U.S. v. McIntosh, 96-3270
| Citation | 124 F.3d 1330 |
| Decision Date | 27 August 1997 |
| Docket Number | No. 96-3270,96-3270 |
| Parties | Bankr. L. Rep. P 77,515, 97 CJ C.A.R. 1845, 97 CJ C.A.R. 2079 UNITED STATES of America, Plaintiff-Appellee, v. Michael R. McINTOSH, Defendant--Appellant. |
| Court | United States Courts of Appeals. United States Court of Appeals (10th Circuit) |
Daniel E. Monnat, Monnat & Spurrier, Chartered, Wichita, KS, for Defendant--Appellant.
Robert S. Streepy, Assistant United States Attorney (Jackie N. Williams, United States Attorney, with him on brief), Kansas City, KS, for Plaintiff--Appellee.
Before KELLY, HOLLOWAY, and HENRY, Circuit Judges.
Michael M. McIntosh appeals from his conviction and sentence on four counts of bankruptcy fraud in violation of 18 U.S.C. §§ 2 and 152 and on nine counts of money laundering in violation of 18 U.S.C. §§ 1956-1957. Our jurisdiction arises under 28 U.S.C. § 1291 and 18 U.S.C. § 3742. We affirm in part, reverse in part, and remand the matter to the district court.
When nearly $445,000 in overdue federal and state tax obligations threatened to cause eviction from his law office, Mr. McIntosh filed a petition for bankruptcy relief under Chapter 11 on November 12, 1991. Alleged omissions from the schedules and reports required in connection with that petition formed the basis of the criminal charges against Mr. McIntosh. The alleged omissions concerned a contingency fee received during the pendency of the bankruptcy proceedings, the house in which Mr. McIntosh lived, and his interest in an unincorporated business.
In 1987, Mr. McIntosh entered into a contingency fee arrangement pursuant to which he represented Wanda Pilcher in a wrongful termination suit against her former employer, Wyandotte County. The agreement provided that, in exchange for his legal services on Ms. Pilcher's behalf, Mr. McIntosh would receive half of any amount recovered after a second trial or an appeal. The agreement also provided that if Ms. Pilcher had no recovery Mr. McIntosh would receive no payment. After the verdict in the first trial was set aside following an appeal, the matter was again tried in a Kansas state court before a jury, which found for Ms. Pilcher. That judgment was affirmed by the Kansas Court of Appeals, and the Supreme Court of Kansas denied certiorari on March 10, 1992. Wyandotte County thereafter issued a check in satisfaction of the judgment, and made it payable to both Mr. McIntosh and Ms. Pilcher.
On March 26, 1992, Mr. McIntosh and Ms. Pilcher negotiated the check from Wyandotte County and had several smaller checks issued. Mr. McIntosh's share was divided into two checks: one for $57,500 made payable to Mr. McIntosh's law firm and the other for $68,000 made payable to Mr. McIntosh. Mr. McIntosh then negotiated the $68,000 check at another bank and had a number of cashier's checks issued in his own name. The largest of those checks--for approximately $22,700--was deposited into an account held by Mr. McIntosh on behalf of his unincorporated business, Fortex Industries (Fortex). Five other cashier's checks in varying amounts indicated that they were to satisfy personal obligations. Mr. McIntosh's March Operating Report was submitted to the bankruptcy trustee on July 1, 1996. It reported receipt of only $57,500 of the total fee Mr. McIntosh had received from Ms. Pilcher.
Eleven of the counts for which Mr. McIntosh was indicted were based upon these transactions pertaining to the Pilcher fee. Count 3 of the indictment charged Mr. McIntosh with fraudulent concealment of $68,000 of the Pilcher fee in violation of 18 U.S.C. § 152 (bankruptcy fraud), and Count 13 charged him with making a false statement on the March Operating Report by virtue of reporting only a portion of the fee, in violation of the same section. Counts 4 through 12 of the indictment charged Mr. McIntosh with money laundering in violation of 18 U.S.C. § 1956(a)(1)(A)(i). Counts 4 and 5 pertained to the exchange of the check from Wyandotte County in settlement of the Pilcher matter for the $57,500 check made payable to Mr. McIntosh's law firm and the $68,000 check made payable to Mr. McIntosh personally. Counts 6 through 12 corresponded to the individual cashier's checks for which Mr. McIntosh exchanged the $68,000 check. Count 11 of the indictment charged Mr. McIntosh with money laundering in violation of 18 U.S.C. § 1956(a)(1)(B)(i) in connection with his deposit of a cashier's check for approximately $22,700 into the Fortex account. Count 12 charged Mr. McIntosh with engaging in a monetary transaction in violation of 18 U.S.C. § 1957 in connection with his use of a cashier's check for approximately $14,465 to pay off a bank loan.
Mr. McIntosh's bankruptcy filings also failed to disclose his financial interest in Fortex, a business which placed cassette tapes and other items for sale at truck stops and convenience stores, and income that business earned. Mr. McIntosh mentioned Fortex to the attorney who represented him in the bankruptcy proceeding, but the attorney decided not to disclose Fortex on the initial schedules because he needed to discuss the valuation of that interest with Mr. McIntosh's accountant. Fortex was never included in the bankruptcy filings; the attorney testified at trial that he was remiss about the matter. The attorney also testified that he recalls mentioning in passing at the 341 meeting the need to amend the schedules to include Fortex, but no mention of Fortex is contained on the transcription of the tape made of the meeting. Count 1 of the indictment charged Mr. McIntosh with fraudulent concealment of his financial interest in Fortex--and in the house in which he lived--in violation of 18 U.S.C. § 152; Count 2 charged him with fraudulent concealment of approximately $68,500 in income from Fortex in violation of the same section.
Mr. McIntosh and his children lived in a home at 8401 New Jersey in Kansas City, Kansas (the New Jersey property). Mr. McIntosh's father purchased that property in 1983. In lieu of rent payments, Mr. McIntosh made the mortgage payments on the property. The New Jersey property was not reported on the bankruptcy filings. As noted, Count 1 of the indictment also charged Mr. McIntosh with fraudulent concealment of his financial interest in the New Jersey property in violation of 18 U.S.C. § 152.
Mr. McIntosh was tried before a jury, which convicted him on all thirteen counts. The district court denied Mr. McIntosh's motion for a judgment of acquittal, and imposed a sixty-month prison sentence for the bankruptcy fraud counts and a concurrent sentence of sixty-three months for the money laundering counts. The district court also ordered Mr. McIntosh to pay a special assessment of $650. Mr. McIntosh appeals both his convictions and his sentence.
Mr. McIntosh argues that the evidence at trial was insufficient to support his conviction on all thirteen counts, and that several of the counts are multiplicitous. Mr. McIntosh also argues that the district court committed several errors in instructing the jury and in admitting evidence. Finally, he argues that the district court erred in sentencing him.
Mr. McIntosh challenges the sufficiency of the evidence against him on both the bankruptcy fraud and money laundering counts. We consider the sufficiency of the evidence in the light most favorable to the jury's verdict, and determine whether any rational trier of fact could have found, from the direct and circumstantial evidence presented to it, together with the reasonable inferences therefrom, the essential elements of the crime beyond a reasonable doubt. United States v. Mitchell, 113 F.3d 1528, 1530 (10th Cir.1997); United States v. Contreras, 108 F.3d 1255, 1264 (10th Cir.1997), petition for cert. filed, June 7, 1997 (No. 96-9286).
Mr. McIntosh first challenges the sufficiency of the evidence supporting the four bankruptcy fraud convictions. A person who knowingly and fraudulently transfers or conceals property with the intent to defeat the provisions of the Bankruptcy Code violates 18 U.S.C. § 152(7).
Mr. McIntosh argues that insufficient evidence supports his intent to conceal his financial interest in Fortex and the income it generated. He reasons that because he mentioned Fortex to his attorney, and his attorney failed to list that asset on the bankruptcy filings, his conviction must be reversed. This argument ignores, however, the evidence of Mr. McIntosh's intent to conceal information about Fortex from the bankruptcy court and his creditors--and from his attorney.
In a bankruptcy proceeding, the duty to disclose assets falls upon the debtor--whether or not that debtor is represented by counsel. Mr. McIntosh signed the bankruptcy schedules over a warning that his failure to provide complete and accurate data on those forms could result in prosecution, and Mr. McIntosh's attorney testified that he explained to Mr. McIntosh the significance of his signature on those forms. Those schedules failed to list the checking account titled in Mr. McIntosh's name on behalf of Fortex. Mr. McIntosh also failed to report to the bankruptcy court his deposit of nearly $23,000 into that account.
The attorney who represented Mr. McIntosh acknowledged that he had been informed generally about Fortex and that he intended to--but ultimately did not--investigate the extent of Mr. McIntosh's interest in that entity and amend the schedules if necessary. The attorney also testified that Mr. McIntosh concealed from him information about the value of Fortex and the income it generated. A revenue agent testified at trial that, during an interview, Mr. McIntosh estimated his earnings from Fortex at about $50,000 annually. After his discussion of the matter with Mr. McIntosh, however, the attorney was left with the impression that Fortex was not an asset of great value....
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