Opinion ID: 75689
Heading Depth: 2
Heading Rank: 4

Heading: Elements of “Fails to Refund”

Text: We next examine whether to engraft an element of conversion onto the offense of “fails to refund” as courts have done for a misapplication violation under § 1097(a). For several reasons, we decline to do so. First, it is well established that “we ordinarily resist reading words or elements into a statute that do not appear on its face.” Bates, 522 U.S. at 29 (concluding that the specific intent to defraud is not an element of the crime of 19 Although Kammer and Bates discussed this legislative history, neither addressed it in this context. In Kammer, this Court noted the legislative history as follows: “[t]he government submitted legislative history on the Higher Education Act of 1965, indicating that ‘failure to pay refunds does constitute criminal misapplication under current law.’ Thus, Congress indicated that persons who failed to refund grant funds to the government could be charged with criminal misapplication.” 1 F.3d at 1166 (internal citation omitted). As already discussed, the issue in Kammer was whether the failure to make refunds was a criminal misapplication under § 1097(a). Because Kammer was indicted for “misapplication,”and not “fails to refund,” Kammer did not address whether “or fails to refund” creates an independent ground of liability. Similarly, the defendant in Bates was charged with criminal misapplication, not “fails to refund,” and, thus, the Supreme Court also did not address that issue. See Bates, 522 U.S. at 32. 24 misapplication under § 1097(a), in part, because § 1097(a) does not state that the specific intent to defraud is an element). Second, there is no basis upon which we can conclude that Congress intended conversion to be an element of the failure to refund federal financial aid funds under § 1097(a). In contrast, the term “misapplies” implies that a conversion must exist. The Supreme Court long ago construed the language “willfully misapplies” in the context of another federal criminal statute to require an additional, unstated element of “a conversion to [the defendant’s] own use or the use of some one else.” United States v. Britton, 107 U.S. 665, 666-67 (1883). Thus, because we “presume that Congress expects its statutes to be read in conformity with th[e] [Supreme] Court’s precedents,” United States v. Wells, 519 U.S. 482, 495 (1997), there is at least some argument that Congress intended conversion to be an element of misapplication under § 1097(a) when it used the misapplication language. Unlike “misapplies,” however, the term “fails to refund” does not imply that a conversion must exist. Weaver does not cite any precedent in which any court has construed the language “fails to refund” in § 1097(a), or similar language in other statutes, to demand a showing of conversion. Thus, we have no reason to believe that Congress intended conversion to be an additional, unexpressed 25 element of the criminal act of “knowingly and willfully” failing to refund federal financial aid funds.20 As such, we decline to read this element into § 1097(a).