United States v. Ronald E. Ponec ( 1998 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
_____________
No. 98-1842NE
_____________
United States of America, *
*
Appellee, *
* On Appeal from the United
v. * States District Court
* for the District of Nebraska
*
Ronald E. Ponec, *
*
Appellant. *
___________
Submitted: October 23, 1998
Filed: December 18, 1998
___________
Before RICHARD S. ARNOLD, WOLLMAN, and MORRIS SHEPPARD ARNOLD,
Circuit Judges.
___________
RICHARD S. ARNOLD, Circuit Judge.
Ronald E. Ponec was convicted on eleven counts of violating the federal bank-
fraud statute, 18 U.S.C. § 1344, and sentenced to twenty-seven months in prison, the
bottom of the Guidelines range. He appeals, claiming that the conduct proved against
him, conduct that he does not substantially contest, did not, even when viewed in the
light most favorable to the government, amount to a violation of the statute. He also
contends that the District Court1 erred in declining to give him a two-point reduction
for acceptance of responsibility. For the most part, we affirm. We hold, among other
things, that the crime of bank fraud under 18 U.S.C. § 1344 does not require a showing
that the defrauded bank suffered a financial loss.
I.
The facts relevant to the issues raised on appeal may be briefly stated.
Mr. Ponec worked for a company called Pro-Data Computer Services, Inc. A number
of checks payable to the order of Pro-Data came into his possession. Defendant
deposited these checks, totaling about $238,000.00, into his personal bank account at
the Douglas County Bank and Trust Company. He had no authority to divert these
funds into his own account. The funds ought to have been deposited in Pro-Data’s
account, at the same bank.
When the defendant made deposits into his own account of checks made to Pro-
Data, he used blank deposit tickets, showing his personal account number. Defendant
had available to him pre-printed deposit tickets showing both the account name and the
number, but he did not use these when depositing Pro-Data checks into his own
account. In this way, the fact that Pro-Data checks were being deposited to the credit
of Ponec, rather than to the credit of Pro-Data, was made less conspicuous. The idea
was that the bank tellers receiving the deposits would simply look at the deposit
number and deposit the checks into the account bearing that number, not noticing that
the checks were payable to Pro-Data instead of to Ronald E. Ponec, the account holder.
The indictment contained eleven counts. Counts 1 through 7 alleged, with
respect to seven separate checks made out to Pro-Data, deposit of these checks in
1
The Hon. William G. Cambridge, Chief Judge, United States District Court for
the District of Nebraska.
-2-
defendant’s account in the manner we have described. Counts 8 through 11 of the
indictment had to do with checks written by Mr. Ponec on this account. Each of these
four counts related to a check, in each case drawn by Mr. Ponec and applied to his own
personal use, rather than to the benefit of Pro-Data. The case was tried to a jury, and
defendant was found guilty on all eleven counts.
Defendant argues on appeal that the indictment failed to state an offense against
the United States, and that the proof similarly failed to establish an offense. Central
to both points is the defendant’s contention that the government did not prove that
Douglas County Bank and Trust Company lost anything. Pro-Data was the victim of
the crime, so far as financial loss was concerned. No funds of the bank were taken,
and it was not part of the scheme that any would be. In order to consider this argument
properly, we first set out the words of the statute:
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.
18 U.S.C. § 1344.2
2
During a small portion of the time period covered by the conduct charged, a
predecessor version of this statute was in effect. See Section 961(k) of the Act of
August 9, 1989, Pub. L. No. 101-73, 103 Stat. 500. There are no relevant differences
between the two versions of the statute. The only change has been to increase the
-3-
The words of the statute themselves convincingly refute the argument now urged
by defendant. Paragraph (2) of the statute refers to a scheme to obtain monies or other
property of a financial institution. Under this paragraph, some loss to the institution,
or at least an attempt to cause a loss, appears to be required. The other portion of the
statute, however, paragraph (1), simply prohibits “defraud[ing] a financial institution
. . ..” Paragraph (1) says nothing about loss to the institution, either actual or intended.
So long as one has “defraud[ed]” a financial institution, one has violated the statute,
whether or not loss has occurred. Otherwise, there seems to be no reason for Congress
to have set out two separate ways in which bank fraud could be committed under this
statute.
In fact, we have specifically so held. In United States v. Solomonson, 908 F.2d
358 (8th Cir. 1990), the defendant was charged with, among other things, directing the
transfer of funds from certain corporate accounts to his personal accounts, without
having the right or authority to do so. He was convicted of both mail fraud and bank
fraud. On appeal, defendant argued that he could not be convicted of bank fraud
because the bank in question had not suffered any financial loss. We squarely rejected
this argument, saying, among other things:
We have difficulty believing that . . . a successful
scheme to defraud that does not result in financial loss to a
bank is not within the conduct proscribed by section 1344.
Thus, we hold that the government was not required to
prove that [the bank] suffered a financial loss.
maximum term of imprisonment from twenty years to thirty years. See Section 2504(j)
of the Act of November 29, 1990, Pub. L. No. 101-647, 104 Stat. 4861.
-4-
908 F.2d at 365.3
Defendant also argues that he did not make any false statement to the bank, so
there could be no scheme to defraud. Williams v. United States, 458 U.S. 279 (1982),
is cited for this proposition. Williams was a prosecution under 18 U.S.C. § 1014,
which makes it a crime knowingly to make any false statement or report for the
purpose of influencing the action of certain financial institutions. The proof showed
that Williams had engaged in a check-kiting scheme. He would maintain a number of
accounts in federally insured banks, would draw a check far in excess of his account
balance in one bank, and would then deposit it in his account in the other, then
reversing the process between his accounts. The Supreme Court held that this conduct
did not violate Section 1014, because, the Court thought, a check does not amount to
a factual assertion that the drawer of the check has sufficient funds on deposit to cover
it. A check is simply an order to a drawee bank to make payment, in default of which
the drawer of the check will be liable for the face amount. On this view, no
misrepresentation, and therefore no false statement or report, is made when an
insufficient-funds check is deposited.
The Supreme Court’s opinion in Williams of course is binding on us, but we do
not think it reaches the present case. We grant that the government needed to prove
that Mr. Ponec deliberately made false representations to the bank. Otherwise, there
would be no scheme or artifice to defraud. We cannot agree, however, that no
misrepresentation or misstatement occurred under the facts of this case. When
Mr. Ponec offered for deposit checks made to Pro-Data and specified that the deposit
be made into his personal account, he was representing to the bank that the proceeds
3
The case was decided under a pre-1989 version of Section 1344. Again,
however, there are no material differences between the statute as it was interpreted in
Solomonson and the versions of the statute that we must apply in the present case. See
908 F.2d at 364 n.4.
-5-
of the checks rightfully belonged to him, or, at least, that he had been authorized by
Pro-Data to deal with the checks in this way. Neither statement was true. Had the
bank known the truth, it certainly would not have wanted its tellers to put the checks
into Mr. Ponec’s own account. When Mr. Ponec wrote his own account number on the
deposit tickets, he was falsely representing that he had the right to put these checks into
his own account. We think this conduct is a scheme or artifice to defraud within the
meaning of Section 1344, and that nothing in the Williams opinion, which deals only
with the issue of insufficient funds, is to the contrary. Defendant points to language
in Williams stating that “a check is not a factual assertion at all, and therefore cannot
be characterized as ‘true’ or ‘false.’ ” 458 U.S. at 284. But the false assertion in the
present case appeared not on the checks, but on the deposit ticket, which implicitly
represented that defendant was dealing with the checks as he had a right to do. We
hold, therefore, that there is no infirmity in the defendant’s conviction on counts 1
through 7.
We think the case is otherwise as to the remaining counts, 8 through 11. These
counts involve not the deposit of checks into the account, but the drawing of checks
on defendant’s personal account. The four checks alleged in these four counts total
$12,897.71. The government’s theory is that when the defendant wrote these checks
and presented them to the bank for payment, he was falsely representing that he had
a right to do so. (As to these counts, notice that defendant could be found guilty,
assuming proper proof, even if the statute were interpreted to require proof of loss to
the bank, because, under paragraph (2) of the statute, obtaining money owned by, or
under the custody or control of, a financial institution, by means of false statements,
is a crime.) Here, defendant argues that the evidence against him is insufficient for a
fundamental reason: the proof did not show the source of the funds used to pay the
four checks in question, beyond the fact that they were paid out of the defendant’s
personal account. A considerable amount of the money in that account, defendant
argues, was unquestionably his own, and not Pro-Data’s. Accordingly, these checks
-6-
might have been paid with defendant’s own money, in which event there would have
been no false representation and no improper obtaining of money.
A factual representation in the brief filed by the United States in this Court
convinces us to agree with defendant’s position on this point. The government’s brief,
page 14, admits that “[o]n two separate occasions, Ponec had a legitimate deposit to
make to his own account on the same day as he intended to deposit a check made out to
Pro-Data.” Thus, the government has conceded that at least some of the money in the
account belonged to Mr. Ponec and could legitimately be drawn on by him for personal
purposes. We do not know the precise amounts, but the government had the burden of
proof on this issue. We hold that this burden was not met, and that the evidence is
insufficient to justify a rational conclusion that it was Pro-Data’s money, and not his
own, that defendant drew on when he wrote the four checks alleged in counts 8 through
11. Accordingly, the convictions on those counts must be reversed.
II.
In view of the reversal on four of the eleven counts, the case has to go back for
re-sentencing. Defendant will be entitled at least to credit for the special assessment on
each of the four courts reversed. Whether his sentence would otherwise be affected, we
do not know, leaving that to the District Court to decide on remand. We do think it
appropriate, however, to address defendant’s contention that the District Court abused
its discretion in denying him a two-level reduction for acceptance of responsibility,
because this issue could occur again at the time of re-sentencing. This sort of decision
is highly fact-intensive, and addresses itself to the sound discretion of the District Court,
which necessarily will have a much better feel of the circumstances of the case and the
attitude of the defendant than we do. It is sufficient for present purposes to note that,
at the time of sentencing, the defendant, though conceding that he had done the acts
alleged, attempted to blame the whole thing on his wife. The
-7-
District Court could reasonably have determined that defendant did not truly accept his
own responsibility for the crime.
As to counts 1 through 7, the judgment is affirmed. As to counts 8 through 11,
the judgment is reversed, and the cause remanded with instructions to dismiss these
counts of the indictment. In addition, the sentence imposed is vacated, and the cause
remanded for re-sentencing in a manner not inconsistent with this opinion.
It is so ordered.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
-8-