U.S. v. Dilks
| Decision Date | 14 September 1995 |
| Docket Number | No. 94-5821,94-5821 |
| Citation | 66 F.3d 317 |
| Parties | NOTICE: Fourth Circuit Local Rule 36(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Fourth Circuit. UNITED STATES of America, Plaintiff-Appellee, v. Julien K. DILKS, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Fourth Circuit |
John P. Fishwick, Jr., David A. Clark, Fishwick, Jones & Glenn, Roanoke, VA, for appellant.
Robert P. Crouch, Jr., U.S. Atty., Thomas L. Eckert, Asst. U.S. Atty., Roanoke, VA, for appellee.
Before HALL, WILKINS and MOTZ, Circuit Judges.
Julien K. Dilks appeals his conviction for bank fraud under 18 U.S.C.A. Sec. 1344 (West Supp.1995). He contends that insufficient evidence existed to convict him and that he should not have been prosecuted under the bank fraud statute. Finding no error, we affirm.
Testimony disclosed that Dilks and Marco Montemezzi, Dilks' longtime friend and mentor, founded the JMA Foundation ("JMA") and National Brain Injury Research Group ("NBIRG") in Washington, D.C., to provide information and support to patients recovering from brain injuries. Dilks acted as president of JMA and NBIRG, and Montemezzi was JMA's primary contributor and usually assisted JMA with any financial difficulties. Although Montemezzi eventually declared bankruptcy, he had provided in his will for JMA to receive money to clear its debts and had begun to make arrangements to sell his home to benefit JMA.
In addition to acting as JMA and NBIRG's president, Dilks handled the finances for both organizations. JMA experienced some difficulty in raising funds and meeting the payroll for its small number of employees. Despite JMA's financial problems, Dilks opened checking accounts at Franklin National Bank ("FNB") in Washington, D.C., First Virginia Bank ("FVB") in Charlottesville, Virginia, and First American Bank ("FAB"), in Washington, D.C. Dilks also opened an investment account at Merrill Lynch, which never held securities.
Dilks made many large transactions between the JMA accounts. On August 17, 1992, Dilks deposited into JMA's FAB account a check drawn on FVB in the amount of $35,000. Two days later, Dilks deposited another $35,000 check drawn on FVB into JMA's FAB account. On the next day, August 20, Dilks conducted three transactions. First, he deposited a $47,000 check from Montemezzi into JMA's FNB account. Montemezzi had asked Dilks to hold the check until he transferred sufficient funds to cover it. Second, from the inflated FNB account, Dilks withdrew $45,000 and deposited a check for that amount into the FVB account. Finally, he wrote a $9500 check drawn on JMA's FVB account and deposited it back into the FNB account. The checks drawn on FVB were returned for insufficient funds: On August 20, FAB returned the August 17 $35,000 check; on August 24, FNB returned the $9500 check; and between August 25 and August 28, FAB returned the August 19 $35,000 check. Also between August 25, and August 28, FNB returned Montemezzi's $47,000 check and FVB returned the $45,000 check.
In order to expand JMA's reach, Dilks established a satellite office in Charlottesville, Virginia. In addition to checking accounts already established, Dilks opened a checking account in Charlottesville at Jefferson National Bank ("JNB"), a bank insured by the Federal Deposit Insurance Corporation. He opened this account on August 24, the day on which Montemezzi committed suicide. Dilks also conducted several transactions through JMA's JNB account. On September 1, 1992, Dilks deposited a $35,000 check drawn on JMA's JNB account into the Merrill Lynch account, which was returned for insufficient funds. The next day, Dilks deposited a $35,000 check drawn on FNB into the JNB account. FNB returned the check for insufficient funds on September 8, which created a small overdraft in the JNB account.
On September 24, 1992, Dilks deposited a $10,000 check from JMA's Merrill Lynch account to the JNB account. One day later, Dilks wrote a $10,000 check drawn on the JNB account to Nathan Zasler, and he withdrew $6000 in cash. JNB allowed the $6000 cash withdrawal based on the September 24 $10,000 deposit, which Merrill Lynch returned for insufficient funds on September 29.
Dilks wrote another check drawn on the Merrill Lynch account for $29,000 and deposited it into the JNB account on September 28. JNB did not place a hold on the check because the teller accepting the deposit felt that Dilks was an established customer. On September 29, Merrill Lynch notified Dilks that it had closed JMA's account. Also on September 29, Dilks withdrew $20,000 from the JNB account using a counter withdrawal ticket, he purchased a cashier's check payable to FAB, and he withdrew another $2000 in cash. JNB released these funds based on the $29,000 Merrill Lynch deposit. Finally, on October 6, 1992, Merrill Lynch returned the $29,000 check unpaid because the account had been closed, creating a $12,104.37 overdraft in the JNB account. JNB notified the Federal Bureau of Investigation ("FBI") that it suspected an intent to defraud.
An FBI agent testified that during his interview with Dilks, Dilks "wasn't very straightforward[,] and it was kind of difficult getting questions answered." The agent explained the concept of check kiting to Dilks as "deposit[ing] checks into a checking account knowing that there's no funds for that check and then drawing off of that checking account funds to pay for other expenses." Dilks agreed that he operated a check kiting scheme and stated that he expected to receive money from Montemezzi's estate to pay JMA's debts and cover the $35,000 check drawn on FNB and the $10,000 and $29,000 checks drawn on Merrill Lynch, all of which were deposited into the JNB account. The agent also testified that Montemezzi asked Dilks to hold the $29,000 check because he was not sure if there were sufficient funds to cover the check, and that Dilks thought the $35,000 and $10,000 checks probably would bounce too.
At the close of the bench trial, the district court concluded that Dilks attempted to obtain money to which he was not entitled and that he intended to defraud JNB. The court found it significant that Dilks opened accounts at five different institutions to operate a small organization. The court sentenced Dilks to ten days imprisonment, ordered four years of supervised release, ordered restitution, and imposed a fine and a special assessment. This appeal followed.
Dilks claims that there was insufficient evidence to find that he intended to defraud JNB. He contends that he acted "from the combined weight of his personal circumstances and the precarious financial position of JMA." Dilks also asserts that there was insufficient evidence of intent because he did not benefit personally from his actions, he was not required personally to cure JMA's debts, and he...
To continue reading
Request your trial