Court Opinion

ID: 5946
Source: CourtListenerOpinion
Date Created: 2010-04-25 05:11:25+00
Date Added: 2024-06-11T13:29:24.881225
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UNITED STATES COURT OF APPEALS
                        FOR THE FIFTH CIRCUIT

                       _____________________

                            No. 91-6261
                       _____________________

                     UNITED STATES OF AMERICA,

                                                 Plaintiff-Appellee,

                               VERSUS

                        DOUGLAS JAMES HORD,

                                                 Defendant-Appellant.

      ____________________________________________________

          Appeal from the United States District Court
               for the Southern District of Texas

      _____________________________________________________
                       (October 22, 1993)

Before KING and BARKSDALE, Circuit Judges, and PARKER, District
Judge.1

BARKSDALE, Circuit Judge:

     This appeal concerns, inter alia, multiplicious convictions

for bank fraud, and turns, once again, on the question of when a

"scheme" is "executed" for purposes of the bank fraud statute, 18

U.S.C. § 1344(a)(1).     Douglas James Hord was convicted on 19

counts: nine for executing and attempting to execute a scheme to

defraud a federally insured bank, in violation of § 1344(a)(1); and

ten for making false statements to the bank, in violation of 18

U.S.C. § 1014.   He was sentenced, inter alia, to 19 concurrent six-

1
     Chief Judge of the Eastern District of Texas, sitting by
designation.
month terms of imprisonment.    We AFFIRM IN PART and REVERSE and

VACATE IN PART.

                                I.

     Hord's convictions arose from a series of bank transactions

involving bogus checks,2 in which he participated in 1988.3    The

transactions for which Hord was indicted began in April 1988.4

2
     The parties variously refer to the checks as "fake", "forged",
"counterfeit", "phony" and "bogus". We will use the term "bogus".
3
     In 1987, Hord, an attorney with a history of financial
problems, became friends with John David Williams, an employee of
the Federal Deposit Insurance Corporation. Although Hord did not
testify at trial, he gave his probation officer the following
account of the scheme he and Williams developed:           Williams
suggested to Hord that he knew a way to make a lot of money without
being caught.    Williams had bought blank stock checks and a
routing/transit coder (with which to imprint checks with routing
numbers) at an FDIC auction; these could be used to print bogus
checks. Williams told Hord that he knew in advance which banks
were scheduled to be closed by the FDIC.       Hord would open an
account in a bank scheduled for closing, using the bogus checks the
two had printed, signed, and endorsed. Once the bank closed, Hord
would immediately withdraw the funds from the account; Williams's
job was to "pull" the returned checks once the FDIC became
involved, thus covering up the evidence of the transactions.
4
     Pursuant to Fed. R. Evid. 404(b), the government also
presented evidence of other similar transactions, beginning early
in 1988. In late March 1988, Hord deposited 16 counterfeit checks,
each for $950, into his business account at MBank. The checks were
payable to Coleman Construction and were signed, "Martin Van
Clark". In fact, however, Hord had signed the checks, forging Van
Clark's name. Hord was given credit for these checks, and withdrew
the money (approximately $15,000). MBank later learned the checks
were bogus because, although they purportedly were drawn on the
account of Van Clark Construction at Texas Commerce Bank, they had
routing and account numbers from an account at U.S. Bank and Trust
in New York. Hord's parents made restitution to MBank for these
funds.

     In April 1988, Hord opened a "trust account" at Cy-Fair Bank
in Houston, and deposited a bogus check, payable to the Winifred
Mae Hunter estate.    Hord quickly withdrew $2,438.45, the full
amount of the check, from this account. Cy-Fair was closed by the
FDIC shortly thereafter.

                               - 2 -
Using a $300 check drawn on his account at First Interstate Bank,

Hord opened a checking account at National Bank of Texas (NBT) in

Houston    on   April    20,   1988.       He   explained   to   the   account

representative that he was an attorney, and would be using the

account as a trust account to probate the estate of a Florida

client.

     Between April 21 and 26, 1988, five deposits were made to the

account.    Hord first deposited three bogus checks into the NBT

account.    The checks, accompanied by a deposit slip and totalling

$9,634.96, were made payable to the estate of Winifred Mae Hunter.

Later, Hord deposited another bogus check for $4,138, again using

a deposit slip.    Again, the check was payable to the Hunter estate.

Bank employees immediately suspected a problem with the checks;

they were poorly printed on poor-quality paper, and had incorrect

routing numbers.        Bank management notified the FBI, and told the

employees to continue accepting the checks, but to refuse to clear

them or tell Hord that he was under suspicion.

     A few days later, Hord deposited three more bogus checks,

totalling $68,549.70, with a deposit slip.           Three additional bogus

checks were also deposited into the account that day, by Hord or

someone else: one check for $82,500 in the first transaction; two,

totalling $57,425, in the second.5

     Hord tried to make three withdrawals from the NBT account. On

April 22, he deposited a check for $16,000, drawn on the NBT

5
     Hord's fingerprint was on the deposit slip submitted with the
$82,500 check; the signatures on the checks that day were forged by
Hord.

                                       - 3 -
account, into his account at MBank.        It was later returned unpaid.

And, on or about April 26, he tried first to withdraw $1,000; he

was told the funds had not yet cleared.         Later, he requested $250

at the drive-in window.      Again, the bank refused to allow him to

make a withdrawal.

     NBT was insured by the FDIC, which closed NBT in May 1988.

Sometime after this, First Interstate Bank returned to NBT the $300

check Hord had used to open the NBT account, because there were

insufficient funds in Hord's First Interstate account.                   Hord

received notice of a "charge back" for $300, as well as a charge

back for a $8,100 check drawn on a Florida bank, and payable to

Winifred Mae Hunter, estate trustee.           NBT also advised Hord by

letter that his account had been closed and his records subpoenaed

by the FBI.

     Hord was indicted in July 1990 on nine counts of executing and

attempting to execute a scheme to defraud NBT, in violation of 18

U.S.C. § 1344(a)(1); and ten counts of making false statements to

NBT, in violation of 18 U.S.C. § 1014.        A jury convicted him on all

19 counts.    After the verdict, the government moved for a downward

departure    in    sentencing,   based   on   Hord's   assistance   in    the

investigation and possible prosecution of Williams.          See U.S.S.G.

§ 5K1.1(a).       The trial court overruled Hord's objections to the

presentence report, but agreed to depart downward in accordance

with the government's recommendation.          The applicable guidelines

range for sentencing was a term of imprisonment of 18-24 months.

After the downward departure, Hord was sentenced to six months in

                                   - 4 -
prison on each of the 19 counts, running concurrently.            He was also

ordered to pay $2,438.45 in restitution,6 and a special assessment

of $50 per count (totalling $950).         Finally, Hord was sentenced to

a two-year term of supervised release following his imprisonment on

counts one-nine, to run concurrently with a one-year term of

supervised release for counts ten-19.

                                     II.

       Hord contends that the nine bank fraud charges under § 1344

were   multiplicious,   with   the    sentences    imposed   as    a   result

violating the double jeopardy clause of the Fifth Amendment; and

that his convictions on the ten false statement counts must be

reversed, and those counts dismissed, because the government failed

to allege or prove a violation of § 1014.7

                                     A.

       Count one of the indictment charged that Hord had executed the

scheme by opening a trust account at NBT; counts two-six, that he

had executed the scheme by making the five deposits, or causing

them to be made; and counts seven-nine, that he had attempted to

6
     The amount that Hord withdrew from Cy-Fair Bank, see supra
note 4.
7
     Hord also appeals the restitution order.           Because he
volunteered to pay restitution, any error in imposition of the
restitution order was invited, and cannot be raised on appeal.
See, e.g., Howell v. Gould, Inc., 800 F.2d 482, 487 (5th Cir.
1986); Farrar v. Cain, 756 F.2d 1148, 1151 (5th Cir. 1985), aff'd,
___ U.S. ___, 113 S. Ct. 566 (1992). Further, we find no plain
error in the restitution order. See United States v. Gaudet, 966
F.2d 959, 964 (5th Cir. 1992) (where defendant made no objection in
district court, restitution order will be reviewed only "under the
weak plain error lens"), cert. denied, ___ U.S. ___, 113 S. Ct.
1294 (1993).

                                 - 5 -
execute the scheme by attempting to withdraw funds from the account

on three occasions (on or about April 22 and 25).

     Hord contends that all nine counts relate to the same offense

-- a single scheme to defraud a single financial institution.

Before trial, he moved, as required, to consolidate all nine counts

on the ground that they were multiplicious; the district court

denied the motion.   Because, as hereinafter discussed, we agree

that counts one and seven-nine were multiplicious, we reverse those

convictions and vacate the sentences imposed pursuant to them.8   We

8
     We note that, as a rule, an appeal cannot be based on
multiplicity where sentences are to be served concurrently. See,
e.g., United States v. Galvan, 949 F.2d 777, 781 (5th Cir. 1991).
However, in cases such as Hord's, where a monetary assessment is
also involved, a multiplicity claim still is viable. Id.; see also
Ray v. United States, 481 U.S. 736 (1987) (per curiam).

     Normally, for convictions on multiplicious counts, "the remedy
is to remand for resentencing, with the government dismissing the
count(s) that created the multiplicity." United States v. Moody,
923 F.2d 341, 347 (5th Cir.), cert. denied, ___ U.S. ___, 112 S.
Ct. 80 (1991), quoted in United States v. Lemons, 941 F.2d 309, 317
(5th Cir. 1991) (per curiam). Generally, on remand, the government
elects which count(s) to dismiss, and the court resentences the
defendant on the remaining count(s). United States v. Brechtel,
997 F.2d 1108, 1112 (5th Cir. 1993) (per curiam); United States v.
Heath, 970 F.2d 1397, 1402 (5th Cir. 1992), cert. denied, ___ U.S.
___, 113 S. Ct. 1643 (1993); United States v. Saks, 964 F.2d 1514,
1526 (5th Cir. 1992). Here, however, we hold that counts one and
seven-nine created the multiplicity. Therefore, there is no need
for the government to make an election.

     The government, which concedes multiplicity, does not request
resentencing.    Furthermore, Hord has served his six-months'
imprisonment, and is on supervised release.     And, the district
judge apparently relied heavily on the government's recommendation
for downward departure in calculating Hord's sentence. Based on
the record, we think the district court would impose the same
sentence on remand.    Therefore, we see no need to remand for
resentencing on the counts we affirm.       Cf. United States v.
Johnson, 961 F.2d 1188, 1189 (5th Cir. 1992) (citing Williams v.
United States, ___ U.S. ___, 112 S. Ct. 1112, 1120-21 (1992))
(remand for resentencing under guidelines unnecessary if the

                              - 6 -
affirm the convictions and sentences imposed pursuant to counts

two-six.

     Following Hord's conviction, we have had occasion to review

the issue of multiplicity under the bank fraud statute. See, e.g.,

United States v. Lemons, 941 F.2d 309 (5th Cir. 1991) (per curiam).

An indictment that charges a single offense in more than one count

is multiplicious.    Id. at 317.    The primary danger created by such

an indictment is that the defendant may receive more than one

sentence for a single offense, in violation of the double jeopardy

clause. Id. (quoting United States v. Swaim, 757 F.2d 1530, 1537

(5th Cir.), cert. denied, 474 U.S. 825 (1985)).        We review such

issues de novo.     See, e.g., United States v. Brechtel, 997 F.2d
1108, 1112 (5th Cir. 1993) (per curiam).

     The crux of any argument that convictions are multiplicious

is, of course, what constitutes the offense charged. "`Whether a

continuous transaction results in the commission of but a single

offense or separate offenses ... is determined by whether separate

and distinct prohibited acts, made punishable by law, have been

committed.'"   Swaim, 757 F.2d at 1536 (quoting United States v.

Shaid, 730 F.2d 225, 231 (5th Cir.), cert. denied, 469 U.S. 844

(1984)), quoted in Lemons, 941 F.2d at 317.      Therefore, our first

task is to review what constitutes the offense of bank fraud under

§ 1344.9

"district court would have imposed the same sentence").
9
     Hord was charged and convicted under former § 1344(a)(1).     At
the time, § 1344(a) provided:

                                   - 7 -
      In Lemons, we noted that "the bank fraud statute imposes

punishment ... for each execution of the scheme" to defraud, rather

than for each act in execution of the scheme. 941 F.2d at 318

(emphasis added).           Lemons involved a fraudulent scheme to, inter

alia,   procure       $212,000     from    a   single    financial    institution;

however,      the   defendant      received       the   money    in   a   series    of

transactions occurring over the course of several months.                    Id.    We

held that the incremental movement of the benefit to the defendant

was   "only    part    of    but   one    performance,     one    completion,      one

execution of that scheme."               Id.   Similarly, in United States v.

              (a) Whoever knowingly executes,              or    attempts    to
              execute, a scheme or artifice --

                         (1) to defraud a federally chartered or
                    insured financial institution; or

                         (2) to obtain any of the moneys, funds,
                    credits, assets, securities or other property
                    owned by or under the custody or control of a
                    federally chartered or insured financial
                    institution by means of false or fraudulent
                    pretenses, representations, or promises, shall
                    be fined not more than $10,000, or imprisoned
                    not more than five years, or both.

18 U.S.C. § 1344(a) (1988), amended by 18 U.S.C. § 1344 (Supp. I
1989).

     Former § 1344(b) defined "federally chartered or insured
financial institution" as used in § 1344(a). Id. at § 1344(b). In
1989, § 1344 was amended by, inter alia, deleting former part (b).
Former part (a) simply became § 1344. 18 U.S.C. § 1344, as amended
by Pub. L. No. 101-73, Title IX, § 961(k), 103 Stat. 500 (1989).
"Financial institution" is now defined in 18 U.S.C. § 20. Pub. L.
No. 101-73, Title IX, § 962(e), 103 Stat. 523 (1989). The amended
§ 1344 also changes the penalties for a violation of the section to
a fine of not more than $1,000,000 or imprisonment for not more
than 20 years, or both. 18 U.S.C. § 1344 (Supp. 1993); see also
United States v. Medeles, 916 F.2d 195, 196-97 and 197 n.1
(discussing amendments to § 1344).

                                          - 8 -
Heath, 970 F.2d 1397, 1402 (5th Cir. 1992), cert. denied, ___ U.S.

___, 113 S. Ct. 1643 (1993), we found a single execution of a

scheme to defraud, although the scheme involved procuring two

separate loans from a single financial institution.              A critical

factor in our holding in Heath that there had been but a single

execution of the scheme was the fact that the two loans were

integrally related; neither could have succeeded without the other.

 Id.

       In Hord's case, the scheme to defraud, as stated in the

indictment,

            consisted essentially of a plan to deposit forged
            and counterfeited checks in a trust account opened
            in the name of ... HORD and to withdraw the money
            credited to that account as a result of those
            deposits.

The government concedes, and we agree, that opening the account

(count one) did not constitute an execution of the scheme, but was

instead only a necessary act in preparation of the scheme.              We,

therefore, hold that count one is multiplicious.

       The transactions for which Hord was indicted are five deposits

(counts two-six), and three attempts to withdraw part of those

deposits    (counts    seven-nine).    As   stated,     counts   seven-nine

(withdrawal attempts) are multiplicious.       It is the deposits, not

Hord's withdrawal attempts, that constitute executions of the

scheme.    The attempted withdrawals were integrally related to the

deposits, and could not have succeeded without them.             See Heath,

970 F.2d 1397.        Further, the deposits, without more, satisfy §

1344's    prohibition    against   "execut[ing],   or    attempt[ing]    to

                                   - 9 -
execute, a scheme or artifice" to defraud the bank.      18 U.S.C. §

1344.   While the term "scheme to defraud" in § 1344 is not "capable

of precise definition", United States v. Goldblatt, 813 F.2d 619,

624 (3d Cir. 1987), cited in Lemons, 941 F.2d at 315, we have no

doubt that Hord's making deposits using bogus checks with forged

signatures and in the name of a fictitious payee, satisfies the

requirements of the statute.10    Accord, United States v. Schwartz,

899 F.2d 243, 248 (3d Cir.) (holding that "in making each deposit

[defendant] was executing his scheme to defraud" bank), cert.

denied, 498 U.S. 901 (1990).     In sum, the counts concerning Hord's

attempts to withdraw funds are multiplicious to those involving his

deposits.

     Admittedly, the argument that a bogus check scheme of the sort

in issue is not executed until a withdrawal is attempted has

considerable force.   The withdrawal is the final step -- it is to

place the funds in the defendant's hands.      And, Lemons is strong

support for the rule that the scheme must be completed or performed

in order for it to be executed. 941 F.2d at 318.

     On the other hand, Lemons also counsels that "the question in

each case is what constitutes an `execution of the scheme'". 941
F.2d at 317 n.5.      On the facts in this case, the scheme was

executed with the deposit of each bogus check, because that was the

event that triggered possible instant credit being given to the

10
     We have previously defined the term "scheme" to include using
"fraudulent pretenses or misrepresentations intended to deceive
others to obtain something of value, such as money, from the
institution to be deceived."   See Lemons, 941 F.2d at 314.

                                 - 10 -
account and therefore available to Hord.        How, and when, Hord

decided to use that hoped-for credit -- either by direct withdrawal

of cash or by drawing a check against it -- was up to him.

     The deposits best gauge the extent of the possible loss, for

it may well be, as in this case, that the withdrawals will be for

a lesser amount.    Moreover, it was the deposits that put the bank

at risk.      And, risk of loss, not just loss itself, supports

conviction.    United States v. Barakett, 994 F.2d 1107, 1111 (5th

Cir. 1993), petition for cert. filed (U.S. Sept. 22, 1993) (No. 93-

6128); Lemons, 941 F.2d at 316 n.3.     No matter that, in this case,

the bank quickly discovered the scheme and avoided loss. With each

deposit, it was put at risk.   Even after the scheme was discovered

and the bank was taking affirmative action to protect itself,

credit could have still been given through mistake or oversight.

     In this case, to equate withdrawal (or its attempt) with

execution is to allow the bank to have been placed at risk five

times, but for Hord to have only executed the scheme three times.

What if Hord had not even attempted a withdrawal; surely it cannot

be said that he had not put the bank at risk?       If, in a case of

this sort, a withdrawal must be attempted, even though the fraud is

known, the danger of additional loss builds while awaiting the

withdrawal attempt and, therefore, the occasion to charge fraud.

Section 1344 does not require that.

     As noted supra, and as stated in Lemons, the question in each

case brought under § 1344 "is what constitutes an `execution of the

scheme'". 914 F.2d at 317 n.5.   We cautioned there that we did

                               - 11 -
"not hold that the execution of a scheme cannot result in the

imposition of multiple liability under § 1344".                Id. at 318 n.6.

Hord asserts that he can be convicted for only one execution; at

most, for three (the withdrawal attempts).              We do not agree that

the transactions constituted but a single execution of the scheme.

Instead, as stated, we conclude that each deposit constituted a

separate execution of it.           Unlike the situations in Heath and

Lemons, the deposits were not integrally related to one another,

such that none could have succeeded without the others.                  Proof of

Hord's intent to defraud NBT with each fraudulent deposit does not

require proof of any of the other deposits.             See United States v.

Farmigoni, 934 F.2d 63 (5th Cir. 1991), cert. denied, ___ U.S. ___,

112 S. Ct. 1160 (1992) (involving a single scheme, executed two

times, in which two banks were defrauded).

       Nor   does   the    fact   that    a   single   bank    was   the    victim

necessarily prove a single execution of the scheme.                See Schwartz,
899 F.2d at 248 (holding each deposit of worthless checks into

account at single bank to be separate execution of single scheme),

cert. denied, ___ U.S. ___, 111 S. Ct. 259 (1990); United States v.

Poliak, 823 F.2d 371, 372 (9th Cir. 1987) (holding writing of ten

separate     checks   in    check-kiting      scheme   to     be   ten   separate

executions of scheme to defraud three banks), cert. denied, 485
U.S. 1029 (1988), cited with approval in Lemons, 941 F.2d at 317 &

n.5.    As noted, a single scheme, if executed more than once, may

support multiple convictions.            Lemons, 941 F.2d at 317.          We hold

that each deposit constituted a separate execution of a single

                                    - 12 -
scheme to defraud NBT; and, therefore, we affirm Hord's convictions

and sentences on counts two-six of the indictment.11

                                  B.

     "To   sustain   a   conviction    under   18   U.S.C.   §   1014,   the

Government must demonstrate that (1) the defendant made a `false

statement or report,' and (2) the defendant did so `for the purpose

of influencing in any way the action of [a described financial

institution] ... upon any application, advance, ... commitment or

loan.... '"    United States v. Bowman, 783 F.2d 1192, 1197 (5th Cir.

1986).12 For counts ten-19, Hord asserts that the government failed

11
     As stated, we find Hord's behavior at NBT to have been
multiple executions of a single scheme. Hord used a single trust
account, representing that it was for the purpose of handling the
estate of a Florida client.           In accordance with that
representation, each of the separate deposits contained similar
bogus checks payable to the same fictitious payee.

     We note, however, that similar behavior, engaged in on
separate occasions, may sometimes constitute several separate
schemes to defraud a financial institution. See Barakett, 994 F.2d
1107. There, our court held that the defendant had engaged in four
separate schemes, pursuant to which he defrauded two banks.
Crucial to that holding was the fact that the defendant in Barakett
could

           identify no linkage between the conduct charged in
           counts one and two [i.e., to defraud the first
           bank], or between that of counts three and four
           [i.e., to defraud the second bank] other than
           victim and modus operandi.     Because counts one
           through four involved separate fraudulent schemes,
           separate sentencing present[ed] no multiplicity
           problem.

Id. at 1111.
12
     18 U.S.C. § 1014 makes it a crime to

           knowingly make[] any false statement ... for the
           purpose of influencing in any way the action of ...
           any institution the accounts of which are insured

                                - 13 -
to either charge or prove an offense under § 1014, contending that

it failed to either allege in the indictment or prove at trial that

he made a false statement, or that he did so for the purpose of

influencing the bank in a lending activity. Hord maintains, first,

that checks are not "false statements" for § 1014 purposes; and

second, that he made no representation for the purpose of obtaining

an   advance,    loan,   or   similar    commitment     from   the    bank.      We

disagree.      We address these contentions initially as they concern

the indictment, and then as they concern the proof.

                                        1.

      Hord contends that the government did not sufficiently allege

in the indictment that he made any "false statement" under the

terms of § 1014.       He also contends that the government failed to

allege in the indictment that he had acted with the purpose of

influencing      the   bank's   action       with   respect    to    one   of   the

transactions specified in § 1014. The indictment stated, in counts

ten through 19, that Hord

            did knowingly make a false statement ... for the
            purpose of influencing the action of the National
            Bank of Texas, the deposits of which were then
            insured by the [FDIC] ... in that [Hord] submitted
            forged and counterfeited checks ..., in order to
            induce   the   bank    to   credit   his   account
            accordingly[.]

(Emphasis added.)

      Before    trial,   Hord   moved    unsuccessfully        to    dismiss    the

indictment for failing to allege a violation of law.                 Because Hord

            by the ... Federal Deposit Insurance Corporation,
            ... upon any ... advance, ... commitment, or
            loan....

                                   - 14 -
objected in district court to the sufficiency of the indictment, we

review the indictment de novo, to determine whether it alleges

sufficiently the elements of the offense charged. United States v.

Aguilar, 967 F.2d 111, 112 (5th Cir. 1992) (citing United States v.

Shelton, 937 F.2d 140, 142 (5th Cir.), cert. denied, ___ U.S. ___,

112 S. Ct. 607 (1991)).

     The indictment expressly charges that Hord made a "false

statement" by "submit[ting] forged and counterfeited checks".               At

least as to this element of § 1014, then, the indictment was

sufficient.     Accordingly, we proceed to the contention that the

indictment does not sufficiently allege that Hord made those false

statements with the intent to induce the bank to make an advance,

commitment, or loan.

     Section 1014 does not include in its list of prohibited

actions   the   act   of   inducing   a   bank   to    "credit   an   account".

However, acting to induce a bank to "credit an account" can, under

certain circumstances, be equivalent to acting to induce it to make

an advance, commitment, or loan.          We realize, of course, that a

depositor ordinarily stands in the position of a creditor of the

bank, rather than the other way around.               See, e.g., In Re Texas

Mortgage Servs. Corp., 761 F.2d 1068, 1075 n.11 (5th Cir. 1985);

Uniform Commercial Code § 4-201, cmt. 4.               As Hord asserts, this

ordinarily would mean that inducing the bank to "credit" Hord's

account would not constitute inducing it to make an advance, loan,

or commitment, because the bank would merely be making available to

its creditor, Hord, his "own" deposited funds.            Usually, this does

                                  - 15 -
not occur until after the deposited check has cleared. See Uniform

Commercial Code § 4-215(e) (stating when funds become available for

withdrawal    as   of   right);     Federal   Reserve    Regulation     CC:

Availability of Funds and Collection of Checks, 12 C.F.R. § 229

(1992).    In fact, this was NBT's policy.     But, under the language

of both § 1014 and the indictment, in issue is Hord's intent to

induce NBT to advance funds to him without waiting for the checks

to clear, not NBT's policy against doing so.

     In situations where the bank gives a customer access to funds

without waiting for deposited checks to clear, it is making an

advance on the security of the checks it holds for collection.          See

Uniform Commercial Code § 4-210(3), cmt. 1 ("A collecting agent may

properly    make   advances   on   the   security   of   paper   held   for

collection, and acquires at common law a possessory lien for these

advances." (emphasis added)).        In this situation, we think, the

language "in order to induce the bank to credit [Hord's] account"

is sufficiently equivalent to stating that Hord acted "in order to

induce the bank to make an advance, loan, or commitment". See

Price, 763 F.2d at 643 & n.4 (depositing false credit card sales

receipts constituted attempt to "obtain cash from the bank to which

[defendants] were clearly not entitled").       Therefore, we hold that

the indictment was sufficient to charge an offense under both

elements of § 1014.

     More importantly, although Williams v. United States, 458 U.S.
279 (1982), discussed infra, holds that presenting checks drawn

against insufficient funds is not a "false statement" for § 1014

                                   - 16 -
purposes, it does not address what constitutes "influencing in any

way the action of ... any bank ... upon any ... advance ... or loan

...."     18 U.S.C. § 1014.      Our court held long ago in United States

v. Payne, 602 F.2d 1215, 1218-19 (5th Cir. 1979), cert. denied, 445
U.S. 903 (1980), that "[t]he essence of check kiting is the

obtaining of credit in the nature of an advance or loan, however it

may be characterized"; that it "was a device for fraudulently

obtaining credit sufficiently in the nature of an advance or loan

to come within the scope of 18 U.S.C. § 1014."                 The Supreme Court's

holding     in   Williams   does       not    displace   this      aspect   of    proof

necessary for the latter part of the statute.                     See Williams, 458
U.S. at 300-01 (Marshall, J. dissenting) ("The banks that extended

funds on the basis of Williams' worthless, and not yet collected,

checks made an `advance,' a `loan,' and a `commitment' within the

ordinary meaning of these terms.")                 The above language from Payne

is still good law.

                                             2.

         Hord also contends that the government failed to prove the

substantive      elements   of     §    1014      (whether   he    made   any    "false

statement", and if so, whether it was to induce the bank to engage

in   a    specified   action).          This      contention      is   essentially    a

sufficiency of the evidence claim.                We will affirm a conviction if

the evidence, viewed in the light most favorable to the verdict and

with all reasonable inferences and credibility choices made in

support of it, is such that any rational trier of fact could have

found the elements of the crime beyond a reasonable doubt.                       Heath,

                                        - 17 -
970 F.2d at 1402 (citing Jackson v. Virginia, 443 U.S. 307 (1979),

and United States v. Kim, 884 F.2d 189, 192 (5th Cir. 1989)).

                                      a.

        In support of his contention on the "false statements" issue,

Hord    relies   principally    on   Williams,   458 U.S. 279,    for   the

proposition that checks are not false statements.                  We find his

reliance misplaced, however. In Williams, the defendant engaged in

a check-kiting scheme, knowing that his accounts did not contain

sufficient funds to cover the checks.              Id.     In reversing his

conviction under § 1014, the Court held that a check drawn on

insufficient funds is not "a `false statement,' for a simple

reason: technically speaking, a check is not a factual assertion at

all, and therefore cannot be characterized as `true' or `false.'"

Id. at 284.

        This was so, the Court stated, because a check drawn on

insufficient     funds   does    not,      "in   [its]    terms,       make   any

representation as to the state of [the drawer's] bank balance."

Id. at 284-85.    The Court also noted that "`false statement' is not

a term that, in common usage, is often applied to characterize `bad

checks.'"     Id. at 286.   Finally, the Court also reasoned that to

hold that a "bad check" (i.e., a check drawn on insufficient funds)

is a "false statement" under § 1014 would "make a surprisingly

broad range of unremarkable conduct a violation of federal law."

Id.13

13
     Williams' narrow construction of § 1014 prompted Congress to
enact § 1344, discussed supra, because Williams and other cases
"`underscored the fact that serious gaps now exist in Federal

                                     - 18 -
     The    obvious     and    basic   difference        between      the   checks   in

Williams and those here is that the checks in issue were bogus

rather than drawn against insufficient funds.14                        We think this

difference   crucial,     however,       and    precisely       what   makes   Hord's

behavior culpable under § 1014.                  We cannot agree with Hord's

conclusion that, like checks drawn on insufficient funds, bogus

checks such as the ones he deposited at NBT are not "false

statements" under Williams and its progeny.                   Instead, we find this

situation more similar to that presented in United States v.

Falcone, 934 F.2d 1528 (11th Cir.) (per curiam), reh'g granted &

opinion vacated, 939 F.2d 1455 (11th Cir. 1991), opinion reinstated

on reh'g, 960 F.2d 988 (11th Cir.) (en banc), cert. denied, ___

U.S. ___,    113   S.    Ct.    292    (1992).      In    a    case    involving     the

presentation of checks bearing a signature stamp made without

authorization, the Eleventh Circuit held that Williams did not

apply.15   The court found, rather, that the unauthorized use of the

jurisdiction over frauds against banks and other credit
institutions....'" S. Rep. No. 98-225, 98th Cong., 2d Sess. 377,
reprinted in 1984 U.S. Code Cong. & Admin. News 3182, 3517, quoted
in United States v. Bonnett, 877 F.2d 1450, 1454 (10th Cir. 1989).
14
     We agree with Hord that the use of deposit slips does not
alone provide a way to distinguish his case from Williams. As Hord
points out, the defendant in Williams presumably also used a
deposit slip to deposit his insufficient funds checks; but, like
the Williams Court, we are concerned with the checks, not with
their deposit slips. See Williams, 458 U.S. at 281.
15
     Although the defendants also had been charged with violations
of § 1014, we note that the appeal in Falcone was taken from a
conviction under former § 1344(a)(2) (for text, see supra note 9),
for making false representations to a federally-insured bank.
Falcone, 934 F.2d at 1539. The court in Falcone, however, defined
"false representations" under § 1344 by referring to Williams and
its discussion of "false statements" under § 1014. Id.

                                       - 19 -
signature stamp constituted an affirmatively false representation

that the signatures so made were authorized; and that such use was

tantamount to forgery.       Id. at 1542.

      The Eleventh Circuit held, and we agree, that "Williams does

not govern a situation in which some information on the check, such

as a false signature, or a fictitious bank, is itself a false

statement...."      Id. at 1541 (internal citations omitted) (citing

Bonnett, 877 F.2d at 1454 ("massive" scheme to defraud not covered

by Williams, despite use of insufficient-funds checks); United

States v. Worthington, 822 F.2d 315, 319 (2d Cir.) (fictitious

drawee bank a false statement, false representation that bank

actually existed), cert. denied, 484 U.S. 944 (1987); United States

v. Price, 763 F.2d 640 (4th Cir. 1985) (false names, amounts,

account numbers, and signatures on credit card slips presented for

deposit were false statements); Prushinowski v. United States, 562

F.   Supp.   151,   156-58    (S.D.N.Y.)    (drafts   with   unauthorized,

illegible or fictitious drawer signatures were false statements),

aff'd mem., 742 F.2d 1436 (2d Cir. 1983)).

      As Falcone and the above listed cases cited by it indicate, we

are not alone among the federal circuits in applying Williams

narrowly, to "the simple presentation of a check drawn on an

account with insufficient funds, without other evidence that the

defendant made some false representation to the bank...." Falcone,
954 F.2d at 1540.      See also United States v. Haddock, 956 F.2d
1534, 1543 (10th Cir.) (altered entries in checkbook in advance of

audit were "false statements"), cert. denied, ___ U.S. ___, 113 S.

                                  - 20 -
Ct. 88 (1992); United States v. Swearingen, 858 F.2d 1555 (11th

Cir. 1988) (per curiam), cert. denied, 489 U.S. 1083 (1989) (sight

drafts representing fictitious sales of automobiles used to obtain

credit held violative of § 1014); United States v. Rafsky, 803 F.2d
105, 107 (3d Cir. 1986) (scheme to defraud based on numerous

insufficient funds checks held violative of § 1344), cert. denied,

480 U.S. 931 (1987); United States v. Glanton, 707 F.2d 1238 (11th

Cir. 1983) (signing false name to signature card and counter check,

and in endorsement, held to violate § 1014).               As the court in Price

noted, "there is nothing in Williams that equates the passing of

checks drawn on accounts with insufficient funds with fraudulently

making or altering a document", as Hord did. 763 F.2d at 643 &

n.3.

       This reading accords with the policy behind Williams as well.

Williams,    as   the   Court    intended,     has   the    salutary   effect   of

ensuring that a "broad range of unremarkable conduct", i.e., the

relatively    commonplace       drawing   of   checks      against   insufficient

funds, is not "a violation of federal law".                Williams, 458 U.S. at

286.    Needless to say, Hord's conduct "does not strike us as

similarly unremarkable."         Worthington, 822 F.2d at 318-19.          As the

Second Circuit has noted, "[i]nsufficient funding may have a

perfectly innocent explanation".          Id. On the other hand, we cannot

conceive of any innocent explanation for presenting bogus checks,

not issued by the banks named as drawee, with forged signatures and

incorrect routing numbers, and payable to a client whose existence

is doubtful at best.      We hold that Hord's use of forged signatures,

                                     - 21 -
false drawee bank and payee information, and inaccurate routing and

account information on the checks he deposited, constituted "false

statements" under § 1014, and is not saved by Williams' limitation

of that term.

                                     b.

      Because the checks in issue contained false statements, we

next examine Hord's contention concerning the final element of §

1014 -- whether the government presented sufficient evidence that

Hord made these false statements with the purpose of influencing

the   action   of   the   bank   "upon    any   application,   advance,   ...

commitment, or loan."      18 U.S.C. § 1014.

      Hord maintains that the government failed to prove that he

acted with the intent to influence the bank to lend its funds or

the funds of its depositors.             To the contrary, the government

presented Rule 404(b) evidence that Hord previously had succeeded

in just such a scheme at other area banks, see supra note 4.16             At

both MBank and Cy-Fair, Hord had successfully withdrawn funds

against checks that he had deposited, before the collection process

had been completed.

16
      Rule 404(b) provides that

           Evidence of other crimes, wrongs, or acts is not
           admissible to prove the character of a person in
           order to show action in conformity therewith. It
           may, however, be admissible for other purposes,
           such as proof of motive, opportunity, intent,
           preparation, plan, knowledge, identity, or absence
           of mistake or accident.

Fed. R. Evid. 404(b).

                                   - 22 -
     Hord next asserts that the fact that NBT did not credit his

account is evidence that he did not intend to influence the bank.

Again, we fail to see the connection between Hord's intent (the

crucial factor under the statute), and NBT's action.    Obviously,

just because NBT did not credit Hord's account does not mean that

Hord did not intend for it to do so.17     Furthermore, the bank's

action in response to Hord's attempt to defraud it is irrelevant.

It is undisputed that a § 1014 offense is "`a crime of subjective

intent that requires neither reliance by the lending institution

nor an actual defrauding for its commission.'" Bowman, 783 F.2d at

1199 (quoting United States v. Davis, 752 F.2d 963, 969 (5th Cir.

1985)); United States v. Huntress, 956 F.2d 1309, 1317-18 (5th Cir.

1992), cert. denied, ___ U.S. ___, 113 S. Ct. 2330 (1993); Shaid,
730 F.2d at 232.18   A rational trier of fact could have found that

17
     In fact, we cannot see what else Hord could have intended. By
making deposits of the bogus checks, he surely intended that the
bank credit his account in the face amounts of the checks. His
withdrawal attempts reflect this. And, he must have intended that
NBT make the credit before the checks cleared through the
collection process, i.e., that NBT make him an advance. Once the
bank put the checks into the collection system, discovery of the
faked routing numbers, etc. was inevitable; and Hord surely would
not have been allowed to withdraw funds after the checks were
returned to NBT unpaid.
18
     Hord's reliance on United States v. Krown, 675 F.2d 46 (2d
Cir.), cert. denied, 459 U.S. 839 (1982), is misplaced. In Krown,
the Second Circuit held that the mere deposit of fraudulent
instruments, followed by a "bookkeeping entry showing the checks
credited" to the account of a third party, did not violate § 1014.
Id. at 51. We are presented with different facts here.

     In Krown, the defendant "paid" for purchases from his supplier
with certified checks drawn on a fictitious offshore bank. The
defendant's intent was only "to have the bank accept the certified
checks for deposit and carry out collection procedures". Id. As
noted, the fictitious bank on which the checks was drawn was

                               - 23 -
Hord was attempting to influence NBT to advance him funds against

the security of the checks he had deposited, before the checks

cleared.

     Because we conclude that the checks deposited in Hord's

account at NBT were false statements, and that Hord's intent was

that NBT credit his account pursuant to them, thus making an

advance, we affirm his convictions and sentences on counts ten-19

of the indictment.

                                III.

     For the foregoing reasons, the convictions and sentences are

AFFIRMED as to counts two-six and ten-19, and REVERSED and VACATED

as to counts one and seven-nine.

           AFFIRMED in Part, REVERSED and VACATED in Part

offshore; after the checks failed to clear through the normal
collection process, and pursuant to the defendant's instruction,
the collecting bank attempted to collect on the checks by mailing
them directly to the bogus bank in the West Indies. Id. at 49.
The purpose of this scheme was not to induce the bank to make an
advance, loan, commitment, etc., but to give the defendant more
time to buy goods on credit from the payee of the checks. Id. at
50. Indeed, rather than attempting to induce the collecting bank
to credit the payee's account, the defendant himself deposited a
legitimate certified check in the payee's account, in order to make
it appear that one of the bogus checks had been honored. Id. at
49.

                               - 24 -