United States v. Mason ( 1996 )

USCA1 Opinion

          January 25, 1996      [NOT FOR PUBLICATION]



                            UNITED STATES COURT OF APPEALS

                                FOR THE FIRST CIRCUIT




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        No. 95-1721



                              UNITED STATES OF AMERICA,



                                 Plaintiff, Appellee,



                                          v.



                                   DENNIS L. MASON,



                                Defendant, Appellant.




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                     APPEAL FROM THE UNITED STATES DISTRICT COURT



                          FOR THE DISTRICT OF MASSACHUSETTS



                   [Hon. Nathaniel M. Gorton, U.S. District Judge]
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                                Selya, Cyr and Stahl,



                                   Circuit Judges,
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             Richard H. Gens for appellant.
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             Pamela  Merchant,  Trial  Attorney, United  States  Department of
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        Justice,  with whom Donald K.  Stern, United States  Attorney, Mark D.
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        Seltzer,  Acting Director, New England Bank Fraud Task Force, and Mark
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        Adler,  Senior Trial  Attorney, United  States Department  of Justice,
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        were on brief for appellee.






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                    Per Curiam.   Dennis  L. Mason appeals  his convictions
Per Curiam.
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          and sentences for  bankruptcy fraud, bank fraud,  and money laun-



          dering, see 18 U.S.C.    152, 1344, 1957.  We affirm.
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                    In  December 1987,  Mason  and First  Service Bank  for



          Savings  ("First Service")  finalized  a loan  agreement  whereby



          First  Service was to advance  $5 million to  Concord Woods North



          Realty Trust ("Realty Trust")  for the sole purpose  of acquiring



          and developing twenty-five  acres of real estate in  Concord, New



          Hampshire.   On the  closing date,  First Service  disbursed over



          $2.4  million to Mason, as trustee of Realty Trust; Mason immedi-



          ately directed  that approximately  $200,000 be deposited  in his



          personal account  at  the Bank  of  Boston.   The  day after  the



          closing, Mason  disbursed  $12,000  from  this  personal  account



          toward the purchase of jewelry for his wife.



                    During 1988,  Mason diverted approximately  $860,000 in



          First Service loan proceeds  to purposes unrelated to  the Realty



          Trust project, including  a $500,000 transfer to an  Ohio account



          in the  name of his  lawyer.  Between  March and August  1989, he



          transferred another  $100,000 in loan proceeds to  a bank account



          in his wife's name.



                    After  First Service  Bank closed  and its  assets were



          acquired by the Federal Deposit Insurance Corporation ("FDIC") in



          March 1989, Realty  Trust filed  a chapter 7  petition, in  which



          Mason, as  trustee, failed to disclose any of the above-described



          diversions of  First  Service loan  funds.   In  May 1989,  at  a



          meeting of  creditors in the Realty  Trust bankruptcy proceeding,





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          Mason  testified that  all First Service  loan proceeds  had been



          applied to the  Realty Trust  real estate project.   Mason  later



          made similar misrepresentations  to FDIC  attorneys in  September



          1989,  and again in 1992.  In  March 1992, he destroyed his busi-



          ness records.  Two months later he filed his own personal chapter



          7 bankruptcy petition.



                    Mason first  claims that  the district court  failed to



          instruct the jury on the essential  elements of the crime of bank



          fraud under  section 1344.1  Since Mason  failed to object to the



          jury instruction, we  review only  for plain error.   See  United
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          States v. Hurley, 63 F.3d  1, 9 (1st Cir. 1995).   The challenged
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          jury  instruction  met  the  three-part  standard  established in



          United States v. Brandon, 17 F.3d 409, 424 (1st Cir.) (bank fraud
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          elements  under 18 U.S.C.    1344 require  showing that defendant



          knowingly engaged in  a scheme  or artifice to  defraud, or  made



          false  statements or  misrepresentations  to  obtain money  from,



          bank), cert. denied, 115 S.  Ct. 80 (1994).  There was  no error,
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          let alone plain error.








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               1As many  arguments advanced by  Mason on appeal  are redun-

          dant, undeveloped, unpreserved, or patently frivolous, they merit

          no discussion.  In particular, since Mason mounts only a perfunc-

          tory challenge  to the bankruptcy fraud  instructions, see United
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          States v. Zannino,  895 F.2d 1, 17 (1st  Cir.), cert. denied, 494
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          U.S. 1082 (1990), and the  record on appeal does not  include the

          challenged instructions,  see Fed. R.  App. P. 10(b),  11(a); see
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          Plummer v.  Springfield Terminal Ry. Co.,  5 F.3d 1, 5  (1st Cir.
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          1993) (merits not reached because pertinent material not included

          in  record  on appeal),  cert. denied,  114  S. Ct.  1057 (1994);
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          United  States v. One Motor  Yacht Named Mercury,  527 F.2d 1112,
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          1113-14 (1st Cir. 1975), we deem the claim abandoned.



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                    Mason next  contends that the district  court committed



          reversible error by rejecting his  motion for judgment of acquit-



          tal on  the  bank  fraud  charge, since  there  was  insufficient



          evidence that he had embarked on a scheme to defraud  the bank by
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          the time the  loan documents were executed in December  1987.  We
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          evaluate the evidence in the light most favorable to the verdict,



          which must  be affirmed if a rational jury could have found Mason



          guilty beyond a reasonable  doubt.  United States v.  Vavlitis, 9
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          F.3d 206, 212 (1st Cir. 1993).



                    Although  Mason  attempts to  explain the  $12,000 dis-



          bursement from his personal account at Bank  of Boston to pay for



          jewelry  for his wife the day after receiving the initial advance
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          from First  Service on  the Realty  Trust loan,  there can be  no



          question that  this virtually contemporaneous evidence was suffi-



          cient to enable the  jury reasonably to infer that  the scheme to
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          defraud  had been  formulated by  the time  the loan  closing oc-
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          curred.   Moreover, larger  diversions of the  Realty Trust  loan
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          proceeds began within three months  after the loan documents were



          executed.   The  jury  was free  to  infer from  this  reasonably



          proximate  subsequent conduct  that Mason's fraudulent  intent to



          engage in the scheme had originated  by the time he executed  the



          loan  documents,  especially  since he  presented  no  compelling



          explanation for  embarking upon the improper  loan diversions the



          day after the  closing.   See United States  v. Sutton, 970  F.2d
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          1001, 1007 (1st Cir. 1992) ("testimony, though it centered around



          later-occurring events,  was relevant to  show appellant's intent





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          at an earlier date"); United States v. Mena, 933 F.2d  19, 25 n.5
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          (1st Cir. 1991) (similar).



                    Mason raises  two sentencing claims.   First, he argues



          that the two-level sentencing  enhancement for more than "minimal



          planning," see  U.S.S.G.   2F1.1(b)(2),  was unwarranted  because
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          the bank  fraud, bankruptcy  fraud, and money  laundering conduct



          constituted "singular transactions" or "single acts."  We find no



          clear error.   See Brandon, 17  F.3d at 459.   The record reveals
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          that  Mason repeatedly  diverted First  Service loan  proceeds to



          personal and other improper purposes throughout much of 1988  and



          1989.   Thus, the  sentencing enhancement  for more  than minimal



          planning simply reflected the  reality that his prolonged conduct



          was  no "spur  of  the moment"  undertaking.   United  States  v.
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          Gregorio, 956 F.2d 341, 343 (1st Cir. 1992).
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                    Second, Mason  claims that  the total  loss calculation



          was clearly  erroneous.  He relies  on a $4 million  appraisal of



          the  Concord Woods  North  property, whereas  the district  court



          relied on a  $110,000 FDIC  appraisal.  We  review the  valuation



          ruling for clear error.  United States v. Tardiff, 969 F.2d 1283,
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          1288 (1st Cir.  1992).   The record discloses  that the  district



          court reasonably  could have  found that Mason's  appraisal over-



          stated the number  of single-family homes the Concord Woods North



          property could accommodate and  relied on inflated valuations for



          individual building lots.  On the other hand, the much lower FDIC



          appraisal figure is the product of alternative valuation methods;



          viz., an "income capitalization  approach" and a "comparable land





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          sales approach."  See U.S.S.G.   6A1.3(a) ("the court may consid-
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          er relevant information .  . . provided that the  information has



          sufficient indicia of reliability to support its probable accura-



          cy.").  On this record, there was no clear error  in the district



          court finding  that the  defendant's valuation was  less reliable



          than that of the FDIC.  United States v.  Tejada-Beltran, 50 F.3d
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          105, 110 (1st Cir. 1995) ("[T]he  sentencing court's choice among



          supportable alternatives cannot be clearly  erroneous.") (quoting



          United States v. Ruiz, 905 F.2d 499, 508 (1st Cir. 1990)).
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                    Finally,  Mason  presents  an "ineffective  assistance"



          claim based on trial counsel's alleged failure (1) to object to a



          supplemental  jury instruction on bank fraud, and (2) to move for



          a new trial based on the same instruction.  See  United States v.
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          Ortiz,  23 F.3d  21  (1st Cir.  1994) (entertaining  "ineffective
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          assistance" claim on direct  appeal where record was sufficiently



          developed and critical facts were not in dispute).



                    The  instruction  in question  informed  the  jury that



          appellant could be  convicted upon "whatever scheme  you find the
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          government  has proven  beyond  a reasonable  doubt."   (Emphasis



          added.)  Mason asserts that this rendered the indictment "duplic-



          itous."  We disagree.  The challenged instruction  simply permit-



          ted the jury to convict based on a scheme plainly  alleged in the



          indictment.  The evidence adduced  at trial worked no  broadening



          of the scheme alleged  in the indictment.   See United States  v.
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          Miller, 471 U.S.  130, 145  (1985).   The ineffective  assistance
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          claim therefore  fails as Mason has  not demonstrated "prejudice"





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          from  the alleged omission by  trial counsel.   See Strickland v.
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          Washington, 466 U.S. 668, 687 (1984).
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                    Affirmed.  See 1st Cir. R. 27.1.
Affirmed.
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