State v. Bonham, A-7614.

• Decision Date: 22 June 2001
• Docket Number: No. A-7614.,A-7614.
• Citation: 28 P.3d 303
• Parties: STATE of Alaska, Appellant, v. Raejean S. BONHAM, Appellee.
• Court: Alaska Court of Appeals

28 P.3d 303

STATE of Alaska, Appellant, v. Raejean S. BONHAM, Appellee.

No. A-7614.

Court of Appeals of Alaska.

June 22, 2001.

Eric A. Johnson, Assistant Attorney General, Office of Special Prosecutions and Appeals, Anchorage, and Bruce M. Botelho, Attorney General, Juneau, for Appellant.

Sue Ellen Tatter, Anchorage, for Appellee.

Before COATS, Chief Judge, and MANNHEIMER and STEWART, Judges.

OPINION

STEWART, Judge.

Raejean S. Bonham pleaded guilty to federal charges of mail fraud and money laundering. Later, a state grand jury indicted Bonham on one count of perjury and six counts of submitting misleading securities filings.¹ Bonham moved to dismiss this indictment, claiming that AS 12.20.010 barred the State from prosecuting her for these crimes. Under AS 12.20.010, the State may not prosecute a defendant for a criminal act if the defendant previously was convicted or acquitted in another jurisdiction for the same act. Bonham asserted that her federal mail fraud conviction encompassed her acts of perjury and submitting misleading securities filings.

The superior court agreed with Bonham and dismissed the state indictment. The State now appeals the superior court's decision. We conclude that Bonham's perjury and misleading securities filings are not the same act as the mail fraud for which she was convicted in federal court—and, thus, AS 12.20.010 does not bar the State from pursuing its indictment. Accordingly, we reverse the decision of the superior court and reinstate Bonham's indictment.

Underlying facts and proceedings

In 1984, Bonham began buying airplane tickets from brokers who specialized in buying frequent flier coupons from airline customers. Bonham and her business, World Plus, Inc., would resell the tickets to her customers for less than the cost of a ticket purchased directly from an airline.

Beginning in 1989, Bonham started selling "contracts" to raise money for her business. She told her potential investors that she would use this money to buy frequent flier coupons in bulk from large corporations. Bonham told her investors that she was selling these "contracts" because she could not obtain the needed financing from banks, and thus she needed to raise money from private sources.

Bonham sold these "contracts" in $5,000 increments. The "contracts" were payable in six to eight months. They carried a return of twenty to fifty percent of the principal investment. When a "contract" matured, Bonham encouraged the investor to roll it over for another term. When Bonham's scheme was in full swing, several hundred individuals held these "contracts" at any one time.

Bonham did not, in fact, purchase frequent flier coupons from large corporations. Instead, she purchased the tickets from brokers using funds provided directly by flying customers. Bonham's profits from reselling these tickets were marginal; sometimes, her transactions actually resulted in losses.

Moreover, Bonham did not use the funds from her "contracts" to buy frequent flier tickets. Instead, she used this money to pay the maturing "contracts" of other investors. That is, Bonham engaged in a "Ponzi", or pyramid, scheme.

After a potential investor in Bonham's "contracts" contacted the State Division of Securities, Ed Watkins, a securities examiner, contacted Bonham. On September 4, 1992, Watkins advised Bonham that her "contracts" were securities for purposes of Alaska's securities statutes (AS 45.55), and that she either had to register each offering or apply for an exemption under AS 45.55.900. Bonham indicated that she had not realized that her contracts were covered by Alaska's securities law. She promised that she would not issue any new contracts or rollover any current contracts until the matter was resolved.

This promise was false. Despite her assurance to Watkins, Bonham continued to issue new contracts through World Plus and through another business entity she owned, the Atlantic Pacific Funding Corporation.

An attorney representing Bonham corresponded with Watkins between November 1992 and February 1993. This correspondence led to Bonham's March 1993 application to the Division of Securities to offer exempt securities. In a letter accompanying Bonham's application, her attorney stated that "all of [Bonham's] prior sales [had been] resolved and all investors paid in full." The attorney said that Bonham wanted to begin selling "new contracts" on March 15, 1993, and that these new contracts would total approximately $300,000. Bonham's application set an upper limit of twenty-five investors and $500,000 in contracts. Based on these representations, the Division of Securities issued Bonham the requested exemption.

By the end of March 1993, Bonham had violated the terms of her exemption. Her outstanding contracts totaled more than $2,000,000.

A little more than one year later, on May 24, 1994, Bonham's attorney wrote the Division of Securities to apply for a renewal of Bonham's exemption. The attorney's letter was accompanied by an affidavit from Bonham. In her affidavit, Bonham swore that all her previously issued contracts had been paid in full. This assertion was false. Since March 1993, Bonham had issued more than 2,000 contracts with a principal amount in excess of $45,700,000.

Based on Bonham's false representations, the Division of Securities granted Bonham another exemption, but this time the Division set upper limits of fifteen investors and no more than $250,000 in contracts. The Division also required Bonham to submit quarterly reports on her contract-selling activities.

In Bonham's first quarterly report (September 8, 1994), Bonham's attorney reported that Bonham had issued no new contracts. In fact, Bonham had issued more than 500 contracts during that three-month period, in a principal amount exceeding $11,700,000. Bonham's next quarterly report (December 12, 1994) stated that she had only one new investor. In fact, Bonham had issued more than 600 new contracts in a principal amount exceeding $14,250,000.

The Division of Securities granted Bonham a renewed exemption for 1995. Bonham's attorney submitted three quarterly reports in 1995, each one claiming that Bonham had engaged only in authorized activity. In truth, Bonham continued to issue hundreds of contracts, with principal sums in the tens of millions of dollars.

In October 1997, a federal grand jury returned a 79-count indictment against Bonham. The indictment included numerous counts of mail fraud,² money laundering,³ and engaging in prohibited monetary transactions.⁴ Bonham ultimately reached a plea agreement with the federal government that called for her to plead guilty to one count of mail fraud and one count of money laundering. On January 14, 1999, United States District Court Judge H. Russell Holland sentenced Bonham to concurrent sentences of 5 years in prison on each count.

One month later, on February 16, 1999, an Alaska grand jury indicted Bonham on one count of perjury and six counts of submitting misleading securities filings. The perjury count was based on Bonham's affidavit (dated May 24, 1994) that her attorney sent to the Division of Securities. The six counts of submitting misleading securities filings were based on Bonham's May 24, 1994, application to offer exempt securities, and the ensuing five quarterly reports that her attorney sent to the Division of Securities in 1994 and 1995.

Bonham moved to dismiss the State's indictment, arguing that AS 12.20.010 barred the State from prosecuting her for any of the acts connected with her mail fraud scheme. Superior Court Judge Michael L. Wolverton found that Bonham's false affidavit and her misleading securities filings were all connected to the mail fraud for which she had been convicted in federal court. Judge Wolverton therefore granted Bonham's motion to dismiss. The State now appeals.

Why we conclude that AS 12.20.010 does not bar the State from pursuing its indictment

The statute that Bonham relies on, AS 12.20.010, declares that if a defendant has been convicted or acquitted in another jurisdiction for a criminal act, Alaska is barred from prosecuting the defendant for the same act:

When an act charged as a crime is within the jurisdiction of the United States, another state, or a territory, as well as of this state, a conviction or acquittal in the former is a bar to the prosecution for it in this state.

Bonham claims that her federal conviction for mail fraud rests on, or incorporates, all the acts she committed in connection with her scheme to defraud—including the false affidavit and the misleading documents she filed with the Division of Securities in her effort to prevent the Division from discovering or interfering with her scheme. Thus, Bonham argues, AS 12.20.010 prohibits the State from prosecuting her for these crimes.

We discussed AS 12.20.010 in Booth v. State.⁵ We noted that Alaska is one of a substantial minority of states that limit the power of their own government to prosecute a defendant for a criminal act after another sovereign already has done so.⁶ We explained that AS 12.20.010 was "designed to complement the double jeopardy clause by protecting criminal defendants against successive prosecutions by different governments."⁷

To determine whether this statute bars the State from prosecuting Bonham, we must interpret the phrase, "an act charged as a crime." Our job is to discern what the legislature meant by these words.⁸ Bonham's case demonstrates that this short and apparently simple phrase does not always point to clear answers. As a New York court remarked (when construing that state's corresponding statutes⁹), any effort to discern the legislature's intent necessarily involves

a careful effort to reconcile the complex and competing considerations inherent in this area of law. On the one hand, there is the powerful traditional rationale underlying double jeopardy—the vital need to protect the accused from repeated prosecutions for the

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