Court Opinion

ID: 810015
Source: CourtListenerOpinion
Date Created: 2012-10-15 14:15:42+00
Date Added: 2024-06-11T18:00:36.564863
License: Public Domain

Case: 12-10029          Date Filed: 10/15/2012   Page: 1 of 11

                                                                        [DO NOT PUBLISH]

                      IN THE UNITED STATES COURT OF APPEALS

                                   FOR THE ELEVENTH CIRCUIT
                                    ________________________

                                            No. 12-10029
                                      ________________________

                               D.C. Docket No. 0:11-cr-60273-WPD-3

UNITED STATES OF AMERICA,

lllllllllllllllllllllllllllllllllllllll                                    lPlaintiff-Appellee,

                                                 versus

DAVID CLUM, JR.,

llllllllllllllllllllllllllllllllllllllll                                Defendant-Appellant.

                                     ________________________

                           Appeal from the United States District Court
                               for the Southern District of Florida
                                 ________________________

                                           (October 15, 2012)

Before HULL and BLACK, Circuit Judges, and GOLDBERG,* Judge.

PER CURIAM:

         *
         Honorable Richard W. Goldberg, United States Court of International Trade Judge,
sitting by designation.
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      Defendant David Clum, Jr., appeals the district court’s pretrial detention

order after being indicted for various offenses related to tax fraud. After review of

the briefs on appeal and consideration of the record, we affirm.

                                I. BACKGROUND

A.    The Indictment

      Defendant Clum and several codefendants were indicted in the Southern

District of Florida on one count of conspiring to defraud the United States, in

violation of 18 U.S.C. § 286, and forty-one counts of making false claims, related

to a scheme to file fraudulent tax returns, in violation of 18 U.S.C. § 287.

Defendant Clum was a principal in PMDD Services. The indictment alleged that

Clum and his codefendants operated a scheme, primarily through PMDD Services,

to help taxpayers obtain fraudulent tax refunds. The scheme was premised upon

“redemption theory,” which espouses that individuals are not responsible for their

personal debts and may seek money from the IRS to repay those debts.

      According to the indictment, PMDD Services prepared false IRS Forms

1099-OID (Original Issue Discount) on behalf of its clients. These tax forms

falsely reported that the clients’ creditors had withheld large amounts of the

clients’ income as taxes. The clients’ tax returns then requested a refund of the

money falsely claimed to have been withheld. Clum’s scheme involved at least

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180 clients from 30 different states, and resulted in the submission of fraudulent

tax claims exceeding $120 million.

B.    First Detention Hearing

      Clum was arrested at his home in Tennessee. A federal magistrate judge in

Tennessee held the initial pretrial detention hearing. During that hearing, the

government introduced testimony from several law enforcement agents who had

participated in Clum’s arrest and initial detention. According to their testimony,

when the agents came to Clum’s residence to arrest him, Clum physically resisted

being handcuffed and said obscenities. During the car ride from his home to the

U.S. Marshals’ office, Clum talked about the government doing the bidding of the

banks, and told the agents that they were slaves to the system.

      At the U.S. Marshals’ office, Clum refused to provide any basic details

about himself, such as his name or date of birth, and physically resisted being

fingerprinted and having his photograph taken. During his initial appearance

before the magistrate judge in Tennessee, Clum refused to take a seat as instructed,

and had to be forcibly placed into the seat.

      In light of the above testimony, the magistrate judge expressed concern

about releasing Clum. Addressing the court, Clum apologized profusely for his

behavior during and after arrest, asked for the court’s mercy, and explained that he

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was surprised and angry at being arrested and that he feared for his family. Clum

stated that his actions were “absolutely unconscionable” and out of character.

Furthermore, Clum’s wife took the stand and assured the magistrate judge that

Clum would not flee and that she would adequately oversee him as a third-party

custodian upon his release.

      At the end of the hearing, the magistrate judge ordered Clum released on a

$25,000 unsecured bond. However, the government moved to stay his release

pending appeal, and the district court in Florida granted the government’s motion.

C.    Government’s Appeal to the District Court

      The government filed an appeal in the Florida district court from the

magistrate judge’s order of release. In its brief, the government argued, inter alia,

that Clum was a flight risk because he resisted arrest, refused to cooperate with

law enforcement, and had a history of defying the authority of the courts. The

government also argued that there was overwhelming evidence of Clum’s guilt

and that he faced over 20 years of incarceration if convicted. The government

pointed to evidence that Clum was a principal in PMDD Services, the corrupt tax

preparation firm that prepared numerous fraudulent tax returns on behalf of its

clients, and that Clum marketed the tax fraud scheme knowing that it was illegal.

      To support its appeal, the government submitted a number of exhibits,

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which included (1) documents showing that Clum had been convicted in 2006 for

contempt of court due to his failure to appear in court, and was sentenced to 10

days in jail and fined $250; (2) a letter from Clum to the court in the contempt

proceeding, in which Clum gave a frivolous justification for his failure to respond

to the court’s show-cause order; (3) a transcript from one of Clum’s seminars

promoting the fraudulent tax scheme, wherein he told his audience how the

government used tanks, helicopters, and over 40 SWAT members to evict him

from his property in Virginia; (4) another seminar transcript wherein Clum (a)

advised his audience to not “go into a courtroom,” (b) stated that the last time he

was arrested, he refused to be fingerprinted or photographed, or to answer

questions willingly, and (c) advised that he would question the authority of the

judge if brought to court; (5) documents evidencing Clum’s involvement in the

tax-fraud scheme; and (6) a transcript of Clum’s first detention hearing, reflecting

the agents’ testimony described above.

      The district court granted the government’s appeal and ordered Clum

detained.

D.    Second Detention Hearing

      Clum then moved for a de novo evidentiary hearing, which the district court

granted. At the second detention hearing, the government proffered its

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aforementioned appeal and corresponding exhibits as evidence in favor of

detention, and argued that Clum’s anti-government ideology showed him to be a

flight risk and that his wife would not be an appropriate third-party custodian.

       Clum’s counsel, in turn, presented a number of factors in support of Clum’s

release, including the following: (1) Clum had lived in Tennessee with his wife

and two daughters continuously for six years, had rented their current residence

for the past two years, and had renewed the lease for another year; (2) Clum had

no contacts outside of the United States; (3) Clum was heavily involved in the

lives of his family members and had served honorably in Vietnam; (4) once Clum

learned that the scheme he was involved in was likely illegal, he stopped

participating in it; (5) Clum’s circumstances were similar to those of his

codefendants, who were released on only a signature bond; (6) the IRS asked

Clum to undergo an interview prior to his arrest, and Clum complied by speaking

with them for several hours, without trying to flee during or after the interview;

and (7) Clum had placed himself at the mercy of the magistrate judge in

Tennessee, and the magistrate judge believed Clum to be good candidate for

pretrial release.

       Clum’s wife also addressed the court, stating that Clum was involved in his

children’s lives, that he would not flee and would obey court orders, and that she

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was willing to submit to the authority of Pretrial Services and monitor her husband

as required by law.

D.    District Court’s Detention Order

      Following the hearing, the district court ordered Clum detained without

bond. In its detention order, the district court found that there was no presumption

of flight risk or danger to the community, but also found that the weight of the

evidence against Clum was significant and that his prior anti-government

statements during promotional seminars indicated that he was a flight risk. The

court described Clum’s arrest and post-arrest behavior, including his physical

resistance to being handcuffed, his use of obscenities and tax-protestor rhetoric,

and his refusal to cooperate with law enforcement.

      The court also found that, while Clum had only a minor criminal record, he

had a prior conviction for failure to appear and had presented a frivolous

justification for failing to appear. Moreover, Clum had no ties to the community

and previously had moved from Virginia to Tennessee due to government

harassment. The court further found that Clum’s promises of cooperation to the

magistrate judge in Tennessee were belied by his actions.

      Based on these findings, the court concluded that Clum represented a

serious risk of flight and that no condition or combination of conditions would

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reasonably assure his appearance. Clum now appeals.

                                   II. DISCUSSION

A.     Standard of Review and the Bail Reform Act1

       In reviewing a pretrial detention order under the Bail Reform Act, we

review the district court’s factual findings for clear error and the application of law

to those facts de novo. United States v. Hurtado, 779 F.2d 1467, 1471-72 (11th

Cir. 1985). Issues relating to a defendant’s individual characteristics and the

threat posed by his release are factual questions reviewed only for clear error. Id.

at 1472. The district court has “substantial latitude in determining whether pretrial

detention is appropriate.” United States v. King, 849 F.2d 485, 487 (11th Cir.

1988).

           The Bail Reform Act provides that a court “shall order the pretrial release

of the person” unless it determines “that such release will not reasonably assure

the appearance of the person as required or will endanger the safety of any other

person or the community.” 18 U.S.C. § 3142(b). If the district court “finds that no

condition or combination of conditions will reasonably assure [1] the appearance

of the person as required and [2] the safety of any other person and the

       1
        See Bail Reform Act of 1984, Pub. L. 98-473, § 202, 98 Stat. 1837, 1976 (1984)
(codified as amended at 18 U.S.C. §§ 3141-56).

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community,” then the person must be ordered detained before trial. Id. § 3142(e).

Either ground may support an order of detention. King, 849 F.2d at 488-89. Here,

the district court based its decision only on the first ground, the risk of flight.

       In determining whether the defendant poses a flight risk, a court must

consider several factors, including (1) the “nature and circumstances” of the

charged offense, (2) the weight of the evidence against the defendant, and (3) the

defendant’s history and characteristics, including his character, his family and

community ties, his past conduct, his criminal history, and his “record concerning

appearance at court proceedings.” 18 U.S.C. § 3142(g).

       At detention hearings, “[t]he rules concerning admissibility of evidence in

criminal trials do not apply,” 18 U.S.C. § 3142(f), and the parties may proceed

solely by proffer, United States v. Gaviria, 828 F.2d 667, 669 (11th Cir. 1987).

The government need only demonstrate by a preponderance of the evidence that

the person poses a risk of flight. King, 849 F.2d at 489 & n.3.2

B.     Analysis

       After review, we conclude that the district court did not err in ordering

Clum detained. The district court found that the significant evidence of Clum’s

       2
         Under the Bail Reform Act, certain criminal charges carry a presumption that no
condition or combination thereof would assure the defendant’s appearance, but none of the
charges in this case carry such a presumption. See 18 U.S.C. § 3142(e)(3).

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guilt, his prior conviction for failing to appear in court, his anti-government

statements at a seminar, his physical resistance to being arrested, his post-arrest

refusal to cooperate with authorities, and his lack of ties to the community all

demonstrated that Clum presented a serious risk of flight. We cannot say that

these findings were clearly erroneous.

      Clum argues that, even if the district court did not err in finding a risk of

flight, the court impermissibly failed to consider or explain why no alternatives to

detention existed. We disagree. The district court specifically found that, based

on Clum’s conduct, it could conceive of no condition or combination of conditions

that would reasonably assure Clum’s appearance. The district court was not

required to list every possible condition of release and then explain why that

condition was inadequate.

      We acknowledge that Clum proffered a number of factors suggesting that

release would be appropriate, such as his strong involvement with his family, his

expressions of remorse at the first detention hearing, his continuous six-year

residence in Tennessee, and his lack of any significant criminal history. However,

this evidence was not sufficient to outweigh the government’s evidence favoring

detention, especially evidence of Clum’s belief in resisting the authority of the

courts—a belief amply supported by Clum’s actions. As explained by our sister

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circuit, a preponderance of the evidence standard does not require a court to

“simply weigh, in a mechanical sense, the number of pieces of probative evidence

on the government’s side against that offered by a [defendant]. Rather, the court

makes a judgment about the persuasiveness of the evidence offered by each

party . . . .” Almerfedi v. Obama, 654 F.3d 1, 5 (D.C. Cir. 2011) (citation

omitted). Here, the district court did not clearly err in finding the government’s

evidence to be more persuasive. In light of the foregoing, we affirm the district

court’s order of detention.

      AFFIRMED.

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