giving rise to a strong inference that the banks had actual knowledge of the problem this report aired by failing to consider those facts in their totality and by failing to draw the required inferences in our favor from those facts we left the darling cunningham branch manager o bank of america and later citizens bank was a knowing and essential participant in the individual defendants r b c responsible for maintaining the engine of the fraud through lies to american express and eventually extracting payment from the individual defendants for doing so how did you know which it was a part of the detail that she knew the defendant solicited and took in funds from investors that she helped shuttling commingle funds around more than one hundred accounts and that she knew the individual defendants resealing investor funds we allege that she knew that account balance are we if for the strong inference of actual knowledge as to the underlying broad or strong in france when you clearly she knew about the deception of american express but what is there in the complaint other than that she opened a large right i mean that doesn't say what the business model was and interesting lee in paragraph forty two to sixty of the complaint where you outlined what the scheme was there's not a single allegation referencing cunningham or her knowledge of any of that scheme so what you've got it seems to me and what you've just said is an allegation that a bank officer opens a lot of accounts for people and then facilitates their transferring money between those and among those accounts but that doesn't say that she knew why they were moving those funds or what was it listed about it right well your honor i would i would say that the fact that she needed lending money that never got repaid based on representations from the bank that the recipient of the money was the person charging the census was solvent that would be certainly something that she a but what connects that i don't understand what connects it in the abstract what role american express cards played in the scheme but what how does that say that ms cunningham knew about the defrauding of investors your honor the than the life amex are evidence of her state of mind of the overall scheme as is the solicitation of the fact that she was engaging in all of these other activities while at the bank that shows what she knew are acts related to american express and to defrauding american express and the question i'm asking is what in any of the complaint alleges or supports an inference that she actually did understand their business model which is to say that she knew that they were taking and money a ponzi scheme basically what we will as if she was the day to day contact for all of the banking transactions and the banking transactions that we outlined in depth in our complaint show that the money was being shuttled around commingle and withdrawn by the individual defendants for their personal use the amex allies around her were not alleging team knew that the amex was the engine of the fraud that was the main line of credit if the amex if i'm a knight of credit to me it's the main line of credit of the defendants business right i mean but what so suppose they were running a completely legitimate business is what we're short of capital and the bank or the bank officer the scylla tapes they are maintaining a line of credit with american express that defrauds american express but says that she understood that the business that she was keeping afloat that way was a criminal enterprise that's what i'm looking for judge i think it's a palette of the circumstances in the allegations outlined in the complain she knew that the m x line of credit was the engine of the business and she lied to american express to keep the business running and what i'm looking for you keep saying the engine of the fraud what is there that says that ms cunningham understood that what they were doing was defrauding investors through his interactions with the early cunningham over the years stated that she knew what they were doing that she knew the character and nature of their business as your weight sense elos says that she knew that they were engaged in fraud and then and when you should when you take that allegation together with the specifics of how the fraud was conducted and the fact that they're only cunningham took substantial steps to further the fraud through the lifting of the  america and a court decision below should be for many reasons maybe the most obvious is that planes play a strong inference of bank of america's actual knowledge and constructive knowledge but actual knowledge of the defendants provided their clients fraudulent material also promising six returns and lying about investments there's no allegation that cunningham knew that they misrepresented the performance of investment for their clients there's no allegation that cunningham knew that they way other than through hindsight or just a while yet for someone to look at those allegations include that a punt is now left the allegation is that ms cunningham called american express and told amex that the individual defendant had sufficient to warrant their line of credit when that was not true and after she left the bank she asked for a quote unquote loan of forty thousand dollars to keep me in call again that month supposed to demonstrate actual now and wrongdoing directed complaint which alleges that sent to los said that cunningham understood that the defendant solicited investments from people deposited the investments into their accounts at bank of america and then shuttled money through the accounts with some of the money going to the individual defendants personal accounts through cash withdrawals and personal checks how close does that come to knowing that there's certainly no nothing here suggesting that any of the money went from those accounts to investments of some kind is there well i don't think it becomes close at even if it were unusual it doesn't somebody looking at that wouldn't say oh out i actually know that they're running a ponzi scheme right and that that's really the question that's really what the what the out there has to be a strong of of attorney accounts you know attorney client and the court held that that was not enough to demonstrate a strong inference of actual knowledge i think what what's crucial about all of this is that one of the reasons that actual knowledge has to be alleged in detail and requires a strong inference including actual knowledge of the general architecture of the scheme otherwise it's very easy to allege these kinds of cases in hindsight right once you know that there was a ponzi scheme happening you can start piecing all sorts of secondary facts together to demonstrate how how those facts might fit into a connection they're there with can be alleged in detail from the outset and in that case the failing in the complaint was that there were no allegations of the actual details of the underlying fraud there were just conclusory allegations that improprieties and then there is the allegation that they she was generally aware of the business they were in their business model whether it's improper or not she knew that they were soliciting funds from investors and then the are a large number of accounts being opened and large numbers of funds that's that's not enough to just get to the level of plausibility for sure not your honor because all of those facts that all those  's true but but that that allegation falls under the principle of cases like lerner and rovner that knowing of impropriety is is not remotely close to enough to  satisfy the standard which is actual knowledge of the actual underlying fraud and i would just say the allegations that cunningham knew what i understood their business model that paragraph ninety two with the earliest years of their relationship and they also allege that from the earliest years of their relationship they were running a legitimate investment advisory practice so the fact as judge with pointed out that there are a lot of different reasons why somebody would want to get extra credit and even lied to their might want to buy an expensive cars or something not looking at those allegations other than in hindsight or just your pure wild guess you couldn't possibly actually know plowed i'm going to join in that plowing and i'm going to focus our short time together on the imputation arguments that have been advanced by the appellants we've already talked about sort of the operative facts the line to amex and the loans and doing things that were against bank policy in terms of listing deposits on low zero negative balance accounts or opening accounts as a threshold matter the district court going along with judge lynch is question if the district court didn't find that cunningham had actual knowledge and we of course argue that that she didn't but let's assume that cunningham had actual knowledge she was not acting within the scope of her employment and there's an awful lot of cases in the circuit that say that the employer is not liable where is here no evidence that the bank induced or otherwise the proved of the employee's conduct and cunningham was not acting in the interests of her employer none of to quote run interference after each bank investigation to find out and that's the end quote and to find out if the schemers quote were all right quote language and they can't have it both ways you can't be acting in the best interest of the bank on the one hand and acting in the scope of your employer and on the other side the calling actively deceiving your employer and there are obviously cases that we've cited that say banks are not liable for the actions that are solely based on the personal motives and not in for the rooms of banks business and briefly agency there is agency just doesn't apply the situation on the facts and obviously we cite cases on that and you know really i'm struck by the words of judge larry  when he said and i couldn't say better it's well settled in the nd circuit that a bank's negligent failure to identify warning signs of fraudulent activity such as atypical transactions where such signs converged for me there double force of red flags from either of the banks is the discussion of the brunt and that's because the bride in this case makes it different than all the other cases cited there is no case cited where there are allegations that he  lie to an ex about how much money they had in various accounts and that they needed her assistance she could solicit money for that but that doesn't say anything more about her knowledge of the character of the underlying pride or maybe it does why right before she was due to make this call means that she knew there was something going on and because of all of the other things that she was involved in it showed that she knew there was a fraud going on and we don't and answer one of your questions your honor that you ask actually undercuts your case because that shows she was in this for herself and not in it for the bank certainly your honor and thank you agency law is pretty clear a liability in this circuit that unless the insider has totally abandon the interests of the bank a mixed motive is still enough to impute her actions and knowledge to them and there are a number of cases about that very different context goldstein for instance is a federal tort claims act that of nothing to do with this so the fact that she was doing things that were and we had alleged in our complaint accruing to the benefit of her employers even if not totally approving right because she certainly had a personal financial stake in the outcome of the fraud but the fact that she was doing things that maintain economic value to her employers is enough to get us over the