Opinion ID: 2736361
Heading Depth: 3
Heading Rank: 2

Heading: Investor Funds

Text: Next, Vernon argues that district court erred in tracing $75,000 used to purchase one of the cashier’s checks to investor funds, offering a different explanation—unrelated to the fraud— for how the money appeared in his account. But Vernon initially acknowledged in his response to the government’s summary-judgment motion that the government conducted an “extensive review” of the relevant bank records and could trace the amount to investor funds. (R. 31-1, Mem. at 3, 5 (requesting the court overrule the government’s summary judgment motion as to “portions of the cashier’s checks,” and acknowledging that $122,000 came from investor funds, necessarily including the $75,000 that bought cashier’s check number 0022175).) Indeed, an exhibit that the government attached to its verified complaint reflects this exhaustive review. It details how Target Oil purchased a compressor with investor funds before selling it for $75,000 and depositing that money into its operating account. Then, Michael withdrew $75,000 from that account and purchased a cashier’s check in that amount, depositing it in an account held -5- Case No. 13-5605 United States v. $72,050.00 in United States Currency, et al. jointly with Vernon, his father. Vernon, in turn, withdrew that $75,000 to apply it to the purchase of the seized $100,000 cashier’s check. (R. 1-5, Bottoms Aff. Ex. B at 1-6.) Vernon now disparages that exhibit, arguing that it cannot qualify as “legally competent evidence,” though he lodges no specific complaints with its detailed transactional history. (Reply Br. at 21-22.) Even if Vernon’s earlier concession does not estop him from changing positions on appeal, see Johnson v. U.S. Postal Serv., 64 F.3d 233, 237 (6th Cir. 1995), his evidentiary challenge lacks merit. The government incorporated the exhibit in its complaint that it verified under 28 U.S.C. § 1746, and the verifying postal inspector’s affidavit identifies the exhibit as part of the analysis of the cashier’s checks performed during the fraud investigation. (R. 1, Verified Compl. ¶ 7; R. 1-2, Verification; R. 1-3, Bottoms Aff. ¶ 50.) The district court therefore properly considered the exhibit. See Am. Civil Liberties Union of Kentucky v. Grayson Cnty., Ky., 591 F.3d 837, 844 n.2 (6th Cir. 2010) (“A verified complaint carries the same weight as would an affidavit for the purposes of summary judgment.”) (internal quotation marks omitted). Vernon’s alternative theory for the $75,000 similarly lacks merit. He points to the affidavit of a Target Oil accountant that states the $75,000 came from the legitimate sale of a drill rig, not the compressor purchased with investor funds. (Appellant Br. at 23, 36-38; R. 34-2, Butler Aff. ¶ 6.) But Vernon offers no evidence that his sons or their companies deposited those sale proceeds into the Target Oil account (Citizens Bank 2016443) that ultimately funded the seized cashier’s check. The accountant has no firsthand knowledge of that; his belief that the deposit occurred stems entirely from his “recollection of a conversation with Mi[chael] Smith in April 2004.” (See R. 34-2, Butler Aff. ¶ 6.) We cannot credit such conjecture. See Fed. R. Civ. -6- Case No. 13-5605 United States v. $72,050.00 in United States Currency, et al. P. 56(c)(4) (“An affidavit . . . must be made on personal knowledge.”). And though Vernon offered a bank statement, check, and deposit slip showing that the Target Oil account posted a $75,000 deposit and withdrawal on the same day, that aligns with the government’s tracing of funds to support its theory that the compressor funded the cashier’s check. (See R. 34-2, Butler Aff. Attached Docs.) Thus, we find no error in the district court’s conclusion that Vernon failed to present evidence creating a genuine issue of material fact about the source of the $75,000 used to purchase the seized cashier’s check.