U.S. v. Edelmann

• Citation: 458 F.3d 791
• Decision Date: 17 August 2006
• Docket Number: No. 05-3122.,05-3122.
• Parties: UNITED STATES of America, Appellee, v. Mary K. EDELMANN, Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (8th Circuit)

458 F.3d 791

UNITED STATES of America, Appellee, v. Mary K. EDELMANN, Appellant.

No. 05-3122.

United States Court of Appeals, Eighth Circuit.

Submitted: March 14, 2006.

Filed: August 17, 2006.

J. Blake Hendrix, argued, Little Rock, AR, for appellant.

George C. Vena, argued, Asst. U.S. Attorney, Little Rock, AR (Anne E. Gardner, Asst. U.S. Attorney, on the brief), for appellee.

Before ARNOLD, JOHN R. GIBSON, and SMITH, Circuit Judges.

SMITH, Circuit Judge.

A jury convicted Mary K. Edelmann of two counts of mail fraud, in violation of 18 U.S.C. § 1341; two counts of wire fraud, in violation of 18 U.S.C. § 1343; and one count of money laundering, in violation of 18 U.S.C. § 1957. The district court¹ sentenced Edelmann to 92 months' imprisonment and three years of supervised release and ordered Edelmann to pay a $500 special assessment and restitution in the amount of $210,730.83. Edelmann appeals arguing that (1) the district court erred in refusing to suppress her incriminating statements; (2) the district court erred by removing her counsel of choice; (3) the district court erred by denying her request to proceed pro se; (4) the district court erred in allowing the government to introduce character evidence; (5) the evidence is insufficient to sustain her convictions on each of the five counts; (6) the district court erred in admitting Bureau of Prison records to prove a prior conviction; (7) the district court was without authority to amend the judgment to include a missing forfeiture award; and (8) the district court committed errors in calculating her offense level and criminal history, resulting in an unreasonable sentence. We affirm.

I. Background

Edelmann's first mail fraud count stemmed from misrepresentations made to a potential business lender. In January 2001, Edelmann, owner and operator of a paralegal service company in Maumelle, Arkansas, contacted Theodore Powell seeking venture capital for her company. Powell referred her to Eleanor Vaughn in Arizona. After receiving Edelmann's project proposal and company prospectus, Vaughn relayed the documents to Victor Beard. Beard communicated to Edelmann, through Vaughn, that he required additional documentation before he would loan $50,000 to Edelmann. Shortly thereafter, Edelmann sent the documents Beard requested to Vaughn, who subsequently hand-delivered the documents to Beard. Beard's review of the documents made him suspect Edelmann's company did not actually have access to the more than $2,000,000, as represented by the documents. As a result, Beard requested a letter from Edelmann's bank showing that the $2,000,000 was secured and accessible to Edelmann. Edelmann responded by faxing Beard a letter purportedly from Bank of America. Beard recognized the letter as fraudulent. A subsequent investigation of the financial statements and tax returns forwarded to Beard by Edelmann revealed that they were not genuine.

Edelmann's second mail fraud count was based upon her actions in connection with an application for a home loan. In March 2001, Edelmann applied for a loan through Lexxel Funding, an Internet loan broker, submitting purported bank statements and wage and earnings forms. Lexxel then sought funding from BNC Mortgage ("BNC") to fund the loan. BNC agreed to loan Edelmann $125,000 to purchase a $225,000 home in Maumelle, Arkansas. Edelmann was required to bring $102,825.08 to closing as a down payment on the property.

Edelmann's first wire fraud count was based on actions she took before closing on her house. Before closing, Edelmann responded to Thomas Richardson's newspaper ad in which Richardson stated that he was interested in purchasing property for cash. Edelmann told Richardson that she expected to obtain a substantial amount of money from an overseas investment soon and needed a short-term loan for "operating cash" for her company's expenses. She promised Richardson a 100 percent return on his money within 30 days. She falsely represented to Richardson that she was an attorney and that she would ensure that all documents were legally sufficient. She provided Richardson with false financial documents similar to those she previously provided to Beard, including a false Bank of America letter showing that she had $10,000,000 in a guaranteed, but frozen, account. Based on these documents, Richardson agreed to lend Edelmann $250,000 and drew up a promissory note and guarantee for their signatures. Richardson then arranged for $147,174.92 to be wired from his Charles Schwab ("Schwab") investment account into Edelmann's account at Superior Federal Bank; in addition, he arranged for $102,825.08 to be presented to Edelmann in the form of a Schwab check. Edelmann negotiated the check and had a cashier's check in that amount made payable to Standard Abstract and Title Company. She then took the check to Standard Abstract and Title Company and used it to close on the loan from BNC. She used the money wired to her account to buy furniture and equipment for her business.

Edelmann's second wire fraud count stems from her conduct in April 2001. At that time, Edelmann offered Richardson a job overseeing foreign investment projects. Richardson and Edelmann entered an employment contract in which Edelmann agreed to pay him a salary of $240,000 annually. Subsequently, Edelmann asked Richardson to loan her an additional $50,000, explaining that because the anticipated return on her overseas investment was delayed, she needed additional operating capital. She agreed to pay Richardson 100 percent on this additional amount, or a return of $100,000. Relying on information provided for the first loan, as well as documentation of the anticipated return on the overseas investment, Richardson had $50,000 from his Schwab investment account wired to Edelmann's Internet bank account.

When the 30-day time frame for repayment had passed, Richardson requested that Edelmann pay on the promissory note. Edelmann, however, failed to do so and terminated Richardson's employment. Richardson sought to enforce the guarantee agreement by pursuing the $10,000,000 in "guaranteed funds" Edelmann claimed to have at Bank of America. When he presented his documentation to Bank of America, he was advised that Edelmann had no such account and that she had defrauded him. Bank of America representatives then contacted the Federal Bureau of Investigation (FBI) about the fraud, and the FBI began investigating Edelmann.

On August 14, 2001, the government filed a lis pendens and civil complaint in forfeiture against Edelmann's property. Immediately thereafter, Edelmann's attorney, John Kitterman, contacted Assistant United States Attorney ("AUSA") Dan Stripling to request a meeting. An initial meeting was held in Kitterman's office and was attended by Edelmann, Kitterman, FBI Special Agent Sharon Dawkins, and Stripling. At the meeting, Stripling advised Edelmann that the government suspected she had committed crimes and that any statement she made could be used against her. During the meeting, Edelmann and Kitterman voluntarily discussed people, events, and correspondence pertaining to a prime-lending scheme or trading program in which Edelmann was involved. The government clearly stated to Edelmann that its investigation was in the preliminary stages. At the conclusion of the meeting, the parties agreed that Dawkins, Edelmann, and Kitterman would meet the next day so that Edelmann could give Dawkins copies of numerous documents.

After the first meeting, Edelmann met four more times with Dawkins and Kitterman, once at Edelmann's business office in Maumelle, Arkansas, and three times at the United States Attorney's Office. Edelmann gave Dawkins documents and discussed the involvement of various people in the suspected lending scheme. Stripling and Dawkins confronted Edelmann with discrepancies in her story. At the fourth meeting, Edelmann admitted greater involvement in the scheme and admitted creating a counterfeit bank letter signed by "Sandra Walsh."

At a final meeting in Stripling's office among Edelmann, Kitterman, Stripling, and Dawkins, Edelmann was given an opportunity to explain her involvement in the scheme. While at previous meetings Edelmann admitted receiving $500,000 from James Harrold in a similar scheme, she consistently denied receiving any more money. However, after Edelmann was confronted with evidence that banking records showed that she received an additional $500,000 from Harrold, she admitted receipt of the additional money. No further meetings occurred, and the government never made a formal plea offer to Edelmann or other agreement with Edelmann.

Edelmann was subsequently indicted for mail fraud, wire fraud, money laundering, and making false statements to a government agent. She pleaded not guilty. Attorney Alvin D. Clay represented Edelmann at the plea hearing. In later proceedings, attorney Darrell Brown represented Edelmann before the district court. After Clay informed the government that both he and Brown would represent Edelmann during trial, the government notified the district court that the FBI was investigating Clay for fraud and that a criminal case against Clay was opened at the United States Attorney's Office for the Eastern District of Arkansas. The district court removed Clay as Edelmann's counsel after she refused to waive a potential conflict of interest caused by the criminal case against Clay.²

Approximately four days before trial, Edelmann filed a motion to proceed pro se. The district court denied Edelmann's motion to proceed pro se, finding that (1) the case had been continued numerous times at Edelmann's request; (2) Edelmann requested to proceed pro se five days before trial; (3) Brown had worked on the case for many months, as Edelmann's counsel of choice, and was thoroughly familiar with the issues in the case; and (4) many issues were involved in the case. The trial commenced on June 21, 2004, with Brown representing...