constraints in order to be fair to everybody so pay attention when the yellow light comes on you have two minutes when the red light comes on me ask you to conclude your argument we appreciate the record citations when you have those at hand with that we will call the first case of the morning number eighteen four of the three six united states versus have some unfortunate familiarity with this area of law as an assistant united states attorney in houston i was the lead prosecutor in the united states versus davis after a week long trial the jury convicted gray davis say you know about the banks i do you're on the jury convicted grady davis of eight counts of bank fraud the sole issue on appeal was whether i had successfully proven the financial institution element this court found that i had not been reversed say this is not a true confessions placing a in doing so this court wrote that technicality we some of these acts or taishan is once more as we compare the proof the law requires with the evidence the government presented to the jury in this case it seems not much has changed your honour's since davis was and thirteen the us supreme court has twice clarified the elements necessary dissatisfied title eighteen united states code section thirteen forty four one and two first in stood at the center of and was a target of the defendants scheme or artifice to defraud in this case the government concedes that this was a thirteen forty four one prosecution see the government's brief of page twenty two that the financial institution charged was j p morgan chase bank see the jury instructions and the record page twelve eighteen and finally that mr perez said bios made no misrepresentations to j p morgan chase bank and that's found at the government's brief at page two accordingly this conviction must be reversed for lack of jurisdiction and for insufficient this outcome result even if we accept the government's espoused theory of liability which can be found on page twenty two of its brief that miss pettis a bios his intent was to trick sun life financial permu because neither sun life financial bermuda nor chase investment services corp is a financial institution much less the financial institution that the government charged as being the victim in that he testified for the now for the government on the question of jurisdiction and the fraud the closest the government came was mr paul arnold right and your honor on thing only you say the closest to see the only one he is the only one your honor and if we look at  page sixteen ninety three of the record i ask him on cross examination and so the account that she opened and again i'm sorry this is lawyer stuff but the account that she opened and the documents that she gave you and the conversations that you had were in connection with opening an account at chase investment and not at the i c i'm sure his answer correct ok question and sun life certainly the government seeks to salvage this situation by inviting this court to contravene supreme court precedent in the form of lupron and shaw as well as this court's own prior rulings in scholtz davis and other cases and to find that so long as the government shows some speculative risk of regulatory liability to a bone they said it was speculative your honor our position is that if the bank is helping the internet do international money laundering your honor two points on that first she was acquitted of that technically but the jerries not required to close their eyes to the circumstances that would have involved the banks well if the government's theory the government's theory on appeal is that the per scheme was to live off the radar by having her funds in an offshore account more specifically however on this point there was no evidence that the money was stolen in fact the jury on the preponderance of the evidence standard found no poor picture and judge of ahmose at the sentencing said that she wouldn't even consider the money stolen for purposes of the sentence and using a preponderance standard if your honour's would like to and this is on page sixteen nine this is the closest they come to asking about a risk of regulatory in the two million nearly two million dollars and then at some point after that she transferred that into the offshore account right that's correct and chase would have had to fill out a currency transaction report would they not this case the money was transferred in from u b s it wasn't any type of a cash deposit it was a wire in from u b s in miami the wire out and there's nothing in the record that suggests that p morgan chase did or didn't do anything that they were supposed to do with regards to the i'm not saying them but what i am saying and i'm not an expert on c t r's but we've had a few appeals and they you know you have to  bank us to fill out certain information in connection with those precisely because the government is allowed to scrutinize such transactions and you know she made a raft of misrepresentations about  residence whether she was the sole owner of the can she said she was separated from her husband she was not a politically exposed person these were the funds were from the sale of a consulting business and then she falsely that but that meant the j p morgan chase had they filled out a c t r mind of might well have been filling out false information it was up to the government you want to produce that evidence a trial this think so this court in united states versus spiri some civil liability the government hostie point to the rule and articulate how it was violated in the case subjugation and as i said  united states versus brick is two thirty three f third eight forty five and that's it circa two thousand the government s salvage this situation this situation that is caused by the bank not being the target even if we were to assume that some c t r existed that still doesn't make j p morgan chase bank the target of any scheme or artifice to defraud the government seeks to salvage the situation by pointing to a line of cases that come first out of the first circuit and that predate lugar and shaw and i would argue contravene this court's own prior precedent those cases are all alone cases and they include own brand in the wall he and ethel kind all of these cases since they concerned loans could easily have been prosecuted in justified under thirteen forty four subsection t which does allow misrepresentations to third parties to result in liability for bank fraud if it results in money coming from being stolen from a bank the other cases that the government sides are forged check cases and those cases are lead brandon and barry catt that the only case that the government sides and support of its theory that comes from this  forged and altered checks into their own bank accounts of f d i c insured institutions and then pay him with those proceeds on appeal he argued i only meant to defraud the women i never meant to def the bank this court disagreed and found him liable under thirteen forty four one in so doing this court preset age which i would say in two thousand and sixteen which is the bank must be the victim but it doesn't necessarily have to be the only victim these cases all stand for the proposition that the bank must stand at the center and be the target of the fraud in lieu grin the supreme court wrote that thirteen forty four one includes the requirement that the defendant intend to defraud a financial institution indeed that is thirteen forty four want a whole sum and substance and for that proposition they cited the brief of the solicitor general of the united states this is twenty fourteen and twenty sixteen the supreme court said that a statement to a the understand your client is here in the courtroom understood her release date is the tenth of november of this year that was a documentary made in error she was released she had received a ten bronson's and was released i believe around because the docket had a different person surrender under her docket number the page had nothing to do with her the caption had nothing to do with her were released in december of twenty seventeen i've believe years which brings me to my my second point of error in this case i submit your honor is that the prosecutor in her closing argument materially intentionally unpresidential the misrepresented the rectory to the jury and used an exhibit that she cobbled together by taking two disparate documents and putting them together the trial attorney i was involved it looks to me as if even honour's to the record thirty or but did they indicate any potential confusion they asked for that testimony the testimony to be read by on the issue of  statute this defendant was and dieted and convicted of is to protect the interest of the federal government when they are the insurer of financial institutions so that it becomes the bank's job to measure the safety and the soundness of their clients and companies and to verify that these are viable and they do this by gathering information from their clients and companies and they depend on that information  rescue i realize this is obviously a very large trial and lots of evidence due to the money laundering in the bank fraud and i thought it might be beneficial to just take a few quick minutes to narrow this bank fraud down because we really are only talking about a five month period and three banks that implicates this particular count that she was convicted of so it starts in may twenty third team until october twenty third team at the end of may is when the defendant comes to the united states she says in her own testimony she never goes back to mexico she is thus a u s resident at the end of may twenty thirty early june twenty third team is when her husband is arrested and to the chase savings account at that point the defendant has opened a chase savings and a chase checking account in early june fourteenth two thousand and thirteen between june and august the defendant contacts the branch manager of her chase bank f d i c bank where she has the checking and savings and if you look at the record at sixteen seventeen to sixteen eighteen paul arnold discusses the conversation he has with that branch manager the branch manager conveys i have a client she is a nonresident she wants to open this particular case kind of account pardon me that you have and what her owner said was so important is you can't live in the united states and open that account so right there the representation from the bank manager to paul arnold is this is a nonresident not going to pay taxes she wants to open an account so then when he gets involved in august of two thousand and thirteen is when a lot of taishan start flowing first of all and obviously the most egregious is giving two different bank statements that are falsified by deleting her husband's name there by having no investigation of him and basically saying she separated not married so we're going from a joint account and she admits freely and her testimony and actually defense attorney even says an opening that she was exposed to she wanted it to be a sole account and basically wanted to get away from him now those are personal reasons but those are also illegal going from a joint account to a sole account without that person's permission and also not giving the marital status not giving the p t p status and you see her intent when she starts to close the account at u fernandes testified she wanted a cashier's check she's built specifically said can i just give this money to a third party can i give it to another company she was already trying to dodge that money and get it away from my husband because obviously he's the flag if his name is associated with any of this it's going to trace back to his charges in mexico which is why u b s exited the relationship in the first place why did why did arnold tell the woman  chase the nonresident couldn't open this kind of account what are you talking about he said that the reason he accepted the call from the branch manager and met with the client was because the branch manager said she was a nonresident point was that he would only be doing accounts for people who were not residents had she said she was a u s resident which she was he wouldn't even met with her in a legal matter that's the way they were organized correct that is correct and so he did  further expand on that in that the reason he went forward with it was some life was she met all the qualifications and so but for the chase savings account the money would have never gotten to some life in fact if you check her bank statements savings account of the chaste f d i c insured bank on thirty seven fifty nine it shows very clearly that one point nine million dollars was deposited on october sixteenth two thousand and thirteen it was there in whole chase savings account for nine days until october twenty fifth when it was then moved to some life based on all of her representations that she was a person that could have the account at somebody which she was not let's back up a little bit to the conversation between the chase bank whoever that person was and arnold because arnold who with arnold was with chinese investment correct correct john why was the person at chase bank early on contacting on i want to trace investment the testimony shows that the branch manager said that the defendant approached him in one of the referral for investment services and because she already had a checking and savings and chase she went to her local branch bank that man his name is not the record i believe but that man then referred her to paul arnold to look into the investment account for nonresident representation to the branch manager to even get the referral but you're correct there's those misrepresentations were made for a whole article didn't the government concede at trial that she didn't make any misrepresentations to chase bank yes and i think that those are overt statements i think the conversation of the branch manager is just an inference that the jury could have made that that's how they got connected was i have this information about this woman i passed along to you because she said she's in on residence but sure we didn't rely on that we procedures they all arnold said that he was rushing or the government the government bears the burden of proof here not chase bank that's true i believe because we're relying on the case all that says it does have to be intended to a specific bank we're just in the chain of banks i understand you're in the chain but why don't you move on to what's the risk of exposure to the bank as shown in the record ok so there it's twofold i believe there's evidence regarding first of all i think the biggest thing is these falsified documents that she is taking money that she's not all entitled to because it is legally on life and chase investment have none of our separate entities from chase yes and bank chase bank has to be the victim so explain how chase bank and chase bank had the funds for nine days and they relied on the representations that that she made to paul arnold whether he was his f d i c or not there's plenty of case law that says the actual misrepresentation doesn't have to be to the f d i c bank if the f d i c bank is harmful i understand that if he if his account was doling out you know if if they were if she had been defrauding arnold personally out of money and she used his bank account i mean of course but that's not what happened here no it really was that chase savings was the holding pattern to get her where she wanted to go which was some life and that money  money stolen some life so some life can cancel the account if they want but who's been defrauded here both all of them i believe both were everyone was told lies to your ok well lies are not bank fraud so tell us again accounts right at the brain that's true but i think the overall sense is that you see in those cases is the custody and control of the money is what puts you at risk and i would say had this money never gone to the chase savings account i don't think we'd be here it's about the care and custody of that control going to that bank and then going somewhere else and we're proving up the j p morgan chase is the f d i c for having that money for the nine days was causing the risk of loss in this case what was the risk of walles the risk of loss is twofold one that she didn't completely own all the money that she misrepresented the money belonged to her in a joint account oh excuse me but mexico's a community property state right if she has if if it's like texas she'll see ability to control what's in a joint account i think that's true your honor i will say i think there's a difference in when you have a joint account each person can pull all the money out and that's fine but that isn't what she did she made a false or preserves representation to someone else that the money was only hers and the point was because he would like the count and no bank would touch it so she knew she had to delete his name for this process to even happen and to your second point judge mark still it's not just that other people were implicated and they may have a right to the money whether that be her defendant or the mexican government but also that they could incur fines there's testimony about the things that banks have to do as specially with the p p account those are high risk accounts they would have to go through more paperwork there's a larger scale investigation of people involved that wasn't done here because she lied and poll arnold specifically said had she been truthful about these things started out with three banks at the end of the government's case on the route twenty motion we got to rid of two of those banks leaving chase alone marty marty pham read your them arresting a sure it's a very simple this is all come down to just one small point but we can't ignore the fact that this money went to the f d i c bank based on false representations and put them in risk of civil liability which is very clear that i have no data to possibly the mexican government or the husband who has a right to part of the money you get statement showed he was putting income on this business about separation sounded to me like a total farce it just sounded to me like a mean you know you're trying to have it both ways she's she's she's quote separated from her husband and she really your honor i can't speak to that but i do know that if a person has a joint account they have a right to it and that it's risk of civil liability we don't have to show that there was a lawsuit and i think i pointed that out in my brief in response to theirs but it also is i'm so happy our federal government is protecting mexico and mexican citizens from being defrauded i can't tell you how reassuring that is to me it's also the risk of the fines and the statutory fines that a bank incurs up fines what well that's what i asked you about five minutes ago what you know i was talking to him about currency transaction reports i don't know what testimony is there in the record about this with regard to chase fame paul arnold testified  about statutory fines and things that banks can incur if they're not given the right information the majority of that really falls on the p p status that they are high risk and had she disclosed that the bank would have done a different investigation obviously they would have found the information about her husband and the funds and they would have naval taken it in fact to use as an example paul o'neill talked about how some life had to change their policies because a lot of banks weren't getting the correct information so i think that he did give pertinent testimony to the risk of the bank to fines that can be a two one million dollars when they don't exercise due diligence in his point was it's increasingly harder for a bank to perform their due diligence when they're getting false information from a client and i think they took her at her word for everything she said and moved this money along but you can see that there were no false representations when she opened the account and chase thing the chase bank other than her signature card that says that she's a nonresident which is really what started the whole thing with the bank manager moving her case along and saying oh she's a nonresident she could have this particular kind of case that you get our account that you don't pay taxes on that is only for not residents of the united states so that is on her signature card and she did say i don't live here but i thought you conceded that there were no false representations to chase bank i suppose i met over the statements that she made to paul arnold that's just a written signature card so i don't have any testimony about her meeting with chase bankers own arnel is not chase bank that's true like the government in this trial kept trying to come afford to train chase bank and ch case the defense attorney quickly spoke about the power point slide that the prosecutor used including argument the defense attorney did not object to that statement in fact  used it in his own closing so any error would be on the plane or i think that the government has agreed that it could have been a misleading slide that the defendant's own closing argument specifically said he didn't think it was intentional and he actually then only then did they come back and find her guilty of the bank fraud but not guilty on the money laundering and so i think this is a situation where the jury actually was listening they were current to the arguments that they were challenged on the fact that you're an officer of the court and i think you have to agree the cobbled together this exhibit gives a very misleading impression on a crucial issue in the case and as an officer the court can you explain how this how this happened i can and i agree with your sentiments about it that it can be misleading and personally looking at it i think it possibly could just be that the documents were so close together that they read as one so i have  two thoughts about that and one is if you mean so close together i mean can't be the top of one and the bottom of the other main close together doesn't i don't understand that ok so i'll explain i think that if you look at her entire power point it's one hundred twenty five slides and even look at that with the closing argument the first half of the power point it's all just the financial documents the second half is her summarizing witness's testimony and this slide is very consistent with all those slides and where she put the bullet points on the side with the subject matter she wanted to cover and then she put pieces of documents up and if you look past that page which the corn is it forty three ninety seven and still thirty four twenty eight it shows a consistent pattern that the prosecutor was summarizing testimony with the bullet points and then you'll see it on the other sleights should put up one or two documents just sort of prove those points so what i meant by close together was on this particular slide she seems to be putting a lot of information there and because they're pushed together i think that might be what gives it the appearance of it being one document she never said that it was but i agree it probably wasn't the best practice but he didn't object to it he didn't have a problem to about it he used it in his rebuttal to get the jury to go back and look at the evidence which ended up working because they dead so in that sense i don't think there's anything about it that was purposely improper i think possibly it may be  poor graphic design but it is consistent with the rest of the powerpoint so girds you to go look at all twenty five six hundred twenty five slides in just review that they're all consistent in the same manner if you don't have any further questions for me and the term c t r currency transaction report was not mentioned at i won't belabor the point your honor but also a if the peers that see two yards are triggered by cash deposits over ten thousand dollars so this wouldn't have my husband is the chief finance officer of tabasco or wherever it was they wouldn't have allowed it right i disagree or out of there's absolutely nothing to that it's not in the record it's not in and i think that what is th the the two two things number one to open up her chase account at her sugar land branch bank there's no questions about pap there's no questions about who your husband is none of that information was asked  her in june we also oppose the government's position here that she became a resident of the united states the moment that she set foot in this country this issue that now she is misrepresenting before that was shown she'd only been in the united states for less than a month at the time she opened up this account i think that to say that somehow we should infer now when it was never argued to the jury and it wasn't even argued in the briefs that she was misrepresenting her residency to the j p morgan bank officer i would add paul arnold at the time of trial did not work for j p morgan bank or chase investment services he worked for morgan stanley nobody was called that works currently for j p morgan chase chase investment services or any other chase associated entity i'd like to address the issue of whether she was stealing the money from her husband if your honour's look at the s bank account it was not a joint account ok she was the owner of the account the testimony at trial was that it was her money she added him as a signatory on the account as many people do so that he could have access to government's point here and again never presented to the jury only argue for the first time here at oral argument that and that would be a fraud on u b s it would be a fraud on j p morgan chase  again the government says j p morgan chase relied on the old and on the documents there is no evidence of that they concede in their brief that none of her misrepresentations went to j p morgan chase the record supports that none of her misrepresentations made their way to j p morgan chase bank that they were all confined to mr on who work for chase investment services yet the government again is trying to conflate the truth  no evidence in the record that a branch would ask about pep status and finally on the issue of prosecutorial misconduct i think it's important i didn't object at the time  and that's because you know frankly i was shocked and i wanted to be sure of what i was saying before i said it but looking at this in retrospect and looking at the pattern of prosecutorial misconduct in the case which included perjured testimony threatened witnesses in a variety of other malfeasance by the government we are convinced at this point that this was done intentionally to muddy the waters and to encourage the jury to reach verdict on an inappropriate ground of your own he's wrong thing accusation against your recent employer as a former colleague of and i don't say it lightly and i don't raise prosecutorial misconduct claims on appeal as a matter of course in this case it was there i mean the the e mails that we got during trial from the case agent saying from witnesses to the case agents and the prosecutor i feel that the prosecutor is threatening me to change my testimony those emails were brady and they were deeply ill and they should have been turned over to what's your point on appeal is not about that your point on appeal is soley on the power point even though you talk about the others do you think in your brief you say to give background correct i believe that our case law states that it order for the claim to be actionable the misstatement must be material intentional and prejudicial material and prejudicial is clear from the record an intentional requires us to look at the trial as a whole thank you very much it up would be honest but is this in your during your closing statement i don't think she did it