Justia White Collar Crime Opinion Summaries

In 2011-2016, Collins was the executive director of the Kankakee Valley Park District. The Park District, which is not tax-exempt, works with the Kankakee Valley Park Foundation, which does have tax-exempt status and raises funds for Park District programs. Collins served as treasurer for the Foundation. It came to light that he had been lining his own pockets with the Park District and Foundation’s money. He pleaded guilty to mail and wire fraud, 18 U.S.C. 1341 and 1343, and was sentenced to concurrent terms of 42 months’ imprisonment, two-year terms of supervised release, and overall restitution of $194,383.51. The Seventh Circuit affirmed, concluding that the district court did not err in calculating his sentencing range and that Collins forfeited the right to complain about the restitution because he failed to file a timely notice of appeal from the district court’s amended judgment. The actual loss amount easily exceeded $150,000, which is the amount associated with a 10-level boost in the base guideline level for U.S.S.G. 2B1.1. More than a guilty plea is necessary before a district court ought to award a discount for acceptance of responsibility. The court fully supported its factual finding that Collins had not fully acknowledged his crimes. View "United States v. Collins" on Justia Law

The DC Circuit affirmed Defendants Cooper and Bryant's appeal of their convictions and sentences for theft of public money and conspiracy to defraud the United States. The court held that the district court correctly concluded that Cooper's statements could be used at trial where the evidence showed that Cooper's statements were given freely and voluntarily; a special agent's testimony did not meaningfully prejudice the defense; the district court did not err by denying Cooper's motion for a mistrial during the government's rebuttal where the prosecutor did not misstate the evidence applicable to Cooper, and the occasional inadvertent references to "these defendants" when discussing acts not attributable to Cooper were quickly remedied; and the district court's calculation of the restitution amount was appropriate. View "United States v. Cooper" on Justia Law

Around 2004, LeBeau's health club located on 10 acres in Aurora, Illinois, ran into difficulties. LeBeau teamed up with Bodie to redevelop the land as a condominium project. Bodie ran two mortgage companies. They submitted a loan application to Amcore, a federally insured financial institution. The bank gave them a $1,925,000 mortgage loan. LeBeau and Bodie executed full personal guarantees on the loan and listed Bodie’s two companies as guarantors. LeBeau failed to disclose more than $130,000 in outstanding personal loans. The two fell behind on the loan and obtained a forbearance agreement (later amended) from Amcore. The two men were indicted in 2014 on multiple counts of bank fraud and making false statements to the bank in connection with the loan and forbearance agreements. In 2017, they were convicted. The court sentenced each one to 36 months’ imprisonment and restitution of more than a million dollars.The Seventh Circuit affirmed, rejecting arguments that the district court erred by failing to give the jury an instruction on materiality for the bank-fraud offenses; that the court should not have admitted evidence related to certain victims’ losses in the scheme and their status as prior victims of fraud; and that LeBeau received ineffective assistance of counsel at the sentencing stage, where his lawyer failed to challenge the amount of restitution. The court also rejected Bodie’s argument that his superseding indictment was time-barred and his challenge to the sufficiency of the evidence. View "United States v. Lebeau" on Justia Law

The Second Circuit affirmed defendant's 70-month sentence for tax offenses. The court held that the district court did not abuse its discretion by denying his post‐trial request for a competency hearing based chiefly on his adherence to the Sovereign Citizen movement. The court held that the record supported the district court's conclusion that defendant's words and actions reflected his anti‐government political views and legal theories rather than an inability to understand the proceedings against him.The court also held that the district court did not abuse its discretion in deciding to give no weight to the report of defendant's expert, because the report was based on insufficient facts and data, and the district court did not abuse its discretion in finding that the expert employed unreliable principles and methods. Finally, even if the court were to conclude that the district court improperly relied on another expert's testimony without explicitly ruling on its admissibility or reliability under Federal Rule of Evidence 702, the error would be harmless. View "United States v. DiMartino" on Justia Law

Fishoff began trading securities in the 1990s. By 2009, he had earned enough money to establish his own firm, with one full-time employee and several independent contractors. Fishoff had no formal training in securities markets, regulations, or compliance. Nor did he hold any professional license. He operated without expert advice. Fishoff engaged in short-selling stock in anticipation of the issuer making a secondary offering. Secondary offerings are confidential but a company, through its underwriter, may contact potential buyers to assess interest. When a salesperson provides confidential information, such as the issuer's name, the recipient is barred by SEC Rule 10b-5-2, from trading the issuer’s securities or disclosing the information before the offering is publicly announced. Fishoff’s associates opened accounts at investment banking firms in order to receive solicitations to invest in secondary offerings. They agreed to keep the information confidential but shared it with Fishoff, who would short-sell the company’s shares.Fishoff pled guilty to securities fraud (15 U.S.C. 78j(b), 78ff; 17 C.F.R. 240.10b-5 (Rule 10b-5); 18 U.S.C. 2), stipulating that he and his associates made $1.5 to $3.5 million by short-selling Synergy stock based on confidential information. Fishoff unsuccessfully claimed that he had no knowledge of Rule 10b5-2 and was entitled to the affirmative defense against imprisonment under Securities Exchange Act Section 32, as a person who violated a Rule having “no knowledge of such rule or regulation”. The Third Circuit affirmed his 30-month sentence. Fishoff adequately presented his defense. The court’s ruling was sufficient; the government never agreed that the non-imprisonment defense applied. Fishoff did not establish a lack of knowledge. His attempts to conceal his scheme suggests that he was aware that it was wrong. View "United States v. Fishoff" on Justia Law

This case arose out of a fraudulent business scheme involving the sale of the “Scrubbieglove” cleaning product. Defendant Pasquale Rubbo and other co-conspirators lied to investors to solicit money, ultimately defrauding them of more than six million dollars. The conspirators lured potential investors to the “Scrubbieglove” by lying about high returns on investment, potential and ongoing business deals, and how they would use and invest funds. They also misrepresented the Scrubbieglove’s production demand, telling told investors that the Scrubbieglove required substantial financing because of deals with QVC, Wal-Mart, Walgreens, and other major retailers. In reality, beyond producing a few samples, the conspirators never manufactured any Scrubbiegloves. Instead, the conspirators transferred investor funds to their own personal bank accounts. Defendant’s primary role in the scheme involved intimidating and threatening investors to ensure their silence. Defendant pleaded guilty to two fraud-related charges, and was sentenced to 106 months’ imprisonment. He appealed his sentence, alleging the government breached the Plea Agreement. Finding no breach, the Tenth Circuit affirmed Defendant’s sentence. View "United States v. Rubbo" on Justia Law

During the 2009-2010 term, James was a senator in the Virgin Islands Legislature. The Legislature maintained a fund for Legislature-related expenses. James used a large portion of the checks issued to him by the fund for personal expenses and his re-election campaign. James obtained these checks by presenting invoices purportedly associated with work on a historical project. In 2015, James was charged with two counts of wire fraud, 18 U.S.C. 1343 and one count of federal program embezzlement, 18 U.S.C. 666(a)(1)(A). The Third Circuit affirmed his convictions, upholding a ruling that allowed the prosecution to introduce evidence of acts outside the limitations period, 18 U.S.C. 3282(a), and the substitution of an excused juror with an alternate after the jury had been polled. The court rejected a claim of prosecutorial misconduct based on the prosecution calling two witnesses concerning an eviction dispute. The court had instructed the government not to discuss the eviction case in its opening; neither witness testified about the eviction case. The Third Circuit also upheld a ruling that permitted the use of a chart as a demonstrative aid to accompany the case agent’s testimony, with an instruction that the jury that it should consider the chart as a guide for testimony, not as substantive evidence. View "United States v. James" on Justia Law

Defendant, the former Speaker of the New York State Assembly, was convicted of two counts each of honest services mail fraud, honest services wire fraud, and Hobbs Act extortion, and one count of money laundering.The Second Circuit held that extortion under color of right and honest services fraud require that the official reasonably believe, at the time the promise is made, that the payment is made in return for a commitment to perform some official action. However, neither crime requires that the official and payor share a common criminal intent or purpose. The court also held that both offenses require that the official understand—at the time he accepted the payment—the particular question or matter to be influenced.In this case, the district court's instructions failed to convey this limitation on the "as the opportunities arise" theory, and the error was not harmless with respect to defendant's convictions under three counts. Furthermore, the evidence as to the same three counts was insufficient as a matter of law to sustain a guilty verdict, and thus the court remanded with directions to dismiss the indictment with prejudice as to them. The court found the error was harmless as to Counts 3s, 4s, and 6s, and affirmed defendant's conviction on those counts. Finally, the court affirmed defendant's conviction under Count 7s for money laundering, because that crime does not require the defendant to be convicted of the underlying criminal offenses, nor does it require the underlying offense to take place within the limitations period. View "United States v. Silver" on Justia Law

The Fifth Circuit affirmed defendant's convictions on twenty-three felony counts related to his role in schemes to defraud philanthropists, using their money to finance his personal life and political career. Defendant served two nonconsecutive terms in the United States House of Representatives.The court held that the district court's jury instructions were not erroneous; it was not plain error for the district court to define 501(c)(3) and 501(c)(4) organizations in the charge, and defendant was not entitled to an instruction on good faith; the district court did not err by denying defendant's motions for judgment of acquittal under Rule 29; the government provided ample evidence that defendant fraudulently devised, and implemented, a scheme to deprive two donors of their money and property, thus allowing the jury to rationally find him guilty of mail fraud, wire fraud, and money laundering; and the Federal Election Campaign Act's contribution limits apply to coordinated spending on political communications, irrespective of whether those communications contain magic words of express advocacy. View "United States v. Stockman" on Justia Law

The Second Circuit affirmed defendant's convictions for wire fraud, Title 18 securities fraud, conversion of U.S. property, and conspiracy, arising from the misappropriation of confidential information from the Centers for Medicare & Medicaid Services. The federal wire fraud, securities fraud, and conversion statutes, are codified at 18 U.S.C. 1343, 1348, and 641, respectively.The court held that confidential government information may constitute "property" for purposes of the wire fraud and Title 18 securities fraud statutes. The court also held that the "personal-benefit" test announced in Dirks v. SEC, 463 U.S. 646 (1983), does not apply to those Title 18 fraud statutes. Finally, the panel found no prejudicial error with respect to the remaining issues presented on appeal. View "United States v. Blaszczak" on Justia Law