Articles Posted in Federal Criminal Defense

Mortgage fraud in South Florida continues to be in the news, as a multi-agency task force involving both federal agencies and local law enforcement continues to file criminal cases in both state and federal Courts. South Florida federal courts are known to be especially focused on sex crimes and white collar fraud, while medicare fraud and mortgage fraud criminal prosecutions are leading the headlines. When looking at the convictions, specifically for mortgage fraud, Florida has a reputation for long prison sentences.

So, is it true that federal criminal judges in Miami and Fort Lauderdale sentence longer than other districts? A lot more?… Well…in a word, yes, a lot more. More than other parts of the U.S.? Yes. More in the Southern District of Florida (i.e. Miami), than in other parts of Florida? In a word, Yes.  This can be seen in the numbers of mortgage fraud cases filed by the U.S. Attorney in Florida, the total number of defendants charged with mortgage fraud, the number of defendants that decide go to trial and the total amounts of money lost by banks in Miami, Fort Lauderdale and Palm Beach.

Most people who are arrested for mortgage fraud and prosecuted in federal court want to know the sentencing risks: The risk of long sentences if the case results in a conviction, the risk of harsh sentencing by federal judges in Florida for those defendants that plead “open” to the court, and the range of sentences for mortgage fraud by defendants who do substantial assistance, that means agree to testify against other defendants.  It is smart to know your exposure before deciding on a strategy.

Sentencing exposure can be guessed at by the criminal lawyers who do mortgage fraud cases, but it is usually a “seat of the pants” estimate, although there is no need to guess, however, because sentences are compiled by the Sentencing Commission and available online.  Here is what the Sentencing Commission found: t

• Twice the number of mortgage fraud cases are filed and prosecuted in the Eleventh Circuit, i.e. in Florida than in any other federal district.
• Nationally, 9.8 % of federal cases involved fraud, and in Florida 18.2 % of the cases involve fraud, which is double.
• Nationally, 3.1 % of federal criminal cases go to trial, and in Florida double the number of cases go to trial, which is 5.6 %.
• Prison sentences (in years) are longer in Florida than in other parts of the U.S. Nationwide, as 71.5 % of those charged with fraud go to prison, while in the Southern District of Florida (Miami, Fort Lauderdale and Palm Beach) it is a little higher,  74.0 % of criminal defendants facing fraud charges go to prison.

The reason Florida has a reputation for longer sentences is, firstly, Florida has more mortgage fraud/white collar prosecutions than other parts of the U.S.  Secondly, as the nature of the cases seem to follow a pattern, so does the outcome. It’s not that Florida federal judges give longer sentences than federal judges in other districts, that is simply not the case. What you are seeing is a greater number of fraud cases with outcomes that are above the median. Florida also has more egregious and offensive operators in the housing sector. We see more double HUD form frauds, more dishonest appraisals, more bank employees willing to be a part of fraudulent loans, and more small offices that are not supervised by a compliance officer. That being the case here in Miami, attorneys who do mortgage fraud cases are more experienced and are flown all over the U.S. to represent defendants in other cities.

A former Boca Raton, Florida resident, Ms. Annette Bongiorno, age 66, was sentenced in Federal Criminal Court in New York. U.S. District Court. Judge Laura Taylor Swain sentenced Bongiorno to six years in Federal prison saying Ms. Bongiorno’s decision to follow Bernard Madoff’s instructions to perpetrate one of the largest frauds in U.S. history was inexcusable. The Judge said the fraud went forward and was advanced “right in front of her,” while Annette Bongiorno did nothing to stop or reveal the fraud.  Instead she helped, year after year, to continue one of the most tragic frauds in history.

The losses are estimated at twenty billion dollars, with estimated forfeitures of almost 155.2 billion dollars. Forfeitures are monies that investors had withdrawn over the twenty-plus years of investing in Bernard Madoff’s investment product, and are forced to return to the Bankruptcy Court. Most investors drew out some of the earnings to live on, and left their original principal investment remain with Madoff’s private investment plan.   The reported yield on investment was not, by most standards, either over high or excessive under then-current market conditions so as not to draw suspicion. What made the Madoff investment product so attractive was the fact that year after year, without exception, his return on investment was constant, regular and unchanging.

Ms. Borngiorno became a millionaire as Bernard Madoff’s assistant, living in luxurious homes in Boca Raton, Florida, and Manhassett, an upscale town on Long Island, New York. U.S. Federal prosecutors sought a twenty-year sentence and were disappointed by Judge Swain’s six-year prison term.   Annette Bongiorno was convicted in New York Federal District Court, criminal division, in March of 2014. The sentencing was set for December 2014.

At the sentencing Federal Judge Swain said of Ms. Bongiorno, among other things, that Ms. Bongiorno was “not fundamentally corrupt” but was rather dazzled by the tone and demeanor of Bernard Madoff. The Judge went on to say that she had “borderline competence” to do the complex financial work that she performed in the Madoff operation. The Judge said Ms. Bongiorno should have realized, as far back as 1992, that Madoff’s operation was a fraud but that she lacked the moral fiber to step forward. The Judge went on to say she was “a knowing and willing participant who made a choice to participate.”

Refuting the Judge’s statement, Ms. Bongiorno insisted that she was innocent of actual knowledge when she said in open court “I did not know what was happening, I didn’t mean to hurt you.” What surprised most attorneys familiar with Federal fraud cases and sentencing is, despite Ms. Bongiorno’s protestations of innocence, the Judge sentenced her to a light sentence of only six years in Federal prison. Ms. Bongiorno, almost challenging the Judge’s decision to be lenient by an under guidelines variance said in open court “how very sorry I am by all the sorrow and loss caused by Madoff and by extension, by me.” These, her protestations of innocence, were an attempt to distance herself from the fraud.  Judge Swain, seemingly ignoring Ms. Bongiorno’s statements, shocked prosecutors by the light sentence of six years in Federal detention. To support Judge Swain’s sentence, the Judge remarked the issues of poor health. Ms. Bongionrno’s slight build (five feet tall) and the Judge’s statement that Ms. Bongiorno would not do well in prison, were made on the record to support the Judge’s variance in sentencing Ms. Bongiorno below the Sentencing Guidelines.

Visit the Wall Street Journal’s section for more articles on the Madoff Ponzi Scheme.

The arrest is where it begins. A Federal criminal arrest can often be an almost civil event between professional U.S. agents and the target. Once arrested you are brought before a Magistrate for arraignment. At arraignment the matter of reading the indictment, determination of counsel, and conditions of pre-trial release, or pre-trial incarceration, are determined.

What comes next is the most difficult and most important stage: it is called Pre-Trial Discovery. In Federal criminal courts in Miami and Fort Lauderdale all cases, not just some, or a few, but all Federal criminal cases are won and lost in Discovery.  Older lawyers learned Motion Practice, and it is still true that in the technical skills of motion practice a case lives, or dies. There is great truth in the ancient lawyers’ adage that good lawyers have good answers, great lawyers have good questions.  What goes on in Federal criminal courtrooms in Miami and all over Florida, is a struggle to force the U.S. Attorney to reveal evidence that will exonerate.

Over fifty years ago the U.S. Supreme Court wrote the groundbreaking case of Brady v. Maryland. In the Brady decision, the U.S. Supreme Court made the finding that the government’s failure to disclose favorable evidence violates the constitution.  But what the Court gives, it also takes away….when the Court added the inscrutable caveat that the rule only applies to information that is “material.”  Certainly no one knows the unknown, but forcing a prosecutor to provide exonerative evidence is what truly great criminal trial lawyers do best.

This is sadly truest, and most lacking, in Federal criminal courts where prosecutors have an unwritten code of total war to secure a conviction. Most criminal trial lawyers in Federal criminal court will agree that Brady rules are more in the breach then in the observance.  A recent study by the National Association of Criminal Defense Lawyers found that in 620 cases under study Federal prosecutors failed to disclose favorable information in 145 of the 620 cases. It is also widely held by criminal defense lawyers that judges are no friend to criminal defense attorneys in federal court.  The NACDL study concluded that in only 14 percent of the cases judges granted the defendant’s motion. Finding a way to use discovery rules to gain advantage is best done not in anger, but with patience.

Here is an illustration of how it is done: Witnesses, who were known to Federal investigators and determined as not useful to the prosecution, are not interviewed.  In discovery practice, all Federal districts require that field notes of investigators be revealed to defendants Demanding interview lists (not notes) is the way to get the names of witnesses who were not interviewed and do not appear in the investigator’s notes. Resistance by prosecutors is successfully skirted by demanding investigation names of both those interviewed and those not interviewed.

Federal criminal court judges, in my opinion, often thwart defense investigations rather than helping them.  You can encourage a Federal judge’s unwilling assistance by couching your demands in such a way as to suggest failure to grant the motion may well be an ethical violation.  Again, asking good questions is better than having good answers.  When you file discovery requests, such that they place a judge in an area that is between ethically right and wrong, you can overcome a judge’s predilection to expediency in moving his criminal docket. Start with having no fear. Do not fear a judge nor prosecutor. Fear cripples; but knowledge and skill can enlist a Federal criminal judge to assist in your discovery rather than block it.

This past Wednesday, October 22, 2014, four former Blackwater contractors were convicted in the infamous 2o007 killings in Baghdad, by a federal jury.

In 2007, at the height of the United States incursion in Iraq, seventeen Iraqi civilians were killed and eighteen wounded in a busy traffic circle in Bagdhad. Employees of Blackwater Corp, a private security company, did the killings and non-fatal shootings. Blackwater was then, and remains today, a military contractor providing services to United States Armed Forces.

Source: www.dailymail.co.uk

The widely reported case brought into focus the fact that the U.S. was using private companies to provide security forces and military services in conjunction with members of the United States military. The allegations then were, and the convictions confirm, that the killings in Nusoor Square were in violation of the rules of engagement and the rules of war.

The attorneys for the convicted contractors have told both the Court and the press that the convictions will be appealed. The case was brought by the United States Justice Department and in the charging documents the Justice Department alleged that the privateers committed murder, manslaughter, and several firearms offenses.

The facts as alleged in the criminal complaint were as follows: On September 16, 2007 nineteen Blackwater employees (called “contractors”) were providing security services to a convoy. The contractors were informed that a car bomb was detonated in Baghdad in a location that was near or part of the team’s assignment. They were escorting and protecting some United States officials. The team, disregarding orders from a senior Blackwater employee (who was in effect in command of the operation) changed the route to the Green Zone. They established a blockade obstructing traffic in busy Nusoor Square, which is next to the U.S. Green Zone. Seven members of the security team from Blackwater fired at vehicles and civilians in the traffic circle. They killed and injured unarmed Iraqi civilians. Among those killed was a medical doctor, a car salesman, an Iraqi soldier, a taxi driver and others who were there in the traffic circle. Blackwater said the convoy was under attack. At the trial witnesses told the jury that was untrue and that the contractors fired first and without provocation.

The case was dismissed in 2008 when a judge found that the government prosecutors withheld evidence that would have exonerated the defendants and ordered a new trial. The Congress of the United States held hearings on the allegations and the hearings were widely covered by the press in the United States and around the world. At the trial, there was evidence that the convoy came under attack and testimony that the contractors and testimony that the Blackwater contractors fired first and without provocation.

Here are the names of the defendants and the charges and convictions:

– Paul Slough, 35, of Keller, Texas: Convicted of thirteen counts of voluntary manslaughter, and 17 counts of attempted manslaughter and one firearms offense.

-Evan Liberty, 32, of Rochester, New Hampshire: eight counts of voluntary manslaughter, 12 counts of attempted manslaughter and one firearms offense.

-Dustin Heard, 33, of Maryville, Tennessee: six counts of voluntary manslaughter, 11 counts of attempted manslaughter and one firearms offense.

-Nicholas Slatten, 30, of Sparta, Tennessee: guilty of first-degree murder.

The FBI has a policy that agents cannot use recording devices/systems when interviewing people who are arrested or are the subject of a criminal investigation; The “302” black hole. “Form 302” is the form used by the FBI, a “302” is a handwritten summary, written by an FBI agent, after conducting an interview.

This policy is widely followed by Florida Sheriffs, Fort Lauderdale Police, DEA investigations, the Office of the Statewide Prosecutor in Florida, and Florida Department of Law Enforcement.

Nationwide, most State and local police agencies do not permit police to record contact with citizens, arrestees, witnesses and on and at crime scenes. The only exception is the DUI car-cameras that many police cruisers use to record DUI roadside examinations.

Criminal defense attorneys have raised Due Process arguments that contact with the government, in which a citizen’s constitutional rights are in play, is subject to Due Process review. Also argued are it is a violation of best-evidence rules. In prosecutions in Fort Lauderdale, where the Broward Sheriff’s Office is the primary policing agency, an officer writes a “probable cause affidavit”. Prosecutors base their decision to file criminal changes or decline after reading the Probable Cause Affidavit. There is increasing pressure to use electronic recording devices, such as audio and video recording systems, but police agencies resist.

Criminal lawyers, and I am one of them, have filed motions to strike affidavits from police officers as Due Process violations. We are asking the courts to require in-custody interrogations be recorded. The tension rises from the very real conflict between permissible interrogation techniques and the reality that they can offend sensibilities but not violate the law. Example: the United States Supreme Court has ruled that in the course of an interrogation it is acceptable for police to assert false statements to elicit a response. It is called lying by laypersons, but it is considered an acceptable interrogation technique. Police can tell an arrestee that their co-defendant has confessed and asserted that you are the shooter. The police can tell a detainee that they have witnesses that do not exist, video recordings that do not exist, evidence that does not exist, and that the other person arrested was an undercover cop. In courtrooms, a video of a police officer lying before a confession is elicited may offend jurors and be disregarded, or cause the jurors to acquit and to express offense at these “aggressive interrogation techniques.”
Check out these articles for on the subject:
Constructing Truth: the FBI’s (non)recording policy

Unrecorded Testimony

The office of the US Attorney announced that several thousands of men and women in federal prison for conviction of federal drug laws will be eligible for early release. The review process means sentences that were given out in the past will be reduced, significantly reduced. That means, and this will rock a lot of worlds….those already serving federal prison sentences can be released early.

These are the criteria:

1. They are serving a federal sentence that would likely be significantly lower if sentenced today (the new policy date is 2014) because of intervening changes in law or policy;
2. They have served at least ten years of the sentence imposed;
3. They are relatively low-level offenders who have no ties to any criminal organizations or gangs;
4. They have relatively little criminal history, both as a matter of quality and quantity;
5. They exhibit a record of good conduct while incarcerated; and

6. They do not have a history of violence.

Deputy Attorney General James Cole made the announcement in April 2014 about this historic event; historic because it has never happened before, and because it may be nullified or cancelled when the current administration leaves. The American Bar Association, the Federal Public Defenders, the National Association of Criminal Defense Lawyers are all on board and available to place you with an attorney who can begin the process of sentence reduction.

Hundreds, if not thousands, of federal prisoners will qualify for this clemency/reduction of sentence program.

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Federal Sentencing has been praised and pilloried since 1984 when the Sentencing Commission, a creature of the Congress, was created. Over the years it has been seen as race neutral, gender neutral, and fair. Heralded as removing judges from the influences of money and lawyers, it has both succeeded and failed beyond expectation. It is now being reviewed. Thankfully. And, amazingly CNN has reported favorably on it!

The Sentencing Commission published some revisions, and they will be implemented. The Congress forever palavering over voters, who want criminals in prison, has evolved. Critics who have been overwrought and often wrong are tempering and things are where they should be: on the road of reform.

The elimination or the cocaine/crack disparities has been accomplished. The US Attorney’s Office has created and is implementing reviews of sentences that will be reduced. Minimum mandatory sentences are being halved. States, Florida and (surprise!) Texas have or are dealing with the issue of incarceration, retribution and the return of the incarcerated to functional citizenry. Drug addiction criminal sanctions include programs not only jail cells. The adage that every problem is a nail and every solution is the hammer is rolling back. Many criminal defense lawyers, both State and Federal, are reporting from the front lines of federal criminal trials and sentencing and the reports are not good, but they are being reported. It is a rationalizing process. And, as no surprise to Tea Party and moderate republicans, National Public Radio agrees!

So… what is going on here? What is being changed?…
Changes go to the DRUG QUANTITY TABLE. The proposed amendments would lower, by two levels, the base offense levels, which means taking 2 to five years off of the sentencing guidelines range(s). Although not a big drop in years it is an attempt to balance the public rage and push to jail addicts and suppliers. Federal Statute Title 18 section 3553 lists statutory factors for a proper and balanced sentence: the circumstances of the criminal act (the offense), the character of the defendant, the judge’s responsibility to the community at large to discourage criminal acts by others who become aware of the certainty of punishment, protecting the public from the defendant returning to the community and victimizing others, and, lastly, to salvage any future hope that the defendant can become a part of the general public who behaves well and pays taxes.

As the Attorney General told the Congress, being effective is being smart and the revisions say “smart” not “blunt”. And your federal government has chimed in with a balanced report of the subject:

Smart is smarter and the proposed amendments are a start toward and a part of the evolving of a view of bad behavior that can only remove those who sin by housing them in concrete and metal bars until age, death or human evolvement (both societal and personal) emote change. Change is needed from both realms and the proposed changes have enlisted support from all parties and actors in the criminal justice realm.

Robert Mueller III is the Director of the FBI. He has 36,074 employees, 13,913 special agents, but he calls the shots. And if a shot across your client’s bow is going to come, he’s the man who brings the misery down on us. So if you advise clients, Boards of Directors, Legal Counsel, etc. on what’s coming down the road, no need to read tea leaves, just listen to The Man. And he has spoken.
Director Mueller spoke in Miami April 2, 2012 and today, almost one year later, I can say with certainty that his speech is the most important roadmap for White Collar Criminal defense lawyers to use in counseling our clients. Read his speech and you’ll see that the FBI and SEC and FINRA and most of the FCPA and Patriot Act prosecutions we’re dealing with over the last year were foreseeable. So if you advise corporate clients on white collar matters, if you assist clients in setting up internal controls, investigations and advisories, line up your caseload and re-read his April 2, 2012 speech. I’ll bet you an amount equal to your past year’s parking fees at U.S. Federal Detention Centers (visiting your in-custody clients), that the roadmap was published. As is said “govern yourself accordingly”.
And here is the list extracted from Director Mueller’s speech:
1. Money laundering
2. Health Care Fraud
3. Mortgage Fraud

Followed by….corporate and securities frauds and Foreign Corrupt Practices Act (FCPA) prosecutions, both civil and criminal.

Many people think that if they are not doing anything wrong on the streets, that it is completely illegal for cops to stop them. In South Florida and many of its jurisdictions such as Miami, Fort Lauderdale, West Palm Beach, Broward County, Dade County and Palm Beach County, there are some facts to be considered to determine if the police have done anything illegal, or anything that violates your constitutional rights.
In South Florida, a police can stop you at any moment, they can approach you and they can ask you questions. They are allowed to do that even if they don’t have reason for it. But what people should know is that only because the cop is allowed to stop them and ask questions, it doesn’t mean that they are required to answer them. The officer may ask you to search something that you have in your possession, like a purse. You are not required to agree to that search.

If you gave any statement or information to a police officer and you think that he compelled you to do so in an illegal way, you should contact an experienced criminal defense attorney in South Florida.