United States v. Bouchard
2016 U.S. App. LEXIS 12498
| 2d Cir. | 2016Background
- Bouchard, a closing attorney, participated in real-estate closings (2001–2007) where sellers/brokers used “double HUD-1” forms to inflate sale prices and divert mortgage proceeds. Bouchard (and his paralegals) signed HUD‑1 forms and disbursed loan funds.
- Two lenders were implicated: Fremont (FDIC‑insured) and BNC (not FDIC‑insured), the latter being wholly owned by Lehman Brothers (which was federally insured and provided funding).
- Bouchard personally signed and submitted false HUD‑1s to BNC in at least two transactions (March and April 2005) and admitted in a federal interview that disbursements often differed from HUD‑1 figures.
- Indictment convictions: Count One (conspiracy to violate 18 U.S.C. § 1014); Counts Seven and Nineteen (bank fraud, 18 U.S.C. § 1344); Count Twenty‑Four (§ 1014 false statement). The three substantive counts all involved loans funded by BNC.
- District Court denied Rule 33 new‑trial motion based on alleged perjury by a government witness and concluded Lehman’s role made BNC‑directed fraud sufficient for § 1344/§ 1014 liability. Court sentenced Bouchard to 48 months; appeal followed.
Issues
| Issue | Government's Argument | Bouchard's Argument | Held |
|---|---|---|---|
| Sufficiency under § 1344(1) (intent to defraud a "financial institution") | Targeting BNC exposed Lehman (a federally insured bank) to risk of loss — conviction is valid even if the scheme was directed at a non‑insured affiliate. | § 1344(1) requires intent to defraud the bank itself; Bouchard did not intend to defraud Lehman or know of its involvement. | Reversed: conviction under § 1344(1) insufficient; defendant must intend to defraud the covered financial institution itself. |
| Sufficiency under § 1344(2) (intent to obtain bank property) | Alternatively, the scheme obtained property ultimately funded by a federally insured institution; conviction sustainable. | No evidence Bouchard knew loan funds were bank property or that he intended to obtain bank‑owned property. | Reversed: insufficient evidence that Bouchard knew funds were bank property or intended to obtain bank property. |
| Sufficiency under § 1014 (false statements to influence a bank) | Bouchard’s experience made it reasonable to infer he knew loans would be financed by an insured bank (Lehman). | No trial evidence that Bouchard knew Lehman funded the loans or that he intended to influence a bank; HUD‑1s listed only BNC. | Reversed: insufficient evidence he knew the statement would influence a federally insured bank. |
| Conspiracy to violate § 1014 (Count One) | Conspiracy included overt acts submitted to Fremont (an FDIC‑insured bank) and to others; conviction supported by at least one overt act involving an insured institution. | Acquittal on the substantive Fremont count shows jury could not have found overt act involving an insured bank. | Affirmed: conspiracy conviction stands because at least one overt act (involving Fremont) was supported; differing verdicts reconcilable. |
| Rule 33 new‑trial claim (witness perjury) | N/A (Government lacked knowledge of perjury). | O’Connell recanted post‑trial; his trial testimony was perjured and prejudiced Bouchard. | Affirmed denial: District Court did not abuse discretion — perjured testimony was equivocal and there was ample independent evidence of guilt. |
Key Cases Cited
- Loughrin v. United States, 134 S. Ct. 2384 (Sup. Ct.) (distinguishes § 1344(1) intent requirement from § 1344(2))
- Nkansah v. United States, 699 F.3d 743 (2d Cir.) (discusses intent element for § 1344)
- Brandon v. United States, 17 F.3d 409 (1st Cir.) (held exposure of an insured bank to loss can support § 1344 despite targeting non‑insured intermediary)
- Stavroulakis v. United States, 952 F.2d 686 (2d Cir.) (requires intent to victimize a bank for § 1344(1))
- Bennett v. United States, 621 F.3d 1131 (9th Cir.) (treats banks and subsidiaries as distinct entities for § 1344 purposes)
- Grasso v. United States, 724 F.3d 1077 (9th Cir.) (experience of defendant may support inference he knew loan would influence an insured bank)
- Sabatino v. United States, 485 F.2d 540 (2d Cir.) (§ 1014 requires knowledge the recipient is a bank and intent to influence)
- Griffin v. United States, 502 U.S. 46 (Sup. Ct.) (verdicts may be sustained if at least one valid theory is supported by evidence)