Justia White Collar Crime Opinion Summaries

In February 2016, Defendant Ricky Williams pled guilty to tax fraud relating to his preparation of federal income-tax returns for third-party clients for the 2010 and 2011 tax years. In his plea agreement, he agreed to pay restitution. After pleading guilty, he was initially released on bond pending sentencing. However, his release was revoked after the court discovered that he had been violating the terms of his release by again engaging in tax preparation activities for someone other than himself or his spouse. The probation officer who prepared his Presentence Investigation Report “determined that the defendant lied about his income, assets, and liabilities” to the probation officer. Among other things, the probation officer discovered several undisclosed financial transactions that Defendant had conducted with someone else’s social security number, and an attempt to unfreeze a bank account that contained approximately $37,000. The bank contacted the IRS. This lead to a sentence of thirty months in prison and an increased restitution amount to the IRS. A few months after Defendant’s sentencing, the government filed an application for post-judgment writ of garnishment against the frozen bank account. The bank objected on the grounds that the account was subject to “a prior internal USAA Federal Savings Bank hold from its Fraud Department." A magistrate judge concluded the government could not seek garnishment. The district court declined to accept the magistrate judge's recommendation pursuant to the terms of defendant's earlier restitution agreement. The Tenth Circuit found no error in the district court’s conclusion that the government was entitled to garnish Defendant’s bank account to obtain partial payment of the amount then-currently due in restitution. View "United States v. Williams" on Justia Law

The Fifth Circuit affirmed defendant's conviction of conspiracy to commit bank fraud. Defendant owned and operated a company that originated loans insured by the FHA. The court held that signing the loan application in the Eastern District established venue there. The court also held that there was no constructive amendment or variance because there was no difference between the jury concluding that the supporting documents were false and it deciding that the application contained those same falsehoods; the evidence supported the verdict where it did not matter that the loan application did not expressly affirm the veracity of the supporting documents; and the government's closing argument was not improper where the prosecution did not err in telling the jury that it had to "decide the truth," which after all was what the "verdict" means. View "United States v. Brown" on Justia Law

Austin Ray was convicted by jury convictions for one count of conspiracy to defraud the United States, five counts of aiding in the preparation of a false tax return, and two counts of submitting a false tax return. Ray argued on appeal: (1) the government violated the Interstate Agreement on Detainers Act (IAD) of 1970; (2) the government engaged in vindictive prosecution; (3) the district court violated his rights under the Speedy Trial Act (STA) of 1974; (4) the government violated his due-process rights by destroying certain evidence; and (5) the district court constructively amended the indictment. The Tenth Circuit affirmed in all respects, finding: (1) the government never lodged a detainer against Ray, meaning the IAD didn’t apply; (2) Ray established neither actual nor presumptive vindictiveness; (3) Ray’s STA argument was waived for failing to raise it below; (4) the evidence at issue lacked any exculpatory value, and even if the evidence were potentially useful to Ray’s defense, the government didn’t destroy it in bad faith; and (5) the district court narrowed, rather than broadened, the charges against Ray. View "United States v. Ray" on Justia Law

The Second Circuit vacated the district court's grant of defendant's motion to dismiss two counts of an indictment charging him with federal-program embezzlement. Defendant, a former New York State Senator, allegedly embezzled funds from escrow accounts that he oversaw in his capacity as a referee for foreclosure actions. The court agreed with the government that the district court erred by concluding pretrial, as a matter of law, that defendant necessarily formed the fraudulent intent required for the charged embezzlements -- and thus completed those embezzlements -- once he failed to remit the funds. Therefore, the court held that the district court made a premature factual determination regarding the time at which defendant, if guilty, formed the requisite fraudulent intent. The court reinstated the two federal-program embezzlement counts and remanded for further proceedings. View "United States v. Sampson" on Justia Law

The Second Circuit affirmed defendant's conviction for obstruction of justice and making false statements to federal agents. Defendant, a former New York State Senator, was convicted of crimes related to his efforts to use his position in the Senate to provide a local businessman with special favors. Defendant provided the businessman with these favors in exchange for a loan that was given to defendant to reimburse funds that he had embezzled, but that he could not repay.The court held that United States v. Hernandez, 730 F.2d 895 (2d Cir. 1984), and United States v. Masterpol, 940 F.2d 760 (2d Cir. 1991), barred the government from prosecuting an individual under 18 U.S.C. 1503(a) for intimidating and threatening witnesses or corruptly persuading witnesses to recant their testimony. However, these cases did not bar the government from prosecuting an individual under section 1503(a) for an inchoate endeavor to witness tamper. The court also held that the district court did effectively instruct the jury on whether defendant willfully caused an obstruction of justice under 18 U.S.C. 2; the evidence was sufficient to convict defendant for making a false statement; the district court district court did not abuse its discretion—or violate the Confrontation Clause—in either of defendant's challenged evidentiary rulings; and defendant's sentence was reasonable. View "United States v. Sampson" on Justia Law

The Second Circuit affirmed the district court's judgment after defendant pleaded guilty to tax evasion and to corruptly endeavoring to obstruct and impede the due administration of the internal revenue laws. Defendant, the founder of an investment management firm, was sentenced to pay restitution of $37 million, serve a 70‐month term of imprisonment, and pay a $10 million fine. The Second Circuit held that the district court did not err in calculating the fine range recommended by the Sentencing Guidelines; defendant was given adequate opportunity to inform the district court of his financial condition and ability to pay a fine; and imposing a $10 million fine was within the district court’s discretion. Defendant's motion to stay his sentence pending this appeal was moot. View "United States v. Zukerman" on Justia Law

For five years, DeHaan, a licensed family‐practice physician working in the Chicago and Rockford areas, was affiliated with agencies providing medical services to homebound patients, and served as medical director of several home health agencies, assisted living facilities, and hospices. DeHaan billed Medicare at the highest levels for services to homebound patients that were ostensibly time‐consuming or complex, when in fact he had either conducted a routine, non‐complex patient visit or had not seen the patient at all on the occasion for which he was billing. At the behest of home health agencies, DeHaan certified as homebound patients whom he either knew did not meet Medicare’s criteria (42 U.S.C. 1395n(a)(2)(A)) for home care or as to whom he lacked meaningful knowledge. DeHaan pled guilty to two counts of a 23‐count indictment, admitting to overbilling and fraudulent certifications. The district court took evidence and found that he was responsible for fraudulently certifying the eligibility of least 305 individuals for home health care services, resulting in wrongful billings to Medicare of nearly $2.8 million. The Seventh Circuit affirmed, finding no error in the district court’s “conservative loss‐estimation methodology,” and upheld a within‐Guidelines sentence of 108 months in prison with an order to pay restitution of $2,787,054.58. View "United States v. DeHaan" on Justia Law

The district court’s decision to grant the jury’s oral request, made during deliberations, for a dictionary was improper, but under the circumstances of this case, the judge did not abuse his discretion in denying Appellant’s motion for a new trial.Appellant was found guilty of conspiracy to commit mail fraud and substantive mail fraud, based upon his certification of false injury claims submitted to the American Family Life Insurance Company. On appeal, Appellant argued that the judge erred in denying his motion for a new trial where the jury was exposed to material not properly offered during trial. The First Circuit affirmed the decision of the district court, holding (1) the judge’s decision to grant the jury’s request, over Defendant’s objection and with no discussion on the record, to use the dictionary was error; but (2) the trial judge took thorough, effective action to investigate the impact of the error and properly concluded that Appellant suffered no prejudice. View "United States v. Pagan-Romero" on Justia Law

Williams, a CPA, was manager or co-owner of Sexton’s Kentucky companies. Flynn was the office manager. From 2006-2010, they secured loans by misrepresenting the businesses’ assets and the identity of the true borrowers. The total amount disbursed from the banks was $8,160,400. Sexton and Williams submitted applications for higher loan amounts ($13,600,000 and $13,800,000) toward the end of the time period involved, but those funds were never disbursed. In 2016, the three and a bank loan officer were charged with conspiracy to commit bank fraud, 18 U.S.C. 1349 and 18 U.S.C. 1344(1) (Count 1) and bank fraud, 18 U.S.C. 1344(1) and 18 U.S.C. 2. The indictment also alleged forfeiture to the U.S. under 18 U.S.C. 981(a)(1)(C), 982(a)(2)(A), and 28 U.S.C. 2461(c). Sexton pleaded guilty to Count 1. The government moved to dismiss Counts 2–24. Sexton’s PSR gave Sexton a four-level increase for being an organizer or leader under USSG 3B1.1(a); one criminal history point under USSG 4A1.1(c), 4A1.2(m), and 4A1.2(f) for a 2005 California sentence for willful infliction of corporal injury to which Sexton pleaded nolo contendere; and two criminal history points under USSG 4A1.1(d) for committing the instant offense while on probation for the California sentence. Sexton’s guideline imprisonment range was 97–121 months. The court sentenced Sexton to 109 months’ imprisonment. The Sixth Circuit affirmed that sentence and orders that he pay $2,637,058.32 in restitution and forfeit property to the government, including a money judgment of $2,534,912. View "United States v. Sexton" on Justia Law

The Fifth Circuit reversed the district court's order dismissing an indictment with prejudice. The indictment charged defendant, the owner and operator of an adoption agency, for fraud. The court held that there was no Brady violation where the evidence clearly was not suppressed; discovery violations did not warrant imposed sanctions where the district court failed to impose the least sever sanction and the government's violations of the discovery deadlines did not warrant dismissing the indictment with prejudice; and defendant failed to demonstrate prejudice sufficient to support the district court's severe sanction and thus the district court abused its discretion when it dismissed defendant's indictment with prejudice. The court remanded for reassignment of the case to a different district judge. View "United States v. Swenson" on Justia Law