Court Opinion

ID: 2981163
Source: CourtListenerOpinion
Date Created: 2015-09-22 19:25:01.678383+00
Date Added: 2024-06-11T11:44:23.786923
License: Public Domain

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                             File Name: 12a0636n.06

                                           No. 11-5442                                      FILED
                                                                                        Jun 18, 2012
                             UNITED STATES COURT OF APPEALS                        LEONARD GREEN, Clerk
                                  FOR THE SIXTH CIRCUIT

UNITED STATES OF AMERICA,                                )
                                                         )        ON APPEAL FROM THE
       Plaintiff-Appellee,                               )        UNITED STATES DISTRICT
                                                         )        COURT FOR THE EASTERN
v.                                                       )        DISTRICT OF TENNESSEE
                                                         )
GLENNA R. CAMPBELL,                                      )                           OPINION
                                                         )
       Defendant-Appellant.                              )

BEFORE:        BOGGS and COLE, Circuit Judges; and OLIVER, Chief District Judge.*

       COLE, Circuit Judge. Defendant-Appellant Glenna Campbell was accused of fraudulently

preparing money orders made out in her and her husband’s name, and using them to pay credit card

bills and other personal expenses. Campbell was convicted of one count of wire fraud in violation

of 18 U.S.C. § 1343, seven counts of mail fraud in violation of 18 U.S.C. § 1341, and one count of

money laundering in violation of 18 U.S.C. § 1957. She was sentenced to forty-one months in

prison. On appeal, she argues that the government failed to demonstrate an interstate nexus for the

wire-fraud and mail-fraud convictions, and that the district court improperly admitted the testimony

of Special Agent Scott Kennedy regarding Campbell’s income and expenditures. For the reasons

set forth below, we AFFIRM the convictions.

       *
        The Honorable Solomon Oliver, Jr., Chief Judge of the United States District Court for
the Northern District of Ohio, sitting by designation.
No. 11-5442
United States v. Glenna Campbell

                                       I. BACKGROUND

       Beginning in 1986, Campbell worked as the office manager for the Stewart Pharmacy, a

family-owned business in McMinnville, Tennessee. As part of her responsibilities, Campbell was

in charge of the Pharmacy’s business of selling money orders. Campbell had day-to-day access to

the record of money orders sold in the pharmacy, as well as the cash box and bank account that were

associated with the money-order business.

       In January 2009, the Stewart family became suspicious of Campbell’s stewardship of the

pharmacy. When the Stewarts attempted to audit the financial records of the pharmacy, Campbell

resisted. At the same time, a shipment of batteries arrived at the store with Campbell’s name on the

order. The Stewarts then audited the money-order records, which revealed money orders totaling

five to seven thousand dollars per month that were issued to Campbell or her husband, without any

record of Campbell paying for them. When a video camera was installed in Campbell’s work area,

it showed Campbell taking money out of the money-order cash box. In July 2009, Campbell was

fired from the pharmacy.)

       A certified public accountant hired by the Stewarts discovered that Campbell issued 409

money orders to herself or to her husband from 2002 to 2009. These orders totaled over $146,000.

The Campbells used these money orders to pay the their credit card bills. The Campbells, in turn,

used the cards to fund a number of purchases, including payments on several Jeep Wranglers, season

tickets to the Tennessee Titans, and jewelry.

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No. 11-5442
United States v. Glenna Campbell

       The government indicted Campbell and her husband1 on one count of wire fraud,18 U.S.C.

§ 1343, stemming from a credit-card purchase of jewelry that was processed by an out-of-state

processing center. In addition, Campbell was indicted on seven counts of mail fraud, 18 U.S.C. §

1341, stemming from fraudulent money orders mailed to credit card companies to pay outstanding

credit-card balances. Finally, Campbell was indicted for conspiracy to launder money, 18 U.S.C.

§ 1956(h), and money laundering, 18 U.S.C. § 1957. At trial, the government called Special Agent

Kennedy to testify regarding his investigation into the Campbells’ finances. Using the “expenditure

method” of accounting, Kennedy concluded that the purchases made by the Campbells during the

period covered by the indictment were far greater than would be predicted, based on their reported

income.

       At the close of the government’s case-in-chief, Campbell moved for a directed verdict on the

mail-fraud and wire-fraud charges, arguing that there was no nexus between the theft of the money

orders and the use of the mail or wires. The district court denied the motion. The motion was

renewed at the close of evidence, and was again denied. The jury convicted Campbell on all counts

except for the conspiracy-to-launder-money charge. Post trial, Campbell filed a motion for judgment

of acquittal, which was denied. The district court sentenced Campbell to forty-one months of

imprisonment, and ordered her to pay restititution to Stewart Pharmacy.

       Campbell appeals, challenging the denial of the motion for judgment of acquittal, as well as

the admission of the testimony of Special Agent Kennedy.

       1
           Bill Campbell was acquitted of all charges at trial.

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No. 11-5442
United States v. Glenna Campbell

                                          II. ANALYSIS

A. Wire and Mail Fraud Convictions

       Campbell argues that there is insufficient evidence to support her convictions for mail and

wire fraud. “For appeals from a denial of a judgment of acquittal based on the sufficiency of the

evidence, the standard of review is whether, after viewing the evidence in the light most favorable

to the prosecution, any rational trier of fact could have found essential elements of the crime.”

United States v. Kernell, 667 F.3d 746, 750 (6th Cir. 2012) (internal quotation marks, alterations,

and citations omitted). To convict a defendant of mail fraud under 18 U.S.C. § 1341, the

government must demonstrate beyond a reasonable doubt “(1) a scheme to defraud, and (2) [that

defendant caused] the mailing of a letter, etc., for the purpose of executing the scheme.” United

States v. Martinez, 588 F.3d 301, 316 (6th Cir. 2009) (quoting Pereira v. United States, 347 U.S. 1,

8 (1954)). Similarly, a wire-fraud conviction under 18 U.S.C. § 1343 requires the government to

demonstrate beyond a reasonable doubt “(1) a scheme or artifice to defraud; (2) use of interstate wire

communications in furtherance of the scheme; and (3) intent to deprive a victim of money or

property.” Id. (quoting United States v. Prince, 214 F.3d 740, 747-48 (6th Cir. 2000)).

       The heart of Campbell’s argument on appeal is that the “scheme to defraud” for purposes of

the mail and wire fraud encompasses only the appropriation of the money orders from Stewart

Pharmacy. In the defendant’s view, once she obtained the money orders the scheme ended, and thus

the use of the mail or wires after the fact was wholly unrelated to the scheme itself. See United

States v. Maze, 414 U.S. 395, 402 (1974) (vacating a mail-fraud conviction where the mailing

involved previously paid invoices); Parr v. United States, 363 U.S. 370, 393 (1960) (same); Kann

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No. 11-5442
United States v. Glenna Campbell

v. United States, 323 U.S. 88, 94 (1944) (vacating a mail-fraud conviction where the mailing

consisted of previously cashed checks).

       “To be part of the execution of the fraud, however, the use of the mails need not be an

essential element of the scheme.” Schmuck v. United States, 489 U.S. 705, 710 (1989) (citing

Pereira, 347 U.S. at 8). “It is sufficient for the mailing to be incident to an essential part of the

scheme . . . or a step in [the] plot.” Id. at 710 (internal quotations and citations omitted) (second

alteration in original). In Schmuck, the Supreme Court held that the act of mailing car registrations

containing falsified mileage numbers was an essential component of a scheme to sell cars at inflated

prices. Id. at 711-12. This is despite the fact that the actual fraudulent act, rolling back the

odometers on the cars, had already been accomplished at the time of the mailing. The court noted

that the scheme as a whole was only complete when the cars were sold by the dealers, and without

the misleading title documents those sales would not have been possible. Id. at 712; see also United

States v. Henson, 848 F.2d 1374, 1378 (6th Cir. 1988) (“For a mailing to be in furtherance of a

scheme, the scheme’s completion or the prevention of its detection must have depended in some way

on the charged mailing.” (internal quotation marks and citations omitted)).

       As Schmuck makes clear, a fraudulent scheme is not complete until the perpetrator has

secured the benefits of the scheme. In this case, that includes Campbell’s payment of her credit-card

bills and her purchase of goods and services for personal use. Campbell’s definition of the scheme

to include only taking possession of the money orders is without merit, as money orders are useless

until they are used to purchase goods or pay off a debt. When the purchases and payment of debts

are included in the scheme, the use of the mail and wires becomes part of an essential step in the

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No. 11-5442
United States v. Glenna Campbell

overall plan, as Campbell could not have paid her debts or used her credit card without making use

of the some means of mail or wires in this case. As such, a rational juror could conclude that the

government demonstrated that the use of the mail or wires was part of the scheme to defraud.

        Furthermore, the indictment’s articulation of the scheme to defraud is broad enough to

encompass all of the conduct that forms the basis of the counts of conviction. Under “Scheme to

Defraud,” the government alleged not only that “defendant GLENNA R. CAMPBELL would and

did embezzle cash and money orders,” but also that “the defendants would and did use the cash and

money orders to buy services, goods, and merchandise” and “the defendants would and did use credit

cards for some purchases and use stolen money orders to pay the credit card bills.” We have held

that the scheme as defined in the indictment is controlling for purposes of calculating the proper

amount of restitution when the case goes to the jury. United States v. Jones, 641 F.3d 706, 714 (6th

Cir. 2011). Similar logic applies here. The broad definition of the scheme in the indictment was

before the jury when they returned the convictions, and thus we presume the jury was using that

definition when it considered whether the government established the required elements of mail and

wire fraud. Thus, we cannot say that it was irrational for the jury to find that the use of the mail and

wires was in furtherance of the scheme to defraud.

B. Testimony of Special Agent Kennedy

        Campbell also challenges the admission of the testimony of Special Agent Kennedy, an

investigator with the Internal Revenue Service. As a preliminary matter, Campbell did not object

to the admission of Kennedy’s testimony at trial. We therefore review the admission of the

testimony for plain error. United States v. Baker, 458 F.3d 513, 519 (6th Cir. 2006). For plain error

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No. 11-5442
United States v. Glenna Campbell

to occur “there must be (1) error, (2) that is plain, and (3) that affects substantial rights.” Johnson

v. United States, 520 U.S. 461, 466-67 (1997) (internal quotation marks, alterations, and citations

omitted). “If all three conditions are met, an appellate court may then exercise its discretion to notice

a forfeited error, but only if (4) the error seriously affects the fairness, integrity, or public reputation

of judicial proceedings.” Id. at 467 (alterations omitted).

        Special Agent Kennedy testified regarding the expenditure analysis he conducted on the

Campbells’ personal finances. In essence, he looked at the value of their purchases over the period

of time covered in the indictment, and determined that their value was significantly greater than the

amount of income the Campbells claimed on their federal tax return and assets listed on credit

applications. He did not conduct the more complex net-worth analysis common in tax-fraud cases,

which requires the government to establish a baseline of assets and cash on-hand prior to the period

where the defendant was alleged to have engaged in fraudulent activity. However, Special Agent

Kennedy never represented that he was engaging in net-worth analysis, but instead stated clearly that

he lacked the records necessary to conduct that analysis. All Special Agent Kennedy was able to

state was that the purchases made by the Campbells could not be reconciled with the income and

other assets that the Campbells disclosed.

        In light of the limited scope of Agent Kennedy’s testimony, it was not error, let alone plain

error, to admit it at trial. Unlike in tax-evasion cases, the government had no burden to prove that

the Campbells’ expenditures stemmed from the fraudulent activity. Instead, Special Agent

Kennedy’s testimony was offered to show that the Campbells had personally profited in some

manner from the fraudulent money orders. While Campbell argues that Special Agent Kennedy’s

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No. 11-5442
United States v. Glenna Campbell

testimony is unfairly prejudicial, “[u]nfair prejudice does not mean the damage to a defendant’s case

that results from the legitimate probative force of the evidence; rather it refers to evidence which

tends to suggest [a] decision on an improper basis.” United States v. Howard, 621 F.3d 433, 457

(6th Cir. 2010) (quoting United States v. Bonds, 12 F.3d 540, 567 (6th Cir. 1993)). Campbell has

no argument as to why Special Agent Kennedy’s testimony would “suggest [a] decision on an

improper basis.” Id. Campbell was free to argue, and did argue, that the discrepancy found by

Special Agent Kennedy could be explained by the Campbells’ dipping into personal savings, and

thus Special Agent Kennedy’s conclusion was not a reliable picture of the Campbells’ finances. The

fact that the jury did not accept Campbell’s argument in voting to convict does not mean that the

testimony was improperly prejudicial. See United States v. Cosgrove, 637 F.3d 646, 658 (6th Cir.

2011) (“All of these arguments go to the weight the jury should afford the evidence, not to its

admissibility. Trial counsel was able to raise each of these points at trial, both through cross

examination and closing arguments.”).

                                        III. CONCLUSION

       For the foregoing reasons, we AFFIRM Campbell’s conviction and sentence.

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