Opinion ID: 20108
Heading Depth: 2
Heading Rank: 1

Heading: Richards

Text: Richards argues that the evidence was insufficient to support his conviction for inducing a person to travel in interstate commerce in furtherance of a scheme to defraud and his conviction for wire fraud. He does not challenge the sufficiency of the evidence supporting his conspiracy conviction.
18 U.S.C. § 2314 “requires proof of two elements to support a conviction: (1) that the defendant devised a scheme intending to defraud victim of money or property of a minimum value of $ 5,000,and (2) that as a result of this scheme, a victim was induced to travel in interstate commerce.” United States v. Myerson, 18 49 F.3d 153, 164 (2d Cir. 1994); see also United States v. Biggs, 761 F.2d 184, 187 (4th Cir. 1985).12 Richards does not challenge the proof that he induced Bert Hayes to travel from Arkansas to Texas to meet with Richards and deliver a $250,000 check. Richards’ argument is narrow. He asserts that the evidence was insufficient to permit a reasonable jury to find that he induced Hayes to cross state lines with the specific intent to defraud Hayes. See United States v. Snelling, 862 F.2d 150 (8th Cir. 1988) (holding that it is an essential element of the interstate transportation offense under section 2314 that the defendant had the intent to defraud at the time the victim crossed state lines as a result of the defendant’s inducement). The record, viewed in the light most favorable to the verdict, contains evidence sufficient to support Richards’ conviction on count 2. Richards promoted the roll program to Hayes, promising that the money invested would be safe and would generate substantial returns. The roll program described to Hayes did not exist. John Shockey, the government’s expert on international banking practices and financial fraud, testified that no such investment existed in the legitimate financial world. 12 Section 2314 provides in relevant part: Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, . . . induces any person . . . to travel in, or be transported in interstate . . . commerce in the execution or concealment of a scheme or artifice to defraud that person . . . of money or property of $ 5,000 or more . . . [s]hall be fined under this title or imprisoned not more than ten years, or both. 50 A reasonable jury could conclude that Richards knew the roll program was not legitimate when he induced Hayes to travel to Texas with his $250,000 check. Richards pitched an investment program that did not exist in the legitimate financial world. He continued his participation in the scheme, soliciting additional investors and later lulling them into continuing to believe that the program existed and was working long after he knew that at least some of the money had gone to the promoters rather than to the investors and that they investors had not received any of the money promised them. The evidence that Richards continued to solicit and reassure investors after he knew that the program had failed to perform as he had promised supports the inference that Richards knew the program was a fraud from the outset, when he induced Hayes to invest in the program and to cross state lines to deliver his check.
“In order to establish wire fraud [under 18 U.S.C. § 1343], the Government must prove that a defendant knowingly participated in a scheme to defraud, that interstate wire communications were used to further the scheme, and that the defendants intended that some harm result from the fraud.” United States v. Powers, 168 F.3d 741, 746 (5th Cir.), cert. denied, ___ U.S. ___, 120 S. Ct. 360 (1999); see also United States v. St. Gelais, 952 F.2d 90, 95 (5th Cir. 1992). “An intent to defraud for the purpose of personal gain satisfies the ‘harm’ requirement of the wire fraud statute.” Powers, 168 F.3d at 746; St. Gelais, 952 F.2d at 95. A use of the interstate wire facilities is in furtherance of a scheme to defraud 51 if it is “incident to an essential part of the scheme.” Schmuck v. United States, 489 U.S. 705, 710–11 (1989) (citations omitted); see also Powers, 168 F.3d 741, 747 (5th Cir. 1999). A defendant need not personally have made the communication on which the wire fraud count is based, nor have directed that it be made. “The test to determine whether a defendant caused [interstate wire facilities] to be used is whether the use was reasonably foreseeable.” United States v. Massey, 827 F.2d 995, 1002 (5th Cir. 1987)(interpreting the mail fraud statute).13 For a defendant to be convicted of wire fraud, it is sufficient that the defendant could reasonably have foreseen the use of the wires; the interstate nature of the wire communication need not have been reasonably foreseeable. See United States v. Lindemann, 85 F.3d 1232, 1241 (7th Cir. 1996); United States v. Blackmon, 839 F.2d 900 (2d Cir. 1988); cf. United States v. Kelly, 569 F.2d 928, 934 (5th Cir. 1978)(holding that the interstate transportation offense, 18 U.S.C. § 2314, included no level of mens rea as to the interstate nexus because the interstate nexus requirement was merely “the linchpin for federal jurisdiction”); United States v. Darby, 37 F.3d 1059, 1067 (4th Cir. 1994)(holding the same under 18 U.S.C. § 875, which prohibits the transmission of a threatening communication in interstate commerce). Richards asserts that the use of the wires charged in count 3 of the indictment was not reasonably foreseeable. This count 13 Because the language of the mail fraud and wire fraud statutes are so similar, cases construing one are applicable to the other. See United States v. Herron, 825 F.2d 50, 54 n. 5 (5th Cir. 1987); United States v. Bentz, 21 F. 3d 37, 40 (3d Cir. 1994). 52 charges the September 17, 1991 wire transfer of $7,500 from Texas to Kurt Latrasse in California. The record evidence supports the conclusion that the wire transfer to Latrasse was a distribution of proceeds from the roll program scheme. Richards reasonably could have foreseen that a distribution of the investors’ funds to the defendant promoters might be made by use of wire transfers. The evidence was sufficient to support Richards’ conviction on count 3.