In the

United States Court of Appeals

For the Seventh Circuit

____________

Nos. 06-3848, 06-4124, & 06-4399

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

EDDIE JACKSON, IEANIS SHAW, AND PAMELA YOUNG,

Defendants-Appellants.

____________

Appeals from the United States District Court 

for the Northern District of Illinois, Eastern Division.

No. 05 CR 247—Ruben Castillo, Judge.

____________

ARGUED JANUARY 17, 2008—DECIDED AUGUST 29, 2008

____________

Before RIPPLE, ROVNER, and TINDER, Circuit Judges.

TINDER, Circuit Judge. Defendants Angela Hubbard,

Ieanis Shaw, Eddie Jackson, Pamela Young, and Bruce

Jones were charged in a three-count indictment with

bank fraud in violation of 18 U.S.C. §§ 1344 and 2. The

government alleged that Ms. Shaw and Ms. Hubbard

generated false mortgage loan documents in order to

wire transfer mortgage loan proceeds to the personal

bank accounts of friends and family. One count was
2 Nos. 06-3848, 06-4124, & 06-4399

dismissed against Ms. Shaw, and a superseding indictment was returned, adding money laundering charges

under 18 U.S.C. § 1957 against all defendants except

Mr. Jones.

Defendants Shaw, Jackson, and Young were tried by a

jury and convicted on all counts. After denying motions

for a new trial, the district court sentenced the defendants to terms of imprisonment and ordered them

to pay restitution. Defendants Shaw, Jackson, and Young

appealed. Their appeals were consolidated.

The defendants raise three issues on appeal. They

first challenge the district court’s decision to exclude

hearsay evidence that Ms. Hubbard lied to the government about Ms. Shaw’s role in one of the wire transfers

involved in the bank fraud scheme. They also challenge

the sufficiency of the evidence of their guilt at trial. Lastly,

they contend that in rebuttal argument government

counsel improperly commented on their decisions not

to testify in violation of their Fifth Amendment right to

remain silent. For the following reasons, we affirm. 

I. Background

Washington Mutual Bank (“Washington Mutual” or the

“bank”) is the nation’s largest savings and loans. Its

deposits are insured by the Federal Deposit Insurance

Corporation. Washington Mutual provides mortgages to

its customers who are buying or refinancing homes. In

2003 its mortgage loans were processed at three sites,

including Downers Grove, Illinois.
Nos. 06-3848, 06-4124, & 06-4399 3

The mortgage loan processing was compartmentalized

into discrete job functions similar to an assembly line.

First, the loans were solicited by mailings to existing

Washington Mutual customers. If a customer completed

certain paperwork and returned it, employees at the

Downers Grove facility put the customer’s personal

information into a loan processing computer system

called “Pronto.” The mortgage loan application then

went to “openers,” employees who were responsible for

compiling required forms and documents for a particular

loan and sending the loan on to the next stage of the

process. The loan file next moved on to the underwriting

department, where underwriters decided whether to

approve, decline, or suspend the loan based on credit

information in the loan file. If a loan was approved, then

the loan file moved on to the processing department.

Employees in that department were responsible for

gathering any additional information needed to complete

the mortgage loan process. Once all these steps were

completed, the file moved to the closing department

where employees called “closers” worked with title

agents and attorneys to reconcile loan fees and balance

and fund the mortgage loan. Closers were responsible

for preparing all legal documents for loan closing, many

of which were prepared using the Pronto system. Openers

and closers had no business reason to interact in order

to complete their respective job functions.

One type of document that the closers were responsible

for preparing was the “wire transfer worksheet.” These

worksheets were used to initiate the actual transfer

of funds from the bank to the specific closing location in
4 Nos. 06-3848, 06-4124, & 06-4399

order to fund a mortgage loan. The wire transfer

worksheets contained information such as the loan applicant’s name, the loan number, the amount of the

loan, and the location where the funds were to be sent.

In 2002 and 2003, after the closer prepared the wire transfer

worksheet, Washington Mutual’s procedures required

that two persons sign the worksheet before it moved on

to the wire room for funding. The first person was the

closer who had finalized the loan paperwork; the second

was a manager at the Downers Grove facility. In 2002

and 2003, at the height of the mortgage refinancing

boom, Washington Mutual employed full-time closers,

who were regular employees, and contract closers, who

were brought in on a part-time basis to assist with the

increased volume of loan applications. Full-time closers

were authorized to sign wire transfer worksheets; contract closers were not. Once the wire transfer worksheet

had the required signatures, it was faxed from the Downers Grove facility to the Washington Mutual wire room

in New York. Employees in the wire room reviewed the

worksheet for approvals and authorizing signatures

and generated the actual disbursement or wire of bank

funds to the settlement agent, usually a title company

or attorney. Wire transfers of bank funds for mortgage

loans were almost never sent to the bank account of an

individual borrower.

The Pronto system also maintained an accounting of

loans that had been approved and of bank funds that had

been dispersed to fund those loans. Pronto allowed wire

transfer requests to be “reversed.” This could be necessary where a loan funding document was not executed
Nos. 06-3848, 06-4124, & 06-4399 5

properly or where a home sales transaction fell through at

the last minute. The process of reversing a wire transfer

was easy and only required a “couple clicks of a button.”

The process could also be used to conceal a fraud. In this

case, the defendants reversed wire transfers in Pronto

before the system completed its daily accounting, which

allowed them to conceal their fraud for some time. But

the process of reversing wire transfers left forensic evidence. One could determine which Washington Mutual

employee reversed a wire transfer in Pronto by examining

the funding screen for that wire reversal and matching

up the user identification number associated with the

reversal with the master list of identification numbers

for bank employees. Every employee who reversed a

wire transfer in Pronto left a digital fingerprint of that

activity.

In early May 2003, TCF Bank notified the loss prevention team at the Downers Grove facility of a large wire

transfer of mortgage loan funds from Washington

Mutual into the personal bank account of TCF Bank

customer Yvette Hulet. The May 8, 2003 wire transfer to

Ms. Hulet’s account was in the amount of $345,943.80.

The wiring of such a large sum of mortgage money into

a personal bank account immediately raised red flags.

The loss prevention team began an investigation into

the wire transfer and determined that no one with the

name Yvette Hulet had a pending mortgage loan application with Washington Mutual. The team then found

the wire transfer worksheet used to generate the Hulet

wire. Examination of the worksheet revealed that it had

been printed on the then-pending mortgage loan applica-
6 Nos. 06-3848, 06-4124, & 06-4399

tion of a person named Percy Williams. In other words,

the worksheet had Mr. Williams’s name and loan

number on it, but Ms. Hulet’s name was listed as the

beneficiary of the wire and her TCF Bank account was

the account to be credited.

Further examination of the worksheet revealed additional evidence of fraud. One of the authorizing signatures

on the worksheet was Stan Zotas, who was no longer

employed by Washington Mutual at the time of the “loan.”

The Washington Mutual investigators determined that

whoever generated the fraudulent wire transfer had cut

and pasted the authorization signatures from a legitimate

wire transfer worksheet onto the same section of the

fraudulent Hulet worksheet and then sent it to the wire

room for funding. The investigators concluded that the

fraud was an inside job because the hard copies of legitimate wire transfer worksheets were only accessible to

any current Washington Mutual employee. The investigators also discovered that six wire transfers in Hulet’s

name had been printed through Pronto in early May

2003, though only one wire transfer worksheet had been

faxed to the wire room in New York. In addition, these

six wire transfers had been printed using Ms. Hulet’s

personal and bank information and a pending loan application, and the wires had been reversed in Pronto.

Washington Mutual attempted to determine whether

any other similar fraudulent wire transfers had occurred

from the Downers Grove facility. An investigation disclosed that wire transfers of mortgage loan funds had

been made from Washington Mutual to the personal
Nos. 06-3848, 06-4124, & 06-4399 7

bank accounts of Pamela Young, Eddie Jackson, and Bruce

Jones. First, on January 28, 2003, a wire transfer of

$194,471.70 was made into Ms. Young’s personal checking

account at Bank One. The wire transfer sheet contained

Ms. Young’s name, the name of her bank and her bank

account number. The Young wire transfer sheet had

been printed on the pending loan application of Washington Mutual customer Beverly Emon, also a Washington

Mutual employee. Next, on April 1, 2003, a wire transfer

of $250,641.40 was made into Mr. Jackson’s personal bank

account at TCF Bank. The wire transfer had been printed

on the pending loan application of Washington Mutual

customer Frank Knoll. Then on April 29, 2003, a wire

transfer of $187,134 was made into Mr. Jones’s personal

bank account at Bank One. This wire transfer had been

printed on the pending loan application of Washington

Mutual customer Mark Corvo. Four other wires were

printed with Mr. Jones’s name, but were not sent to the

wire room for funding and were reversed before a wire

transfer took place. The Washington Mutual investigators

also discovered five wires in Pronto that had been

printed in April 2003 in the name of George Davis, Defendant Shaw’s husband, for amounts ranging from $90,000

to a bit over $100,000. None of the Davis wires were sent

to the wire room for funding.

The Washington Mutual investigators took steps to

determine whether the Young, Jackson, and Jones wires

were legitimate and found similar evidence of fraud in

each of them. Neither Young, Jackson, nor Jones was a

Washington Mutual mortgage loan customer in the

winter or spring of 2003, and the authorization signa-
8 Nos. 06-3848, 06-4124, & 06-4399

tures on each wire had been cut and pasted from

legitimate worksheets. Washington Mutual’s investigation led to Angela Hubbard and Ieanis Shaw. Ms. Hubbard

had been a contract closer at the Downers Grove facility

from September 2002 until April 28, 2003, her last day

of employment. Ms. Shaw was hired as a contract opener

at the Downers Grove facility in late August 2002 and

then made a full-time employee in March 2003. Her last

day of employment with Washington Mutual was May 20,

2003.

Before the January 28 wire transfer of $194,471.70 into

Ms. Young’s personal bank account, Ms. Young’s

checking account had maintained very low or negative

balances. Her bank records show that the day after the

transfer, January 29, 2003, she opened a new savings

account at Bank One in Texas and transferred $94,243.58

from her checking account into her new savings account.

Bank records further show that on January 30, 2003,

$45,207.12 was withdrawn from this new savings account.

Also on January 29, Ms. Young wrote a personal check to

Bank One to obtain a cashier’s check made payable to

Angela Hubbard in the amount of $97,000. The cashier’s

check later was endorsed by Ms. Hubbard. Bank Calumet

records reflect that on February 3, 2003, Ms. Hubbard

deposited $46,000 into her checking account, used $50,000

to open a new savings account, and received $1,000 cash.

Ms. Young and Ms. Hubbard are sisters. Telephone

records revealed that from January 1 through January 24,

2003, they spoke on the phone only three times for a

total of forty-two minutes. But during the ten days from
Nos. 06-3848, 06-4124, & 06-4399 9

January 25 through February 3, 2003, the period surrounding the wire transfer, they spoke on the phone thirty-six

times for a total of 228 minutes. In the remainder of

February 2003, they spoke eleven times for a total of 108

minutes.

On April 1, 2003, $250,641.40 was wired from Washington Mutual to a personal checking account at TCF

Bank opened by Mr. Jackson on March 23, 2003. The

account had very low or negative balances before the

transfer. The same day as the wire transfer, Mr. Jackson

wrote a personal check on the account in the amount of

$125,000 payable to Angela Hubbard. On April 3, 2003,

that check was deposited into Ms. Hubbard’s personal

checking account at Bank Calumet and Ms. Hubbard

wrote a personal check on her account payable to

Ms. Shaw for $10,000. This check was later deposited into

Ms. Shaw’s bank account. A week later Ms. Hubbard wrote

another personal check for $10,000 payable to Ms. Shaw.

This check also was deposited into Ms. Shaw’s account.

Mr. Jackson ran through the money he retained rather

quickly on cash withdrawals, furniture, vehicles, and gifts

to family and friends. On June 23, 2003, less than three

months after the wire transfer, his account balance was

near $0.

Telephone records of calls between Mr. Jackson and

Ms. Hubbard reveal a spike in activity in the time period

surrounding the April 1 wire transfer. In January and

February 2003, Mr. Jackson and Ms. Hubbard spoke nine

and seven times, respectively, for a total of fifty-three

minutes each month. From March 1 through March 25,
10 Nos. 06-3848, 06-4124, & 06-4399

2003, they had sixteen telephone conversations for a total

of sixty-six minutes. However, during the ten days from

March 26 through April 4, 2003, they had seventy-three

telephone conversations for a total of 222 minutes.

In April 2003, Ms. Shaw purchased two wedding rings

from the Jewelry Exchange, valued at $3,225.64 and

$2,312.21, respectively. That same month Ms. Shaw and

her husband went on a honeymoon to Jamaica at the cost

of $3,306. Then on May 8, 2003, Ms. Shaw purchased

approximately $12,500 in furniture from Harlem Furniture.

On April 29, 2003, $187,134 was transferred by wire

from Washington Mutual to Mr. Jones’s personal checking

account at Bank One. On May 1, Mr. Jones obtained two

cashier’s checks. The first, in the amount of $63,567, was

made payable to Ms. Hubbard; the second, in the amount

of $60,000, was made payable to Ms. Shaw. Mr. Jones

testified that Ms. Hubbard had instructed him to divide

the proceeds of the wire transfer three ways and to

obtain two cashier’s checks, one for her and one for Ms.

Shaw. He also testified that he had never met Ms. Shaw

before. Mr. Jones used his share of the proceeds to buy

some vehicles and pay off some bills. Ms. Shaw’s bank

records show that on May 2, 2003, she opened a new

savings account at TCF Bank with the $60,000 cashier’s

check. She then transferred $30,000 from that account

into her checking account.

Washington Mutual’s investigation revealed that the

authorizing signatures on the Jones wire transfer were

identical to those on the worksheet involved in the Hulet

wire transfer that had prompted the investigation. Five
Nos. 06-3848, 06-4124, & 06-4399 11

wires had been printed in Mr. Jones’s name, but four were

reversed before the real wire took place. Ms. Hubbard’s

user identification number was used to reverse the

first four Jones wires in Pronto. Ms. Shaw’s user identification number was used to reverse the real wire

transfer on April 29, the day after Ms. Hubbard’s employment at Washington Mutual ended. Ms. Shaw’s user

identification number also was used to reverse all five

wires printed in her husband’s name and all of the Hulet

wires as well. The investigation also revealed that two

wires had been printed in Mr. Jackson’s name. The first

was printed and reversed in Pronto on March 28, 2003;

Ms. Shaw’s user identification number was used to

reverse the wire. Ms. Hubbard’s user identification number was used to reverse the real wire transfer on April 1,

2003.

On March 17, 2005, Defendants Hubbard, Shaw, Jackson,

Young, and Jones were charged in a three-count indictment with a scheme to defraud Washington Mutual and

to obtain monies and funds owned by and under the

custody and control of the bank in violation of 18 U.S.C.

§§ 1344 and 2. The government alleged that Ms. Shaw and

Ms. Hubbard generated false mortgage loan documents

in order to wire transfer mortgage loan proceeds to the

personal bank accounts of friends and family, including

Ms. Hubbard’s sister, Ms. Young, and Ms. Hubbard’s longtime friend, Mr. Jackson. Mr. Jones and Ms. Hubbard

entered into written plea agreements. On August 30,

2005, Mr. Jones pled guilty to count three of the indictment which alleged the fraudulent wire transfer into

his account. On October 25, 2005, pursuant to a written
12 Nos. 06-3848, 06-4124, & 06-4399

plea agreement, Ms. Hubbard pled guilty to count one

of the indictment alleging the fraudulent Young wire

transfer.

As part of her plea agreement, Ms. Hubbard agreed

to cooperate with the government and to provide

complete and truthful information during its investigation and in preparation for trial of the co-defendants.

Both in her proffer of her involvement in the scheme

and in her plea agreement, Ms. Hubbard implicated Ms.

Shaw in the Young wire transfer. Specifically, Ms. Hubbard

admitted certain facts as a basis for her plea: In January

2003 she and Ms. Shaw “began talking about the possibility of attempting to fraudulently wire money from

Washington Mutual into someone else’s bank account”;

they “agreed they would first attempt this scheme by

wiring money to [Ms. Hubbard’s] sister, co-defendant

Pamela Young”; after Ms. Young provided Ms. Shaw with

her personal and banking information, “Shaw generated

fraudulent mortgage loan documents in Young’s name and

sent a wire request for mortgage loan funds to be disbursed to Young’s personal bank account”; and Ms.

Hubbard, Ms. Shaw, and Ms. Young executed the

scheme on January 28, 2003, by causing a wire transfer of

loan funds to Ms. Young’s checking account and subsequently agreed on how to divide the proceeds from the

scheme, with Ms. Young keeping half and Ms. Hubbard

and Ms. Shaw dividing the other half.

On January 20, 2006, shortly before the start of the

scheduled jury trial, Ms. Hubbard told the government

that she had not been truthful in her proffer and plea
Nos. 06-3848, 06-4124, & 06-4399 13

agreement. She claimed that Ms. Shaw had no active role

in the Young wire transfer. More specifically, Ms. Hubbard

said that it was she who contacted Ms. Young about

participating in the fraud scheme, obtained Ms. Young’s

bank account information, and generated the fraudulent

wire transfer worksheet. However, Ms. Hubbard also

said that she and Ms. Shaw had conversations about

wiring money into people’s bank accounts and that

Ms. Shaw knew Ms. Hubbard was involved in the wire

transfer to Ms. Young’s account. Ms. Hubbard added that

after learning how much money Ms. Hubbard and Ms.

Young received, Ms. Shaw said she would like to get

involved.

The morning that trial was to commence, the government informed the court that Ms. Hubbard had advised

that information she previously had provided was not

truthful. The government took the position that Ms.

Hubbard had lied in her proffers and in open court during

her plea hearing and was no longer usable as a witness.

The government moved to revoke Ms. Shaw’s plea agreement and vacate her guilty plea. The district court granted

these motions and continued the trial date. The government then moved to dismiss count one of the indictment

(involving the Young wire transfer) as to Ms. Shaw. The

district court granted this motion. On March 1, 2006, the

grand jury returned a nine count superseding indictment against all defendants except Mr. Jones, who by

then had already pled guilty. The superseding indictment added money laundering charges in violation of

18 U.S.C. § 1957.
14 Nos. 06-3848, 06-4124, & 06-4399

Only Ms. Shaw’s counsel sought the admission at trial of 1

Ms. Hubbard’s January 20 partial recantation. Mr. Jackson’s

counsel did not take a position on the statements’ admissibility,

and Ms. Young’s counsel actually objected to their admission.

After the superseding indictment was filed, the government filed a supplemental evidentiary proffer to

admit co-conspirator statements. (The district court

previously had granted the government’s motion to

admit co-conspirator statements based on a proffer that

relied heavily, but not exclusively, on Ms. Hubbard’s

statements.) The supplement proffered that Mr. Jones

would testify that Ms. Hubbard told him that Ms. Shaw

was orchestrating the fraud and that Ms. Hubbard could

wire him money only if “Ieanis would do it.”

Defendants Shaw, Jackson, and Young were tried by a

jury and convicted on all counts. During trial, the government moved to preclude the defense from presenting

evidence about Ms. Hubbard’s January 20th partial recantation through the cross-examination of the government

agent, Mike Clifford. Ms. Shaw’s counsel argued that the

evidence that Ms. Hubbard recanted statements she had

made to the government about Ms. Shaw’s involvement

in the Young wire transfer was admissible as statements

against interest under Fed. R. Evid. 804(b)(3). The district 1

judge cautioned, “Just before me Miss Hubbard has

said conflicting things. So for me to allow in some type

of hearsay statement that Miss Hubbard made is going

to take a lot of corroborating circumstances for that to

come in.” The court ultimately found insufficient corrobo-
Nos. 06-3848, 06-4124, & 06-4399 15

rating circumstances to admit the hearsay, sustained the

government’s objection and thus excluded the evidence. 

At trial, consistent with the government’s proffer, Mr.

Jones testified that he knew Ms. Shaw was involved in the

fraud scheme because Ms. Hubbard had told him so. He

also testified that when he asked Ms. Hubbard if he

could get some money wired to him, she said that she

could not do it, but she would check with Ieanis to see

if Ieanis could do it.

Ms. Shaw and Ms. Young moved for a new trial. The

district court treated the motions as made by all defendants and denied the motions. The defendants were sentenced to terms of imprisonment and ordered to pay

restitution. At sentencing, Ms. Shaw again raised the

issue of Hubbard’s recanted statements. Judge Castillo

said with respect to Ms. Hubbard, “I think her credibility

is zero at this point, as I’ve seen her take inconsistent

positions before this Court during plea allocutions that

occurred on the record under oath, and so I could not

in good conscience admit any of her out-of-court statements, and so that was the basis for that ruling . . . .” Shaw,

Jackson, and Young timely appealed their convictions.

Their appeals were consolidated and are before us now.

II. Discussion

On appeal, the defendants raise three challenges to

their convictions. They first contend that the district

court erred in excluding hearsay evidence that Ms. Hubbard lied to the government about Ms. Shaw’s role in the
16 Nos. 06-3848, 06-4124, & 06-4399

Young wire transfer. They also challenge the sufficiency

of the evidence of their guilt at trial. Finally, the defendants

contend that in rebuttal the government improperly

commented on their decisions not to testify in violation

of their Fifth Amendment right to remain silent. Each of

these challenges fails, as explained below, so we affirm.

A. Exclusion of Ms. Hubbard’s Statements

The defendants contend that the district court erred by

excluding evidence that Ms. Hubbard recanted prior

statements and lied to the government about Ms. Shaw’s

involvement in the Young wire transfer. They assert that

the excluded evidence was essential to their case and, as

a result, its exclusion denied them a fair trial. This court

generally reviews a district court’s decision regarding

the admission of evidence for an abuse of discretion.

United States v. Swan, 486 F.3d 260, 263 (7th Cir. 2007). As

noted, however, only Ms. Shaw sought admission of Ms.

Hubbard’s January 20th recanting statements; Mr. Jackson

did not address the evidence and Ms. Young actually

objected to their admission. This is a clear case of waiver

by Ms. Young of any right to challenge the exclusion of

the statements, see United States v. Clements, 522 F.3d 790,

793 (7th Cir. 2008) (“Waiver occurs when a criminal

defendant intentionally relinquishes a known right.”), and

a forfeiture by Mr. Jackson of any such right, see id.

(“Forfeiture occurs when a defendant negligently fails

to assert a right in a timely fashion.”). Waiver extinguishes any error, precluding appellate review; forfeiture, however, allows for plain error review. Id. A plain
Nos. 06-3848, 06-4124, & 06-4399 17

error “must be clear or obvious and affect substantial

rights in order to warrant reversing the district court’s

decision” as to the admissibility of evidence. United

States v. Schalk, 515 F.3d 768, 776 (7th Cir. 2008) (citation

omitted). Thus, we review the exclusion of this evidence

for an abuse of discretion as to Ms. Shaw and for plain

error as to Mr. Jackson. And because of Ms. Young’s

waiver, our review is precluded as to her.

Prior to analyzing admissibility under Rule 804(b)(3), we

observe that by offering Ms. Hubbard’s recanting statements, Ms. Shaw sought, in effect, to impeach Ms. Hubbard on a collateral matter. “[C]ontradiction is a valid

method of impeachment, [but] it is well-settled that one

may not impeach by contradiction regarding collateral or

irrelevant matters and that a party may not contradict

for the sake of contradiction.” United States v. Bitterman,

320 F.3d 723, 727 (7th Cir. 2003) (quoting United States v.

Kozinski, 16 F.3d 795, 805-06 (7th Cir. 1994)). We note

that this rule ordinarily is utilized when a witness is

testifying, and Ms. Hubbard never testified as a witness.

However, in our view, the rule is equally applicable

where a party attempts to put a non-testifying person’s

statement before the trier of fact solely to impeach that

person. The jury was not asked to determine whether

Ms. Shaw participated in the Young wire transfer: before

trial the government had dismissed the Young wire

transfer count against Ms. Shaw. Furthermore, Ms. Hubbard’s earlier statements that Ms. Shaw participated in

the Young wire transfer were not before the jury. Thus,

in order for the jury to find that Ms. Hubbard lied about

Ms. Shaw’s participation in the Young wire transfer, the
18 Nos. 06-3848, 06-4124, & 06-4399

jury would also have to hear evidence that Ms. Hubbard

had made statements implicating Ms. Shaw in that transaction. Such evidence was irrelevant because Ms. Shaw

was no longer charged with any offense arising out of the

Young wire transfer. The only purpose of presenting

evidence that Ms. Hubbard recanted prior statements

implicating Ms. Shaw in the Young wire transfer was

to prove that Ms. Hubbard was lying. But “[m]erely

attempting to prove that a witness is lying is not a proper

purpose of impeachment by contradiction.” Kozinski, 16

F.3d at 807. And the district judge could have excluded

this collateral and irrelevant evidence under Fed. R. Evid.

403 because its tendency to mislead and confuse the jury

outweighed its negligible probative value. All that said,

we move on to consider whether the district court abused

its discretion in excluding the evidence under Rule

804(b)(3).

Under Fed. R. Evid. 804(b)(3), hearsay statements are

not excluded by the hearsay rule if “(1) the declarant is

unavailable as a witness, (2) the statement was against

the declarant’s penal interest when made, and (3) corroborating circumstances clearly suggest that the statement is trustworthy.” United States v. Loggins, 486 F.3d

977, 981 (7th Cir. 2007), cert. denied, 128 S. Ct. 805 (2007);

see also United States v. Leahy, 464 F.3d 773, 797-98 (7th

Cir. 2006), cert. denied sub nom. Duff v. United States, 128

S. Ct. 46 (2007). The proponent of the hearsay statement

bears the burden of demonstrating that each of these

elements is satisfied. United States v. Robbins, 197 F.3d 829,

838 (7th Cir. 1999). Here, the district court found—and the

government does not dispute—that Ms. Hubbard was
Nos. 06-3848, 06-4124, & 06-4399 19

Ms. Hubbard’s recanting hearsay statements concern only 2

the first wire transfer into Ms. Young’s account. The recantation

has no relevance as to either Ms. Shaw or Mr. Jackson who

were not charged under the count arising from that wire

transfer.

unavailable to testify because she would assert her Fifth

Amendment right against self-incrimination. The government also concedes, and we accept, that Ms. Hubbard’s

recantation of her prior statements implicating Ms. Shaw

in the Young wire transfer were against Ms. Hubbard’s

penal interest. Ms. Hubbard stood to and did, in fact,

lose the benefits of a favorable plea agreement and exposed herself to additional criminal charges. Thus, the

only issue is whether the defendants have shown that

corroborating circumstances clearly suggest that Ms.

Hubbard’s January 20 statements were trustworthy.2

The district judge’s determination as to the trustworthiness of an out-of-court statement is entitled to considerable deference and should be upheld unless “clearly

erroneous.” United States v. Amerson, 185 F.3d 676, 684

(7th Cir. 1999); see also United States v. Hall, 165 F.3d 1095,

1112 (7th Cir. 1999). We have emphasized that Rule

804(b)(3) “expressly requires the exclusion of out-of-court

statements offered to exculpate the accused unless there

are corroborating circumstances that ‘clearly indicate’ the

trustworthiness of the statement.” Hall, 165 F.3d at 1112

(quoting United States v. Garcia, 897 F.2d 1413, 1420 (7th

Cir. 1990)). The defendants submit that the statements

in question were admissible based on consideration of
20 Nos. 06-3848, 06-4124, & 06-4399

the factors from United States v. Nagib, 56 F.3d 798 (7th

Cir. 1995). In Nagib we identified three factors for district

courts to consider when determining whether corroborating circumstances exist for Rule 804(b)(3) purposes: (1) the

relationship between the declarant and the exculpated

party; (2) whether the statement was voluntary and given

after Miranda warnings; and (3) whether there is any

evidence the statement was made to curry favor with

authorities. Id. at 805 (citing United States v. Garcia, 986

F.2d 1135, 1140 (7th Cir. 1993)).

These factors might seem to provide some weight in

favor of finding corroborating circumstances here. Ms.

Hubbard and Ms. Shaw did not have a close personal

relationship which one would expect for Ms. Hubbard

to be motivated to falsely exculpate Ms. Shaw—though

they were close enough to be involved in the fraudulent

scheme together. Ms. Hubbard had been advised of her

Miranda rights and made the statements in the presence

of her counsel. It seems that her statements were

voluntary; the government does not suggest otherwise.

Nor is there anything in the record to suggest that Ms.

Hubbard recanted her prior statements in order to curry

favor with the government. To the contrary, Ms. Hubbard

would have known that recanting her prior statements

and admitting to having lied to the government in

pretrial preparation, in her plea agreement, and even

under oath at her plea hearing would result in the withdrawal of her plea agreement, at the least, and expose her

to additional criminal charges.

We have never said, however, that the considerations

we identified in Nagib were the only factors to be
Nos. 06-3848, 06-4124, & 06-4399 21

weighed in determining whether corroborating circumstances exist. See Am. Auto. Accessories, Inc. v. Fishman, 175

F.3d 534, 541 (7th Cir. 1999) (stating that the factors to

consider in determining whether corroborating circumstances exist “include” the factors identified in Nagib);

Garcia, 986 F.3d at 1140 (indicating that the case law

identifies some circumstances relevant to determining

whether corroborating circumstances clearly indicate

trustworthiness). Other circumstances in this case

strongly detract from any corroboration raised by the

Nagib factors. Ms. Hubbard’s statements that Ms. Shaw

was not directly involved in the Young wire transfer

clearly contradicted her several prior statements to the

government, in her plea, and affirmed under oath, that

Ms. Shaw was involved in the Young wire transfer. We

have concluded that similar circumstances justified the

conclusion that a statement lacked the requisite trustworthiness for admission under Rule 804(b)(3). United

States v. Groce, 999 F.2d 1189, 1190-91 (7th Cir. 1993)

(upholding district court’s conclusion that out-of-court

statement lacked the trustworthiness required under

804(b)(3) where the declarant “gave several conflicting

statements, most of which contradicted the statement

[sought to be admitted]”).

The defendants argue that Ms. Hubbard’s statements

recanting her prior statements about the fraud scheme

were corroborated by other evidence, but her prior statements implicating Ms. Shaw were not. We disagree.

Specifically, the defendants point to the evidence that

none of the co-defendants other than Ms. Hubbard

knew Ms. Shaw. While the government did not have
22 Nos. 06-3848, 06-4124, & 06-4399

evidence to suggest that Ms. Shaw would risk being

charged with a crime solely to benefit persons she did not

know, it did offer evidence that Ms. Shaw herself benefitted from her participation in the scheme. The evidence

allowed a reasonable jury to find that Ms. Shaw received

$80,000 for her role in the Jackson and Jones wire transfers.

This, and other evidence, for example, the use of Ms.

Shaw’s user identification number in fraudulent wire

transfers, and the timing of the Jones wire transfer and

Hulet wire transfers after Ms. Hubbard had left Washington Mutual’s employ, corroborated Ms. Hubbard’s

earlier statements as to Ms. Shaw’s involvement in the

scheme to defraud.

As Judge Castillo explained, because Ms. Hubbard made

conflicting statements before him, “a lot of corroborating

circumstances” would be required to admit her

recanting hearsay statements. In effect, he was saying

that her statements were so conflicting that her

recanting hearsay statements were untrustworthy. The

judge later reiterated that Ms. Hubbard’s credibility was

“zero” and he “could not in good conscience admit any

of her out-of-court statements.” The district judge did not

err in finding that Ms. Hubbard’s recanting hearsay

statements lacked trustworthiness. And we cannot disagree with his conclusion that a lot of corroboration

would be needed to admit the recanting hearsay statements of an incredible and untrustworthy declarant.

Ultimately, Judge Castillo did not find sufficient corroborating circumstances to admit the statements. That was

well within his discretion based on the entire record before

him. And, as we have noted, Rule 804(b)(3) explicitly
Nos. 06-3848, 06-4124, & 06-4399 23

requires a judge to exclude an out-of-court statement

unless there are sufficient corroborating circumstances.

Hall, 165 F.3d at 1112. We thus uphold the judge’s

decision to exclude Ms. Hubbard’s recanting hearsay

statements.

The defendants suggest that the district court relied on

its inherent powers to exclude Ms. Hubbard’s hearsay

statements. They are incorrect. As explained supra, we

do not quarrel with the district court’s conclusion that

there were insufficient corroborating circumstances to

indicate the trustworthiness of Ms. Hubbard’s hearsay

statements. Thus, Rule 804(b)(3) expressly required the

exclusion of those statements. See id. Accordingly, the

basis for the district court’s ruling was Rule 804(b)(3), not

its inherent powers.

The defendants cite Taylor v. Illinois, 484 U.S. 400 (1988),

for the well-established proposition that it is the jury’s

role to assess the credibility of witnesses. But it is the

judge’s role to determine the admissibility of evidence.

See Fed. R. Evid. 104(a) (“Preliminary questions concerning . . . the admissibility of evidence shall be determined by the court.”); United States v. Collins, 966 F.2d 1214,

1223 (7th Cir. 1992) (“[I]t is the judge’s role to determine

admissibility of evidence.”). A defendant’s right to offer

testimony is not absolute. See United States v. Scheffer, 523

U.S. 303, 308 (1998) (holding military rule of evidence

making polygraph evidence inadmissible in court martial

proceedings did not violate the accused’s right to present

a defense); Taylor, 484 U.S. at 410 (“The accused does not

have an unfettered right to offer testimony that is . . .
24 Nos. 06-3848, 06-4124, & 06-4399

inadmissible under standard rules of evidence.”);

Malinowski v. Smith, 509 F.3d 328, 338 (7th Cir. 2007)

(concluding the district court did not violate petitioner’s

right to present a defense by excluding victim’s school

counselor’s testimony at trial); Tyson v. Trigg, 50 F.3d 436,

444 (7th Cir. 1995) (“A court does not violate the Constitution every time it sustains an objection to the testimony of one of the defense witnesses, or for that matter

every time it excludes one of those witnesses altogether.”).

Finally, the defendants’ reliance on United States v. Peak,

856 F.2d 825 (7th Cir. 1988), is misplaced. The hearsay

exception at issue there was the state of mind exception

under Rule 803(3). Id. at 834. Rule 803(3) does not

expressly require the exclusion of evidence absent corroborating circumstances clearly indicating the trustworthiness of the statement. Rule 804(b)(3) does.

The defendants argue that the exclusion of Ms. Hubbard’s statements recanting her prior statements violated

their Sixth Amendment right to confrontation. This

court reviews de novo evidentiary rulings that affect a

defendant’s Sixth Amendment right to confront witnesses. United States v. Gilbertson, 435 F.3d 790, 794 (7th

Cir. 2006). The Confrontation Clause guarantees a defendant an opportunity for effective cross-examination.

Delaware v. Fensterer, 474 U.S. 15, 20 (1985) (per curiam);

United States v. Ghilarducci, 480 F.3d 542, 548 (7th Cir.), cert.

denied sub nom. Richardson v. United States, 128 S. Ct.

159, and cert. denied, 128 S. Ct. 252 (2007). There is no

guarantee of cross-examination “to whatever extent[] the

defense might wish.” Delaware v. Van Arsdall, 475 U.S. 673,

679 (1986) (quoting Fensterer, 474 U.S. at 20). A district
Nos. 06-3848, 06-4124, & 06-4399 25

judge has wide discretion to impose reasonable limits on

cross-examination, and may do so based on concerns

about, inter alia, prejudice, confusion of the issues, or

questioning that is only marginally relevant. Id.; United

States v. Smith, 454 F.3d 707, 714 (7th Cir. 2006). The

defendants had the opportunity to effectively crossexamine Agent Clifford, and did so. The district judge was

well within his discretion in prohibiting Ms. Shaw from

questioning Agent Clifford about Ms. Hubbard’s recantation of her earlier statements about Ms. Shaw’s role in the

Young wire transfer. Ms. Shaw was not charged with

participating in the Young wire transfer. Thus, testimony

that Ms. Hubbard originally implicated Ms. Shaw in that

wire transfer and later said she had been untruthful about

that would be only marginally, if at all, relevant. Such

testimony also had a strong potential for confusing the

issues because Ms. Shaw was not charged with the Young

wire transfer and Ms. Hubbard’s credibility was not

directly at issue.

Furthermore, Ms. Hubbard did not recant all of her

prior statements regarding Ms. Shaw’s role in the fraudulent scheme. Had the district court allowed evidence of

Ms. Hubbard’s statements that were exculpatory as to

Ms. Shaw with respect to the Young wire transfer, the

other statements that Ms. Hubbard made to Agent

Clifford implicating Ms. Shaw in the overall scheme

may have been admissible on redirect. See United States v.

Glover, 101 F.3d 1183, 1189 (7th Cir. 1996) (indicating

that where a fragmentary statement is introduced, Fed. R.

Evid. 106 allows an adverse party to require the admission

of any other part of the statement to clarify or explain the
26 Nos. 06-3848, 06-4124, & 06-4399

part already received so as to avoid any misleading

impression created by offering the statement outside of

context). Additional statements made by Ms. Hubbard,

including other things she said on January 20th, could

have been offered to put the recanting statements in their

proper context and to avoid misleading the jury into

believing that Ms. Shaw had no involvement in the fraudulent scheme. During the same January 20th recantation

exculpating Ms. Shaw in the Young wire transfer, Ms.

Hubbard reconfirmed that she and Ms. Shaw had had

several discussions about wiring money into other’s

accounts and Ms. Shaw knew that Ms. Hubbard wired

money into Ms. Young’s account. Ms. Hubbard further

stated that after seeing that the wire transfer was successful and knowing how much money Ms. Young and

Ms. Hubbard received, Ms. Shaw said she wanted to get

some money through a wire transfer. Ms. Hubbard made

several very damaging statements about Ms. Young’s

involvement in the scheme in the January 20th statement

as well. The admission of the remainder of Ms. Hubbard’s

statements to Agent Clifford may have been highly prejudicial to Ms. Young and would have raised concerns

about Ms. Young’s confrontation rights. See Crawford v.

Washington, 541 U.S. 36, 54, 59 (2004) (defendant’s right

to confrontation violated by admission of testimonial

statements if declarant was unavailable to testify at trial

and defendant did not have a prior opportunity to

cross-examine the declarant); United States v. James, 487

F.3d 518, 525 (7th Cir. 2007) (citing Crawford).

The defendants assert that it was inconsistent for the

district court to allow Ms. Hubbard’s out-of-court state-
Nos. 06-3848, 06-4124, & 06-4399 27

The defendants suggest that the district court was biased 3

against them and made rulings simply based on whether the

proponent was the government or a defendant. The record

does not support this claim.

ments to come in through Mr. Jones’s testimony but to

preclude cross-examination of Agent Clifford about Ms.

Hubbard’s recantation of her prior statements about Ms.

Shaw. The Confrontation Clause is not violated by the

admission of co-conspirator statements made in furtherance of the conspiracy; such statements are not hearsay

under Fed. R. Evid. 801(d)(2)(E) and not “testimonial.”

United States v. Hargrove, 508 F.3d 445, 448-49 (7th Cir.

2007); United States v. Jenkins, 419 F.3d 614, 618 (7th Cir.

2005). The government’s evidence supported the conclusion that Ms. Hubbard and the defendants on trial were

involved in a scheme to defraud Washington Mutual. Ms.

Hubbard’s statements to Mr. Jones about Ms. Shaw’s

role in the scheme were statements of a co-conspirator

made during the course of and in the furtherance of a

conspiracy. Thus, those statements were admissible

under Rule 801(d)(2)(E). Ms. Hubbard’s recanting statements were not made during the course of or in furtherance of the conspiracy and thus do not fall within

Rule 801(d)(2)(E). Moreover, a critical difference exists

between Rule 801(d)(2)(E) and Rule 804(b)(3). The

former, unlike the latter, does not expressly require

corroborating circumstances indicating a statement’s

trustworthiness for admissibility. Therefore, the district

court did not make inconsistent rulings on the admissibility of Ms. Hubbard’s various out-of-court statements.3

Further, Ms Hubbard’s statements testified to by Mr. Jones
28 Nos. 06-3848, 06-4124, & 06-4399

were the only co-conspirator statements introduced at

trial and were a relatively small piece of evidence at trial.

The admission of Ms. Hubbard’s statements through

Mr. Jones’s testimony did not violate the Confrontation

Clause.

The district court was well within its discretion to

limit the cross-examination of Agent Clifford by precluding inquiry into Ms. Hubbard’s statements recanting her

earlier statements about Ms. Shaw’s role in the Young

wire transfer. The decision to exclude this evidence did

not violate the defendants’ rights under the Confrontation

Clause. We find no error, plain or otherwise, in the district court’s decision to exclude the evidence.

Even if the district court erred in excluding such evidence, we will not reverse if the error was harmless.

Smith, 454 F.3d at 715. The question is whether the erroneous exclusion of evidence “had a substantial

influence over the jury and the result reached was inconsistent with substantial justice.” United States v. Savage,

505 F.3d 754, 762 (7th Cir. 2007) (quoting United States

v. Seals, 419 F.3d 600, 607 (7th Cir. 2005)). In determining whether an error was harmless, we consider

factors such as the importance of the witness’s testimony

in the government’s case, whether the testimony was

cumulative, the presence or absence of corroborating or

contradicting evidence, and the overall strength of the

government’s case. Smith, 454 F.3d at 715.

According to the defendants, Ms. Hubbard was essential to the government’s case. They contend that the government’s vehement argument to exclude her statements
Nos. 06-3848, 06-4124, & 06-4399 29

As discussed below, see infra II.B, the evidence against the 4

other defendants was overwhelming as well.

strongly suggests it knew the statements would undermine

its case. It is difficult to discern how Ms. Hubbard was

essential to the government’s case when she never even

testified. It seems likely that the government strenuously

opposed introduction of evidence of her January 20

statements because it believed then, as it argues now,

that the statements were irrelevant. It is also difficult to

see how the evidence of Ms. Hubbard’s statements was

essential to the defendants’ case when the jury was not

charged with deciding whether Ms. Shaw—the only codefendant about whom Ms. Hubbard recanted any statement—was guilty with respect to the Young wire

transfer—the only wire transfer to which the statements

at issue pertained. The excluded statements would not

have been the only—or even primary—evidence as to the

defendants’ knowledge or intent.

Here, the government’s case against Ms. Shaw was

overwhelming. The government offered evidence that Ms. 4

Shaw’s user identification number was used to reverse

several wire transfers in Pronto, including the Jones wire

transfer, the Hulet wire transfers, and the five wires

printed in her husband’s name. Furthermore, the evidence

also included Ms. Hubbard’s two checks for $10,000

payable to Ms. Shaw shortly after the Jackson wire

transfer and the $60,000 check from Mr. Jones, who testified he had never met Ms. Shaw. The evidence of Ms.

Hubbard’s statements about Ms. Shaw’s involvement in
30 Nos. 06-3848, 06-4124, & 06-4399

the scheme introduced through Mr. Jones’s testimony was

helpful, but not necessary to the government’s case. This

circumstantial evidence corroborated Ms. Hubbard’s

statements about the scheme, particularly Ms. Shaw’s

direct participation in it. Therefore, the exclusion of Ms.

Hubbard’s January 20 statements recanting her prior

statements of Ms. Shaw’s involvement in the Young wire

transfer, even if erroneous, was harmless.

B. Sufficiency of the Evidence

The defendants contend that the evidence at trial was

insufficient to prove their knowledge and intent to defraud. Their burden in doing so is heavy. United States v.

Useni, 516 F.3d 634, 646 (7th Cir. 2008). When the sufficiency of the evidence is challenged, we review the evidence and all reasonable inferences from it in the light

most favorable to the verdict. Id. We “will reverse only

if no rational trier of fact could find the defendants

guilty beyond a reasonable doubt.” United States v. DeSilva,

505 F.3d 711, 715 (7th Cir. 2007); see also Useni, 516 F.3d

at 646.

A conviction for bank fraud under 18 U.S.C. § 1344

requires proof of, inter alia, the defendant’s knowing

participation in a scheme to defraud a bank, see United

States v. Yoon, 128 F.3d 515, 523 (7th Cir. 1997); United

States v. Ross, 502 F.3d 521, 530-31 (6th Cir. 2007), cert.

denied, 128 S. Ct. 1723 (2008), and the defendant’s intent

to defraud the bank, United States v. Lamarre, 248 F.3d 642,

649 (7th Cir. 2001). “Intent to defraud” means that the
Nos. 06-3848, 06-4124, & 06-4399 31

defendant “acted willfully and with specific intent to

deceive or cheat, usually for financial gain for one’s self

or the causing of financial loss to another.” Id.; see also

United States v. Sloan, 492 F.3d 884, 891 (7th Cir. 2007). The

intent to defraud may be proven by circumstantial evidence and inferences drawn from the scheme itself.

Lamarre, 248 F.3d at 649. Falsifying information on

loan documents is circumstantial evidence of intent to

defraud. Id.

The government offered some direct evidence of the

defendants’ knowledge of the scheme and intent to defraud the bank, that is, it produced Mr. Jones’s testimony

that Ms. Hubbard had identified “Ieanis” as an insider

involved in the scheme. And we agree with the

district court that the circumstantial evidence was overwhelming. The evidence against Ms. Young established

that she was the sister of Ms. Hubbard, one of the

insiders at Washington Mutual. Ms. Young’s checking

account had very low or negative balances in late 2002

and early 2003. But on January 28, $194,471.70 was transferred from Washington Mutual, the bank where her

sister worked, into Ms. Young’s checking account in

Texas, even though she was not a Washington Mutual

mortgage loan customer. The wire transfer sheet used to

request the transfer contained Ms. Young’s name, the

name of her bank, Bank One, and her bank account number. The jury reasonably could infer that Ms. Young’s

personal information was on the wire transfer sheet

because she had given that information to Ms. Hubbard.

Phone records support the inference that Ms. Young and
32 Nos. 06-3848, 06-4124, & 06-4399

Ms. Hubbard discussed the scheme to defraud Washington

Mutual and that Ms. Young gave her account information to Ms. Hubbard in the days leading up to the wire

transfer. Their telephone conversations increased significantly during the ten days surrounding the wire transfer.

Ms. Young’s actions following the inexplicable transfer

of $194,471.70 into her account provided additional

circumstantial evidence of her knowledge and intent. Ms.

Young never attempted to determine why she received

such a large sum of money from Washington Mutual—the

bank where her sister worked. Nor did she attempt to

notify her bank or Washington Mutual that a mistake

apparently had been made involving her account. Instead,

the day after the wire transfer, as her bank records show,

Ms. Young opened a new savings account and transferred

$94,243.58 into that new account. She also obtained

a cashier’s check made payable to Ms. Hubbard for

$97,000—a little more than half of the money that had been

transferred into her account the day before. It was reasonable for the jury to infer that this was a kickback to Ms.

Hubbard for her role in the fraudulent wire transfer. The

bank records also show that the following day, $45,207.12

was withdrawn from Ms. Young’s new savings account.

Ms. Young argues that the government had little evidence of her activities after the wire transfer on January 28.

But the government was not required to prove what

Ms. Young did with the money she received in order to

prove her guilty of bank fraud. See 18 U.S.C. § 1344; United

States v. Abboud, 438 F.3d 554, 590 (6th Cir. 2006); United

States v. Dadi, 235 F.3d 945, 950 (5th Cir. 2000); see also

Federal Criminal Jury Instructions of the Seventh Circuit 266
Nos. 06-3848, 06-4124, & 06-4399 33

(1999). The fact that Ms. Young did not go on a spending

spree or purchase big ticket items does not exculpate her.

Nor does it negate the reasonable inference of her knowledge of the scheme and intent to defraud the bank. Quite

possibly, Ms. Young restrained her spending so as not

to draw attention to her new-found riches.

With respect to Ms. Shaw, the evidence was more than

sufficient to allow a reasonable jury to conclude that she

had the requisite knowledge and intent to defraud.

The evidence supported a reasonable inference that Ms.

Shaw was an insider at Washington Mutual and a key

player in the fraudulent scheme. As an opener, her job

responsibilities would not have included accessing wire

transfers in Pronto. But nonetheless, the evidence raises

a reasonable inference that she accessed wire transfers—repeatedly. Every Washington Mutual employee

who reversed a wire transfer in Pronto left a digital

fingerprint. The investigation revealed that Ms. Shaw’s

user identification number was used to reverse the

March 28 wire to Mr. Jackson, which preceded the real

wire transfer of April 1; the April 29 wire transfer to

Mr. Jones and all the Hulet wires, which occurred after

Ms. Hubbard had left Washington Mutual’s employ;

and lastly, the five wires printed in Ms. Shaw’s husband’s

name. While it is possible that another Washington

Mutual employee used Ms. Shaw’s identification number

to reverse the wire transfers, the jury properly could infer

that it was Ms. Shaw using her own identification number. The timing of the Jones wire transfer and all of the

Hulet wires after Ms. Hubbard had left the bank meant

that Ms. Hubbard was no longer in a position to reverse
34 Nos. 06-3848, 06-4124, & 06-4399

these wire transfers, yet Ms. Shaw remained at the bank

where she could. In addition, the Jones wire transfer

was effected in a way similar to that of the other wire

transfers in the scheme, and the authorizing signatures

on the Jones wire transfer were identical to those on the

worksheet for the Hulet wire transfer. The jury could

reasonably infer Ms. Shaw’s intent to defraud from her

creation of fraudulent wire transfers and wire reversals.

See Lamarre, 248 F.3d at 649.

And there was more. Shortly after the Jackson wire

transfer, Ms. Shaw received two personal checks for

$10,000 from Ms. Hubbard who had just received a personal check from Mr. Jackson for $125,000. The jury could

reasonably infer these $10,000 checks were payment for

Ms. Shaw’s role in the Jackson wire transfer. As the

government argues, it is highly unusual for one coworker to give another co-worker $20,000, for no apparent reason. The evidence was that Ms. Shaw actually

received these suspicious checks—they were deposited

into her own bank account. Moreover, the evidence

established that after the Jones wire transfer, Mr. Jones

obtained a cashier’s check payable to Ms. Shaw, whom

he had never met, in the amount of $60,000. Mr. Jones

testified that Ms. Hubbard had instructed him to divide

the proceeds of the wire transfer three ways and to obtain

two cashier’s checks, one for her and one for Ms. Shaw.

And the evidence raised an inference that someone other

than Ms. Hubbard caused the Jones wire transfer; Ms.

Hubbard had left Washington Mutual the day before.

Thus, the jury reasonably could infer that the $60,000

cashier’s check was payment for Ms. Shaw’s knowing

and intentional role in the Jones wire transfer.
Nos. 06-3848, 06-4124, & 06-4399 35

Yet Ms. Shaw argues that there was no evidence as to

what she was told about the checks she received from

Mr. Jones and Ms. Hubbard. Like Ms. Young, Ms. Shaw

did not spend all of the money she obtained immediately.

But as stated, quick spending of ill-gotten gains is not an

element of bank fraud. See Abboud, 438 F.3d at 590;

Dadi, 235 F.3d at 950. Anyway there was evidence that Ms.

Shaw spent a good deal of the money in a short period

of time on frills such as expensive jewelry, a honeymoon

to a resort in Jamaica, and new furniture. The fact that

she did not spend all of the money does not negate the

reasonableness of the inference of her knowledge and

intent to defraud. The jury could have inferred that Ms.

Shaw did not spend more of the money more quickly

in order to avoid calling too much attention to her

sudden windfall.

Finally, Mr. Jackson’s close friendship with Ms. Hubbard

was not the only evidence regarding his knowledge and

intent. Mr. Jackson was not a Washington Mutual customer, yet he received a wire transfer of $250,641.40 into

his newly opened bank account. This account had carried

a very low and even negative balance right before the

transfer. There was no evidence that Mr. Jackson ever

questioned the wire transfer or notified the bank that an

error had been made. Importantly, the wire transfer

worksheet contained Mr. Jackson’s name, his bank name,

and his personal checking account number. As with Ms.

Young, the jury could draw a reasonable conclusion

from this evidence that Mr. Jackson had given this information to Ms. Hubbard. Also as with Ms. Young, telephone

records showed a marked increase in the number and
36 Nos. 06-3848, 06-4124, & 06-4399

As noted, a spending spree is not a required element of 5

bank fraud. Nonetheless, a spending spree may typically

follow such fraudulent behavior.

duration of telephone calls between Ms. Hubbard and

Mr. Jackson in the ten days surrounding the wire transfer.

From this evidence, the jury could reasonably infer that

they were planning and discussing the fraudulent wire

transfer to Mr. Jones’s account. The evidence of what

Mr. Jackson did with the money wired to his account

also raises an inference of knowledge and intent. He

quickly wrote a personal check for $125,000 payable to

Ms. Hubbard. The jury could infer that this was

Ms. Hubbard’s kickback for her role in the wire transfer.

Mr. Jackson spent the money he fraudulently obtained

almost as soon as it hit his account, for cash, furniture,

vehicles, and gifts to family and friends. His bank account

was back to a near $0 balance in less than three months.

Mr. Jackson’s extraordinary spending spree raises a

reasonable inference of his knowing participation in the

scheme and intent to defraud.

5

In sum, the documentary evidence of the defendants’

knowing participation in the scheme to defraud and

intent to defraud Washington Mutual as corroborated

by Mr. Jones’s testimony as to how the scheme worked

while he was involved was overwhelming. Therefore, the

defendants’ challenge to the sufficiency of the evidence

fails.
Nos. 06-3848, 06-4124, & 06-4399 37

C. Prosecutor’s Remarks in Rebuttal

The defendants argue that during closing argument

the government improperly commented on their decisions not to testify. The prosecutor may comment on the

weakness of the defense case in closing arguments. United

States v. Stark, 507 F.3d 512, 519 (7th Cir. 2007). But the

prosecutor may not make direct or indirect comments

that invite the jury to draw an adverse inference from a

defendant’s decision not to testify. Griffin v. California, 380

U.S. 609, 614 (1965); Stark, 507 F.3d at 519. Improper

indirect comments occur “only if (1) the prosecutor manifestly intended to refer to the defendant’s silence or (2) a

jury would naturally and necessarily take the remark for

a comment on the defendant’s silence.” United States v.

Mietus, 237 F.3d 866, 871 (7th Cir. 2001).

Where, as here, the defendants failed to object to the

allegedly improper comment when made, this court

reviews the comments for plain error. DeSilva, 505 F.3d

at 717. Under this standard, the defendants have the

burden of demonstrating that the remark was improper,

that it denied them a fair trial, and that the outcome

would have been different absent the remark. Id. at 718-19.

If the remark is improper, the court determines whether

the comment, considered in context of the record as a

whole, denied the defendants a fair trial. Id. at 719. In so

doing, we consider “(1) the nature and seriousness of the

statement; (2) whether the statement was invited by the

conduct of defense counsel; (3) whether the district court

sufficiently instructed the jury to disregard such statement; (4) whether the defense could counter the improper
38 Nos. 06-3848, 06-4124, & 06-4399

statement through rebuttal; and (5) whether the weight

of the evidence was against the defendant.” Id.

The defendants have not shown that the prosecutor’s

single comment in rebuttal that he was not sure he

heard any explanation “from her” about where the $60,000

came from was improper. We agree that with the government that its attorney, Mr. Hotaling, did not refer to

Ms. Shaw’s silence but rather to the lack of explanation

by her counsel, Ms. Winslow. The context of the rebuttal

argument surrounding the remark supports this view. The

prosecutor prefaced his rebuttal by stating that he was

going “to talk a little bit about all of the different things

that [the jurors] have heard from all of the different

attorneys during the course of the trial—during the

course of closing arguments. So I will just take it in the

order that you heard it.”

In her closing argument Ms. Winslow talked about the

two wire transfers with which Ms. Shaw was alleged

to have been involved, the typical patterns of money

flow into and out of accounts in a fraudulent scheme,

and the absence of such a pattern with Ms. Shaw’s account.

She addressed Ms. Shaw’s alleged “spending spree,” the

computers, wire transfers and reversals, and electronic

fingerprints. Ms. Winslow specifically discussed the two

$10,000 checks from Ms. Hubbard to Ms. Shaw that the

government had attempted to show were a kickback for

the Jackson wire transfer. This discussion fills one page

of the trial transcript. Then Ms. Winslow moved on to the

$60,000 check, saying: “There’s a lot to be said about this

check and Bruce Jones . . . .” But while Ms. Winslow later
Nos. 06-3848, 06-4124, & 06-4399 39

talked about Mr. Jones, she did not say much about the

$60,000 check. The prosecutor merely pointed this out. We

cannot conclude that the prosecutor was referring to the

lack of evidence presented by Ms. Shaw herself (and

inferentially the other defendants).

But even if the prosecutor’s remark is viewed as improper, the defendants must show that it denied them

a fair trial and that the outcome would have been different

but for the remark. This burden proves insurmountable

for them. The remark was not inflammatory. It was not a

direct reference to the defendants’ failure to testify. The

remark could be understood as a response to Ms. Winslow’s statement in closing that “there was a lot to be said

about” the $60,000 check and Mr. Jones. Ms. Winslow

really did not say much about why Mr. Jones gave Ms.

Shaw the check. Her comments discussed what the evidence showed or did not show about what happened

after Ms. Shaw received the money. No objection was

made and no curative instruction was given at the time.

Since the remark was made in rebuttal argument, the

defendants had no opportunity to counter it. But this

single remark was made in passing and certainly was not

the emphasis of the government’s arguments.

Furthermore, the district court instructed the jury—both

at the beginning and at the end of trial—that the government has the burden of proving the defendants’ guilt

beyond a reasonable doubt and that this burden remains

with the government throughout the case. The court

further instructed that the defendants are never required

to prove their innocence or to produce any evidence at
40 Nos. 06-3848, 06-4124, & 06-4399

all. The court specifically instructed: “A defendant has an

absolute right not to testify. The fact that the defendants

did not testify should not be considered by you in any

way in arriving at your verdict.” Generally we may

presume that the jury followed the court’s instructions.

United States v. Warner, 498 F.3d 666, 683 (7th Cir. 2007),

reh’g and suggestion for reh’g en banc denied, 506 F.3d 517 (7th

Cir. 2007); United States v. Puckett, 405 F.3d 589, 599 (7th

Cir. 2005). Nothing in this record suggests that the jury

was unable, or chose not, to follow these instructions.

And, significantly, as explained supra, the evidence

against all defendants was overwhelming. Thus, even if

the prosecutor improperly commented on Ms. Shaw’s

right to remain silent, when viewed in context of the

record as a whole, we cannot say that the remark deprived

the defendants of a fair trial or that the outcome would

have been different absent the remark.

III. Conclusion

For the foregoing reasons, we AFFIRM the defendants’

convictions.

8-29-08