United States v. Kain

F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
JUN 18 1998
TENTH CIRCUIT
PATRICK FISHER
Clerk
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v. No. 97-6207
JANICE CHRISTINA KAIN, (W.D. Oklahoma)
(D.C. No. CR-96-178-L)
Defendant - Appellant.
ORDER AND JUDGMENT *
Before PORFILIO, KELLY, and HENRY, Circuit Judges.
Janice Kain appeals her convictions for mail fraud, bank fraud, and money
laundering following a jury trial, arguing that there is insufficient evidence to
support the jury’s verdict. After examining the briefs and appellate record, this
panel has determined unanimously that oral argument would not assist the
determination of this appeal. See Fed. R. App. P. 34(a); 10th Cir. R. 34.1.9. We
order the case submitted without oral argument, exercise jurisdiction under 28
U.S.C. § 1291, and affirm.
* This order and judgment is not binding precedent, except under the doctrines
of law of the case, res judicata, and collateral estoppel. The court generally
disfavors the citation of orders and judgments; nevertheless, an order and
judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
BACKGROUND
In an indictment filed in November 1996, the government charged Ms.
Kain with ten counts of mail fraud (violations of 18 U.S.C. § 1341)), two counts
of bank fraud (violations of 18 U.S.C. § 1344(2)), and three counts of money
laundering (violations of 18 U.S.C. § 1956(a)(1)(B)(i)). Ms. Kain entered a plea
of not guilty, and the case proceeded to trial.
The evidence presented at trial indicated that Ms. Kain served as treasurer
of the First Church of Christ Scientist in Nichols Hills, Oklahoma from 1986 to
1995. In that position, Ms. Kain was responsible for managing church funds and
paying church expenses as authorized by the church’s governing board.
In June 1989, the board granted Ms. Kain’s request to change the church’s
bank accounts. Ms. Kain then opened a new account for the church at Nichols
Hills Bank in Oklahoma City. However, she left open the church’s account at
Liberty Bank in Oklahoma City. She directed Liberty Bank to send account
statements to a post office box that she had opened without informing church
officials.
Ms. Kain then used the account at Liberty Bank to pay a variety of
personal expenses, including rent and utility and telephone bills for her personal
residence and expenses incurred on family vacations. Ms. Kain was not
authorized to use church funds in this manner. Additionally, in 1994, Ms. Kain
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deposited two checks written on a church bank account into her personal account
at the Bank of Oklahoma in Oklahoma City. These checks listed Ms. Kain’s son
as the payee, even though the church’s governing board had not authorized
payments to him. Moreover, Ms. Kain’s son’s signature endorsing the checks
had been forged.
The government’s theory of the case was that, by directing the statements
for the Liberty Bank account to be mailed to her post office box without
informing church officials, Ms. Kain used the mails to further her scheme to
defraud the church. The government also argued that by depositing into her
personal account the unauthorized checks drawn on a church account and
containing forged endorsements, Ms. Kain committed bank fraud under 18 U.S.C.
§ 1344(2). Finally, the government contended that by depositing proceeds of her
mail fraud scheme into her personal account, Ms. Kain sought to conceal
evidence of her unlawful activity, thereby violating 18 U.S.C. §
1956(a)(1)(B)(i).
At trial, Ms. Kain acknowledged that she had used church funds to pay
unauthorized personal expenses. However, she argued, the government failed to
prove that she had violated the federal mail fraud, bank fraud, and money
laundering statutes. According to Ms. Kain, the mailing of the bank statements
to her personal post office box did not further her plan to defraud the church.
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She also argued that because she had not intended to defraud the banks at which
the church held accounts, she did not violate the bank fraud statute. Finally, she
contended, because a money laundering violation involves the concealing of the
proceeds of unlawful activity and because she did not commit the alleged
unlawful activity (mail fraud), there was insufficient evidence to support the
money-laundering counts.
DISCUSSION
In assessing a challenge to the sufficiency of the evidence, we examine the
record in the light most favorable to the government, determining whether the
evidence and all reasonable inferences therefrom can support a finding of guilt
beyond a reasonable doubt. United States v. Wacker, 72 F.3d 1453, 1462 (10th
Cir. 1995). We may overturn a conviction “only if no rational trier of fact could
have found the essential elements of the crime beyond a reasonable doubt.” Id. at
1462-63.
In challenging the sufficiency of the evidence in this appeal, Ms. Kain
argues that her use of the personal post office box to receive the bank statements
for the church accounts did not constitute mail fraud because the church
authorized her to receive financial documents in her capacity as treasurer. See
Aplt’s Br. at 9. Ms. Kain’s argument ignores the evidence presented by the
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government indicating that church officials did not know that she continued to
maintain the church account at Liberty Bank after she opened the account at
Nichols Hills Bank and that her use of the post office box allowed her to conceal
her unauthorized withdrawals from the Liberty Bank accounts. This evidence is
sufficient to establish the elements of mail fraud: “(1) the devising of a scheme or
artifice either (a) to defraud or (b) for obtaining money by means of false or
fraudulent pretenses, representations, or promises, (2) the specific intent to
defraud, and (3) the use of the United States mails to execute the scheme.”
United States v. Kennedy, 64 F.3d 1465, 1475 (10th Cir. 1995).
Ms. Kain advances a similar argument regarding the two bank fraud
counts. She contends that her position as treasurer gave her the authority to issue
checks from the church accounts, that her “subsequent conversion of money was
beyond the cognizance of the banks,” and that, as a result, this conversion did not
constitute bank fraud under § 18 U.S.C. § 1344(2). See Aplt’s Br. at 7. We
disagree.
In order to establish a bank fraud violation under § 1344(2), the
government must establish that the defendant executed or attempted to execute a
“scheme or artifice-- . . . to obtain . . . funds . . . owned by, or under the custody
or control of, a financial institution, by means of false or fraudulent pretenses,
representations, or promises.” See 18 U.S.C. § 1344(2); United States v. Sapp,
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53 F.3d 1100, 1102-03 (10th Cir. 1995). This circuit has concluded that a
defendant’s misrepresentation to a bank that he or she is authorized to engage in
a particular transaction may constitute a violation of § 1344(2). See United
States v. Young, 952 F.2d 1252, 1257 (10th Cir. 1991). Depositing a check that
is known to contain a forged endorsement may constitute a misrepresentation
sufficient to support a bank fraud conviction under § 1344(2). See United States
v. Lemons, 941 F.2d 309, 315-16 (5th Cir. 1991).
Here, viewing the evidence in the light most favorable to the government,
the jury could reasonably conclude that Ms. Kain deposited checks written on
church bank accounts into her personal bank account when she knew that the
checks contained forged endorsements. The evidence is therefore sufficient to
support Ms. Kain’s bank fraud convictions under § 1344(2).
Finally, Ms. Kain challenges her money laundering convictions under 18
U.S.C. § 1956(a)(1)(B)(i). In order to establish a violation of this statute, the
government must prove beyond a reasonable doubt that: (1) the defendant
engaged in a financial transaction; (2) the defendant knew that the property
involved in the transaction represented the proceeds of his or her unlawful
activities; (3) the property did in fact constitute the proceeds of the unlawful
activities; and (4) the defendant knew that the transaction was designed in whole
or in part to conceal the nature, source, ownership or control of the proceeds of
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the specified unlawful activities. United States v. Garcia-Emanuel, 14 F.3d 1469,
1473 (10th Cir. 1994). Because there is insufficient evidence to support the mail
fraud convictions, Ms. Kain contends, there is insufficient evidence of the
unlawful activity necessary to support the money laundering convictions.
We conclude that because the evidence is sufficient to support Ms. Kain’s
mail fraud convictions, her challenge to the money laundering convictions must
also fail. The evidence presented by the government is sufficient for a rational
juror to conclude that Ms. Kain deposited funds from the church accounts into
her personal accounts in order to conceal the proceeds of her mail fraud scheme,
thereby violating § 1956(a)(1)(B)(i).
Accordingly, we affirm the judgment of the district court.
Entered for the Court,
Robert H. Henry
Circuit Judge
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