Justia White Collar Crime Opinion Summaries

After a jury trial, Defendants, James Prange and John Jordan, were convicted of multiple fraud-related counts based on their participation in an FBI securities fraud sting. The district court sentenced both Defendants to concurrent terms of thirty months’ imprisonment for each count of conviction. The First Circuit affirmed Defendants’ convictions but remanded for resentencing, holding (1) the district court did not err when it permitted an undercover agent to interpret what he and Jordan meant by certain statements in their recorded face-to-face conversation; (2) Defendants failed to establish that the government entrapped them as a matter of law; (3) the district court did not abuse its discretion in submitted a superseding indictment to the jury; but (4) the district court procedurally erred when formulating Defendants’ guideline sentencing ranges. View "United States v. Prange" on Justia Law

After a seventeen-day jury trial, Appellants, a brother and sister, were found guilty of multiple bankruptcy-related crimes designed to conceal the brother’s assets and avoid his obligations to creditors. Appellants appealed, challenging both their convictions and sentences. The First Circuit affirmed Appellants’ convictions and sentences, holding (1) the evidence was sufficient to support Appellants’ convictions on all counts; (2) the district court did not err in imposing a sixteen-level increase to Appellants’ base offense levels under the sentencing guidelines; (3) the brother’s settlement of the adversary proceeding in his bankruptcy case did not provide a basis for a judgment of acquittal on the criminal charges subsequently filed against him; and (4) the district court did not err in allowing the jury to hear evidence relating to the sister’s bankruptcy proceedings in 2000. View "United States v. Colon-Ledee" on Justia Law

Waters, a former Michigan state legislator, became involved in a corruption probe involving her then-live-in companion, political consultant Riddle. With a negotiated plea agreement, Waters pleaded guilty to filing a fraudulent tax return (26 U.S.C. 7207). The district court sentenced her to a year’s probation on the misdemeanor charge. Eight days later, Waters moved pro se to withdraw her guilty plea. The district court denied that motion. The Sixth Circuit affirmed and later affirmed Waters’s conviction and sentence. More than three years later, Waters petitioned for a writ of error coram nobis, claiming that her attorney was constitutionally ineffective in promising that her misdemeanor conviction could “easily” be expunged and in failing to represent her vigorously at sentencing because he had a conflict of interest arising from his simultaneous representation of Riddle. The district court denied the petition. The Sixth Circuit affirmed. Waters did not establish an ongoing civil disability. At most she has alleged an injury to reputation, but this is not enough to warrant coram nobis. Although Waters claimed that her ability to travel outside the United States has been impaired, she did not show how this is the case. View "United States v. Waters" on Justia Law

After being caught in a 2011 ATF sting operation out of a Milwaukee warehouse, Wamiq was convicted of four counts of knowingly shipping, transporting, receiving, possessing, selling, distributing, or purchasing contraband under the Cigarette Trafficking Act (CCTA). The same jury convicted Khan, who acted independently of Wamiq, of three counts under the CCTA, 18 U.S.C. 2342(a). The Seventh Circuit affirmed the convictions, rejecting challenges to evidentiary rulings and the sufficiency of the evidence. The court also upheld the forfeiture orders and Wamiq’s sentence, rejecting Wamiq’s challenges to the court’s findings as to the loss amount caused by Wamiq’s unlawful conduct and Wamiq’s acceptance of responsibility. View "United States v. Wamiq" on Justia Law

Defendant was convicted of making false, fictitious, and fraudulent claims to the United States Treasury, assisting in the filing of false tax returns, criminal contempt, and mail fraud. On appeal, defendant challenged his convictions and the district court's supervised release conditions. The court concluded that the district court did not commit reversible error under the Sixth Amendment when it did not prompt defendant to present a closing argument to the jury and where defendant simply chose to remain silent; nothing in Herring v. New York or the court's precedents gives a self-represented defendant a right to be affirmatively and individually advised that he or she has a right to present a closing argument; Herring and the court's precedent held that a court may not prevent a litigant from making a closing argument; the government provided sufficient evidence to prove that defendant assisted another in the filing of fraudulent tax returns; but the district court did abuse its discretion by requiring defendant to abstain from alcohol and drug consumption and participate in treatment as conditions of his supervised release where the record contains no evidence showing that defendant abused alcohol or other substances and the district court made no relevant findings during the sentencing hearing. Accordingly, the court affirmed in part, vacated in part, and remanded. View "United States v. Bell" on Justia Law

Nayak owned outpatient surgery centers and made under-the-table payments to physicians that referred patients to his centers, including cash payments and payments to cover referring physicians’ advertising expenses. Nayak instructed some of his collaborators not to report these payments on their tax returns. Nayak was charged with honest-services mail fraud, 18 U.S.C. 1341 and 1346, and obstruction of the administration of the tax system, 26 U.S.C. 7212(a). Although the indictment a alleged that Nayak intended “to defraud and to deprive patients of their right to honest services of their physicians” through his scheme, there was no allegation that Nayak caused or intended to cause any sort of tangible harm to the patients in the form of higher costs or inferior care. After denial of his motion to dismiss, Nayak entered a conditional guilty plea, reserving his right to appeal denial of his motion to dismiss the mail fraud charge. On appeal he argued that tangible harm to a victim is a necessary element of honest-services mail fraud, at least in cases not involving fraud by a public official. The Seventh Circuit affirmed, holding that actual or intended tangible harm is not an element. View "United States v. Nayak" on Justia Law

A jury convicted defendants James Sweeney II and Patrick Ryan of 65 counts of white-collar crime (all relating to the sale of securities) and found true three special allegations. The court sentenced Sweeney to 33 years and Ryan to 31 years. The court also imposed restitution. On appeal, both defendants challenged the sufficiency of the evidence on count 68 and the convictions on counts 67, 68, 69, 70, and 71, primarily involving multi-level marketing programs. Ryan also claimed various sentencing errors, including those related to fines and restitution.3 Sweeney makes similar arguments. The Court of Appeal found sufficient evidence for count 68. The Court also upheld convictions on counts 67 through 71. View "California v. Sweeney" on Justia Law

After she was unable to sell her Henderson, Kentucky house, Hargis solicited Vashaun to burn it down for a payment of $10,000, so that she could collect a settlement from her insurance company. White burned down the house in December 2007, and both were charged with conspiracy to use fire to commit wire fraud, 18 U.S.C. 844(m), and unlawful structuring of cash withdrawals, 31 U.S.C. 5313, 5324(a)(3), 5322(a). After first denying her involvement, Hargis pleaded guilty to conspiracy in exchange for the government dismissing the structuring charge. The district court imposed an above-guidelines sentence of 60 months imprisonment. The Seventh Circuit affirmed, rejecting an argument that the district court erred when it applied upward adjustments for obstruction of justice, U.S.S.G. 3C1.1, and her aggravating role in the offense,View "United States v. Hargis" on Justia Law

Malone owned a cattle feedlot. He cared for cattle, including some owned by GLS, and worked as an agent of GLS to buy cattle. Anderson was president of GLS, which was owned by others. GLS’s cattle were collateral for its loans. In 2008, the feedlot started losing money, jeopardizing Malone’s business and GLS’s loans. Malone and Anderson began kiting checks; one would write a check to the other, and before it was collected, the other would write a check back to the first. Malone was overdrawn by $400,000 in 2009. Malone and Anderson arranged to sell O’Hern 700 cattle. O’Hern paid $400,000, which Malone deposited to his overdrawn bank account. In reality, there were no cattle. Malone gave O’Hern $115,000. Unsatisfied, O’Hern visited the feedlot and removed cattle that did not belong to Malone; obtained liens on property owned by Malone and Anderson; and filed a state court civil suit. Malone pled guilty to bank fraud and money laundering. He urged the district judge to refrain from ordering restitution, arguing that O’Hern had already received full recovery and that the judge exercise her discretion under 18 U.S.C. 3663A(c)(3)(B), because the need to compensate O’Hern was outweighed by the burden of determining complex issues regarding his losses. The judge imposed restitution of $285,000, stating that she had no discretion under the Mandatory Victims Restitution Act, 18 U.S.C. 3663A.The Seventh Circuit affirmed the award as supported by the preponderance of the evidence regarding O’Hern’s loss and the cash returned to him, the only relevant factors. It would have been error for the judge to consider other amounts O’Hern may be adjudged to owe Malone or Anderson in the state court litigation.View "United States v. Malone" on Justia Law

In 2006, United States Postal Inspectors learned Crosby Powell had deposited checks stolen from the United States mail into his accounts at TCF Bank, UMB Bank, and Wells Fargo. An investigation revealed Powell had altered payee information or forged endorsements on some of the stolen checks. The United States obtained a superseding indictment charging Powell with eleven counts of uttering or possessing forged checks, and seventeen counts of possessing stolen mail. At trial, the government sought to prove the forged checks were “of an organization” by presenting evidence that each bank into which the forged checks were deposited was a federally insured bank operating in interstate commerce. The jury convicted Powell on the first eleven counts set out in the indictment. In his appeal to the Tenth Circuit, Powell raised three challenges to his convictions, all of which were raised for the first time on appeal, all of which were raised on the same premise: at no point during his possession or utterance of the forged checks were the checks "of" the banks into which they were deposited. The Tenth Circuit agreed that the forged checks were not "of" the depository banks. Because Powell did not raise his arguments before the district court, however, he was not entitled to relief unless he could "successfully run the gauntlet created by our rigorous plain-error standard of review." The Court found that Powell could not satisfy this burden as to all counts of conviction. Accordingly, the Court: (1) affirmed Powell’s convictions as to Counts 10, 13, and 20; and (2) remanded the case to the district court so it could vacate the remaining convictions and take any other necessary actions. View "United States v. Powell" on Justia Law