Elliott v. U.S.
| Decision Date | 18 June 2003 |
| Docket Number | No. 02-4836.,No. 02-4755.,02-4755.,02-4836. |
| Citation | 332 F.3d 753 |
| Parties | Patricia Furlong ELLIOTT, Defendant-Appellant, v. UNITED STATES of America, Plaintiff-Appellee. United States of America, Plaintiff-Appellant, v. Patricia Furlong Elliott, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Fourth Circuit |
ARGUED: John Henry Herbig, Parker, Pollard & Brown, P.C., Richmond, Virginia, for Appellant. Thomas Andrew Hanusik, Trial Attorney, Richmond, Virginia, for Appellee. ON BRIEF: Stephen E. Scarce, Parker, Pollard & Brown, P.C., Richmond, Virginia, for Appellant. Paul J. McNulty, United States Attorney, Sara E. Flannery, Assistant United States Attorney, Richmond, Virginia, for Appellee.
Before KING, Circuit Judge, HAMILTON, Senior Circuit Judge, and PAYNE, United States District Judge for the Eastern District of Virginia, sitting by designation.
Affirmed in part, reversed in part, vacated in part, and remanded by published opinion. Judge KING wrote the opinion, in which Senior Judge HAMILTON and Judge PAYNE joined.
Patricia Furlong Elliott was convicted on multiple counts of making false statements to a financial institution, in violation of 18 U.S.C. § 1014. On appeal, she raises several challenges to those convictions. She also appeals her sentence, contending that the district court erred both in calculating the fraud loss attributable to her conduct and in denying her an adjustment for acceptance of responsibility. The Government cross-appeals the sentence, maintaining that the court erred in awarding Elliott a downward departure based on family responsibilities. As explained below, we affirm Elliott's convictions, the court's fraud loss calculation, and the court's denial of an adjustment for acceptance of responsibility. We reverse the downward departure for family responsibilities. Because the court erred in its downward departure ruling, we vacate the sentence and remand for resentencing.
On November 8, 2001, a grand jury in the Eastern District of Virginia returned a thirty-eight count indictment against Elliott. The indictment alleged twenty-four counts of mail fraud; one count of wire fraud; and, pursuant to 18 U.S.C. § 1014, thirteen counts of making false statements to a financial institution.1 Elliott moved to dismiss the indictment, asserting that the charges were legally insufficient. On March 12, 2002, the district court dismissed the mail fraud charges, but it authorized the remaining fourteen counts to proceed. United States v. Elliott, Mem. Op., CR-01-327 (E.D.Va. Mar. 12, 2002) (the "Dismissal Opinion").2 Subsequently, the Government dismissed the single count of wire fraud.3 On April 8, 2002, following a one-day bench trial conducted on April 4, 2002, Elliott was convicted on twelve of the thirteen false statement counts (Counts 26-30 and 32-38); she was acquitted on the remaining false statement count (Count 31). See United States v. Elliott, Findings of Fact and Conclusions of Law, CR-01-327 (E.D.Va. Apr. 8, 2002) (the "Opinion").4 The facts underlying Elliott's convictions, as found by the district court in its Opinion, are reviewed below.
In December of 1991, Elliott and her brother, William Furlong ("William"), discussed their need to protect the estate of their father, R. Dulany Furlong ("Mr. Furlong"), against the estate taxes that would be owed upon his death. Elliott suggested to William that they transfer their father's stock into a three-party brokerage account, on which she, William, and Mr. Furlong would each be a principal. At that time, Elliott held a power-of-attorney for her father. William agreed to the proposal, and the account was opened in January of 1992 at Wheat First Securities (the "Wheat First Account"). The Wheat First Account was held by the three principals in joint tenancy with the right of survivorship.5 Pursuant to the account agreement, Wheat First authorized any one of the three principals to disburse funds from the account. Upon the direction of a principal, Wheat First would issue a check in the names of all three principals. However, the check would be negotiable only if it carried the endorsement of each of the three principals.
In addition to the Wheat First Account, Elliott also maintained at least two bank accounts at Southside Bank ("Southside"), an institution in Aylett, Virginia, insured by the Federal Deposit Insurance Corporation (the "FDIC"). One of the Southside accounts was held jointly by Elliott and Mr. Furlong (the "Elliott/Furlong Account"), and the other was held jointly by Elliott and her husband. In the nearly four-year period between the opening of the Wheat First Account in January of 1992 and Mr. Furlong's death in December of 1995, Elliott directed Wheat First to issue several checks on the Wheat First Account, which she thereafter deposited into the Elliott/Furlong Account at Southside. The Wheat First checks were all issued in the names of Elliott, William, and Mr. Furlong and, when deposited at Southside, bore the purported endorsement of all three principals. William, however, had neither endorsed the checks nor authorized that they be endorsed on his behalf.
Southside customarily "advanced" funds to its customers in good standing, extending "immediate credit for deposits from [other] banks to [eligible] customers ..., pending payment of the check by the [other] bank."6 Opinion at 3. Because Elliott was a customer in good standing, she received credit on twelve of the Wheat First checks bearing William's forged endorsement (the "Forged Checks")7 immediately after she deposited them at Southside. In its Opinion, the court found that Elliott presented the Forged Checks to Southside "desiring and knowing that she would receive immediate credit for the deposit of said checks." Id. at 10. The court based this finding on the fact that Elliott "wrote checks [drawn on the Elliott/Furlong Account] on the same day as the deposits were made for a greater amount than existed in the [Elliott/Furlong Account] prior to the deposits being made." Id. The court further found that these advances "ultimately went to [Elliott] for her own personal benefit." Id. at 11. In short, on twelve separate occasions, Elliott deposited a Forged Check in the Elliott/Furlong Account in order to obtain an "advance" on the funds from Southside. The total value of the Forged Checks was more than $225,000, which was credited to the Elliott/Furlong Account. Elliott utilized over $90,000 of the advanced funds, i.e., she spent more than $90,000 of the funds from the deposited Forged Checks before those checks had cleared.8
On the occasion of Mr. Furlong's funeral in December of 1995, Elliott advised William that their father's widow had transferred the funds from the Wheat First Account to a separate account in her own name. The court found that this statement was false and concluded that the statement evidenced Elliott's "intent to divert the funds in the [Wheat First Account] to herself for her personal benefit." Id. William did not learn of Elliott's depletion of the Wheat First Account until February of 1997, more than two years after Mr. Furlong's death. A federal investigation of Elliott's activities began soon thereafter.
During the course of the investigation, Elliott attended a June 1998 meeting with the FBI. In that meeting, she acknowledged observing Id. Although Elliott advised the FBI that she used the funds to pay her father's medical expenses, the court found this claim "not borne out by the evidence." Id. at 12.
On April 4, 2002, Elliott's bench trial was conducted in the Eastern District of Virginia. At trial, the district court denied Elliott's motion for judgment of acquittal. Following the trial, the court convicted Elliott on twelve of the thirteen § 1014 counts (the "False Statement Convictions"). A person violates § 1014 by "knowingly mak[ing] any false statement... for the purpose of influencing in any way the action of ... any [FDIC-insured financial institution], ... upon any application, advance, discount, purchase, ... commitment, or loan." 18 U.S.C. § 1014. The court concluded that, in order to obtain a conviction under § 1014, the Government was obliged to prove three essential elements: (1) that Elliott made a false statement; (2) that Elliott made that statement to influence a bank's action; and (3) that Elliott made the statement knowingly. Opinion at 12.
The court found that the Forged Checks constituted "false statements" within the meaning of § 1014. It also determined that Elliott had "deposited [the Forged Checks] with the intent to receive immediate credit of and access to those funds." Id. at 13. Finally, the court found that the false statements were knowingly made, concluding that Elliott "knew that her brother did not endorse the [Wheat First] checks, yet she attempted to negotiate the checks nevertheless." Id. Accordingly, the court found Elliott guilty on twelve counts of violating § 1014.9
On April 10, 2002, Elliott renewed her motion for judgment of acquittal on Count 27, contending that the Government had failed to prove that she intended to cause or influence Southside to make an advance of funds in connection with the Moore's Cadillac Check. See supra note 8. The court denied the renewed motion on April 15, 2002.
On September 5, 2002, the district court conducted Elliott's sentencing hearing. During the hearing, Elliott objected to several of the recommendations contained in her pre-sentence investigation report (the "PSR"), specifically the PSR recommendations (1) that the total loss attributable to her criminal conduct (the "fraud loss") was...
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