Singletary, and others, with conspiring between 1997 and September 16, 2004, in violation of 18 U.S.C. 371, to commit three offenses: (1) to defraud a federally insured bank, in violation of 18 U.S.C. 1344; (2) to make false representations with respect to material facts to the United States Department of Housing and Urban Development (HUD), in violation of 18 U.S.C. 1001; and (3) to defraud purchasers of residential property and mortgage lenders, in violation of 18 U.S.C. 1343. The Singletarys eventually pled guilty to Count One to the extent that it alleged a conspiracy to commit the section 1343 offense in addition to the section 1001 offense. At issue was whether the district court abused its discretion in ordering restitution in the sum of $1 million. The court held that the district court failed to determine by a preponderance of the evidence which of the 56 mortgages the loan officers handled was obtained through a false "gift" letter, a false "credit explanation" letter, or a false employment verification form; and where fraud was found, to determine the extent of the actual loss HUD could have incurred due to the mortgage's foreclosure. Accordingly, the court vacated the restitution provisions and remanded for further proceedings.

Defendant-Appellant Michael Cooper was convicted by jury on one count of conspiracy to defraud, and multiple counts of mail and wire fraud, money laundering and engaging in transactions derived from unlawful activity. Defendant filed several motions with the district court including motions for a judgment of acquittal, a post-verdict motion for a new trial, and a motion to suppress evidence under the Fourth Amendment. The district court denied them all. On appeal, Defendant challenged the district court's denial of those motions. Upon review of the trial court record and the applicable legal authority, the Tenth Circuit found Defendant failed to prove that the evidence presented against him at trial was insufficient to support his convictions. Therefore the Court affirmed the district court's denials of Defendant's motions for judgment of acquittal, for a new trial, and to suppress evidence, and affirmed Defendant's convictions.