Fraud Archives | Fort Worth Criminal Defense and Personal Injury Attorneys

Misapplication of Fiduciary Property Texas 32.45

Misapplication of Fiduciary Property in Texas | Texas Penal Code 32.45

By | White Collar

Misapplication of Fiduciary Property—What is it?

Misapplication of Fiduciary Property Texas 32.45Misapplication of fiduciary property is a charge that is aimed at protecting beneficiaries of trusts, estates, receiverships and the like. Pursuant to Section 32.45 of the Texas Penal Code, a person commits the offense of misapplication of fiduciary property by intentionally, knowingly, or recklessly misapplying property he holds as a fiduciary in a manner that involves substantial risk of loss to the owner of the property. Tex. Penal Code Ann. § 32.45(b). “Substantial risk of loss” means a real possibility of loss. Casillas v. State, 733 S.W.2d 158, 163¬–64 (Tex. Crim. App. 1986). However, the possibility need not rise to the level of a substantial certainty (which is required for theft)—the risk of loss need only be more likely than not. Id.

Who is a “Fiduciary” Under Texas Law?

The penal code sets out four distinct groups that are considered fiduciaries pursuant to Section 32.45. These include:

  • A trustee, guardian, administrator, executor, conservator, and receiver;
  • An attorney in fact or agent appointed under a durable power of attorney;
  • An officer, manager, employee, or agent carrying on fiduciary functions on behalf of a fiduciary; or,
  • Any other person acting in a fiduciary capacity.

Id. at § 32.45(a)(1).

“Acting in a fiduciary capacity” is not defined in the penal code. However, the Texas Court of Criminal Appeals determined that because “fiduciary” has such a common meaning it should be construed according to its plain meaning. Berry v. State, 424 S.W.3d 579 (Tex. Crim. App. 2014).

The plain meaning of fiduciary means, “holding, held, or founded in trust or confidence.” More notably, a person who acts as a fiduciary is one “who has a duty, created by his own undertaking, to act primarily for another person’s benefit in matters connected with such undertaking.” Gonzalez v. State, 954 S.W.2d 98, 103 (Tex. App.—San Antonio 1997, no pet.). For example, courts have held that a person acts in a fiduciary capacity “when the business which he transacts, or the money or property which he handles, is not his or for his own benefit, but for the benefit of another person as to whom he stands in a relation implying and necessitating great confidence and trust on the one part and a high degree of good faith on the other part.” Gonzalez v. State, 954 S.W.2d 98, 103 (Tex. App.—San Antonio 1997, no writ).

Additionally, a person acting in a fiduciary capacity embraces any fiduciary, including a joint adventurer or partner. Coplin v. State, 585 S.W.2d 734 (Tex. Crim. App. 1979). This does not, however, include everyday business dealings. Berry, 424 S.W.3d at 584. The Court of Criminal appeals assume such transactions are entered into for a mutual benefit and, therefore, neither party is expected to act solely for the benefit of the other. Id.

What does it mean to “Misapply” Property?

The definition of “misapply” is fairly broad under the penal code. Pursuant to Section 32.45, a person who is a fiduciary misapplies property held as a fiduciary if the person deals property contrary to:

  • An agreement under which the fiduciary holds the property; or
  • A law prescribing the custody or disposition of the property.

Evidence that a defendant aided another person in misapplying property is sufficient, pursuant to the law of parties, to convict a defendant of misapplication of fiduciary property—even if the defendant did not personally handle the misapplied funds. Head v. State, 299 S.W.3d 414 (Tex. App.—Houston [14th Dist.] 2009, pet. ref’d). Furthermore, a defendant need not receive a benefit in order to misapply property. Talamantez v. State, 790 S.W.2d 33,37 (Tex. App.—San Antonio 1990, pet. Ref’d). Nor does it matter if a defendant donated the property to charity. Little v. State, 699 S.W.2d 316, 318 (Tex. App.—San Antonio 1985, no pet.).

Therefore, misapplication can occur by an omission or failure to act where a duty to act exists. Coleman v. State, 131 S.W.3d 303, 309-10 (Tex. App.—Corpus Christi 2004, pet. ref’d).

What does it take to Prove up an Agreement?

The government must prove the defendant knew of the agreement for misapplication to occur. Amaya v. State, 733 S.W.2d 168 (Tex. Crim. App. 1986). But, similar to “fiduciary,” Section 32.45 does not define “agreement.” Thus, the Court of Criminal Appeals construes agreement according to its plain meaning. Bynum v. State, 711 S.W.2d 321, 323 (Tex. App.—Amarillo 1986), aff’d, 767 S.W.2d 769 (Tex. Crim. App. 1989). To prove up an agreement, the State must be able to demonstrate a harmonious understanding or an arrangement, between two or more parties, as to a course of action. Id. Additionally, there is nothing in Section 32.45 that requires the agreement to be in writing or proved directly. Id.

Possible Defenses?

An effective defense to a charge of misapplication of fiduciary property is mistake of fact—otherwise negating the culpability required for the commission of the offense. Section 32.45 is designed to punish intentional, knowing or reckless misapplication of property. Thus, if it can be proved that the improper use or application of the property was the result of mere negligence, by mistake of fact, the statute will not apply. Other defense vary depending on the facts of the case.

What are the Penalties?

Texas has broad laws governing the use of property by a fiduciary. The charges can range from a Class C misdemeanor to a first-degree felony, based on the amount or value of property that is “misapplied.”

According to the Texas value ladder, an offense under this section is a:

  • Class C misdemeanor if the value of the property misapplied is less than $100;
  • Class B misdemeanor if the value of the property misapplied is $100 or more but less than $750;
  • Class A misdemeanor if the value of the property misapplied is $750 or more but less than $2,500;
  • State Jail Felony if the value of the property misapplied is $2,500 or more but less than $30,000;
  • Felony of the third degree if the value of the property misapplied is $30,000 or more but less than $150,000;
  • Felony of the second degree if the value of the property misapplied is $150,000 or more but less than $300,000; or
  • Felony of the first degree if the value of the property misapplied is $300,000 or more.

Id. at § 32.45(c).

Moreover, there is also an additional enhancement (to the next higher category) if it can be shown that the beneficiary was a person 65 years or older. § 32.45(d).

When Does Misapplication of Fiduciary Property Usually Occur?

This charge can arise in several different contexts. To name a few, misapplication of fiduciary property can occur:

  • When trustees misapply trust property;
  • When the holder of power of attorney makes a gift to herself;
  • When a business partner improperly diverts funds for personal use; or,
  • When an attorney misapplies a client’s funds.

These examples demonstrate that Section 32.45 covers many situations and may result in serious consequences. Thus, if you are under investigation or have been charged with the offense of misapplication of fiduciary property, it is necessary you seek help.

Misapplication of Fiduciary Property Defense Attorneys

Our criminal defense team handles Misapplication of Fiduciary Property cases in Tarrant County, Texas and surrounding areas. If you are under investigation for w financial crime or white collar offense, contact our firm today for a free case evaluation.

Probable Cause Affidavit Franks Hearing

Challenging the Probable Cause Affidavit | Franks Hearing Requirements

By | Fraud

Problems with Probable Cause: Law Enforcement Allegedly Used Conflicting Third Party Statements as the basis for a Search Warrant

Probable Cause Affidavit Franks HearingEvidence obtained by a valid search warrant can be used at trial. But what if the search warrant was based on information provided by a third party who later recants the information he provided? Further, what if law enforcement mischaracterized the evidence when presenting it to the magistrate in the application for the warrant? What legal remedy, if any, exists to support defendants who find themselves in this situation? The Fifth Circuit heard United States v. Minor in August, this article summarizes the Court’s surprising holding.

See the full text of the 5th Circuit’s decision in United States v. Minor (USCA 5th Cir. 2016)

US v. Minor – Rogue Bank Employee Hatches Identity Theft Scheme

Anthony Minor and his friend Katrina Thomas, a Fannie Mae employee, hatched a plan to steal the identities of numerous Fannie Mae clients with the intention of using the personal information to obtain entry into checking and savings accounts. Thomas created a list of client names and personal information while at work, and then provided Minor with the information. Minor was successful in using the data to steal money from those individuals’ bank accounts by contacting banks, pretending to be the individual, and transferring funds to Minor’s personal account.

During the time of these crimes, Minor was frequenting a hotel. Eventually, law enforcement began investigating Minor; the lead investigator assigned to the case was Albert Moore. In a warrant affidavit, Moore states that Will Crain, the director of security at the hotel, reported to law enforcement that he had seen Minor with expensive merchandise. That statement was used to establish probable cause for obtaining a search warrant. Law enforcement used the search warrant to search Minor’s dwellings, and the search rendered evidence of the crimes. Minor was arrested on numerous bank fraud charges.

Minor Goes to Trial on Federal Fraud Charges

At trial, a jury found Minor guilty of bank fraud, aiding and abetting bank fraud, conspiracy to commit bank fraud, using or trafficking in an unauthorized access device, aggravated identity theft, and aiding and abetting aggravated identity theft. Minor was sentenced to 192 months’ imprisonment, a sentence that incorporated a six-level enhancement, but was set well below the federal Sentencing Guidelines recommendation at the trial judge’s discretion.

Minor appealed to the Fifth Circuit Court of Appeals, arguing that the search warrant contained false information and that he is entitled to a Franks Hearing to establish the facts surrounding the statements used to support the finding of probable cause for the search warrant.

Minor Appeals to the Fifth Circuit Arguing Agents Lacked Probable Cause for Search Warrant

Minor appealed to the Fifth Circuit Court of Appeals, arguing:

  1. that the trial court should have held a Franks Hearing to determine whether law enforcement improperly obtained a search warrant for his car,
  2. that even if Minor’s case does not meet the requirement for a Franks Hearing, that an exception be carved out specifically for his case, and
  3. that his sentence should not have included a six-level enhancement (more prison time).

Minor alleged that Crain, the hotel’s security guard, testified at trial that he did not see Minor carrying merchandise and therefore, law enforcement did not have probable cause to secure a search warrant.

Franks Hearing Requirements—A Supreme Court Precedent

In Franks v. Delaware, 438 U.S. 154 (1978), the Supreme Court held that

“where the defendant makes a substantial preliminary showing that a false statement knowingly and intentionally, or with reckless disregard for the truth, was included by the affiant in the warrant affidavit, and if the allegedly false statement is necessary to the finding of probable cause, the Fourth Amendment requires that a hearing be held at the defendant’s request.”… [Further, if the] “allegation of perjury or reckless disregard is established by…a preponderance of the evidence…the search warrant must be voided and the fruits of the search excluded to the same extent as if probable cause was lacking on the face of the affidavit.”

Id. at 155-56.

Federal Sentencing Guidelines for Bank Fraud Crimes

“U.S.S.G. § 2B1.1 (2014), provides that “if the defendant’s offense involved 250 or more victims, then § 2B1.1(b)(2)(C) requires the court to increase the defendant’s offense level by 6 levels. U.S.S.G. §2.B1.1(b)(2)(C).

The Fifth Circuit Weighs In; Holds that the Affiant’s statements were not “deliberately false or made with reckless disregard for the truth.”

The Fifth Circuit relied heavily on Supreme Court precedent with regard to the evidentiary appeal and deferred to the reasoning of the trial court with regard to sentencing.

As “Minor concedes that Agent Moore did not intentionally insert false information into the affidavit, or act with reckless disregard for the truth…and because Minor failed to make the requisite substantial preliminary showing, [Minor] is not entitled to a Franks hearing.” Secondly, “[Minor] asks us to hold that in a case where a law enforcement affiant is relying upon information….from other[s]…the challenger should not be required to meet the intentional or reckless requirement to proceed a Franks hearing.” Here, “Minor’s argument is meritless under any standard…[and he] has not cited any authority recognizing his proposed exception to Franks…we decline…to create a new exception to well-established Supreme Court precedent.

Further, the Fifth Circuit said, “we agree with the district court that Minor…actively employed the means of identification of over 250 victims in furtherance of their bank fraud scheme…with the object of unlawfully accessing those customers’ bank accounts without their consent.” Accordingly, the Fifth Circuit affirms the holding and sentence of the trial court.

Frozen Assets Attorneys Fees

Supreme Court Rules Feds Cannot Seize Untainted Assets Needed for Attorney Fees

By | Asset Forfeiture

In Luis v. United States, the Supreme Court Addressed Whether and to What Extent, Federal Authorities Can Seize Assets Unrelated to Criminal Activity.

Frozen Assets Attorneys FeesMany federal defendants have been in the position of needing to hire an attorney but having all of their assets frozen.  Not anymore.  The United States Supreme Court ruled this week that the federal government cannot, before trial, seize the assets of the defendant if those assets are unrelated to the criminal allegation and are needed to fund a defense attorney.

See Luis v United States (US S.Ct. 2016)

Luis v. United States – Case Background

In Luis, a Miami woman named Sila Luis was accused of Medicare and banking fraud. The criminal charges alleged that she illegally used kickbacks and other criminal schemes to fraudulently obtain over $45 million. Luis only had $2 million left when federal prosecutors obtained a court order seizing all of her assets — both those assets related to the crime and those unrelated to it. She challenged the federal seizure order arguing that she needed the unrelated (untainted) assets in order to retain an attorney for her trial.

A majority of Supreme Court justices agreed with Luis. that allowing the government to take her untainted assets would violate her Sixth Amendment right to counsel of her choice.

When Can the Federal Government Seize a Defendant’s Assets?

18 U.S. Code Section 1345(a)(2) provides that a court may freeze before trial certain assets belonging to a defendant accused of violations of federal health care or banking laws. Those assets include (1) property “obtained as a result of” the crime, (2) property “traceable” to the crime, and (3), as relevant here, other “property of equivalent value.”

Writing for four of the justices, Justice Stephen Breyer explained that the frozen assets

belongs to the defendant, pure and simple.” He added that, as a practical matter, to accept the government’s position could have grave consequences for a defendant who is actually innocent, whose assets are all untainted and, if seized, would leave the defendant without her lawyer of choice to defend against meritless charges.

He went on, “[t]o permit the Government to freeze Luis’ untainted assets” in this case, Breyer wrote, “would unleash a principle of constitutional law that would have no obvious stopping place.”

Chief Justice Roberts, Justice Ginsburg, and Justice Sotomayor joined the Justice Breyer’s opinion. Justice Thomas wrote separately, with a slightly different analysis, explaining that the 6th Amendment right to counsel of choice would be meaningless if we did not allow a defendant to use his or her property to pay for that attorney.

Justices Kennedy and Alito dissented and would hold that there is no real way to distinguish between tainted and untainted assets since money is fungible.

TAKEAWAY: The government may not seize assets in a federal case if the assets are not connected to the alleged criminal activity and if those assets are needed to hire an attorney for the defense.

MVRA Restitution Victim Benns

Who Qualifies as a “Victim” Under the Mandatory Victims Restitution Act?

By | Fraud

Definition of “Victim” under the MVRA, leaves HUD out in the Cold | Who Qualifies for Relief Under the Mandatory Victims Restitution Act?

HUD MVRA Restitution Victim BennsUnited States v. Benns (5th Circuit, 2016) is a case regarding the Mandatory Victims Restitution Act (MVRA).  In this case, the US Court of Appeals for the Fifth Circuit held that HUD is not a victim of the defendant’s crime, even though the HUD was out a considerable amount of money after defendant forged a credit application. Read more about USA v. Benns below.

Anxious Couple Seeks Help for Mortgage Default

Desperate for relief from a mortgage in arrears, Michael and Brenda Arnold conveyed ownership rights of their Arlington home to Rickey Benns. At the time of the conveyance, Benns agreed to rent the home and pay the mortgage from the profits made from future tenants. The mortgage loan, held by Bank of America and insured by the United States Department of Housing and Urban Development (“HUD”), remained in the Arnold family’s name. Unfortunately, Benns reneged on his agreement and failed to pay off the mortgage, triggering foreclosure proceedings against the Arnolds, unbeknownst to them.

Looming Foreclosure Leads to Desperate Acts of Forgery

In an attempt to prevent foreclosure of the property, Benns secretly tried to refinance the property. Benns forged Arnolds’s signatures on loan modification documents and used a false pay stub to trick the bank into believing the Arnolds were creditworthy and still owned the property. After the application was denied by the bank, the property was eventually foreclosed on and sold below market value. Because Bank of America’s mortgage was insured by HUD, HUD paid the bank $54,906.59—the difference between what HUD paid Bank of America following foreclosure and the later sale price of the property.

A Plea is Entered and Restitution is Ordered

Benns plead guilty to one count of making false statement on a credit application, a violation of 18 U.S.C. § 1014. Upon entering the guilty plea, Benns “accepted the accuracy of a factual resume prepared by the government…author[izing] restitution to the victims of the community…includ[ing] restitution arising from all relevant conduct, not limited to that arising from the offense of conviction alone.” Benns was sentenced to twenty-seven months imprisonment, five years of supervised release, and ordered to pay restitution, totaling $544,602.42, under the federal Mandatory Victims Restitution Act (“MVRA”). Benns appealed to the United States Court of Appeals for the Fifth Circuit, arguing that HUD was not a victim of his convicted offense.

What is the Mandatory Victims Restitution Act (“MVRA”)?

The MVRA requires district courts to order restitution payments to crime victims during sentencing. 18 U.S.C. § 3663A. Under federal law, a victim is defined as, “a person directly and proximately harmed as a result of the commission of an offense for which restitution may be ordered.” Id. Typically, restitution is limited to losses arising from underlying conduct of a defendant’s offense of conviction. Hughley v. United States, 495 U.S. 411, 412-13 (1990); United States v. Espinoza, 677 F.3d 730, 732 (5th Cir. 2012); United States v. Maturin, 488 F.3d 657, 660-61 (5th Cir. 2007). To be a considered a victim under the MVRA, a person or organization must “suffer a foreseeable loss as a result of the conduct underlying the convicted offense.” Id. The government must establish, by a preponderance of the evidence, direct or proximate causation between the conduct underlying the offense and the actual loss suffered by the victim. United States v. Reese, 998 F.2d 1275, 1282 (5th Cir. 1993).

The Big Issue: Is HUD really a victim of Benns’s forgery scheme?

The United States Court of Appeals for the Fifth Circuit must determine whether HUD was a victim of Benn’s convicted offense. If the Court finds that HUD was a victim, then HUD will receive restitution under the MVRA. If the Court finds that HUD was not a victim, then Benns’ restitution award, which was imposed by the district court, could be amended or vacated altogether.

The Court of Appeals for the Fifth Circuit Weighs In with a Surprising Twist

Here, the Court weighs the argument made by the government against the facts of the case. The government argues that HUD’s loss was a direct result of Benn’s false credit application because the filing of the application itself delayed the foreclosure, which resulted in HUD selling the property at a loss. However, the Court states that the government did not produce evidence that the false credit application resulted in a delay, or that such a delay resulted in a greater loss for HUD than if HUD had sold the property any sooner than it actually did. The Court holds, because of the lack of evidence connecting the false credit application with the loss incurred by HUD, HUD is not to be considered a “victim” under the MVRA and, accordingly, cannot receive an award of restitution. “Benns was indicted and pleaded guilty to one count of filing a false credit application…it therefore does not follow that the behavior underlying Benn’s offense was the cause of HUD’s loss.”

Restitution could have only been awarded had the government established a direct or proximate causation between Benn’s false credit application and HUD’s loss when HUD sold the property at a foreclosure auction. The Court says the government failed to do so. Even though HUD was out $54,906.59, the Court does not consider HUD to be a victim of Benn’s convicted offense and vacates the restitution award.

Fraudulent execution of document Texas

Court Sets Aside Fraud Conviction Based on the Meaning of One Common Word in the Statute

By | Fraud

What does it mean to cause someone to fraudulently execute a document?

Fraudulent execution of document TexasRoger and Aaron Liverman filed separate mechanic’s lien affidavits with the Denton County clerk, claiming that they had worked on Katheryn Payne’s home and had not been paid. The county clerk filed and recorded the liens, which is the customary practice. The mechanic’s liens were determined to be fraudulent, and the Livermans were charged with securing the execution of documents by deception. The Livermans were convicted and placed on community supervision.

On appeal, the court of appeals reversed the Livermans’ convictions. The State appealed to the Court of Criminal Appeals. Because the case turned on an interpretation of statutory language, the CCA reviewed the case de novo; in other words, rather than reviewing the reasonableness of the lower court’s decision, the CCA made its own independent decision based on the facts and the statute.

OpinionLiverman v. StateTexas Court of Criminal Appeals 2015

The language of the statute under which the Livermans were convicted states that a person commits a crime if, “with intent to defraud or harm any person, he, by deception causes another to sign or execute any document affecting property or service . . . .” The case before the CCA boiled down to three questions: (1) What does the term “execute” mean in the statute? If nothing was executed, there was no offense. (2) Did the Livermans’ action of filing the fraudulent liens meet the definition of execution? (3) Who actually executes a mechanic’s lien when it is filed? The offense involves deceptively causing “another” to sign or execute a document. If the clerk’s actions constituted execution, the Livermans might be guilty. If the Livermans executed the affidavits themselves by filing them, then they could not be convicted under the statute.

Arguments against Fraudulent Execution of a Document

The State and the Livermans put forward a number of arguments for their respective positions. The arguments involved comparing the “sign and execute” language of the statute with a related provision that uses the phrase “file and record;” consideration of the legislative intent and history when the statute was enacted; and which action actually perfected the liens. After reviewing the arguments and performing its own analysis, the CCA concluded:

(1) The term “execute” means more than just to sign a document and involves the broader act of bringing a document to its final, legally enforceable form.

(2) When the Livermans filed the affidavits with the clerk, the affidavits accomplished their role in perfecting the mechanic’s lien. Therefore, the act of filing the affidavits was equivalent to execution.

(3) Because Texas law requires the person claiming a mechanic’s lien to “file” the affidavit, then the Livermans did execute the affidavits by filing them. However, the CCA considered whether the clerk’s actions might also constitute execution. Although the county clerk is required by law to record or index a filed affidavit, the clerk’s failure to do so does not invalidate the lien. If the clerk’s action of recording or indexing can be omitted and the affidavit still be valid, then the clerk’s actions clearly did not “execute” the affidavits.

But, asked the Court, did the clerk “execute” the affidavits by accepting them when the Livermans filed them? The CCA answered in the negative. The statutory requirement to file the affidavit “with the county clerk” means that the clerk is simply the recipient of the filing and plays no role in its execution.

Because no action of the clerk executed the affidavits, the CCA held, the Livermans did not cause “another” to “execute” the documents as required for the offense of which they were convicted. The CCA agreed with the court of appeals, with the result of setting aside the Livermans’ conviction.

Many people will recall President Bill Clinton’s grand jury testimony in the Monica Lewinsky case. When asked why he wasn’t lying when the told his aides that there was nothing going on between him and Miss Lewinsky, the President said “[i]t depends on what the meaning of the word ‘is’ is.”

While many will find the President’s response amusing, a Criminal Defense Attorney in Fort Worth may see an opportunity. Although not nearly so salacious as the Monica Lewinsky affair, the Livermans’ case truly turned on what the meaning of the word “execute” is.

A Criminal Defense Attorney in Fort Worth will understand and appreciate the nuances of the statutory language and may succeed in acquittal by arguing that the law does (or does not) say what it seems to say.

Fort Worth Forgery Attorneys

The Wide Net of Forgery in Texas

By | Forgery

Fort Worth Forgery AttorneysTo the average person, the offense of Forgery probably doesn’t sound like something that occurs on a regular basis. The term “forgery” usually conjures up the image of a shady artist carefully recreating some poor, unsuspecting victim’s signature and then passing themselves off using the victim’s identity. While an act like this most certainly would be forgery, the offense in Texas actually encompasses a broad range of activities and, because of that, it is much more common than most people realize.

The definition of forgery is laid out in Sec. 32.21(b), which states that,

a person commits an offense if he forges a writing with intent to defraud another.

Simple enough, right? Not quite. The simple definition of forgery begs multiple questions. For instance, what is the definition of “forge?” And, what is the definition of “writing?” This is where the net gets bigger.

The legislature defined “forge” in Sec. 32.21(1) to include a wide range of acts. These include altering, making, completing, executing, or authenticating any writing with the intent to defraud in addition to issuing, transferring, registering the transfer of, passing, publishing, or otherwise uttering a writing that is forged. What is a “writing” you ask? Well, the legislature decided to stretch the net even further by defining a writing as a printing or any other method of recording information as well as money, coins, tokens, stamps, seals, credit cards, badges, trademarks, symbols of value, right, privilege or identification.

Most forgery cases in Texas deal with the writing or passing of forged checks or fake currency. Occasionally, we see cases involving credit or debit cards charged as forgery (although there is another offense in the code more accurate to charge these types of offenses). While we see quite a few of these more common offenses involving checks, I can’t say that we’ve ever seen as case of forgery involving publishing a symbol of privilege with the intent to defraud.

But, as you can see the net is wide and I’m sure someplace, sometime one of those exotic forgery fishes will be caught up in the State’s tangled web.

Avery v. State

A Prescription for Acquittal

By | Drug Crimes

What does it mean to use a “Fraudulent Prescription Form” in Texas?

Avery v. StateThe State of Texas charged and convicted Billie Jean Avery of attempting to obtain a controlled substance “through use of a fraudulent prescription form.” The evidence presented at trial, however, revealed that the defendant actually used a legitimate prescription form, but that she forged some data on her prescription information in an attempt to obtain stronger pain pills.

In her appeal to the 13th District Court of Appeals (Corpus Christie), Appellant argued that she could not be convicted of using a “fraudulent prescription form” when the prescription form she used was legitimate.  The Court of Appeals agreed and acquitted her of the offense.

On discretionary review, the Texas Court of Criminal Appeals affirmed Court of Appeals’ affirmed judgment of acquittal. In a unanimous opinion, the CCA explained:

Just as tax information should be recorded on a tax form to create a competed tax return, so too prescription information should be recorded on a prescription form to create a completed prescription.  The information that is written on the form is not the form itself…[W]e hold that “prescription form” refers to a pre-printed form designed to have prescription information written on it.

This was a case of a simple charging error by the District Attorney’s office, but it goes to show that attention to detail can win the day.

Fort Worth Drug Crimes Attorneys | Keller Southlake Drug Possession Defense Attorneys

Identity Theft in Texas

Girlfriend Destroys Expectation of Privacy in Identity Theft Case

By | Identity Theft

Identity Theft in TexasAfter being convicted of aiding and abetting mail fraud and aggravated identity theft, Lonnie Oliver Jr., challenged his convictions on appeal, arguing that federal agents conducted an illegal search of the contents of a cardboard box that his girlfriend provided to them and that his statements to police officers were involuntary.

See the full opinion in United States v. Oliver  (5th Circuit, 2011)

Mr. Oliver left an unsecured cardboard box, which contained ample evidence of his identity theft operation, in the dining room of his girlfriend’s apartment. When agents interviewed his girlfriend, she gave them the box, but did not tell them she had already examined its contents.

Does a person have a Reasonable Expectation of Privacy in the contents of a box that was not kept private from his girlfriend?

The court held that the girlfriend’s prior search of the box destroyed Appellant’s reasonable expectation of privacy in it, and rendered the subsequent warrantless police search permissible under the Fourth Amendment. The court stated that the girlfriend’s search made the agents’ warrantless search permissible, regardless of whether the agents knew about it. The court cautioned that his holding was limited to the unique facts of this case and was not intended to expand significantly the scope of the private search doctrine.

Does a waiver of Miranda Right to remain silent need to be in writing?

Appellant also argued that incriminating statements he made to the agents during his custodial interrogation should have been suppressed, claiming that he had not waived his Miranda rights. After agents arrested Appellant, they advised him of his Miranda rights and provided him two forms. Appellant signed the first form acknowledging that he understood his rights, but he refused to sign the second form waiving those rights. Nevertheless, Appellant told the agents that he wished to answer their questions and he confessed to his role in a mail fraud and identity theft scheme.

The Court explained that suspect may waive his Miranda rights if the waiver is made voluntarily, knowingly and intelligently. The mere refusal to sign a written Miranda waiver does not automatically make subsequent statements by a defendant inadmissible. The court held that the circumstances surrounding Appellant’s arrest and interview established that Appellant’s waiver was voluntary, even though he refused to sign the wavier form. Specifically: (1) agents provided Appellant with a copy of the Miranda warning waiver form and read it aloud to him as he followed along, (2) Appellant expressly told the agents that although he would not sign the Miranda waiver form, he would discuss the fraud scheme, (3) Appellant never requested an attorney, (4) Appellant was articulate, coherent and not under the influence of alcohol or drugs, and appeared to understand what was going on, (5) Appellant clearly understood his rights since he signed the first form that acknowledged this, and he had extensive experience with the criminal justice system, and (6) Appellant was not coerced in any way during the interview.