United States v. Williams

FILED
United States Court of Appeals
PUBLISH Tenth Circuit
UNITED STATES COURT OF APPEALS August 4, 2017
Elisabeth A. Shumaker
FOR THE TENTH CIRCUIT Clerk of Court
_________________________________
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v. No. 16-3220
MATTHEW WILLIAMS,
Defendant - Appellant.
_________________________________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
(D.C. No. 2:15-CR-20034-CM-1)
_________________________________
Daniel T. Hansmeier, Appellate Chief (Melody Brannon, Federal Public Defender, and
Thomas W. Bartee, Assistant Federal Public Defender, with him on the briefs), Office of
the Federal Public Defender for the District of Kansas, Topeka, Kansas, appearing for
Appellant.
Carrie N. Capwell, Assistant United States Attorney (Thomas A. Beall, United States
Attorney, with her on the brief), Office of the United States Attorney for the District of
Kansas, Kansas City, Kansas, appearing for Appellee.
_________________________________
Before TYMKOVICH, Chief Judge, MATHESON, and MORITZ, Circuit Judges.
_________________________________
MATHESON, Circuit Judge.
_________________________________
A jury convicted Matthew Williams of bank fraud in violation of 18 U.S.C.
§ 1344(1), and aggravated identity theft in violation of 18 U.S.C. § 1028A. He
appeals and asks that we reverse his convictions because the evidence against him
was insufficient.
Mr. Williams began a mortgage loan application at Pulaski Bank (the “bank”)
using his father’s personal and financial information and his status as a Purple Heart
veteran. After his father received the application packet in the mail, he called the
bank to explain he had not applied for a loan. The bank referred the matter to law
enforcement, but continued to work with Mr. Williams to process the loan and obtain
additional documents to clarify the applicant’s identity. The bank sent Mr. Williams
a notice of incompleteness because it lacked several required documents, signatures,
and a photo identification. In response, Mr. Williams provided some of the required
documents to the bank, including a fake earnings statement and a letter expressing his
intent to proceed with the loan. The bank sent a final notice of incompleteness to Mr.
Williams. Mr. Williams did not respond, and the bank closed his application file.
Mr. Williams argues his misrepresentations on the incomplete application
could not support a bank fraud conviction because they (1) were not material to the
bank’s decision to issue him a loan; and (2) did not impose a risk of loss on the bank.
Exercising jurisdiction under 28 U.S.C. § 1291, we affirm Mr. Williams’s bank fraud
and aggravated identity theft convictions.
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I. BACKGROUND
A. Factual History
Mr. Williams challenges the sufficiency of the government’s evidence, which
requires us to view the evidence in the light most favorable to the Government. We
present the factual background accordingly.
1. Bank Processes
The testimony at trial established that the bank has a four-step process for issuing
mortgage loans: (1) application; (2) processing; (3) underwriting; and (4) closing. Each
step has its own verification processes and safeguards.
First, in the application phase, a loan officer:
 Helps a potential borrower fill out a preliminary application;
 Runs a credit report;
 Requests verification documents, such as a photo identification (“ID”), pay
stubs, bank statements, and tax returns; and
 Adjusts the information on the preliminary application as necessary based
on the verification documents.
Preliminary applications for a loan guaranteed by the U.S. Department of Veterans
Affairs (a “VA loan”) require an addendum confirming the VA will insure the loan. The
loan application packet consists of the preliminary application, the VA addendum, around
30 disclosures to the borrower that require signatures,1 and a letter indicating the
1
One disclosure is a truth-in-lending document that the bank provides to the
potential borrower to facilitate shopping for the best loan.
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borrower’s intent to proceed.2 The borrower must sign and date all of the documents in
the packet and return them to the bank.
Second, at the processing step, a processor reviews the borrower’s credit report,
calculates available income, verifies the reported income, and reviews the application
packet. The bank generally requires a complete preliminary application packet before
advancing the loan to this second stage. The bank will sometimes overlook deficiencies
in completeness to advance a loan. An employee said:
Well, they’re supposed to date it but we do have people who
don’t date it. We don’t not [sic] accept it if it’s not dated . . .
Well, I mean, they’re supposed to date it. . . No, we’re not
going to not accept this application ‘cause it’s not dated.
ROA, Vol. 2 at 162-63. She also explained: “Now, if someone’s taking a long time or
maybe we’ve just got a little bit of documentation, we’ll go ahead and turn it in so we can
get the file going. So, we don’t always have all the documentation when it goes to a
processor.” Id. at 144.
Third, after the processor’s work is complete, the application goes to the third
stage: underwriting.3 The underwriter decides whether to approve a loan. Underwriting
2
A bank employee testified that once the bank has a “valid loan application,”
it sends the loan application and multiple disclosures to the applicant. ROA, Vol. 2
at 191.
3
A bank employee testified that processing “may or . . . may not” still send a
file to underwriting even if it doesn’t get all the documents it needs. Id. at 210. She
stated that, “It depends how much documentation they have, and if they have enough
that—underwriting has enough information to give a rendering or an – you know,
like a preliminary approval, or if we have—[enough] . . . items to make a decision.”
Id. “It’s possible to forward [the loan application] with some notation in the file, still
Continued . . .
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involves review of the applicant’s credit report, income, assets, debts, employment
history, the home appraisal, and whether the applicant has sufficient funds to make the
down payment and pay closing costs. The underwriter’s options include suspending the
application for additional information, approving it with conditions, or just approving it.
Fourth, if the underwriter approves, the loan goes to the final stage: closing. The
closer runs an additional credit search, conducts a title search, and verifies the borrower’s
employment, title insurance, and homeowner’s insurance. The closer also prepares the
final loan document for the borrower’s signature. Until the completion of closing, the
bank does not commit to loaning money.
2. Mr. Williams’s Loan Application
On July 19, 2014, Mr. Williams entered into a contract to purchase a home in
Kansas for $480,000.
On July 25, 2014, Mr. Williams called Theresa Mentzel, a loan officer at the bank,
to inquire about a loan. She asked him questions to prepare a mortgage application. He
falsely told her that his legal name was Earl Williams, who is his father, and provided her
with his father’s social security number, date of birth, and Texas address.4 He also gave
her, as if it were his own, the name of Earl Williams’s current employer, monthly income
and expenses, and bank account information. He authorized her to run a credit report on
waiting on X, Y, or Z.” Id. at 212.
4
To avoid confusion, we refer to Matthew Williams, the defendant, as “Mr.
Williams” and to his father as “Earl Williams.”
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“Earl Williams,” which she did. Mr. Williams told Ms. Mentzel he wished to apply for a
VA loan. He said, again falsely, that he was exempt from the high funding fee applicable
to VA loans because he had received a Purple Heart and was on VA disability. Ms.
Mentzel used this information and obtained a VA certificate of eligibility, which
confirmed Earl Williams was a veteran, exempt from paying a funding fee, and qualified
for a low interest rate.
On July 30, 2014, the bank sent a copy of the application, which included
information provided during Mr. Williams’s phone call, and the necessary disclosure
forms to Earl Williams’s Texas address. Earl Williams received the packet, called the
bank, and spoke with Ms. Mentzel’s assistant, Judith Atkinson. He told her that he had
not applied for a loan and was concerned because the loan application included his social
security number. Ms. Atkinson alerted her manager but was told to “just proceed on the
loan.” ROA, Vol. 2 at 194-95
Denise DeRousse, a senior vice president at the bank with responsibility for
monitoring fraud and loss, became involved with the loan application at some point
following Earl Williams’s call. Ms. Mentzel was unsure “who was who, or who was
telling the truth,” or whether there had been a mistake and Ms. DeRousse thought “[i]t
could still be, in [her] mind, an error” and still viewed Mr. Williams as “a person who
might be a potential customer.” Id. at 227, 228, 181. Aware that critical loan documents
were missing, and still viewing Mr. Williams as a potential client whom she did not want
to “interrogat[e],” Ms. DeRousse turned the investigation over to law enforcement. Id. at
228. She determined the bank was not then at a risk of loss, and she decided she would
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not investigate further unless Mr. Williams submitted documents that would allow the
bank to proceed with his loan application. She told the bank’s mortgage officers to notify
her if Mr. Williams provided additional documentation.
Following her manager’s directions, Ms. Atkinson called Mr. Williams and asked
him to submit the disclosure forms and his photo ID. He said he would come to the bank
the following week with the requested documents, but he did not.
On August 8, 2014, Ms. Atkinson emailed Mr. Williams a notice of
incompleteness. The notice advised he had 10 business days to provide the requested
information or the bank would send a final notice of incompleteness.
On August 19, 2014, Mr. Williams provided the bank with the following
documents, all using his father’s name: (1) an undated, electronically-signed loan
application, (2) two signed but undated disclosure forms, including a notice of intent to
proceed with the loan application, and (3) a fake earnings statement showing monthly net
wages of $3,275.25. He also arranged for the Defense Finance and Accounting Service
to send the bank a letter verifying that Earl Williams was receiving $3,585 in monthly
retirement pay. Mr. Williams did not provide a photo ID, which the bank required from
every customer.5
On August 22, 2014, the bank emailed a final notice of incompleteness to Mr.
Williams. The notice advised that he had five business days to provide the requested
information, or the bank would close his file. Mr. Williams did not respond with the
5
Ms. Atkinson testified that the loan could not move forward to processing
without the photo ID.-7-
required documents, so the bank closed his application. Mr. Williams’s application never
made it to the underwriting phase because the bank “never had enough documentation—
complete documentation to send it to the underwriter.” ROA, Vol. 2 at 166.
B. Procedural History
1. Indictment
A grand jury in the District of Kansas returned a two-count indictment against Mr.
Williams. Count 1 charged bank fraud in violation of 18 U.S.C. § 1344(1), and Count 2
charged aggravated identity theft in violation of 18 U.S.C. § 1028A.
2. Trial and Oral Motion for Judgment of Acquittal
At trial, the Government called nine witnesses. Mr. Williams did not present
evidence. The testimony established the facts outlined above.
At the close of the Government’s evidence, Mr. Williams moved for a judgment of
acquittal under Federal Rule of Criminal Procedure 29 on the bank fraud charge—Count
1—and argued the Government had failed to prove two essential elements: (1) that his
statements were material to the bank’s decision as to whether to issue him a loan, and
(2) that the bank suffered a risk of loss or civil liability. He also argued the aggravated
identity theft charge—Count 2—was invalid because it was premised on the bank fraud
charge. The district court denied the motion.
The jury found Mr. Williams guilty of both charges.6
6
18 U.S.C. § 1344(1) makes it a crime to “knowingly execute[], or attempt[]
to execute, a scheme or artifice . . . to defraud a financial institution.” On appeal,
Mr. Williams states that “[t]here was some debate below about whether Mr. Williams
Continued . . .
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3. Post-Trial Motion for Judgment of Acquittal
Mr. Williams filed a post-trial motion for a judgment of acquittal under Rule 29,
reasserting his arguments from the close of evidence. The district court again denied the
motion. It ruled there was sufficient evidence to show the bank suffered a risk of loss
because Mr. Williams submitted a fraudulent loan application and expressed his intent to
proceed with it. The materiality element also was satisfied, the district court ruled,
because Mr. Williams applied for a VA home mortgage loan and his misrepresentations
influenced the bank’s decision whether to issue the loan. Because the evidence was
sufficient on Count 1, the court said it also was sufficient on Count 2.
4. Sentencing
Mr. Williams received a prison sentence of 27 months—three months for bank
fraud and 24 months for aggravated identity theft. The district court also imposed a two-
year term of supervised release.
II. DISCUSSION
Mr. Williams challenges the sufficiency of the evidence underlying both of his
convictions. Because the aggravated identity theft conviction was premised on the
was charged and convicted of attempted bank fraud, rather than a completed bank
fraud.” Aplt. Br. at 25 n.7; see e.g., id. (explaining indictment did not charge
“attempt[] to execute” but attempt language was included in jury instructions); ROA,
Vol. 2 at 446 (district court’s statement at sentencing that “[a]lthough the bank fraud
statute includes the word attempt, defendant was convicted of bank fraud, not
attempted bank fraud”). Mr. Williams does not challenge the theory of his conviction
or his sentence on appeal, so we do not address those issues. He argues only that the
Government failed to prove his misrepresentations (1) were material, or (2) imposed
a risk of loss on the bank. Id.-9-
bank fraud conviction, the Government and Mr. Williams agree that whether the
evidence was sufficient for the bank fraud conviction is the determinative issue on
appeal.7
Mr. Williams argues the Government failed to prove the first element of bank
fraud because it failed to show that his misrepresentations (1) were material, or
(2) imposed a risk of loss on the bank. We disagree. Based on the trial evidence, a
rational jury could find that Mr. Williams’s misrepresentations were both material
and imposed a potential risk of loss on the bank.
A. General Legal Background
1. Standard of Review
“To review [a] sufficiency of the evidence [challenge], we engage in de novo
review, considering the evidence in the light most favorable to the government to
determine whether any rational jury could have found guilt beyond a reasonable
doubt.” United States v. Los Dahda, 853 F.3d 1101, 1106 (10th Cir. 2017), petition
for cert. filed, (July 7, 2017) (No. 17-43). “[W]e consider all of the evidence, direct
7
As we explained in United States v. Camick, 796 F.3d 1206, 1219 (10th Cir.
2015), the aggravated identity theft statute, 18 U.S.C. § 1028A, prohibits identity
theft “during and in relation to” any of the enumerated felonies, including bank fraud.
18 U.S.C. § 1028A(c)(5) (defining “felony violation” to include “any provision
contained in chapter 63 (relating to mail, bank, and wire fraud)”). “Thus, a
conviction for aggravated identity theft is predicated on the commission of one of the
enumerated felonies.” Camick, 796 F.3d at 1219. If we reverse a conviction for the
predicate felony, we must necessarily also reverse an aggravated identity theft
conviction that was premised on the now-reversed predicate conviction. Id. Because
we affirm Mr. Williams’s bank fraud conviction, we also affirm his aggravated
identity theft conviction.
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and circumstantial, along with reasonable inferences[,] . . . [b]ut we do not weigh the
evidence or consider the relative credibility of witnesses.” Id.8 Thus, our review of
the evidence is “highly deferential.” United States v. Bowen, 527 F.3d 1065, 1076
(10th Cir. 2008) (quotations omitted).
2. Bank Fraud
18 U.S.C. § 1344 states:
Whoever knowingly executes, or attempts to execute, a
scheme or artifice—
(1) to defraud a financial institution; or
(2) to obtain any of the moneys, funds, credits, assets,
securities, or other property owned by, or under the
custody or control of, a financial institution, by means
of false or fraudulent pretenses, representations, or
promises;
shall be fined not more than $1,000,000 or imprisoned not
more than 30 years, or both.
“The [bank fraud] statute was intended to reach a wide range of fraudulent
activity that undermines the integrity of the federal banking system.” United States v.
Akers, 215 F.3d 1089, 1102 (10th Cir. 2000) (quotations omitted). We note that this
broad statute considers even “attempts to execute” as bank fraud. 18 U.S.C. § 1344.
It was modeled after the mail and wire fraud statutes, see 18 U.S.C. §§ 1341, 1343,
8
See also United States v. Gallant, 537 F.3d 1202, 1222-23 (10th Cir. 2008)
(“We will not weigh conflicting evidence or second-guess the fact-finding decisions
of the jury. Rather than examining the evidence in ‘bits and pieces,’ we evaluate the
sufficiency of the evidence by ‘considering the collective inferences to be drawn
from the evidence as a whole.’” (quotations and citations omitted)).
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and contains “virtually the same language” as those statutes. United States v. Young,
952 F.2d 1252, 1255-56 (10th Cir. 1991). Thus, our analysis of bank fraud under
§ 1344 often draws on mail and wire fraud cases under § 1341 and § 1343.
Mr. Williams was convicted of violating 18 U.S.C. § 1344(1). To establish a
violation under § 1344(1), the Government must prove:
(1) that the defendant knowingly executed or attempted to
execute a scheme or artifice to defraud a financial
institution;
(2) that the defendant did so with the intent to defraud the
financial institution; and
(3) that the financial institution was federally insured.
United States v. Swanson, 360 F.3d 1155, 1161 (10th Cir. 2004) (paragraph breaks
added).
Under the first element, a scheme to defraud “can involve fraudulent
misrepresentations to deceive a bank to obtain money.” Young, 952 F.2d at 1257.
“[S]cheme and artifice are defined to include . . . fraudulent pretenses or
misrepresentations intended to deceive others to obtain something of value, such as
money, from the institution to be deceived.” Id. at 1256 (quotations omitted). The
misrepresentation or falsehood must be materially false. See Neder v. United States,
527 U.S. 1, 25 (1999). Also subsumed within the first element is a requirement that
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the government prove a “risk,” “potential risk,” or “risk of loss” to the financial
institution. Swanson, 360 F.3d at 1161.9
B. Materiality
1. Additional Legal Background10
a. Materiality Definition
A “‘false statement is material if it has a natural tendency to influence, or is
capable of influencing, the decision of the decisionmaking body to which it was
addressed.’” United States v. Irvin, 682 F.3d 1254, 1267 (10th Cir. 2012) (quoting
Neder, 527 U.S. at 16). Materiality is a mixed question of law and fact. United
States v. Schulte, 741 F.3d 1141, 1154 (10th Cir. 2014); Gaudin, 515 U.S. at 511-12.11
First, deciding whether a statement is “material” requires the determination of
two subsidiary questions: (a) “what statement was made?” and (b) “what decision
was the agency trying to make?” Gaudin, 515 U.S. at 512; United States v. Camick,
9
This court’s opinion in United States v. Young, 952 F.2d 1252, 1257 (10th
Cir. 1991), used the term “potential risk.” Mr. Williams and the Government
concede that this court has “used the phrase ‘potential risk of loss’ interchangeably
with the phrase ‘risk of loss.’” Fed. R. App. P. 28(j) Supplemental Authority (May
26, 2017); Fed. R. App. P. 28(j) Supplemental Authority (May 24, 2017).
10
The bank fraud materiality analysis is identical to the materiality analysis
required for convictions of making a false statement under 18 U.S.C. § 1001, mail
fraud under 18 U.S.C. § 1341, and wire fraud under 18 U.S.C. § 1341. See Neder v.
United States, 527 U.S. 1, 25 (1999) (“[M]ateriality of falsehood is an element of the
federal mail fraud, wire fraud, and bank fraud statutes.”). Cases involving bank
fraud, mail fraud, and wire fraud, and false statement offenses inform our analysis.
11
But see United States v. Camick, 796 F.3d 1206, 1214 (10th Cir. 2015)
(‘“The question of whether a statement is material is a question of fact for the jury to
decide.’” (quoting United States v. Sharp, 749 F.3d 1267, 1279 (10th Cir. 2014)).
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796 F.3d 1206, 1214-15 (10th Cir. 2015). The jury must then determine whether the
relevant statement could influence the relevant decision. Camick, 796 F.3d at 1215.
Second, we analyze whether the statement was capable of influencing the
relevant decision. Irvin, 682 F.3d at 1267. Because the Supreme Court’s materiality
definition in Neder, 527 U.S. at 16, “refer[s] to natural tendencies and capabilities,
[it] establishes materiality in the bank fraud context as an objective quality,
unconcerned with the subjective effect that a defendant’s representations actually had
upon the bank’s decision.” Irvin, 682 F.3d at 1267. Materiality therefore does not
turn on whether the misrepresentation actually influenced the bank or whether the
decision maker actually relied on the misrepresentation; the “pertinent inquiry is
instead whether [the defendant’s] representations had the capability to so influence
the[] decision[].” Id. at 1268.12
The Third Circuit has explained that “the relevant inquiry [is] whether the
falsehood was of a type that one would normally predict would influence the given
decisionmaking body.” United States v. McBane, 433 F.3d 344, 351 (3d Cir. 2005).
The phrase ‘“natural tendency’ connotes qualities of the statement in question that
transcend the immediate circumstances in which it is offered and inhere in the
statement itself.” Id. Stated another way, the objective materiality test focuses on
12
But this test is “unquestionably satisfied when, as here, the defendant’s
falsehoods did in fact influence agency action. Actually influencing an agency to act
is proof positive that a statement is capable of influencing an agency to act.” United
States v. Garcia-Ochoa, 607 F.3d 371, 378 (4th Cir. 2010).
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“the intrinsic capabilities of the statement itself, rather than the possibility of the
actual attainment of its end as measured by collateral circumstances.” Id. at 352.13
b. Tenth Circuit Precedent
Two Tenth Circuit cases figure prominently in our analysis.
i. United States v. Camick
In Camick, 796 F.3d 1206, Mr. Camick used his brother’s name and identity to
file a provisional patent application with the U.S. Patent and Trademark Office
(“PTO”). Id. at 1210-11. For this he was prosecuted and convicted of wire fraud,
making a material false statement, and aggravated identity theft. Id. at 1212-13. We
reversed his wire fraud and false statement convictions for lack of materiality,
holding Mr. Camick’s statements on the provisional patent application were not
capable of influencing the PTO’s decision to grant a patent. Id. at 1218-19.14
Based on the law governing provisional patent applications, we determined
that the preliminary application did not require an oath or declaration, would not be
examined for patentability, and would be deemed abandoned if the applicant took no
13
See also United States v. Lindsey, 850 F.3d 1009, 1015 (9th Cir. 2017) (“A
false statement is material if it objectively had a tendency to influence, or was
capable of influencing, a lender to approve a loan. This standard is not concerned
with a statement’s subjective effect on the victim, but only ‘the intrinsic capabilities
of the false statement itself.’ For this reason, we have previously held that
‘misrepresentation may be material without inducing any actual reliance.’” (citations
omitted)).
14
We also reversed Mr. Camick’s related conviction for aggravated identity
theft because it was predicated on his wire fraud and material false statement
felonies. Camick, 796 F.3d 1219.
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action within a year. Id. at 1218. Within one year, the applicant could convert the
provisional to a nonprovisional application or incorporate it into one by reference.
Id. at 1218-19. Thus “statements in a provisional patent application, without
additional action on the part of the applicant, cannot influence the decision of the
decisionmaking body to which it was addressed.” Id. at 1219 (alterations and
quotations omitted.) When the provisional application is filed, there is no decision to
be made. Id. Even though the provisional application could later inform the PTO’s
decision if the applicant took additional action, the applicant could abandon the
process through inactivity. Id. Because statements in the provisional application are
incapable of influencing a PTO decision and because Mr. Camick abandoned his
application, we held his false statements on the preliminary application were
immaterial. Id. The PTO had no reason or opportunity to review the preliminary
application, so it could not have influenced any patent decision. Id.ii. United States v. Irvin
In Irvin, 682 F.3d 1254, Ms. Irvin was part of a conspiracy to inflate the
creditworthiness of potential home buyers. Id. at 1259-60. She also inflated her own
credentials to obtain a mortgage loan, which she co-signed with a co-conspirator. Id. at
1267. At her trial for bank fraud, the bank said Ms. Irvin’s fraudulent financial
information had “no impact on the ultimate issuance of the loan,” explaining that its
“successful dealings with [her co-conspirator] provided the sole basis of decision to
recommend issuance of the mortgage loan.” Id. “[Ms.] Irvin’s credit information was
not even included in [the loan officer’s] presentation to the loan committee.” Id. Despite
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this testimony from the bank, we affirmed her conviction on appeal, holding that whether
her fraudulent representations actually influenced the bank did not matter because the
representations still had the capability to influence the bank’s decisions. Id. at 1268. We
explained:
[The bank’s loan officer]’s requirement that Irvin submit her
financial information as part of the loan application process,
for example, indicates the information was at least potentially
relevant to the bank’s decision, and [her] decision to falsify
the requested information indicates [she] believed it to be so.
Furthermore, [the loan officer] testified it would have been
relevant to the bank’s decision to know that Irvin had
submitted fraudulent tax returns . . . . [T]hose facts,
combined with testimony presented . . . describing the
significance of a loan applicant’s financial information, could
lead a rational trier of facts to conclude Irvin’s representations
to [the bank] were material.
Id. at 1268. In short, Ms. Irvin’s misrepresentations were material because they could
have influenced the bank’s decision.
2. Analysis
a. Threshold questions
To determine whether Mr. Williams’s misrepresentations were material, we follow
the Gaudin framework, 515 U.S. at 512, and identify, based on the trial evidence: (1) the
false statements Mr. Williams made, and (2) the decision the bank was trying to make.
First, Mr. Williams made several false statements. On July 25, 2014, he provided
the bank with false information about his name, date of birth, social security number, and
VA loan eligibility. The bank ran a credit report based on this false information, and
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entered the resulting information onto his application. On August 19, 2014, he provided
the bank with false income and asset information.
Second, the bank needed to decide whether to provide a loan to Mr. Williams.
b. Materiality
Based on the foregoing, we address whether Mr. Williams’s misrepresentations
had the “capability” or “natural tendency” to influence a reasonable bank’s decision of
whether to provide a loan. Irvin, 682 F.3d at 1267-68; McBane, 433 F.3d 350-51. A
rational jury could conclude that Mr. Williams’s misrepresentations were material beyond
a reasonable doubt.
First, a rational jury could conclude that the misrepresentations on the loan
application could influence the bank’s decision to issue a loan:
 Ms. Mentzel testified Mr. Williams gave her permission to run his credit
report based on the false information he had provided her. The assets and
liabilities entered on his loan application came from that credit report,
reflecting his creditworthiness for a potential loan. ROA, Vol. 2 at 127-28.
 The application explained that the bank would rely on the information
provided. By electronically signing the application, Mr. Williams agreed
and acknowledged that “all statements made in this application are made
for the purpose of obtaining a residential mortgage loan” and “[t]he lender
. . . may continuously rely on the information contained in the application
. . . .” Supp. ROA at 40. Ms. Mentzel also testified that “We have to
[continue to] rely on information that’s given to make a decision on if
someone can purchase a home.” ROA, Vol. 2 at 130.
 The application warned that criminal penalties could result from
misrepresentations. By electronically signing the application, Mr. Williams
also agreed and acknowledged that “the information provided in this
application is true and correct . . . and that any intentional or negligent
misrepresentation of this information contained in this application may
result in civil liability . . . and/or in criminal penalties.” Supp. ROA at 40;
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ROA, Vol. 2 at 130; see also id. at 167.
 The loan application packet contained another document titled
“MORTGAGE FRAUD IS INVESTIGATED BY THE FBI,” explaining
that “[i]t is illegal for a person to make any false statement regarding
income, assets, debt, or matters of identification . . . in a loan and credit
application for the purpose of influencing in any way the action of a
financial institution.” Supp. ROA at 115. This document listed bank fraud
under § 1344 as a potentially applicable federal criminal statute and
required a signature by the applicant. Id.15
 Mr. Williams provided, among other things, a false name, false social
security number, false employment verification, and false salary and
income information. ROA, Vol. 2 at 81-90, 96-97; Supp. ROA at 36-42.
Ms. Atkinson testified that the “[u]nderwriting [group] looks at things like
credit history, income, employment history, debts, assets, and the value of
property to decide whether a loan should be approved[.]” ROA, Vol. 2 at
216.16
Second, a rational jury could conclude that Mr. Williams’s misrepresentations
were capable of influencing the type of loan Mr. Williams could receive and the amount
he would be eligible to borrow:
 Mr. Williams falsely represented to Ms. Mentzel he was eligible for a VA
loan and was exempt from paying the typical funding fee for a VA loan
because he had received a Purple Heart and was on VA disability. ROA,
Vol. 2 at 133.
15
Even if Mr. Williams did not sign this warning document, he signed and
returned another document in the application packet. ROA, Vol. 2 at 308-09; id. at
331. Drawing inferences in the light most favorable to the government, United States
v. Los Dahda, 853 F.3d 1101, 1106 (10th Cir. 2017), petition for cert. filed, (July 7,
2017) (No. 17-43), a rational jury could conclude Mr. Williams saw the warning
document.
16
Ms. Mentzel testified that “[r]ight before closing, we have to do another soft
credit pulled on their credit report.” ROA, Vol. 2 at 173.
- 19 -
 Based on that representation, Ms. Mentzel “pulled his certificate of
eligibility” for a VA loan application and began to process a VA loan
rather than an ordinary mortgage loan. Id. The bank submitted the credit report to the VA to obtain a “certificate of
commitment to guarantee the subject loan.” Supp. ROA at 43
(Government Exhibit 6).
 Ms. Mentzel asked the underwriter to calculate the maximum loan Mr.
Williams would be eligible to receive based on Mr. Williams’s
misrepresentations and his VA certificate of eligibility showing he was
eligible for a VA loan and exempt from the funding fee. ROA, Vol. 2 at
136-37. Ms. Mentzel testified that “after the loan application was taken,”
she “talked to [her] underwriter” to find out that the maximum for Mr.
Williams’s loan would be $423,750. Id. at 122.
 Ms. Mentzel testified that the VA loan without the funding fee was
“definitely a better loan” for the borrower than other types of loans. ROA,
Vol. 2 at 133.
Third, our case law supports the jury’s finding that Mr. Williams’s
misrepresentations were material. In United States v. Moser, 466 F. App’x 713 (10th Cir.
2012) (unpublished),17 we held that misrepresentations on attachments to a loan
application were material. We explained that an application’s showing that a “borrower
could guarantee a reliable stream of . . . income . . . was at least capable of influencing a
bank’s loan decision.” Id. at 716. Similarly, in United States v. Rackley, 986 F.2d 1357(10th Cir. 1993), we found material the defendant’s misrepresentation about his personal
financial interest in a loan. We explained that this misrepresentation was material
because the bank “would not have approved the loans or authorized the payments at
17
Although not precedential, we find the reasoning of the unpublished cases
cited in this opinion to be instructive. See 10th Cir. R. 32.1 (“Unpublished decisions
are not precedential, but may be cited for their persuasive value.”); see also Fed. R.
App. P. 32.1.
- 20 -
closing had the loan documents accurately reflected defendant’s interest in the loans.” Id.
at 1362. And in Irvin, we reasoned that the existence of a bank’s requirement that the
borrower submit financial information “indicate[d] the information was at least
potentially relevant to the bank’s decision, and [the defendant’s] decision to falsify the
requested information indicate[d] [that the defendant] believed” the information could
influence the bank’s decision. 682 F.3d at 1268. Mr. Williams’s misrepresentations
included a false stream of income. From the trial testimony, a rational jury could find
that Mr. Williams was unable to afford the down payment on the home or to repay the
loan. ROA, Vol. 2 at 319 (explaining that Mr. Williams stated the $70,000 down
payment “was way over his head”); id. at 281-83 (explaining that Mr. Williams was
“living in his car” when seeking the home loan and “had also filed and was going through
a bankruptcy,” claiming to have $303 “at the end of every month”). The bank would
have denied him a loan had it known his true identity and financial state. Under the
foregoing cases, his misrepresentations were capable of influencing the bank’s decision.
c. Mr. Williams’s arguments
Mr. Williams’s arguments that his misrepresentations were not material are
unavailing.
First, relying on Camick, he contends that, because he never completed the loan
application and failed to date it, submit the required disclosures, submit a photo ID, or
submit other supporting documentation, his misrepresentations were incapable of
influencing the bank’s loan decision. This argument fails factually and legally.
- 21 -
Mr. Williams assumes the bank never considers an incomplete application, but the
evidence showed the bank sometimes does consider incomplete applications:
 Ms. Mentzel testified that the failure to date an application does not
preclude the bank’s consideration of that application. She said, “Well,
[applicants are] supposed to date it but we do have people who don’t date
it. We don’t not accept it if it’s not dated . . . Well, I mean, they’re
supposed to date it. . . No, we’re not going to not accept this application
‘cause it’s not dated.” ROA, Vol. 2 at 162-63.
 Ms. Atkinson testified that the processing group “may or . . . may not” still
send a file to the underwriting group even if the processing group does not
obtain all the required documents. ROA, Vol. 2 at 210. She stated that
whether the underwriter will review the application “depends on how much
documentation they have, and if they have enough that—underwriting has
enough information to give a rendering or an—you know, like a
preliminary approval, or if we have—[enough] . . . items to make a
decision.” Id. “It’s possible to forward [the loan application] with some
notation in the file, still waiting on X, Y, or Z.” Id. at 212.
Camick is distinguishable. In Camick, the provisional patent application was
incapable of influencing the PTO’s decision to issue a patent without additional action by
the applicant. 796 F.3d at 1218-19.18 Even if fully completed, the PTO specified that
provisional applications “[would] not be examined for patentability” unless and until the
applicant took some further action to incorporate the provisional application into a final,
18
See also United States v. Rigas, 490 F.3d 208, 234-36 (2d Cir. 2007) (finding
some misrepresentations to be immaterial because they were only relevant to
decisions the bank lacked authority to make); United States v. Litvak, 808 F.3d 160,
172-74 (2d Cir. 2015) (finding misrepresentations to the Treasury were immaterial
because the Treasury did not have authority to make the relevant decisions that the
misrepresentations were intended to influence).
- 22 -
nonprovisional application. Id. at 1218-19.19 If the applicant did not take further action
within a year, the preliminary application would be deemed abandoned. Id. Moreover,
even if the applicant incorporated the provisional application into a final, nonprovisional
application, the provisional application would serve only as a placeholder for the date of
its filing; the PTO’s ultimate decision on whether to issue a patent would be based on the
nonprovisional application. Id. at 1219.20
In contrast to the provisional application in Camick, Mr. Williams’s loan
application stated: “All statements made in this application are made for the purpose of
obtaining a residential mortgage loan . . . . The lender . . . may continuously rely on the
information contained in the application.” Supp. ROA at 40. And, as Ms. Atkinson
testified, an application may be sent to the underwriting group for a loan approval
19
The PTO specifies that “(C) Provisional applications will not be examined
for patentability.” U.S. Patent & Trademark Office, Manual of Patent Examining
Procedure § 201.04 (9th ed. 2014); Camick, 796 F.3d at 1218 (citing PTO Manual of
Patent Examining Procedure). It “cautions” that “[p]rovisional applications are not
examined on their merits,” and “[a] provisional application cannot result in a U.S.
patent unless” a corresponding nonprovisional application for patent is filed or a
petition to convert the provisional application into a nonprovisional application is
filed. Provisional Application for Patent, U.S. Patent & Trademark Office, available
at https://perma.cc/3QAF-NKRA. It also “warn[s]” that “[i]ndependent investors
should fully understand that a provisional application will not mature into a granted
patent without further submissions by the inventor.” Id.
20
See Nonprovisional (Utility) Patent Application Filing Guide, U.S. Patent &
Trademark Office, available at https://perma.cc/5BLL-Z9NV (“An applicant who
decides to initially file a provisional application must file a corresponding
nonprovisional application during the 12-month pendency period of the provisional
application in order to benefit from the earlier provisional application filing. A
nonprovisional application is examined by a patent examiner and may be issued as a
patent if all the requirements for patentability are met.”).
- 23 -
decision even without all required documentation. ROA, Vol. 2 at 210, 212. Thus,
unlike Camick, Mr. Williams’s misrepresentations were capable of influencing the bank’s
loan decision and were made on the same application that the bank would consider in
deciding whether to approve the loan.
Second, Mr. Williams argues that an underwriter never considered his incomplete
application because it did not advance beyond the loan officer’s assistant. This argument
fails because a statement can be objectively material even if the decision maker did not
consider it. See e.g., United States v. Puente, 982 F.2d 156, 159 (5th Cir. 1993) (“The
statement may still be material ‘even if it is ignored or never read by the agency receiving
the misstatement.’”); United States v. Diaz, 690 F.2d 1352, 1357-58 (11th Cir. 1982)
(same); United States v. McIntosh, 655 F.2d 80, 83 (5th Cir. 1981).
Third, Mr. Williams argues the Government has cited no bank fraud conviction in
which a defendant’s misrepresentations never reached the bank’s decision maker or the
defendant never obtained money from the bank. But our precedent holds that a decision
maker’s actual reliance on the misrepresentation is not required for a statement to be
material. Irvin, 682 F.3d at 1267. It is irrelevant that the statement did not in fact reach
the decision maker so long as the misrepresentation was objectively capable of
influencing the decision. Additionally, as we explain below, “the Government does not
have to prove the bank suffered any monetary loss, only that the bank was put at potential
risk by the scheme to defraud.” Young, 952 F.2d at 1257. Finally, the statute includes the
words “attempts to execute.” 18 U.S.C. § 1344. Requiring the government to establish
actual reliance to satisfy materiality or actual loss to show risk of loss would undermine
- 24 -
the statute’s criminalization of “attempts to execute” the fraudulent scheme. 18 U.S.C.
§ 1344.
Fourth, Mr. Williams argues the bank already knew “early in the process” the
application contained misrepresentations and had determined it would not approve the
loan. Aplt. Br. at 31. This argument overlooks Ms. Atkinson’s testimony that bank
officials told her to “just proceed on the loan.” ROA, Vol. 2 at 194-95.21 Even under Mr.
Williams’s version of the facts, an early decision to deny him a loan shows his
misrepresentations influenced the bank. As a legal matter, materiality turns on the nature
of the misrepresentation: whether it was capable of influencing the bank’s loan decision.
It does not turn on whether the decision maker actually relied on the misrepresentation.
Irvin, 682 F.3d at 1267; see also McBane, 433 F.3d at 351-52 (finding misrepresentation
to FBI was material even when FBI’s investigation was essentially complete and FBI
conceded the statement had no effect on its case because it was still “of a type” capable of
influencing a reasonable decision maker).
* * * *
From the evidence at trial, a rational jury could find that Mr. Williams’s
misrepresentations were material beyond a reasonable doubt.
21
Ms. DeRousse also testified she planned to continue working with Mr.
Williams to obtain the documents needed to investigate further. She testified that “In
this case, I [was] still looking at this as a person who might be a potential customer.
There’s no concrete evidence that a fraud has been committed. It could still be, in my
mind, an error, so I don’t want to contact people and start interrogating them.” ROA,
Vol. 2 at 228.
- 25 -
C. Risk of Loss
1. Legal Background
To satisfy the first element of bank fraud under § 1344(1)—“that the defendant
knowingly executed or attempted to execute a scheme or artifice to defraud a
financial institution”—our case law states that the government must show, in addition
to materiality, that the financial institution was put at “risk,” “potential risk,” or
suffered a “risk of loss.” United States v. Bowling, 619 F.3d 1175, 1181 (10th Cir.
2010); Swanson, 360 F.3d at 1161 (citing Akers, 215 F.3d at 1101; United States v.
Sapp, 53 F.3d 1100, 1102-03 (10th Cir. 1995); Young, 952 F.2d at 1257).22 The
government need not prove “a substantial likelihood of risk of loss” to support a bank
fraud conviction; proving a potential risk is sufficient. See United States v.
22
As the Government pointed out in a Rule 28(j) letter, some of our sibling
circuits do not read § 1344 to require proof of risk of loss. Fed. R. App. P. 28(j)
Supplemental Authority (May 24, 2017). See United States v. Goodale, 530 F. App’x
338, 341 (5th Cir. 2013) (unpublished) (citing United States v. Warshak, 631 F.3d
266, 313 (6th Cir. 2010); United States v. Everett, 270 F.3d 986, 991 (6th Cir. 2001);
United States v. De La Mata, 266 F.3d 1275, 1298 (11th Cir. 2001)); see also United
States v. Hoglund, 178 F.3d 410, 413 (6th Cir. 1999) (“We believe that ‘risk of loss’
is merely one way of establishing intent to defraud in bank fraud cases.”). Although
the phrase does not appear in § 1344, in this circuit the government must show “risk
of loss” to sustain a bank fraud conviction. See United States v. Akers, 215 F.3d
1089, 1101 (10th Cir. 2000); United States v. Sapp, 53 F.3d 1100, 1102-03 (10th Cir.
1995); Young, 952 F.2d at 1257. We are bound by the precedent of this circuit’s prior
panels absent en banc reconsideration or a superseding contrary decision by the
Supreme Court. Barnes v. United States, 776 F.3d 1134, 1147 (10th Cir. 2015).
- 26 -
McCauley, 253 F.3d 815, 820 (5th Cir. 2001). Risk of loss is a question of fact for
the jury.23
“To support a § 1344 conviction [for bank fraud,] the Government does not
have to prove the bank suffered any monetary loss, only that the bank was put at
potential risk by the scheme to defraud.” Young, 952 F.2d at 1257; see also United
States v. Mullins, 613 F.3d 1273, 1279 (10th Cir. 2010) (“[A] potential risk of loss is
enough to prove a scheme to defraud a financial institution.”).24 Section 1344
prohibits devising and executing, or intending and attempting to execute, a scheme to
defraud, and the ultimate success or failure of the scheme does not determine
criminal liability. United States v. Kelley, 929 F.2d 582, 585 (10th Cir. 1991); see
also 18 U.S.C. § 1344 (criminalizing “attempts to execute, a scheme or artifice . . . to
23
See United States v. Reaume, 338 F.3d 577, 583 (6th Cir. 2003) (treating
risk of loss as a way to prove intent and holding that “whether [the defendant]
actually harbored such intent is a question of fact for the jury to decide”); Goodale,
530 F. App’x at 342 (reviewing the district court’s risk of loss finding as a finding of
fact); United States v. Nelson, 242 F. App’x 164, 173 (5th Cir. 2007) (unpublished)
(“On this evidence, a reasonable trier of fact could have found that [the defendant]
knowingly subjected [the bank] . . . to a risk of loss.”); United States v. Rudaj, No.
04-CR-1110, 2006 WL 1876664, at *7 (S.D.N.Y. July 5, 2006) (“The issues of
materiality and whether [the defendant] intended to expose the bank to risk of loss
are questions of fact . . . .”).
24
See also United States v. Thomas, 315 F.3d 190, 201 (3d Cir. 2002) (“[The
legislature intended] that the [bank fraud] statute would proscribe conduct which
undermines the integrity of federal insured institutions. The reputation and integrity
of banking are harmed when a bank is victimized in a way that exposes it to liability.
Conduct which exposes a bank to liability casts the institution of banking into doubt
by adversely affecting its image with the public. It implicates the federal interest in
maintaining the integrity and esteem of our federally insured banks.”), vacated on
other grounds by Loughrin v. United States, 134 S. Ct. 2384 (2014).
- 27 -
defraud a financial institution”). Thus, requiring that the bank suffer an actual loss
would conflict with the statute. Kelley, 929 F.2d at 585.
A defendant’s conduct can expose the bank to risk of loss just by “expos[ing]
the bank to civil litigation,” even if that liability is not realized. Young, 952 F.2d at
1257; see also United States v. Lemons, 941 F.2d 309, 316 (5th Cir. 1991) (“Although
the banks did not suffer harm [from accepting the defendant’s forged check
endorsement], because [the account owner] did not challenge the endorsement, they
were at risk.”).
“[T]here is only a small subset of cases where a defendant would intend to
defraud a bank and yet the bank would never be at any risk—i.e., incompetent
attempts.” United States v. Loughrin, 710 F.3d 1111, 1116 (10th Cir. 2013).25
1. Analysis
The uncontested jury instruction on risk of loss stated the Government must prove
beyond a reasonable doubt that “the defendant placed Pulaski Bank at risk of civil
liability or financial loss.” ROA, Vol. 1 at 106. Based on the trial evidence viewed in the
light most favorable to the Government, a rational jury could have found that Mr.
25
Cases finding no risk of loss include: United States v. Rodriguez, 140 F.3d
163, 169 (2d Cir. 1998) (finding no risk of loss when a bank takes a check only as a
holder in due course, which “preclude[s] the potential that the bank could be
victimized by a loss” because the bank takes the check free of any claims or defenses
that the signatory may have or choose to institute against the bank); United States v.
Khorozian, 333 F.3d 498, 505-06 (3d Cir. 2003) (collecting cases finding no risk of
loss because “those cases involved fraud on a third party where the bank was merely
an ‘unwitting instrumentality’ in the fraud rather than the ‘target of deception’”).
- 28 -
Williams exposed the bank to “a potential risk of loss,” Mullins, 613 F.3d at 1279, due to
his July 25 and August 19 misrepresentations.
a. July 25 misrepresentations
The trial evidence showed Mr. Williams’s misrepresentations on July 25, 2014
about his creditworthiness and VA loan eligibility exposed the bank to a risk of loss. As
explained above:
 Mr. Williams gave Ms. Mentzel permission to run his credit report based on
the false information he had provided, and information from that credit
report was entered on his loan application. ROA, Vol. 2 at 127-28.
 Mr. Williams provided, among other things, a false name, false social
security number, false employment verification, and false salary and
income information. Id. at 81-90, 96-97; Supp. ROA at 36-42. Ms.
Atkinson testified that the underwriting group looks at that information to
decide whether to approve a loan. ROA, Vol. 2 at 216.
 Mr. Williams falsely represented to Ms. Mentzel he was eligible for a VA
loan and was exempt from paying a funding fee because he had received a
Purple Heart and was on VA disability. Id. at 133. Ms. Mentzel obtained
his certificate of eligibility for a VA loan application and began to process a
VA loan rather than an ordinary mortgage loan. Id.26 Based on this
information, Ms. Mentzel testified that her underwriter said the maximum
for Mr. Williams’s loan would be $423,750. Id. at 122.
Viewed in the light most favorable to the government, the evidence showed the
credit report used to establish Mr. Williams’s loan eligibility was based on Earl
26
On the VA “Addendum to Uniform Residential Loan Application,” which is
required to obtain a VA loan, the bank “ma[de] the following certifications to induce
the Department of Veterans Affairs to issue a certificate of commitment to guarantee
the subject loan”: “A. The loan terms furnished in the Uniform Residential Loan
Application and this Addendum are true, accurate and complete,” and “B. The
information contained in the Uniform Residential Loan Application and this
Addendum was obtained directly from the borrower . . . and is true to the best of the
lender’s knowledge and belief.” Supp. ROA at 43.
- 29 -
Williams’s credit, which was superior to Mr. Williams’s. Bank employees testified that
incomplete applications may be passed on to an underwriter. The misrepresentations
about Mr. Williams’s creditworthiness and VA loan eligibility tended to show that Mr.
Williams exposed the bank to a risk that it might loan him more money than he could
afford to repay.
b. August 19 misrepresentations
The bank also faced risk when Mr. Williams continued to pursue the loan by
submitting additional documents on August 19, 2014. The evidence showed:
 After learning about the call from Earl Williams, Ms. DeRousse directed
bank employees to continue working with Mr. Williams to obtain the
documents needed to investigate further. Id. at 228. She testified, “In this
case, I’m still looking at this as a person who might be a potential customer.
There’s no concrete evidence that a fraud has been committed. It could still
be, in my mind, an error, so I don’t want to contact people and start
interrogating them.” Id. at 227-28.
 Mr. Williams told Ms. Mentzel that he would bring in the requested
documents and photo ID. Id. at 141. To explain his delay, he told her
“[t]hat he was working on it, or that he had requested information, or like
one time, [another] bank was supposed to be sending us the bank
statements and items that we needed.” Id. at 142.
 Ms. DeRousse testified that she contacted federal authorities about Mr.
Williams’s application “relatively early on in the investigation,” but that she
would investigate further if the bank received more documentation. Id.
230-31. She stated that, after Earl Williams’s call, she “didn’t have
sufficient information to clearly determine whether truly there was an
identity theft in progress . . . [and she,] at that point, because [the bank]
didn’t have the proper identification to proceed with the loan, didn’t feel
that the bank was at a risk for a loss, so [she] was not going to do anything
further to try to investigate.” Id. at 230-31. She continued, “Unless [the
bank] did at some point receive the documentation [it] needed to proceed
with the application, [she] didn’t see a need to investigate further.” Id. at
231; see also id. at 241 (testifying that she was satisfied the bank was not at
a risk of loss “[u]nless the proper documentation, the identification was
- 30 -
obtained”).
 Ms. DeRousse testified that, although she referred the investigation to law
enforcement, the bank could still face a future risk of loss. She said she
generally turns investigations over to law enforcement if she
“[d]etermine[s] that . . . at that point, there’s no risk for loss.” Id. at 245.
But she clarified that “[t]here could still be risk of loss, future loss.” Id. at
246. She would then take steps to ensure that a future risk of loss did not
occur by, for example, monitoring a loan application. Id. at 246.
 Ms. DeRousse testified that she would continue her investigation if more
documents were received from Mr. Williams. She requested that the
mortgage department inform her “if they did obtain that [photo]
identification and were going to proceed with the loan . . . because at that
point, [she] would have wanted to further [her] investigation just to assure
that there would be no loss to the bank.” Id. at 237.
 On August 19, 2014, Mr. Williams sent additional documents to the bank,
including a signed form titled “INTENT TO PROCEED WITH LOAN
APPLICATION” to express his “intent to proceed with this [loan]
application,” and a pay stub showing at least monthly net wages of
$3,275.25. Supp. ROA at 105; ROA, Vol. 2 at 135, 308-09; id. at 331. Ms.
DeRousse testified that this was the sort of “trickling in of documents,” that
“would lead you to believe that maybe there was just some kind of an error.
He’s continuing to provide the documents being asked for except for the
driver’s license.” Id. at 232-33.
Viewed in the light most favorable to the government, this second grouping of
evidence also was probative of risk of loss. Even if Ms. DeRousse’s testimony that she
“didn’t feel that the bank was at a risk for a loss,” id. at 230-31, could suggest the bank’s
risk had subsided when she contacted law enforcement, the risk resumed when Mr.
Williams provided further documentation on August 19 and persisted until the bank
closed his file. Ms. DeRousse testified that the bank could still be at a future risk of loss
if Mr. Williams provided further documentation. He did so on August 19, including a
- 31 -
fraudulent earnings statement and the form on which he expressed his intent to proceed
with the loan.
c. Totality of the evidence
A rational jury could find the bank was at risk (1) after Mr. Williams called the
bank on July 25 and repeatedly misrepresented himself to Ms. Mentzel in ways that
prompted the bank to obtain a credit report and a VA loan certificate, and (2) after Mr.
Williams provided further documentation on August 19. We need not determine whether
the July 25 and August 19 misrepresentations were independently sufficient to find risk
of loss. The totality of the trial evidence was sufficient for a rational jury to find a
potential risk of loss beyond a reasonable doubt.
d. Mr. Williams’s arguments
Mr. Williams’s three arguments fail.
First, he relies on Ms. DeRousse’s testimony that she determined “very early in
the process” that the bank was not at a risk of loss. Aplt. Br. at 31. But Mr. Williams has
taken Ms. DeRousse’s statement out of context. United States v. Gallant, 537 F.3d 1202,
1222-23 (10th Cir. 2008) (“Rather than examining the evidence in bits and pieces, we
evaluate the sufficiency of the evidence by considering the collective inferences to be
drawn from the evidence as a whole.” (quotations omitted)). Even if Ms. DeRousse’s
statement meant the bank’s risk had abated, she testified that “[t]here could still be risk of
loss, future loss” if more documentation was received. ROA, Vol. 2 at 246. Mr.
Williams then assured the bank he would provide the required information, sent the letter
- 32 -
indicating his intent to proceed with the loan, and provided additional documentation—
together exposing the bank to the risk Ms. DeRousse described.
Second, Mr. Williams reiterates that his loan application was incomplete and
argues his efforts were an “incompetent attempt” that did not put the bank at a risk of
loss. Aplt. Br. at 40. But as explained above, the bank employees’ testimony shows that
even an incomplete loan application may be sent to the underwriting department. See
United States v. Morganfield, 501 F.3d 453, 465-66 (5th Cir. 2007) (finding bank had
risk of loss when it was presented with a check from an account with insufficient funds
because testimony showed the bank might honor the check even when an account had
insufficient funds and “[t]hat possibility create[d] a sufficient risk of loss”).
Additionally, a rational jury could find Mr. Williams’s misrepresentations were
not “incompetent.” When analyzing risk of loss, the question is whether the executed or
attempted scheme to defraud would objectively expose the bank to a risk of loss. See
United States v. Adekoya, 60 F. Supp. 3d 294, 300 (D.N.H. 2015) (“[A] bank fraud
conviction requires proof of a scheme—whether or not it is actually capable of success—
that would, if realized, victimize a bank . . . or put it at risk of loss.” (emphasis omitted)),
appeal filed, (Mar. 13, 2015) (No. 15-1304). As with materiality, the factfinder must
look to the nature of the misrepresentation and determine whether that misrepresentation
would expose a bank to a potential risk of loss.27 This approach is consistent with the
27
See United States v. Jacobs, 117 F.3d 82, 93 (2d Cir. 1997) (“Jacobs may
have intended to defraud [only] his customers by inducing them to purchase certified
drafts which he knew were not ‘worth the paper they’re printed on,’ but inherent in
Continued . . .
- 33 -
statute’s criminalization of “attempts to execute” a scheme to defraud, § 1344, and our
precedent that the bank need not suffer actual loss. Young, 952 F.2d at 1257.28 Here, Mr.
Williams’s misrepresentations inflating his ability to repay a loan exposed the bank to a
potential risk that the bank would approve a loan he would be unable to repay. See
Jacobs, 117 F.3d at 93 (“But, for purposes of this statute, the risk can be said to have been
increased in that there was some possibility—at least a potential—that the bank would
release security, delay efforts at collection or otherwise act in reliance upon its receipt of
the certified drafts.”); id. (“Admittedly, the possibility of such actions in reliance may be
rather remote since banks are cautious; but such actions are not impossible and, under the
case law, a mere possibility of detrimental reliance is enough.”).
Third, Mr. Williams argues that his August 19, 2014 misrepresentations did not
put the bank at a risk of loss because the bank sent a second notice of incompleteness just
three days later.29 But Ms. Atkinson testified that the first notice of incompleteness gave
that transaction was the risk that the certified drafts would eventually be presented to
the [bank] as payment, and acceptance of a false certified draft would expose the []
bank to real loss.” (emphasis added)), vacated on other grounds by Loughrin, 134 S.
Ct. 2384; United States v. Stavroulakis, 952 F.2d 686, 695 (2d Cir. 1992) (“Inherent
in a [scheme for the] sale of stolen checks is that they will eventually be presented to
the drawee bank for payment; and payment over a forged signature exposes the bank
to real loss.” (emphasis added)).
28
Allowing an incomplete scheme to avoid liability would undermine the
statute’s criminalization of attempts to execute a fraudulent scheme. A “potential
risk of loss” necessarily includes loss that has not and may not be realized.
29
Even though the bank closed Mr. Williams’s loan file for incompleteness
and avoided actual monetary loss, we reiterate that “the Government does not have to
prove the bank suffered any monetary loss, only that the bank was put at potential
Continued . . .
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Mr. Williams ten business days to provide more requested documents, which he did on
August 19, and the second notice gave him five more business days. The notices thus
provided Mr. Williams with an opportunity to remedy the incompleteness until the bank
closed the file. The bank’s risk of loss thus persisted until then.
* * * *
From the evidence at trial, a reasonable jury could find that Mr. Williams’s
misrepresentations exposed the bank to a potential risk of loss beyond a reasonable doubt.
III. CONCLUSION
For the foregoing reasons, we affirm Mr. Williams’s bank fraud conviction.
We also affirm his aggravated identity theft conviction because it rises and falls with
the bank fraud conviction.
risk by the scheme to defraud.” Young, 952 F.2d at 1257; see also United States v.
Hord, 6 F.3d 276, 282 (5th Cir. 1993) (explaining that it is “[n]o matter that, in this
case, the bank quickly discovered the scheme and avoided [actual] loss”). We look
to whether the scheme exposed the bank to a potential risk of loss; not whether actual
loss was incurred. Young, 952 F.2d at 1257. Here, the bank was exposed to a
potential risk of loss by Mr. Williams’s misrepresentations about his creditworthiness
and VA loan eligibility. Mr. Williams’s continued pursuit of the loan perpetuated the
risk.
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