United States v. Heinz, No. 13-3119 (2d Cir. 2015)
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Defendants appealed their convictions for conspiracy to commit wire fraud and wire fraud. The court concluded that since the relevant charges in the superseding indictment were well
within the applicable ten‐year statute of limitations, the district court properly denied the motion to dismiss. The court considered defendants' remaining arguments and concluded that they are without merit. Accordingly, the court affirmed the judgment.
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13-3119(L) United States v. Heinz 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT August Term, 2014 (Argued: May 15, 2015 Decided: June 4, 2015) Docket Nos. 13 3119 cr(L), 13 3121 cr(CON), 13 3296 cr(CON), 14 1845 cr(CON), 14 1857 cr(CON), 14 1859 cr(CON) _____________________________________ UNITED STATES OF AMERICA, Appellee, v. GARY HEINZ, MICHAEL WELTY, PETER GHAVAMI, Defendants Appellants. _____________________________________ Before: WINTER, LOHIER, and CARNEY, Circuit Judges. Defendants appellants Gary Heinz, Michael Welty, and Peter Ghavami appeal from judgments of conviction entered by the United States District Court for the Southern District of New York (Wood, J.), following a jury trial where the Defendants were convicted of conspiracy to commit wire fraud in violation of 18 U.S.C. §§ 371 and 1349 and, as to Heinz and Ghavami, wire fraud in violation of 18 U.S.C. § 1343. On appeal, the Defendants argue that the District Court erred by denying their motion to dismiss the superseding indictment as time barred. We AFFIRM. MARC L. MUKASEY (Philip J. Bezanson, on the brief), Bracewell & Giuliani LLP, New York, NY, for Defendant Appellant Gary Heinz. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 GREGORY L. POE (Preston Burton, Rachel S. Li Wai Suen, on the brief), Poe & Burton PLLC, Washington, DC, for Defendant Appellant Michael Welty. NATHANIEL Z. MARMUR, Law Offices of Nathaniel Z. Marmur, PLLC, New York, NY (Charles A. Stillman, James A. Mitchell, Mary Margulis Ohnuma, Ballard Spahr Stillman & Friedman, LLP, New York, NY, on the brief), for Defendant Appellant Peter Ghavami. DANIEL E. HAAR, Attorney (Brent Snyder, Deputy Assistant Attorney General, James J. Fredricks, Finnuala K. Tessier, Kalina Tulley, Jennifer Dixton, Attorneys, on the brief), U.S. Department of Justice, Antitrust Division, Washington, DC, for Appellee. PER CURIAM: Defendants appellants Gary Heinz, Michael Welty, and Peter Ghavami 18 19 appeal from judgments of conviction entered by the United States District 20 Court for the Southern District of New York (Wood, J.), following a jury trial 21 where the Defendants were convicted of conspiracy to commit wire fraud in 22 violation of 18 U.S.C. §§ 371 and 1349 and, as to Heinz and Ghavami, wire 23 fraud in violation of 18 U.S.C. § 1343. On appeal, the Defendants argue that 24 the District Court erred by denying their motion to dismiss the superseding 25 indictment as time barred.1 We AFFIRM. We address the Defendants’ remaining arguments in a separate summary order filed simultaneously with this opinion. 2 1 1 2 BACKGROUND Heinz, Welty, and Ghavami were convicted in connection with schemes 3 to defraud municipalities, the Department of the Treasury, and the Internal 4 Revenue Service by manipulating the bidding process for municipal bond 5 reinvestment agreements and other municipal finance contracts while 6 employed at UBS Financial Services, Inc. (“UBS”). 7 Before trial, the Defendants moved to dismiss the superseding 8 indictment as untimely, arguing that the District Court should apply the five 9 or six year statute of limitations for wire fraud and wire fraud conspiracies, 10 see 18 U.S.C. § 3282(a); 26 U.S.C. § 6531(1), and that each fraudulent 11 transaction identified in the indictment was completed more than six years 12 before that indictment was filed. In denying the motion, the District Court 13 concluded that the evidence the Government intended to submit at trial was 14 enough to permit a jury to find that the Defendants’ conduct “affect[ed] a 15 financial institution” within the meaning of 18 U.S.C. § 3293(2), and thereby 16 extend the statute of limitations to ten years under § 3293(2). The 17 Government’s proffered evidence comprised non prosecution agreements 18 and settlement agreements (the “Bank Agreements”) that UBS and two other 3 1 co conspirator banks entered into with the Department of Justice, other 2 federal regulatory agencies, and various state attorneys general; testimony 3 from representatives of these banks that the Bank Agreements resulted from 4 the conduct charged in the superseding indictment; and documents reflecting 5 that some of the Bank Agreements discuss the particular transactions 6 referenced in the indictment. In the Bank Agreements, the three financial 7 institutions admitted wrongdoing, accepted responsibility for the illegal 8 conduct of certain former employees, and agreed to pay more than $500 9 million in fines and restitution to federal agencies and municipalities. The 10 banks also incurred attorney’s fees arising from the investigations that 11 resulted in the Bank Agreements. 12 Following the District Court’s denial of the Defendants’ motion to 13 dismiss, the parties stipulated that “each offense charged in the above 14 captioned matter, if proven beyond a reasonable doubt to have occurred, 15 affected a financial institution for purposes of 18 U.S.C. § 3293(2) and 18 16 U.S.C. § 1343.” App’x 1911. 17 18 The jury convicted Heinz, Welty, and Ghavami of conspiracy to commit wire fraud, and convicted Heinz and Ghavami of substantive wire fraud. 4 DISCUSSION 1 The Defendants orally preserved their right to appeal their legal 2 3 arguments regarding the statute of limitations issue, and the District Court 4 confirmed the Defendants’ understanding that they had preserved those 5 arguments. Accordingly, we address the merits. 18 U.S.C. § 3293(2) extends to ten years the statute of limitations for 6 7 wire fraud offenses (including conspiracy to commit wire fraud) “if the 8 offense affects a financial institution.” 18 U.S.C. § 3293(2). “[T]he verb ‘to 9 affect’ expresses a broad and open ended range of influences.” United States 10 v. SKW Metals & Alloys, Inc., 195 F.3d 83, 90 (2d Cir. 1999). The plain 11 language of § 3293(2) makes clear that “Congress chose to extend the statute 12 of limitations to a broader class of crimes” than those in which “the financial 13 institution is the object of fraud.” United States v. Bouyea, 152 F.3d 192, 195 14 (2d Cir. 1998) (quotation marks omitted). And so § 3293(2) “broadly applies 15 to any act of wire fraud that affects a financial institution,” provided the effect 16 of the fraud is “sufficiently direct.” Id. (quotation marks omitted). 17 18 three banks in this case within the meaning of § 3293(2). It is undisputed that We conclude that the Defendants’ wire fraud offenses “affected” the 5 1 the banks executed the Bank Agreements prompted in part by the fraudulent 2 conduct of the Defendants and their co conspirators. As a result, the banks 3 incurred significant payments and related fees, which were foreseeable to the 4 Defendants at the time of their fraudulent activity. The role of the banks as 5 co conspirators in the criminal conduct does not break the necessary link 6 between the underlying fraud and the financial loss suffered. 7 Since the relevant charges in the superseding indictment were well 8 within the applicable ten year statute of limitations, the District Court 9 properly denied the motion to dismiss. CONCLUSION 10 11 We have considered the Defendants’ remaining arguments and 12 conclude that they are without merit. For the reasons stated herein and in the 13 separate summary order accompanying this opinion, the judgments of the 14 District Court are AFFIRMED. 6
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