Justia White Collar Crime Opinion Summaries

The Ninth Circuit affirmed defendant's convictions for health care fraud where the evidence of actual knowledge was overwhelming, and thus the court did not need to determinate whether the district court erred in giving a deliberate ignorance instruction on the knowledge element of health care fraud. Furthermore, the panel rejected defendant's arguments regarding the sufficiency of the illegal remunerations convictions.However, the panel reversed the aggravated identity theft convictions, because defendant did not "use" the patients' identities within the meaning of 18 U.S.C. 1028A. The panel also held that United States v. Osuna-Alvarez, 788 F.3d 1183 (9th Cir. 2015), foreclosed defendant's claim that the "without lawful authority" element of aggravated identity theft was not satisfied because the patients voluntarily provided their information. Finally, the panel held that the district court did not err in applying sentencing enhancements for obstruction of justice and aggravating role in the offense. The panel remanded for resentencing. View "United States v. Hong" on Justia Law

The Second Circuit affirmed defendant's conviction of wire fraud and conspiracy to commit wire fraud in connection with a foreign currency exchange transaction with Cairn Energy. Defendant was the former global head of the foreign exchange trading desk at the investment bank HSBC. The court held that there was sufficient evidence to convict defendant on the right‐to‐control theory because a reasonable jury could conclude that his misrepresentations to Cairn related to the price of the transaction, which was an essential element of the parties' bargain, and were capable of influencing Cairn's decisionmaking. View "United States v. Johnson" on Justia Law

Defendant appealed the district court's denial of the government's motion under Federal Rules of Criminal Procedure 35(b)(2)(B) to resentence defendant based on his substantial assistance in the prosecution of others. The Second Circuit rejected the government's argument that the court lacked jurisdiction to hear the appeal.In a separate summary order filed under seal, the court affirmed the judgment on the merits. View "United States v. Doe" on Justia Law

The IRS searched Ellis’s apartment and found personal identifying information for more than 400 people on printouts from the Alabama Department of Corrections’ database and in a TurboTax database on laptops seized from Ellis’s bedroom. Her computers had been used to file hundreds of electronic tax returns in 2008-2012. Ellis was charged with devising a scheme to submit fraudulent tax returns in “2012,” including eight counts of wire fraud, 18 U.S.C. 1343, and eight counts of aggravated identity theft, 18 U.S.C. 1028A(a)(1), (c)(5) and 18 U.S.C. 2. After the government admitted that some of Agent Ward’s grand jury statements had been wrong, Ellis unsuccessfully moved to dismiss the indictment. The court found that the “inaccurate statements did not have a substantial influence" given "overwhelming other evidence he presented.” Agent Ward testified that the intended loss from Ellis’s scheme was approximately $700,000, based on the total requested refunds, not the actual refunds. The court agreed and applied a 12-step ioffense level increase (U.S.S.G. 2B1.1(b)(1)(H)), with a resulting Guidelines range for the wire fraud counts of 51-71 months. The court imposed a 48-month sentence for wire fraud and a consecutive, mandatory, 24-month sentence for aggravated identity theft and ordered forfeiture of $11,670, the total of the eight tax returns for which Ellis was convicted. The court imposed the government’s requested $352,183.20, in restitution to governmental entities. The Sixth Circuit affirmed the denial of the motion to dismiss, the calculation of the forfeiture, and the restitution order, rejecting arguments that the government had not presented evidence that all of the refunds used to calculate restitution were part of the same scheme and that some of that amount was tied to conduct that occurred outside of the limitations period. View "United States v. Ellis" on Justia Law

Defendants, Mr. Feldman and Mrs. Feldman, appealed their convictions stemming from their operation of a pain management clinic. The Eleventh Circuit affirmed the convictions, holding that the district court did not abuse its discretion by denying Mrs. Feldman's motion for severance; the district court did not plainly err by admitting the testimony of the government's witness; because Mrs. Feldman implicitly consented to the order declaring a mistrial, she was not entitled to relief on her double jeopardy claim; and the court rejected Mrs. Feldman's remaining claims of prosecutorial misconduct and claims of error regarding the jury instructions.The court also held that the evidence was sufficient to support each of defendant's conspiracy convictions, and convictions based on dispensation of controlled substances without a legitimate medical purpose that resulted in death (Counts 2 through 4). However, the court reversed the district court's application of 21 U.S.C. 841(b)(1)(C)'s 20-year mandatory minimum sentence on Counts 2–4 and remanded the case for the district court to resentence Dr. Feldman to a term of imprisonment of not more than 20 years as to each of these counts. View "United States v. Feldman" on Justia Law

The Ninth Circuit affirmed defendant's conviction for engaging in a monetary transaction of over $10,000 derived from a specified unlawful activity, in violation of 18 U.S.C. 1956. In this case, defendant, a citizen of South Korea employed at a government-funded research institute, solicited and received payments from two seismometer manufacturers in exchange for ensuring that the research institute purchased their products, and gave the companies inside information about their competitors.The panel held that "bribery of a public official" in section 1956 is defined by that phrase's ordinary, contemporary, common meaning and is not constrained by 18 U.S.C. 201, a statute to which section 1956 makes no reference. Because the panel found the crime described in Article 129 of the South Korean Criminal Code fits comfortably within the ordinary meaning of "bribery of a public official" as used in section 1956, the panel held that the indictment was sufficient and that there was no instructional error. View "United States v. Heon-Cheol Chi" on Justia Law

U.S. Customs Officer Parra spent December 8, 2010 “cracking open containers” at a warehouse near the Los Angeles seaport. Opening one from South Korea to inspect its freight, Parra found a fully assembled, five-foot-tall industrial turbo blower. A placard riveted to the side read, “Assembled in USA.” The discovery led to a federal investigation that traced back to Lee. Prosecutors charged Lee with executing a scheme to defraud local governments by falsely representing that his company manufactured its turbo blowers in the U.S. The Seventh Circuit affirmed his wire fraud convictions, reasoning that Lee’s misrepresentations were material under the American Recovery and Reinvestment Act, 123 Stat. 115 (2009), which includes a “Buy American” provision. The evidence adequately supports Lee’s participation in a scheme to defraud and his intent to do so. Lee used interstate wires as a part of that scheme. The indictment afforded Lee ample notice of the case the government presented at trial and included specific details of the crimes alleged to avoid double jeopardy risk; no impermissible constructive amendment or variance occurred. The court also upheld Lee’s smuggling convictions under 18 U.S.C. 545. The mislabeling served an important function in Lee’s broader scheme to deceive customers about the origin of the turbo blowers. View "United States v. Lee" on Justia Law

Defendant appealed the district court's imposition of a condition of supervised release that required him to perform 300 hours of community service a year over his term of supervision for a total of 695 hours. Defendant's conviction stemmed from his role in two different fraud schemes.The Second Circuit vacated and remanded for resentencing, holding that the challenged condition was not reasonably related to any of the relevant sentencing factors, was inconsistent with the pertinent Guidelines policy statements, and involved a greater deprivation of liberty than was reasonably needed to achieve the purposes of sentencing. The court held that the pertinent policy statement issued by the Sentencing Commission must be read to advise that courts should generally refrain from imposing more than a total of 400 hours of community service as a condition of supervised release. View "United States v. Parkins" on Justia Law

The Second Circuit affirmed defendant's conviction of paying and conspiring to pay bribes, in violation of 18 U.S.C. 371, 666, and the Foreign Corrupt Practices Act (FCPA), and gratuities to United Nations officials and of related money laundering. Defendant's charges stemmed from his sustained effort to bribe two U.N. officials to designate one of his properties as the permanent site of an annual U.N. convention.The court held that the word "organization" as used in section 666, and defined by 1 U.S.C. 1 and 18 U.S.C. 18, applies to all non‐government legal persons, including public international organizations such as the U.N. The court also held that the "official act" quid pro quo for bribery as proscribed by 18 U.S.C. 201(b)(1), defined by id. section 201(a)(3), and explained in McDonnell v. United States, does not delimit bribery as proscribed by section 666 and the FCPA. Thus, the district court did not err in failing to charge the McDonnell standard for the FCPA crimes of conviction. Insofar as the district court nevertheless charged an "official act" quid pro quo for the section 666 crimes, that error was harmless beyond a reasonable doubt. Finally, the evidence was sufficient to convict defendant, and the jury did not misconstrue the "corruptly" element of section 666 and the FCPA and the "obtaining or retaining business" element of the FCPA. View "United States v. Ng Lap Seng" on Justia Law

Bank of America advances funds whenever customers deposit checks. During this “float” period, it permits the customer to withdraw the funds while the bank confirms the check’s validity. In Michigan, Thomas would enlist BoA customers and give the customers’ information (account numbers, debit card numbers, and PINs) to Illinois conspirators led by Cobb. The Illinois conspirators would steal corporate checks, alter the checks to list the customers as payees, and deposit the checks at BoA. In Michigan, Thomas would withdraw the funds before the bank uncovered that the checks were bad. Thomas would then divvy up the funds. The fraud caused bank losses of $214,286.03. All the defendants were charged with a conspiracy to commit bank fraud, 18 U.S.C. 1344(2) and 1349. Thomas, listed on 25 counts, pleaded guilty to a conspiracy count and to one count of bank fraud, which generated a guidelines range of 46-57 months. His probation officer found that he lied during his presentence interview. Thomas denied leading the Michigan cohort, denied recruiting others, and denied knowing of Cobb’s role. (2016). The government sought an obstruction enhancement, U.S.S.G. 3C1.1 and compiled evidence that Thomas oversaw the Michigan recruiters and facilitated the withdrawals. The court applied the obstruction enhancement and declined the acceptance-of-responsibility reduction U.S.S.G. 3E1.1, which produced a guidelines range 70-87 months; concluded that this range was insufficient under the 18 U.S.C. 3553(a) sentencing factors; and imposed an above-guidelines 102-month sentence. The Sixth Circuit affirmed. View "United States v. Thomas" on Justia Law