246 F.3d 186 (2nd Cir. 2001), 00-1364, United States v Kim

Docket Nº:Docket No. 00-1364
Citation:246 F.3d 186
Party Name:United States of America, Appellee, v. Charles Kim, aka "Yong Chull Kim," Defendant-Appellant.
Case Date:April 10, 2001
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

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246 F.3d 186 (2nd Cir. 2001)

United States of America, Appellee,


Charles Kim, aka "Yong Chull Kim," Defendant-Appellant.

Docket No. 00-1364

United States Court of Appeals, Second Circuit

April 10, 2001

Argued Dec. 8, 2000

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Jane Simkin Smith, New York, NY (Larry J. Silverman), for Defendant- Appellant.

David Greenwald, Assistant United States Attorney for the Southern District of New York, New York, NY (Mary Jo White, United States Attorney, Andrea Likwornik Weiss and Andrea L. Labov, Assistant United States Attorneys, of counsel), for Appellee.

Before OAKES, KEARSE, and WINTER, Circuit Judges.

OAKES, Senior Circuit Judge:

Charles Kim was convicted of wire fraud and conspiracy based on his approving for payment inflated travel invoices submitted to the United Nations as part of its peacekeeping mission in Bosnia-Herzegovina. The United States District Court for the Southern District of New York, Barbara S. Jones, Judge, entered Kim's conviction pursuant to a jury verdict. In this appeal, Kim argues that neither jurisdiction nor venue was proper in the Southern District, and further argues that the district court erred in its evidentiary rulings and sentencing calculation. Because we find that jurisdiction and venue were proper under the wire fraud statute, and find no error on the part of the district court with respect to the other claims, we affirm.


In 1992, the United Nations established a peacekeeping mission in Bosnia-Herzegovina (the "UNMIBH"), stationing there military observers and civilian police who were citizens of various United Nations member states. The UNMIBH incurred substantial travel expenses with commercial airlines for the transportation of these peacekeepers to and from Bosnia-Herzegovina. Between 1995 and 1998, Kim, a resident of New York, was stationed in Zagreb, Croatia, as the UNMIBH's Chief

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of Travel and Traffic. In that capacity, he was responsible for making the travel arrangements for peacekeepers and approving invoices submitted by travel agencies and airlines.

Several commercial airlines used by the UNMIBH offered the mission substantial baggage discounts in the form of carrying up to 120 kilograms of each peacekeeper's baggage without charge. The government alleged that Kim knew of these discounts but nevertheless approved payment of invoices containing more than half a million dollars in improper baggage charges. These improper charges were made in two separate schemes, one involving a Croatian travel agency called Zagrebtours and the other involving Air France, in which Kim colluded with employees of those entities to defraud the UNMIBH. The Zagrebtours scheme occurred between October 1996 and September 1998, while the Air France scheme occurred between July 1996 and January 1998.

In each scheme, payment of the inflated invoices approved by Kim was done by wire transfer. Upon receiving Kim's approval, the UNMIBH chief cashier would, by fax, direct its bank to pay the relevant entity. From July 1997 forward, the UNMIBH paid its travel vendors by wire transfer from the Chase Manhattan Bank in New York City. The UNMIBH cashier testified at trial that on at least two occasions during the time the schemes were ongoing, she told Kim that the invoices were being paid by Chase Manhattan.

Prior to trial, Kim moved to dismiss his indictment for lack of jurisdiction and venue. His motion was denied by the district court on July 15, 1999, after full briefing by the parties. Kim then filed with this Court a petition for mandamus seeking to overturn the pre-trial rulings, which was denied on August 25, 1999. On September 28, 1999, after a two-week trial, a jury convicted Kim of five counts of wire fraud and conspiracy to commit wire fraud. Kim was sentenced on May 12, 2000, and subsequently moved in this Court for bail pending appeal on the ground that his conviction was likely to be overturned on the bases of jurisdiction and venue. Kim's motion was denied on August 18, 2000, and this appeal followed.


Kim principally challenges his conviction with the argument that because neither he nor any of his co-conspirators personally committed any fraudulent or conspiratorial act while in the United States, jurisdiction and venue were lacking to prosecute him in the Southern District of New York. Because the questions of jurisdiction and venue are questions of law, we review them de novo. See United States v. White, 237 F.3d 170, 172 (2d Cir. 2001).

I. Jurisdiction

Kim asserts that the district court lacked jurisdiction in this case because none of his conduct, or that of his co-conspirators, occurred in the United States and the wire fraud statute under which he was prosecuted was not intended to apply to an entirely foreign fraud. The government argues that the language and legislative history of the wire fraud statute, as well as precedent in this Court, make it clear that the statute applies when foreign frauds are committed by American citizens and furthered by wires into or out of the United States. On this question of statutory construction, we agree with the Government.

At the outset, we note that although there is no general bar against the extraterritorial application of our criminal laws to American citizens, the Supreme Court has long recognized a presumption

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against such applications. See Sale v. Haitian Ctrs. Council, Inc., 509 U.S. 155, 173 (1993). The presumption against extraterritorial application is overcome, however, when it is clear that Congress intends the statute to cover conduct that occurs outside the United States. See EEOC v. Arabian Am. Oil Co., 499 U.S. 244, 248 (1991). We must therefore determine whether Congress clearly intended that the statute at issue here apply to foreign conduct. In so doing, we "are permitted to consider 'all available evidence' about the meaning of the statute, including its text, structure, and legislative history." United States v. Gatlin, 216 F.3d 207, 212 (2d Cir. 2000) (quoting Sale, 509 U.S. at 177).

The wire fraud statute, 18 U.S.C.A. § 1343 (2000), criminalizes the use of wire transmissions to further a fraudulent scheme.1 In 1956, Congress amended the statute to include the words "foreign commerce" so as to reach fraud schemes furthered by foreign wires as well as by interstate wires. See 18 U.S.C.A. § 1343, Historical and Statutory Notes. The legislative history of this amendment, while terse, is telling. The amendment was prompted by the failed prosecution of an individual who made a fraudulent telephone call from Mexico to the United States and successfully argued that § 1343 did not cover such a foreign communication. See S. Rep. No. 1873, 84th Cong., 2d Sess. 2 (1956). With this case in mind, Congress acted to "close [the] loophole" that limited prosecution to cases in which the fraudulent transmission occurred between two states, and explicitly extended the coverage of § 1343 to foreign communications. See H.R. Rep. No. 2385, 84th Cong., 2d Sess. 1 (1956), reprinted in 1956 U.S.C.C.A.N. 3091, 3092.

Kim urges us to interpret § 1343's admittedly slim legislative history as a congressional retention of the focus on domestic fraud, and not an expansion of statutory coverage to frauds committed abroad. As the Government points out, however, the fraud at issue here involved an American perpetrator and a victim headquartered in New York. That the fraudulent scheme was implemented while Kim was located in Croatia -- but furthered by wire transmissions to and from New York -- makes it similar to the Mexico/America fraud that prompted Congress to enact the 1956 amendment to § 1343. As we have recognized in an analogous context:

There would seem to be no logical reason for holding that Congress intended to punish those who cause the violation of a law regulating and protecting foreign commerce only when they act within the borders of the United States or that Congress is powerless to protect foreign commerce and those who engage in foreign commerce from intentionally injurious acts, simply because those acts occur outside our borders.

United States v. Braverman, 376 F.2d 249, 251 (2d Cir. 1967). We therefore believe that Congress clearly intended conduct such as Kim's to be within the reach of our criminal laws.

Our conclusion here flows from the earlier holdings of this Court in United States

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V. Gilboe, 684 F.2d 235 (2d Cir. 1982), and United States v. Trapilo, 130 F.3d 547 (2d Cir. 1997). In Gilboe, we addressed jurisdiction under § 1343 for a nonresident alien who had perpetrated a massive fraud on the international shipping industry. See 684 F.2d at 236-37. Rejecting the defendant's arguments that the fraudulent acts occurred outside the United States and had no detrimental effects within it, we held that wire communications between Hong Kong and Manhattan, and Hong Kong and Bayshore, Long Island, were "clearly sufficient to sustain jurisdiction on th[e] offense," because "jurisdiction under § 1343 is satisfied by defendant's use of the wires to obtain the proceeds of his fraudulent scheme." Id. at 238.

In Trapilo, we interpreted § 1343 in the context of a tax revenue fraud on the Canadian government, and concluded that the statute covered such a fraud. See 130 F.3d at 551-553. Looking at the language of the statute, we found that "as the statute plainly states, what is proscribed is use of the telecommunication systems of the United States in furtherance of a scheme.... Nothing more is required. The identity and location of the victim, and the...

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