Opinion ID: 2982493
Heading Depth: 3
Heading Rank: 1

Heading: Mail, Wire, and Securities Fraud

Text: To sustain a conviction for mail fraud under 18 U.S.C. § 1341, the Government must prove “(1) a scheme or artifice to defraud; (2) use of mails in furtherance of the scheme; and (3) intent to deprive a victim of money or property.” United States v. Warshak, 631 F.3d 266, 310 (6th Cir. 2010) (quoting United States v. Turner, 465 F.3d 667, 680 (6th Cir. 2006)). The elements of wire fraud under 18 U.S.C. § 1343 are identical to the elements of mail fraud except that wire fraud’s second element requires use of “an interstate wire communication in furtherance of the scheme.” United States v. Cunningham, 679 F.3d 355, 370 (6th cir. 2012) (quoting United States v. We grant defendants’ motions to adopt each other’s arguments pursuant to Fed. R. App. P. 28(i). That rule 2 states: “In a case involving more than one appellant. any number of appellants. may join in a brief, and any party . . . . may adopt by reference a part of another’s brief. Parties may also join ii reply briefs.” Id. 6 Nos. 12-5574/5611.6090, Un ited States v. Coffrnan, et at. Faulkenberry, 614 F.3d 573, 581 (6th Cir. 2010)). The offense of securities fraud under 15 U.S.C. § 78j(b) is “quite similar” to mail fraud “in that it also calls for proof of a scheme or design to defraud incident to the purchase or sale of a security” and “the use of an instrumentality of interstate commerce or of the mails in furtherance of that scheme or design.” United States v. MacKay, 491 F.2d 616, 619 (10th Cir. 1973). “Both statutes require a specific intent to defraud.” United States v. DeSantis, 134 F.3d 760, 764 (6th Cir. 1998). Coffman argues that there was not sufficient evidence to prove the intent element for each of the crimes. To have intent, “a defendant must knowingly make a material misrepresentation or knowingly omit a material fact,” and “the misrepresentation or omission must have the purpose of inducing the victim of the fraud to part with property or undertake some action that he would not otherwise do absent the misrepresentation or omission.” DeSantis, 134 F.3d at 764. “[A] jury may consider circumstantial evidence of fraudulent intent and draw reasonable inferences therefrom. Intent can be inferred from efforts to conceal the unlawful activity, from misrepresentations, from proof of knowledge, and from profits.” United States v. Davis, 490 F.3d 541, 549 (6th Cir. 2007) (internal quotation marks and citations omitted). We are not persuaded. The Government presented evidence that Coffman created Mid-America and Global investor programs at Milby’s direction. Witnesses testified that Coffman prepared prospectuses used to mislead investors about potential profits, and that Coffman knowingly failed to inform inquiring investors that Milby had gone bankrupt and that Milby’s companies were under investigation for fraud. Testimony also indicated that Coffman set up Global as an off-shore company to defraud investors after the SEC and several states began investigating Mid-America. 7 Nos. 12-5574/5611.6090, United States v. Coffinan, et al. The evidence presented at trial demonstrated that Coffman received millions of dollars from Mid-America and Global, all the while aware that investors were receiving minimal returns from oil production. Coffrnan funneled these millions of investors’ dollars through multiple bank accounts. Any rational trier of fact could have found this evidence sufficient to demonstrate intent. Coffman seeks to analogize this case to Bennett v. Durham, 683 F.3d 734 (6th Cir. 2012). In Bennett, we held that a Kentucky securities law did not impose civil liability on “an attorney who performs traditional legal services for a company offering its securities for sale to the public.” Id. at 735. The key difference between this case and Bennett—other than Bennett’s being a civil case—is that here the Government presented strong evidence that the lawyer—Coffman—actively participated in the fraud scheme.