Source: https://appellate.typepad.com/appellate/2007/05/ca1_bank_fraud_.html
Timestamp: 2020-08-15 11:07:43
Document Index: 306682029

Matched Legal Cases: ['§ 1344', '§ 657', '§ 1006', '§ 371', '§ 3293', '§ 657']

Appellate Law & Practice: CA1: bank fraud convictions affirmed
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US v. Munoz-Franco, Nos. 04-1532, 04-1533, 04-1534, 04-1535. Affirms the convictions in a Puerto Rican bank fraud case involving loans Many of the defendants were represented by large law firms. There were a total of thirteen points raised and rejected on appeal. The substantive provisions were 18 U.S.C. § 1344 (bank fraud), 18 U.S.C. § 657 (misapplication of bank funds), 18 U.S.C. § 1006 (false entries in records of a bank), and 18 U.S.C. § 371 (the conspiracy provision).
It is a big case, dealing with evidence, bank fraud, statutes of limitation, constructive amendment, ex post facto clauses, and, of course review of improper prosecutorial statements (hint: they are never improper enough to warrant reversal). At the end of the day, I get the sense that the defendants were guilty, but I don’t like the way the government played the game.
18 U.S.C. § 3293 (10 year statute of limitations). The defendants argued that it began to run when the board was given some sort of report involving their misdeeds, and expresses concern, but the First finds that these statements did not really fully illuminate the board. The superceding indictments did not relate back because, “The government ‘is not limited in its proof at trial to those overt acts alleged in the indictment.’ United States v. Adamo, 534 F.2d 31, 38 (3d Cir. 1976). Therefore, allegations of additional loan projects and overt acts in the superseding indictments do not broaden the original indictment; they simply provide more specific examples to substantiate the original fraud and conspiracy charges.” There was no request for a statute of limitations instruction, and no obligation of the District Court to do it own its own.
18 U.S.C. § 657. The First acknowledges a split with the Fifth regarding the mens rea for bank “misapplication” of funds. The First says that reckless isn’t enough, it must be “willful.” But, the District Court said “If you find that defendants acted recklessly, with respect to the alleged misapplications, you may find that the defendants acted with intent to injure, defraud or deceive the bank.” The First says that this is good enough.
Prosecutorial Misconduct. The First always given a green light to prosecutors to say what they want. This case is no exception. The AUSA accused the defenses attorneys of lying, interrupted defense counsel. The First calls it “unfortunate” and “unprofessional.” But, since the First just won’t ever reverse on these grounds, it does not (and, of course, it doesn’t name the AUSA).
Ex Post Facto clause. The Court writes “”As we have explained, ‘[w]here a ‘continuing offense’ straddles the old and new law . . . applying the new is recognized as constitutionally sound.’” But, in this case, the error was unpreserved, and whatever error he did make is rejected on plain error review. There is a discussion of various circuit’s laws in applying a plain error test to the ex post facto clause.
Speedy Trial Issues. As to pre-indictment delay, the First finds that the lack of availability of a couple of the witnesses didn’t constitute a due process problem. On constitutional (not STA) grounds, the First finds that five years is troublesome, but not constitutionally infirm.
Length of Trial: A long trial (fifteen months) with repetitive evidence (mostly from the government) didn’t deny the defendants due process. Why? It wasn’t that repetitive, and the delays were partially the defendant’s doing.
FRE 403 wasn’t violated when “general evidence of loss” was presented to the jury, in the form of an exhibit that was later found to be inaccurate because the amount of loss isn’t an element of bank fraud, and the exhibit wasn’t that prejudicial. Likewise, evidence of civil and regulatory violations just provided context.
Constructive Amendment: Admission of evidence relating to forgery and check fraud, the First holds, didn’t constructively amendment the indictment, but rather showed intent.
FRE 602 (personal knowledge requirement) wasn't violated because a bank officer that testified about improper banking procedures really was a offering lay opinion under FRE 701. This seems like a bit of a stretch, but we all know that FRE 602 an exception that has been swallowed by the rest of the rules. Other 602 objections are rejected on their facts.
FRE 803(6) (business records). The First starts out normally, and holds that minutes of a business meeting are business records normally kept. But then the defendants raise a Crawford objection, and the First starts stretching. It writes, "...it is beyond debate that the Board minutes are nontestimonial in character and, consequently, outside the class of statements prohibited by the Confrontation Clause." Let's look at what the Supreme Court said, "Most of the hearsay exceptions covered statements that by their nature were not testimonial—for example, business records or statements in furtherance of a conspiracy. We do not infer from these that the Framers thought exceptions would apply even to prior testimony." Are board meeting records really non-testimonial? Board meetings often involve declarations that are made for the purpose of informing people of criminal acts, the reporting is often statutorily required. There probably should have been more analysis on this point. But, it gets worse! The minutes were used to demonstrate the “absence” of a statement. So, essentially, the First is holding that if someone walks into a board meeting, the records that are kept of it lack substantive effect, and are some sort of automatic recording of statements that are made for no particular purpose. Anyone disagree with me?
Sufficiency challenges are rejected. But, I don’t think that I would really do justice to the facts by summarizing them.
Booker. This was a Booker pipeline case, it seems, and the First reviews for “Antonakopoulos plain error” and finds none.
Posted by S. COTUS on May 22, 2007 at 04:15 PM in Criminal - Offenses, Criminal - Sentencing, Criminal Procedure, Evidence, First Circuit | Permalink