Opinion ID: 2735150
Heading Depth: 3
Heading Rank: 1

Heading: Defendants’ Appeals as to Counts 1 and 6

Text: i. Barkus’s Appeal as to Sufficiency of Evidence for Venue Barkus argues that the government failed to prove proper venue because there was no evidence of an agreement between Helfgott and Barkus to pursue a common objective of evading federal income taxes (count 6) or of defrauding private individuals (count 1). “[T]he government must prosecute an offense in a district where the offense was committed.” FED. R. CRIM. P. 18. In criminal conspiracies, venue is proper “in any district where the conspiracy was formed or in any district where an overt act in furtherance of the conspiracy was performed.” United States v. Scaife, 749 F.2d 338, 346 (6th Cir. 1984). Helfgott used his IOLTA account in Cleveland at the direction of Barkus and knew that the funds were used for the defendants’ benefit and that use of the account would prevent the IRS from collecting from the defendants. Therefore, overt acts as to both counts 1 and 6 were performed in the Northern District of Ohio and venue was thus proper. ii. Defendants’ Appeals as to Sufficiency of Evidence for Elements of Crimes Counts 1 and 6 both charged conspiracy in violation of 18 U.S.C. § 371. According to the jury instructions, for a guilty verdict on count 1, the government had to prove beyond a reasonable doubt: First, that two or more persons conspired, or agreed, to commit the crime of mail fraud or wire fraud. Second, that the defendant knowingly and voluntarily joined the conspiracy. And, third, that a member of the conspiracy did one of the overt acts described in the superseding indictment for the purpose of advancing or helping the conspiracy. In order to prove wire fraud, the government must show beyond a reasonable doubt a scheme to defraud and the use of an interstate electronic communication in furtherance of the - 10 - Case Nos. 12-4056; 4060 United States v. Lombardo and Barkus scheme. United States v. Brown, 147 F.3d 477, 483 (6th Cir. 1998). In order to prove mail fraud, the government must show beyond a reasonable doubt a scheme to defraud and use of the mails in furtherance of the scheme. United States v. Jamieson, 427 F.3d 394, 402 (6th Cir. 2005). “A scheme to defraud includes any plan or course of action by which someone uses false, deceptive, or fraudulent pretenses, representations, or promises to deprive someone else of money.” Id. The government need only show that “the defendant acted with knowledge that use of the mails would follow in the ordinary course of business, or that a reasonable person would have foreseen use of the mails.” United States v. Cantrell, 278 F.3d 543, 546 (6th Cir. 2001). According to the jury instructions, for a guilty verdict on count 6, the government had to prove beyond a reasonable doubt: First, that two or more persons conspired, or agreed, to defraud the United States or one of its agencies or departments by dishonest means. . . . Second, . . . that the defendant knowingly and voluntarily joined the conspiracy. And, third, . . . that a member of the conspiracy did one of the overt acts described in the superseding indictment for the purpose of advancing or helping the conspiracy. In order to prove a conspiracy existed, a showing of a mutual understanding among the parties is sufficient. United States v. Fisher, 648 F.3d 442, 450 (6th Cir. 2011). A conspiracy may be inferred from acts done with a common purpose so long as the “defendant [knew] of the conspiracy, associate[d] himself with it, and knowingly contribute[d] his efforts in its furtherance.” United States v. Barger, 931 F.2d 359, 369 (6th Cir. 1991). - 11 - Case Nos. 12-4056; 4060 United States v. Lombardo and Barkus
Barkus argues that the government failed to offer sufficient proof as to counts 1 and 6. However, the government was able to prove that Helfgott, Barkus, and Lombardo knowingly and voluntarily conspired to commit mail and wire fraud and to defraud the United States. Helfgott specifically explained his efforts with Barkus to obtain money from private individuals and then to transmit that money to the IOLTA via wire. He also testified that he knew the IRS would not be able to collect money that was in the IOLTA, much less be aware of the money. Finally, Helfgott admitted to committing at least one of the overt acts charged in the conspiracies for counts 1 and 6 when they transferred money by wire primarily for the benefit of the defendants through the IOLTA. Therefore, Helfgott’s testimony indicates a mutual understanding among the parties to participate in the conspiracies.
Lombardo argues that the evidence is not sufficient to support his conviction on count 1 because it did not show that he had an agreement with Barkus and Helfgott to commit wire and mail fraud, that he had knowledge and intent to join the conspiracy, or that he committed an overt act toward that end. He further argues that there was not sufficient proof to support a conviction on count 6 because nothing in the evidence suggested a purpose by any of them to evade taxes and because the government did not offer independent proof that Helfgott intended to assist Lombardo in evading taxes. The government proved that Lombardo conspired with Barkus and Helfgott to defraud the United States. Helfgott testified that most of the distributions from his IOLTA went to benefit Lombardo and Barkus. Helfgott specifically identified wiring instructions leading to Lombardo’s bank account. He also testified that he knew that the use of the IOLTA would have - 12 - Case Nos. 12-4056; 4060 United States v. Lombardo and Barkus prevented the IRS from collecting from Lombardo because it would not have known about the account. Esposito sent letters to the defendants’ investors in November 2006 promising repayment and specifically naming Lombardo as his client. These letters were sent within weeks of when IRS Special Agent Dever interviewed the defendants, which serves as circumstantial evidence that Lombardo and Barkus were participating in a common plan to defraud the United States. The government proved that Lombardo committed an overt act. He was directly involved in soliciting Rothgarn’s investment and instructed him to characterize his investment as a loan. Rothgarn’s last investment was made via wire, fulfilling the underlying crime of wire fraud.