United States v. Wider

• Decision Date: 03 May 2016
• Docket Number: 14-cr-221 (ADS) (AKT)
• Citation: 184 F.Supp.3d 10
• Parties: United States, v. Aaron Wider, Defendant.
• Court: U.S. District Court — Eastern District of New York

184 F.Supp.3d 10

United States,

v.Aaron Wider, Defendant.

14-cr-221 (ADS) (AKT)

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

Signed May 3, 2016

The United States' Attorneys' Office, E.D.N.Y., 610 Federal Plaza, Central Islip, NY 11722, By: Allen Lee Bode, Assistant U.S. Attorney, Artie McConnell, Assistant U.S. Attorney.

Richard A. Miller, Esq., Attorneys for the Defendant Wider, 356 Veterans Memorial Highwaym Suite 3, Commack, NY 11725

MEMORANDUM OF DECISION & ORDER

SPATT, District Judge

On January 25, 2016, after a two and a half week trial, a jury convicted the Defendant Aaron Wider ("Wider") of one count of conspiracy to commit bank fraud pursuant to 18 U.S.C. §§ 1349 and 3551.

Presently before the Court is a motion pursuant to Federal Rule of Criminal Procedure ("Fed. R. Crim. P." or the "Rules") 29 by Wider for a judgment of acquittal.

For the reasons set forth below, the Rule 29 motion by Wider is denied in its entirety.

I. BACKGROUND

This case arises from a criminal indictment (the "Indictment") filed on May 1, 2014 against the Defendants Aaron Wider ("Wider"), Joseph Ferrara ("Ferrara"), Eric Finger ("Finger"), Joseph Mirando ("Mirando"), John Petiton ("Petiton"), and Manjeet Bawa ("Bawa"). The Indictment charged each Defendant with one count of conspiracy to commit bank fraud pursuant to 18 U.S.C. §§ 1349 and 3551.

The Indictment alleged that the Defendants devised a scheme to defraud warehouse lenders and financial institutions of more than $30 million by inflating the collateral value of the properties owned by HFTC Corporation ("HFTC") in order to obtain mortgage funding from lenders in an amount that substantially exceeded the true sales price of those properties.

According to the allegations in the Indictment, Wider was the owner, president, and sole shareholder of HFTC; Ferrara and Bawa purchased residential real estate in Nassau and Suffolk Counties through mortgages issued by HFTC; Petiton was an attorney who created legal entities called trusts into which HFTC transferred all ownership rights of the properties for no money or consideration; Eric Finger acted as the settlement attorney for HFTC; and Mirando prepared false and fraudulent appraisal reports to correspond to the fraudulently inflated purchase prices contained in the allegedly false mortgage loan applications.

On May 27, 2015, the Court accepted the guilty plea of the Defendant Bawa.

On September 15, 2015, the Court accepted the guilty plea of the Defendant Finger.

On October 29, 2015, the Court accepted the guilty plea of the Defendant Petiton.

On January 5, 2016, the three remaining Defendants Wider, Mirando, and Ferrara appeared before United States Magistrate Judge A. Kathleen Tomlinson for jury selection.

On January 6, 2016, the Government filed a letter with the Court stating that after the conclusion of jury selection, counsel for the Defendant Mirando informed the Government that his client wished to plead guilty prior to the commencement of opening statements in the trial, which was scheduled to begin on January 7, 2016.

On January 7, 2016, prior to the commencement of the trial, the Court granted the request by Mirando to withdraw his plea of not guilty and accepted his plea of guilty. Thus, only Wider and Ferrara remained to be tried.

Also on January 7, 2016, prior to the opening statements, the Court gave the following limiting instruction to the jury with regard to Mirando:

And let me say now that one codefendant is no longer on trial. The defendant Joseph Mirando is no longer on trial. As a result, you will not be asked to reach a verdict as to him.

You are not to be concerned with the fact that he is longer in the case, nor are you to speculate about the reasons why he is no longer part of this trial. And that fact, that he's no longer part of this trial, should not affect or influence your verdict in any manner with respect to the remaining defendants.

You are not to infer anything as a result of his absence from this trial. You must base your verdict as to the two remaining defendants solely on the basis of the evidence or lack of evidence against each of the two remaining defendants.

(Tr. 13:7–20.)

The Defendants did not object to the use of this instruction, nor did they move for a mistrial at that time.

On January 7, 2016, following the instruction, the jury trial commenced. In the Government's case-in-chief, it presented documentary evidence and testimony from co-conspirators, as well as investigators and expert witnesses, suggesting that under the direction of Wider, HFTC used straw buyers to purchase homes; misrepresented the value of those homes on loan applications; forged credit reports and appraisal reports; and created sham trusts.

On January 17, 2016, the Government filed a letter with the Court stating that it intended to call Mirando as a witness in its case-in-chief. In addition, the Government requested that the Court provide the jury with an additional limiting instruction regarding Mirando's testimony.

On January 18, 2016, the Defendant Wider filed a motion for a mistrial, arguing that Mirando's presence at jury selection impermissibly tainted the jury pool.

On January 19, 2016, the Court held oral argument on Wider's motion. Ultimately, the Court concluded that Mirando could testify with a proper jury instruction and denied Wider's motion for a mistrial. (See Tr. 1023:24–1025:2.)

Also on January 19, 2016, prior to Mirando testifying, the Court gave the following instruction to the jury:

Members of the jury, the next witness is going to be Joe Mirando. You may recall that I previously instructed you after he pled guilty after he was selected about Joseph Mirando and I'm going to repeat that now.

The fact that he pled guilty should not affect or influence your verdict in any way. You will now hear testimony from Mr. Mirando about his decision to enter into a guilty plea. You are not to draw any negative inference against either of the two remaining defendants, whatsoever, based on Mirando's decision to enter a guilty plea or testify during this trial. That was a personal decision [on] his part, and has nothing to do with the defendants in this case.

The guilty plea of a person such as Mr. Mirando is not evidence of guilt on the part of any other person, specifically the two remaining defendants. You are not to infer anything from the fact that he pled guilty. That was his, and is his personal decision. Each witness's decision to plead guilty is a personal decision based upon the circumstances and evidence in that person's case and has nothing to do with the two defendants on trial.

So that the fact of the guilty plea by Mr. Mirando may not be used by you in any way as evidence against or unfavorable to the defendants on trial. You as jurors may give Mr. Mirando's testimony such weight that you feel it deserves, keeping in mind that it must be considered with great caution and great care and not evidence of guilt on the part of the two defendants on trial.

(Tr. at 1098:3–1099:6.)

On January 20, 2016, the Government rested, and the Defendants Wider and Ferrara made oral motions pursuant to Rule 29 to dismiss the Indictment. (See Tr. 1283–1290.) The Court denied both motions.

Also on January 20, 2016, the Defendant Ferrara presented two witnesses—Kate Termini, a psychologist, and Robert Ferrara, the Defendant's cousin—both of whom offered testimony suggesting that the Defendant Ferrara lacked the capacity to knowingly participate in Wider's fraudulent scheme.

On January 20, 2016, following the testimony of Termini and Ferrara, both Defendants rested.

On January 22, 2016, following closing statements, the jury began their deliberations.

On January 25, 2016, the jury reached a verdict. They found the Defendant Ferrara not guilty of the single count of conspiracy to commit bank fraud, and they found the Defendant Wider guilty of the single count of conspiracy to commit bank fraud.

On February 4, 2016, Wider renewed his motion for acquittal pursuant to Rule 29, asserting that (i) the banks were not "objectively reasonable" victims because there was testimony that the banks could have discovered that HFTC had fraudulently inflated the value of properties on loan applications had they done proper due diligence; (ii) the jury selection was tainted by the fact that Mirando participated in the selection and then decided to plead guilty following the conclusion of jury selection; (iii) the Court should not have permitted Mirando to testify at trial for the Government after he took part in the jury selection as a Defendant; and (iv) there was no evidence as to Wider's income, and therefore it was not reasonable for the jury to conclude that his income was misrepresented on loan applications.

The Government contends that each of these contentions lacks merit and urges the Court to deny Wider's motion.

The Court will address the applicable legal standard and each of Wider's arguments, in turn.

II. DISCUSSION

A. The Legal Standard

Under Rule 29, "the court on the defendant's motion must enter a judgment of acquittal of any offense for which the evidence is insufficient to sustain a conviction." Fed. R. Crim. P. 29(a). A defendant bears a heavy burden in meeting this standard—"[t]he test for sufficiency is whether, as to a given count, a ‘rational trier of fact could have found the defendant guilty beyond a reasonable doubt.’ " United States v. Persico, 645 F.3d 85, 104 (2d Cir.2011) (quoting United States v. Jackson, 335 F.3d 170, 180 (2d Cir.2003) ). "The court must make that determination with ‘the evidence against a particular defendant ... viewed in a light that is most favorable to the government, ... and [with] all reasonable inferences ... resolved in favor of the government.’ " United States v. Eppolito, 543 F.3d 25, 45 (2d Cir.2008) (alterations in original) (quoting United States v. Eppolito, 436 F.Supp.2d 532, 568 (E.D.N.Y.2006), rev'd on other grounds , 543 F.3d 25 (2d Cir.2008) ).

Thus, " Rule 29(c) does not provide the trial court...