United States v. Fisher, 15–CR–19–A

• Citation: 225 F.Supp.3d 151
• Decision Date: 21 December 2016
• Docket Number: 15–CR–19–A
• Parties: UNITED STATES of America, v. Georgina FISHER, Defendant.
• Court: U.S. District Court — Western District of New York

225 F.Supp.3d 151

UNITED STATES of America,

v.Georgina FISHER, Defendant.

15–CR–19–A

United States District Court, W.D. New York.

Signed December 21, 2016

Maryellen Kresse, Mary C. Kane, U.S. Attorney's Office, Buffalo, NY, for United States of America.

Randall P. Andreozzi, Andreozzi Bluestein Weber Brown, LLP, Clarence, NY, for Defendant.

DECISION AND ORDER

HONORABLE RICHARD J. ARCARA, UNITED STATES DISTRICT JUDGE

This case is before the Court on the Government's objections to Magistrate Judge Scott's Report and Recommendation (Docket No. 107, United States v. Fisher , 2016 WL 2779018 (W.D.N.Y. May 13, 2016) ), which recommends dismissing the superseding indictment without prejudice. In the alternative, Judge Scott recommends striking the superseding indictment's forfeiture notice. Judge Scott makes these recommendations because, during grand jury proceedings in this case, the Assistant United States Attorney (AUSA) made several references to the Defendant's ex-husband's criminal conduct. Judge Scott also recommends dismissal because, in response to grand juror questions, the AUSA and the IRS Special Agent who testified before the grand jury discussed whether and how Fisher's home could be forfeited in the event of a conviction.

The Court reviews Judge Scott's recommendations de novo. See 28 U.S.C. § 636(b)(1). The Court has carefully reviewed the record, the parties' extensive briefing, and, in particular, the transcripts of grand jury proceedings in this case. See Docket No. 118. After de novo review, and for the reasons stated below, the Court does not adopt the Report and Recommendation. The Court therefore denies Fisher's motion to dismiss the superseding indictment for alleged grand jury misconduct. See Docket No. 80.

BACKGROUND

A. Procedural history

The Court assumes familiarity with this case's lengthy procedural history. Thus, the Court recites only those facts relevant to Fisher's motion to dismiss.

The superseding indictment charges Fisher with eight counts of structuring. Fisher's ex-husband, Gregory Fisher, is not charged in the superseding indictment, nor was he a target of the grand jury investigation in this case.¹ Gregory's criminal history, however, is central to Georgina's arguments for dismissal. In 2008, Gregory pled guilty to a two-count information charging mail fraud and filing false tax returns. See United States v. Gregory Fisher , No. 08–cr–00315–WMS, Docket Nos. 5 & 10. And in 2009, Judge William M. Skretny sentenced Gregory to 36 months' imprisonment and three years' supervised release. See id. Docket No. 27. Judge Skretny also ordered Gregory to pay $969,647.09 in restitution. Id.

Just over five years later, the AUSA² assigned to this matter presented a grand jury with a case involving Georgina's purchases of over $300,000 in money orders. After the AUSA made a second presentation a week later, the grand jury voted to indict Fisher. The indictment charged nine counts of causing a financial institution to fail to file a transaction report—i.e., structuring—in violation of 31 U.S.C. § 5325(a)(2). The indictment also contained a forfeiture allegation stating that, in the event of a conviction, the Government would seek to forfeit "all right, title, and interest in any and all money and other property involved in the offense[s] [charged] and all property traceable to such property, including but not limited to" (1) real property located on Theresa Lane in Niagara Falls, New York, which is titled in Fisher's name; (2) $74,000, "which is the total amount of the property involved in the offenses [charged]"; or, (3) if the Theresa Lane home or $74,000 cash is unavailable, "any other property of [Fisher's] up to the value of the forfeitable property described above." Docket No. 1 at 7–8. Two weeks later, the Government filed a notice lis pendens against Fisher's Theresa Lane home. And several months later, the grand jury handed up a superseding indictment. The superseding indictment rearranged the money orders at issue into eight counts of structuring (rather than nine counts), but it contained the same forfeiture allegation as the original indictment. See Docket No. 20.

B. The grand jury proceedings

Fisher's motion to dismiss is based on the AUSA's conduct before the grand jury. She argues that dismissal is warranted for two reasons. First, Fisher notes that the AUSA referred to Gregory's criminal conviction several times during grand jury proceedings. According to Fisher, these references improperly suggested that Fisher conspired with Gregory or was somehow involved in his crimes. Second, Fisher claims that the AUSA incorrectly explained to the grand jury whether and how the Government could seize Fisher's home in the event of a conviction.

The first reference to Gregory before the grand jury came in the AUSA's opening statement.³ After she introduced herself and, briefly, the structuring statute, the AUSA told the grand jury that "the background of this case is that Georgina Fisher was married to a guy who got in trouble for some criminality and was prosecuted. She came into some cash—this is not part of this case, but it was probably the ill-gotten gains of the proceeds of her husband's criminal activity." A3:21–A4:1. The AUSA then gave a short summary of the evidence against Fisher, as well as another summary of the structuring statute. The AUSA continued by describing Fisher's interview with the IRS Special Agent who investigated the case. According to the AUSA, Fisher told the Special Agent that "[s]he wasn't attempting to evade the reporting requirements [in the structuring statute]. She was just following her husband's instructions, who I believe at this time was in jail. The only relation to that is background and it goes to what her defense is. Listen, my husband told me to do this, I was just doing what he told me to do, I knew there was a requirement, but I never intended to evade any reporting requirement." A–5:2–8. The AUSA once again described the structuring statute, and she responded to a number of grand juror questions about how the statute operates and what conduct it prohibits.

The Special Agent then began her testimony. She first described how the IRS became aware of Fisher's conduct; Gregory was not mentioned. The Special Agent next explained the structuring statute and Fisher's conduct. The Special Agent told the grand jury, for instance, that over a ten-month period Fisher had purchased more than $300,000 in money orders at a number of stores, but that Fisher made her purchases in increments of less than $3,000 per store. The Special Agent testified that Fisher used those money orders to pay off her mortgage. And the Special Agent testified in detail as to when and where Fisher purchased many of the money orders.

Following that, the Special Agent told the grand jury about her interview with Fisher. The Special Agent first told the grand jury that Fisher had claimed that the allegedly structured cash was her life savings. But, the Special Agent continued, she disproved Fisher's claim by examining the Form W–2s from Fisher's entire employment history. It was during this discussion that Gregory was mentioned for the second time in the proceedings. Specifically, the AUSA asked, and the Special Agent confirmed, that there was "mention during the interview of [Fisher's] husband Greg Fisher." A–37:12–13. The AUSA then asked the Special Agent to tell the grand jury—"without getting into a lot of detail"—whether Gregory "had some fraud charges against him"; she asked the Special Agent to describe "generally ... the nature of his offense"; she asked the Special Agent to tell the grand jury about the size of Gregory's fraud; and she asked the Special Agent whether, "[a]s part of that investigation [the Special Agent was] able to trace all of the several million dollars that Greg Fisher took." A–37:12–A–38:22. The Special Agent confirmed that, while "some" of Gregory's fraud proceeds could be traced, approximately $500,000 could not, either because Gregory "had cash" or because he "wrote checks out to cash to individuals," thus making the proceeds "hard to follow." A–38:21–A–39:11. Finally, the Special Agent testified, Fisher stated during her interview that "you don't have to show ID if it's less than $3,000." A–40:1–2. The Special Agent then stepped out of the grand jury room.

The grand jurors had a number of questions for the AUSA. One of the first questions concerned the difference between structuring and money laundering. Another grand juror asked whether the mortgage Fisher paid off was "part of the assets purchased with the fraud proceeds." A–43:20–24. The AUSA responded: "So you're talking about the connection with Greg Fisher. I think the question is was the house somehow linked to his fraudulent conduct and I think the simple answer is no because if so she wouldn't have had to pay off the mortgage because it would have been seized." A–43:25–A–44:4. The AUSA then briefly explained that the Government can "try to seize and ultimately forfeit, take, any assets that we can trace to the fraudulent conduct," and she described the manner in which the Government can seek pre-trial restraint of those assets. A–44:19–24. The AUSA concluded by stating, "long way around," that "because after [Gregory's] arrest and conviction I'm pretty sure she is still paying on the mortgage, that says to me that the house was not seized as part of the criminal investigation of the husband." A–45:2–6. A grand juror then asked whether the house could "be seized now." A–45:10. The AUSA responded that she did not know whether structuring is a crime for which forfeiture is an available penalty.

The grand jury's questioning continued. One grand juror asked whether "there [is] a conspiracy charge" involving Gregory Fisher. The AUSA responded, "[n]o. And the question of whether it could be a conspiracy charge? Maybe. But he pled guilty to a lot of criminal activity. The bottom line is that these are the decisions...