U.S. v. Sancho
| Decision Date | 20 February 1997 |
| Docket Number | No. 95 Cr. 1052 (SAS).,95 Cr. 1052 (SAS). |
| Citation | 957 F.Supp. 39 |
| Parties | UNITED STATES of America v. Anthony SANCHO, Defendant. |
| Court | U.S. District Court — Southern District of New York |
Leonard F. Joy, Legal Aid Society, New York City, for Defendant.
Peter C. Sprung, Assistant United States Attorney, S.D.N.Y., New York City, for the Government.
Defendant moves for a judgment of acquittal pursuant to Rule 29(c) of the Federal Rules of Criminal Procedure. For the reasons set forth below, defendant's motion is denied.
On December 11, 1995, defendant was indicted on two counts of wire fraud under 18 U.S.C. §§ 1343 and 1346 (). The indictment charged that defendant devised or intended to devise a scheme to deprive the Tishman Construction Corporation ("Tishman") of the intangible right of honest services of someone defendant believed to be Tishman's consultant, and that defendant used interstate wires on November 19 and 21, 1995 in furtherance of this scheme.
On November 7, 1996, after a four day trial, a jury found defendant guilty of both counts of the indictment. The evidence at trial showed that defendant agreed to pay a $1.25 million bribe to an undercover officer (who defendant believed to be a consultant of Tishman) to induce Tishman to participate in a construction project, and that defendant concealed his agreement with the undercover officer from Tishman.
On the eve of trial, defendant moved to dismiss the indictment on the grounds that the government would not be able to prove an essential element of the offenses charged in the indictment: namely, that either defendant or the undercover officer owed a fiduciary duty to Tishman. See Letter from Steven M. Statsinger, Counsel to defendant, to the Court of October 30, 1992 at 2. I denied defendant's motion from the bench on November 4, 1996. See Trial Transcript ("Tr.") at 8. Defendant renewed his motion on the same grounds after the close of the government's case, and also argued that the indictment should be dismissed because the November 21 telephone call was not in furtherance of the scheme to defraud. See Tr. at 429-31. Both motions were denied.
Federal Rule of Criminal Procedure 29(a) states:
The court on motion of a defendant or of its own motion shall order the entry of judgment of acquittal of one or more offenses charged in the indictment or information after the evidence on either side is closed if the evidence is insufficient to sustain a conviction of such offense or offenses.
Stated another way, a judgment of acquittal must be entered "if there is no evidence upon which a reasonable mind might fairly conclude guilt beyond a reasonable doubt". United States v. Mariani, 725 F.2d 862, 865 (2d Cir.1984). Here, defendant alleges that the government failed to produce sufficient evidence with regard to an essential element of wire fraud, namely the existence of a fiduciary duty between the undercover officer and Tishman. See Jackson v. Virginia, 443 U.S. 307, 319, 99 S.Ct. 2781, 2789, 61 L.Ed.2d 560 (), reh'g denied, 444 U.S. 890, 100 S.Ct. 195, 62 L.Ed.2d 126 (1979).
The federal wire fraud statute states, in pertinent part:
Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communications in interstate or foreign commerce, any writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice, shall be fined ... or imprisoned ... or both.
18 U.S.C. § 1343 (1956). Therefore, the required elements of the offense are (1) a scheme to defraud; (2) money or property; and (3) use of the interstate wires to further the scheme. See United States v. DiNome, 86 F.3d 277, 283 (2d Cir.1996); United States v. Mittelstaedt, 31 F.3d 1208, 1216 (2d Cir. 1994), cert. denied, 513 U.S. 1084, 115 S.Ct. 738, 130 L.Ed.2d 640 (1995). A "scheme to defraud" may include a scheme to "deprive another of the intangible right of honest services." 18 U.S.C. § 1346 (1988). With regard to the second element, the government need not prove that the scheme successfully defrauded the intended victim. See DiNome, 86 F.3d at 283; Mittelstaedt, 31 F.3d at 1216. However, the government must establish that "some actual harm or injury was contemplated by the schemer." DiNome, 86 F.3d at 283 (quotation and citation omitted). Therefore, "fraudulent intent is essential to a scheme to defraud." Id. (quotation and citation omitted).
Defendant argues that a non-employee may not be convicted under § 1346 for depriving a corporation of its right to the honest services of a person who did not in fact owe the corporation a fiduciary obligation. Defendant does not rest his argument on a claim of impossibility,1 but rather on his interpretation of the scope of conduct Congress intended to proscribe under § 1346. See Defendant's Memorandum of Law in Support of Post-Verdict Motion ("Defendant's Memo") at 10. In his support, defendant cites, inter alia, United States v. Herron, 825 F.2d 50, 54 (5th Cir.1987) () and United States v. Alexander, 741 F.2d 962, 964 (7th Cir.1984) (), overruled on other grounds by United States v. Ginsburg, 773 F.2d 798 (7th Cir.1985). From these and other cases, defendant deduces that a fiduciary duty must exist and be "corrupted" for culpability to attach under § 1346. In support of his argument, defendant relies primarily on cases that are not controlling in this jurisdiction, and each case he cites was decided before § 1346 was enacted.2 Defendant concedes that the Second Circuit has never ruled that § 1346 requires the government to establish the existence of a fiduciary relationship between one of the "schemers" and the defrauded person or entity. See Defendant's Memo at 14, 16.
It may be true, as defendant asserts, that no person has yet been prosecuted under the wire fraud statute for attempting to bribe someone who was actually an undercover officer rather than the intended victim's employee.3 Yet a plain reading of the wire fraud statute indicates that there is no requirement that the government establish a fiduciary relationship of any kind to pursue a § 1343 conviction. The 1988 amendment to the wire fraud statute states only: "For the purposes of this chapter, the term scheme or artifice to defraud' includes a scheme or artifice to deprive another of the intangible right of honest services." 18 U.S.C. § 1346. The statute does not expressly limit culpability to cases involving schemes to deprive another of "honest services of a fiduciary." There is simply no indication from the text of §§ 1343 and 1346 that a necessary element of wire fraud is the existence of an actual fiduciary duty.
Defendant argues that the Second Circuit has indicated that it would not allow § 1343 to be "expanded" to cover a case of wire fraud that does not involve the corruption of an employee's fiduciary duty. It is true that courts should not expand the scope of criminal liability beyond the range of conduct Congress intended to proscribe by interpreting ambiguous statutory language in the government's favor. See United States v. Von Barta, 635 F.2d 999, 1001 (2d Cir.1980) ), cert. denied, 450 U.S. 998, 101 S.Ct. 1703, 68 L.Ed.2d 199 (1981). However, it is equally inappropriate to constrict the scope of criminal liability by requiring the government to prove elements not required by the statute itself.
Although § 1346 was enacted in 1988, the Second Circuit has never addressed the question of whether § 1346 covers only the "honest services" of fiduciaries, as defendant now argues. However, the mere fact that a case is atypical4 does not require a judgment of acquittal. A review of Second Circuit wire fraud cases requires that the defendant's position be rejected.
If the government was required to prove that defendant's scheme was capable of actually harming his intended victim by depriving it of honest services to which it was entitled, it would follow that the government was required to show the existence of an actual fiduciary relationship between the "corrupted" employee and the victim. If the intended victim has no actual right to the employee's honest services, the defendant's scheme cannot be said to actually harm the victim by depriving the victim of those honest services. Yet, as noted in Part II of this Opinion, § 1343 does not require a defendant to have actually defrauded the intended victim, or that a defendant's scheme was capable of doing so. The essence of the wire fraud act is the defendant's intent to defraud, and the scheme he perpetrates in furtherance of that intent, and not the actual corruption of an employee. See DiNome, 86 F.3d at 283 (); United States v. D'Amato, 39 F.3d 1249, 1257 (2d Cir.1994) (same); Mittelstaedt, 31 F.3d at 1216 (same). It is for exactly this reason that impossibility is not a defense under § 1343. See Ames Sintering Co., 927 F.2d at 235; United...
To continue reading
Request your trial
-
U.S. v. Hickey
...with the plain and expansive language of Section 1346 and, accordingly, is found to be without merit. Cf. United States v. Sancho, 957 F.Supp. 39, 42 (S.D.N.Y.1997) ("The statute [Section 1346] does not expressly limit culpability to cases involving schemes to deprive another of `honest ser......
-
United States v. Finazzo
...Co., 421 F.2d at 1180 (explaining that the government need not prove that the victim was actually defrauded); United States v. Sancho, 957 F. Supp. 39, 41 (S.D.N.Y. 1997). ...
-
U.S. v. Sancho
...his argument that an actual fiduciary relationship was a required element. The court denied the motions. See United States v. Sancho, 957 F.Supp. 39, 42 (S.D.N.Y.1997). The jury found Sancho guilty, and he was sentenced primarily to 37 months' imprisonment and a fine of Sancho contends that......