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Case Law - save on Lexis / WestLaw. IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT No. 00-20385 MAX GLEN MCCAULEY MOHAMED CHENDEKA Defendants-Appellants VERSUS UNITED STATES OF AMERICA Plaintiff-Appellee Appeal from the United States District Court for the Southern District of Texas June 7, 2001 Before POLITZ and BARKSDALE, Circuit Max Glen McCauley and Mohamed Judges, and FALLON, District Judge.* Chendeka appeal their convictions for bank fraud and conspiracy to commit bank fraud FALLON, District Judge: arguing that the evidence produced at trial was insufficient to support the jury verdict. Chendeka additionally challenges the * sentencing enhancement for obstruction of District Judge of the Eastern justice imposed by the district court. We District of Louisiana, sitting by designation. 1 affirm both convictions and Chendeka's company, he explained that it had been sentence. operating for one year. Jones also made two I. deposits of $100 and $400 with money In April of 1999, Cornelius Fields and his provided by Chendeka, McCauley, and sister Latrinda Fields conspired to divert Cornelius and Latrinda Fields. funds from a Chase Bank account to a Jones provided the corporate documents MetroBank account using an unauthorized and bank account information on D & M electronic wire transfer. Latrinda, an Impex to Chendeka who copied the employee in the accounting department of documents for McCauley.3 McCauley then Western Atlas International, a division of the delivered the documentation to Cornelius Baker Hughes company, agreed to prepare a Fields who in turn provided it to Latrinda request for the treasury department of Baker Fields to initiate the wire transfer. Hughes to wire funds from its Chase Bank On May 17, 1999, Latrinda Fields account to the bank account of a false volunteered to facilitate wire transfers from company. Cornelius was responsible for Baker Hughes' treasury department to Chase obtaining the documentation necessary to Bank of Texas although she did not normally establish a corporation and bank account handle such transfers. She faxed an invoice able to receive the transfer. requesting that Baker Hughes transfer Cornelius Fields contacted his former co- $150,000 for "lost equipment" from its worker Max Glen McCauley to create the Chase Bank account to D & M Impex's fraudulent bank account. McCauley solicited MetroBank account.4 The request listed the assistance of Mohamed Chendeka to several serial numbers for the equipment and execute the scheme. Chendeka introduced included authorizing signatures from other McCauley to his co-worker Derick Jones employees.5 On the basis of the apparently who had agreed to prepare the documents authorized request, the Baker Hughes required to create a corporation and a bank treasury department finalized the wire account.2 transfer and funds were transferred from its Jones completed a "doing business as" Chase account to the D &M Impex account (d/b/a) certificate of operation for a sole proprietorship named "D & M Impex." He then opened a bank account for D & M 3 Chendeka explained to Jones that Impex at MetroBank on May 5, 1999. When his father would wire $150,000 into the a bank employee questioned Jones about the account in one week to begin their business. 4 The wire transfer request 2 Chendeka and Jones had previously mistakenly listed "D & M Impex discussed starting an import/export business. Construction" as the payee. Chendeka explained to Jones that his father would wire money from Africa to fund their 5 Serial numbers for the equipment venture if Jones prepared the documents matched numbers listed on a legitimate required to start the company. Chendeka, invoice Fields had prepared earlier. The however, refused to accompany Jones to requesting and authorizing signatures were complete the paperwork or to be named on from employees who testified that they never any of the documents. signed the document. 2 at MetroBank. had withdrawn the money and wanted to With the transfer complete, Cornelius meet. Jones met Chendeka at a parking lot, Fields, McCauley, Chendeka, and Jones gave him the money, and then FBI agents organized to retrieve the money from the arrested both men. After his arrest, MetroBank account. First, Chendeka and Chendeka agreed to contact Cornelius Fields Jones went to a MetroBank location to and McCauley and arrange a meeting. withdraw $25,000 for alleged business Chendeka met Cornelius Fields and expenses. When Jones submitted a McCauley at McCauley's home where they withdrawal slip, the teller inquired about the all were arrested. nature of the business, requested McCauley and Chendeka were tried by a identification, and told Jones that he would jury and each convicted of bank fraud and need to speak with the manager before conspiracy to commit bank fraud. They completing the withdrawal. The manager, moved for acquittal which the district court suspicious of the lack of activity in the denied. McCauley was sentenced to thirty- account, informed Jones that he could not three months imprisonment and three years access the money unless he received supervised release, and Chendeka was confirmation from the transferor that he was sentenced to twenty-four months entitled to the funds.6 imprisonment and three years supervised After failing to withdraw $25,000 from release. this branch, Chendeka and Jones attempted Both defendants now appeal their to collect $1,000 from another MetroBank convictions on the sufficiency of the location. Bank employees indicated to evidence. Chendeka also argues that district Jones, however, that their computers could court erred by increasing his sentence for not complete the transaction. obstruction of justice. We first consider the MetroBank, suspicious of these attempts challenges to the convictions. to withdraw money, contacted Chase Bank II. and the FBI about the wire transfer. FBI McCauley and Chendeka argue that the agents told MetroBank not to release the evidence presented by the government was funds to Jones. When Jones returned to insufficient to prove beyond a reasonable MetroBank with new corporate documents doubt that they committed bank fraud and for "D & M Impex Construction," he was conspiracy to commit bank fraud. met by FBI agents, interviewed, and invited This Court reviews jury verdicts with to cooperate in an investigation. great deference and evaluates "the evidence At the request of the agents, Jones in the light most favorable to the verdict and contacted Chendeka and explained that he 'afford[s] the government the benefit of all reasonable inferences and credibility choices.'" United States v. Odiodio, 99- 6 The manager of MetroBank also 11202, 2001 WL 242478, at *2 (5th Cir. testified that she had received a cryptic Mar. 9, 2001) (quoting United States v. telephone message on May 18, 1999 Gray, 96 F.3d 769, 772 (5th Cir. 1996)). A requesting that funds be released to "D & M district court's denial of motions for Construction" for shipping and construction judgment of acquittal is reviewed de novo. costs. Chendeka later admitted to FBI United States v. De Leon, 170 F.3d 494, 496 agents that he had left the message. 3 (5th Cir. 1999). custody or control of a financial When considering a challenge to the institution by means of false or sufficiency of the evidence for a conviction, fraudulent pretenses, representations the Court considers "whether, viewing the or promises. evidence in the light most favorable to the Odiodio, 2001 WL 242478, at *2. A government, a rational trier of fact could scheme to defraud includes using false have found the essential elements of the pretenses or representations to obtain money offense beyond a reasonable doubt." Id. from the institution to be deceived. See "All reasonable inferences from the evidence United States v. Doke, 171 F.3d 240, 243 must be construed in favor of the jury (5th Cir. 1999). "The requisite intent to verdict." United States v. Martinez, 975 defraud is established if the defendant acted F.2d 159, 161 (5th Cir. 1992) (citing Glasser knowingly and with the specific intent to v. United States, 315 U.S. 60, 80, 62 S.Ct. deceive, ordinarily for the purpose of causing 457, 469, 86 L.Ed. 680 (1942)). "An some financial loss to another or bringing appellate court will not supplant the jury's about some financial gain to himself." Id. determination of credibility with that of its The evidence clearly demonstrates that own." Id. (citing United States v. Barron, McCauley and Chendeka executed or 707 F.2d 125, 127 (5th Cir. 1983)). attempted to execute a scheme or artifice to Appellants question the government's defraud a financial institution. McCauley proof of intent and of loss, both of which and Chendeka attempted to defraud Chase must be proved beyond a reasonable doubt Bank and MetroBank, financial institutions to support convictions for bank fraud and insured by the Federal Deposit Insurance conspiracy to commit bank fraud. Corporation ("FDIC"), by aiding in the A. creation of a fraudulent bank account for a McCauley and Chendeka first argue that fictitious vendor company. They made false the evidence does not prove that they representations to MetroBank to induce it to knowingly participated in a scheme to release fraudulently transferred funds. All of defraud Chase Bank or MetroBank. these actions were done in furtherance of a McCauley explains that he did not make scheme demonstrated to defraud the banks in misrepresentations to MetroBank to obtain violation of § 1344. account information. Chendeka maintains Appellants also contend that the mere act that his attempts to withdraw money from of instructing a bank to transfer funds is not MetroBank were not material a misrepresentation constituting bank fraud misrepresentations. under § 1344(2). In United States v. Briggs, In order to establish the elements of bank this Court held that an employee who falsely fraud under 18 U.S.C. § 1344, the represents having the authority to transfer government must prove beyond a reasonable funds does so under false pretenses in doubt violation of the statute. See 965 F.2d 10 (5th that the defendant[s] knowingly Cir. 1992). In the present case, McCauley executed or attempted to execute a and Chendeka participated in a scheme in scheme or artifice 1) to defraud a which Latrinda Fields misrepresented her financial institution or 2) to obtain authority to falsify a wire transfer. any property owned by, or under the Appellants contributed to this conspiracy 4 by creating a bank account on behalf of a the bank was insured by the Federal Deposit fictitious company and by attempting to Insurance Corporation. See Odiodio, 2001 retrieve the funds. The evidence WL 242478, at *2 (internal citations demonstrated that they knowingly omitted). It is not necessary, however, for misrepresented information to MetroBank to the government to prove that banks actually influence it to release funds transferred by suffered civil liability or financial loss in Chase Bank. See United States v. Foster, order to obtain bank fraud convictions. See 229 F.3d 1196, 1197 (5th Cir. 2000). United States v. Waldrip, 981 F.2d 799, 806 Therefore, we find the evidence sufficient to (5th Cir. 1993) (explaining that "loss need not support the jury's finding that McCauley and be proven to convict a defendant for bank Chendeka knowingly participated in a fraud or making a false statement to a bank" scheme to defraud financial institutions.7 and evidence that there was no loss is not a B. defense to either crime); Briggs, 965 F.2d at McCauley and Chendeka secondly argue 12. Cf. United States v. Sprick, 233 F.3d that neither Chase Bank nor MetroBank 845, 853 (5th Cir. 2000) (expressing no were exposed to civil liability or risk of loss opinion on bank's civil liability when from the scheme. They explain that the acts government failed to offer evidence of of Latrinda Fields put the funds of her liability when a financial advisor misused employer, Western Atlas, at risk rather than client's funds). the funds of either bank. Because these We dismissed the risk of loss argument financial institutions never faced civil liability made by appellants in United States v. nor suffered financial losses, appellants Briggs when we considered a similar scheme contend that they cannot be found guilty of in which an employee diverted millions of bank fraud. dollars from a corporate account to a In order to prove bank fraud, the personal bank account using unauthorized government must demonstrate that the wire transfers. See 965 F.2d at 11. Briggs, defendants placed the financial institution at like McCauley and Chendeka, claimed never risk of civil liability or financial loss and that to have made any overt misrepresentations or false statements to any financial institution. See id. Yet, Briggs acted 7 The evidence also supports the similarly to Latrinda Fields in this case by conspiracy convictions against appellants. failing to disclose her lack of authority to To establish a conspiracy, the government make the unauthorized transfer. See id. need prove "(1) an agreement between two We found in Briggs that such a scheme or more persons (2) to commit a crime, and clearly put financial institutions at risk even (3) an overt act committed by one of the though the record may not indicate that they conspirators in furtherance of the were actually threatened with civil liability. agreement." United States v. Bruton, 126 See id. at 13. McCauley and Chendeka F.3d 666, 670 (5th Cir. 1997). The scheme participated in a factually similar conspiracy, outlined above and engaged in by appellants and, clearly placed Chase Bank and satisfies the elements of a conspiracy under MetroBank at a risk of loss. See id. 18 U.S.C § 371 because it included overt The government need only prove a risk acts by more than one person to transfer and of loss to support McCauley's and procure fraudulent funds. 5 Chendeka's convictions for bank fraud and Chendeka separately argues that the trial conspiracy to commit bank fraud. See id. at court erred at sentencing by granting the 12-13. We also note that the government government's request for a two point need not prove a substantial likelihood of increase for obstruction of justice based on risk of loss to support the convictions. See his alleged perjury at trial.8 Chendeka United States v. Barakett, 994 F.2d 1107, explains that he was not aware of the 1111 (5th Cir. 1993) (holding that deposits of conspiracy and believed that McCauley forged checks exposed banks to risk of loss requested bank account information from even though they recovered the funds); him to procure a loan for legitimate business United States v. Saks, 964 F.2d 1514, 1519 purposes. (5th Cir. 1992) (holding that fraudulent loan The standard of review for findings of transaction exposed financial institutions to fact in applying sentencing guidelines is risk of loss even though loan was secured); "clearly erroneous." See United States v. United States v. Lemons, 941 F.2d 309, 316 Greer, 158 F.3d 228, 233 (5th Cir. 1998). (5th Cir. 1991) (finding risk of loss to bank The district court sentenced Chendeka to from forged endorsed check even though twenty-four months imprisonment followed bank suffered no harm); United States v. by three years supervised release. Finding Church, 888 F.2d 20, 23-24 (5th Cir. 1989) that Chendeka made pretrial statements that (affirming bank fraud conviction for significantly contradicted his trial testimony, fraudulent overdrafts although "plan was no the district court sustained the government's more likely to succeed than a request that the objection to the presentence investigation Bank exchange monopoly money for its face report and accepted a two point value in U.S. currency"). Cf. Odiodio, 2001 enhancement for perjury pursuant to United WL 242478, at *2 (finding no risk of loss States Sentencing Guideline § 3C1.1.9 We when financial company rather than bank handled fraudulent instrument). The government satisfied its burden in 8 McCauley does not appeal his this case by presenting evidence at trial that sentence. Chase Bank lost its ability to earn interest on $150,000 because the funds were transferred 9 Chendeka's knowledge of the to MetroBank for more than one day. scheme is indicated by his pretrial Furthermore, Chase Bank and MetroBank statements. During a tape recorded were certainly exposed to a risk of loss conversation between Chendeka, Jones, and because McCauley and Chendeka aided in Cornelius Fields, Chendeka stated, "Max the attempt to withdraw the fraudulently asked me to get the account set up and I set transferred funds. Because we find the it up." Govt.'s Ex. 25A at 6. In addition, evidence presented at trial sufficient to Chendeka admitted to FBI agents after his support the jury's verdict, we affirm arrest that McCauley had asked him to McCauley's and Chendeka's convictions for provide an account into which $150,000 bank fraud and conspiracy to commit bank could be deposited, that McCauley would fraud. pay him $10,000 once the deposit had been made, and that Chendeka knew that the wire III. scheme was illegal. See Tr. Vol.7 at 131-33, 136-37. 6 find that on the basis of Chendeka's statements before and at trial, the district court did not commit clear error in sustaining the government's objection for obstruction of justice against Chendeka.10 Therefore, we affirm Chendeka's sentence. IV. For the foregoing reasons, we affirm McCauley's and Chendeka's convictions for bank fraud and conspiracy to commit bank fraud as well as Chendeka's sentence. AFFIRM. In contrast to his statements before trial, Chendeka testified at trial that his understanding and involvement in the conspiracy was limited to an attempt to obtain a $15,000 loan from McCauley to start his business venture with Jones. He also testified that he believed that McCauley deposited large amounts of money into the account to hide them from his wife. See id. Vol. 8 at 79, 142-43. 10 We note, as did the district court, that Chendeka's sentence of twenty-four months imprisonment is within the appropriate Guideline range regardless of whether the two point enhancement is applied to his sentencing recommendation. See Sent. Tr. at 5. 7 |
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