United States District Court, D. Arizona
G, CAMPBELL SENIOR UNITED STATES DISTRICT JUDGE
December 12-14, 2018, the Court held a bench trial on Counts
2 and 7 of the Superseding Indictment. Doc. 13. The
government previously dismissed the other 33 counts.
See Doc. 202. Counts 2 and 7 charge Defendant with
wire fraud in violation of 18 U.S.C. § 1343. To prove
Defendant guilty of this crime, the government must establish
the following elements beyond a reasonable doubt:
First, Defendant knowingly participated in, devised, or
intended to devise a scheme or plan to defraud, or a scheme
or plan for obtaining money or property by means of false or
fraudulent pretenses, representations, promises, or omitted
facts. Deceitful statements or half-truths may constitute
false or fraudulent representations;
Second, the statements made or facts omitted as part of the
scheme were material; that is, they had a natural tendency to
influence, or were capable of influencing, a person to part
with money or property;
Third, Defendant acted with the intent to defraud, that is,
the intent to deceive or cheat; and
Fourth, Defendant used, or caused to be used, an interstate
or foreign wire communication to carry out or attempt to
carry out an essential part of the scheme.
Ninth Circuit Model Jury Instruction 8.124; see also
United States v. Woods, 335 F.3d 993, 997 (9th Cir.
2 and 7 concern funds paid to Defendant in connection with
her purported efforts to obtain hundreds of millions of
dollars in international loans for victims Frank D'Aries
and Matt Logan. Frankly, the entire venture was foolhardy.
D'Aries was a homebuilder in Atlanta, Georgia, who had no
experience in large developments or substantial financing. He
decided to undertake a large commercial and residential
development, paid $50, 000 for an option on land where the
project could be developed, and pursued a $50 million loan.
No. bank would fund the loan because, in his words, he was
“stretched out” on his other real estate
projects. So D'Aries attended a conference in Florida,
spoke with several individuals, and eventually was referred
to Defendant as a possible source of international funding.
Curiously, D'Aries was convinced by Defendant's
assertion that it was easier to obtain a $100 million loan
than a $50 million loan, and hired her to seek $100 million
in funding. He somehow also believed that Defendant could
obtain a $100 million loan on nothing more than a development
plan, with no collateral or security other than some vaguely
identified gold bullion that Defendant purportedly could
access somewhere. When D'Aries eventually lost his option
on the land, he continued to seek the financing through
Defendant, apparently thinking that he could obtain the loan
even though he had no rights to the land where it would be
used for development.
Matt Logan's plan was just as unrealistic. He too was a
homebuilder - in the Houston area - and decided to build a
plant that would convert cow manure and other garbage into
gasoline, would cost some $650 million, and for which he had
not acquired the necessary fuel-conversion technology. He
apparently believed that he could obtain a $650 million loan
before he secured rights to the technology necessary to make
his plan successful (assuming the technology worked in any
event). Logan also accepted Defendant's farfetched
assertion that she could obtain a $100 million loan on
nothing more than his gasoline-plant concept and then
transform it into $650 million in a mere three months by use
of an unspecified “trading platform.”
short, both victims were pursuing utterly fanciful funding
schemes. This does not relieve Defendant of any fraud she
committed. As the government has noted, there is no
requirement that the scheme be reasonably calculated to
deceive only persons of ordinary prudence and comprehension.
Doc. 183; United States v. Ciccone, 219 F.3d 1078,
1083-84 (9th Cir. 2000). The fraud statutes protect even the
most gullible. Id. at 1083. But the Court cannot
tell from the evidence surrounding this venture whether
Defendant was a knowing fraudster or just another daydreamer.
beginning of trial, the government said it would prove that
Defendant made three misrepresentations to the victims: (1)
she had the ability to obtain the loans sought by the
victims, (2) the loans would close within specific time
periods, and (3) the money transmitted to Defendant by the
victims as alleged in Counts 2 and 7 would be used for
specific purposes: to register the victims' corporations
and obtain legal addresses in Europe. The Court will address
each alleged misrepresentation.
Ability to Obtain the Loans.
the financing scheme was unrealistic from the beginning, the
government has not proven beyond a reasonable doubt that
Defendant knew she lacked the ability to obtain the
financing. The government presented no evidence regarding
Defendant's education or past business experience. The
government confirmed that Defendant maintained an office in
Europe and incurred business expenses there, but presented no
evidence regarding the nature of that business or why it
precluded her from attempting to obtain the financing. The
government noted that Defendant claimed to have closed a
billion-dollar loan in the past, but presented no evidence
that she did not. The government asserts that there is no
evidence Defendant ever ...