United States v. Jeffrey Allen Gardner
16-4054
| 8th Cir. | Nov 20, 2017Background
- Jeffrey Gardner ran Hennessey Financial and solicited investors for mezzanine real-estate loans, often underwriting loans to his own development companies.
- Gardner executed personal financial statements and loan applications to First Commercial Bank that certified disclosure of assets/liabilities but omitted large personal loans from Stuart Voigt (the bank chairman) and extensive personal guarantees.
- First Commercial approved an initial $1,000,000 line and later an increase to $2,000,000 based on the submitted statements.
- Beginning in 2006 Gardner’s companies deteriorated and stopped paying Hennessey, but Gardner failed to disclose the worsening financial condition to investors.
- A jury convicted Gardner of mail fraud, conspiracy to commit mail fraud, bank fraud (18 U.S.C. § 1344), and making false statements to a financial institution (18 U.S.C. § 1014); convictions were affirmed in part on appeal.
- At sentencing the district court applied an 18-level loss enhancement (loss > $3,500,000, fraud found as of July 1, 2006) and a 2-level role-in-offense enhancement for Gardner’s supervisory role; Gardner challenged both enhancements on appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Sufficiency of evidence for bank fraud (18 U.S.C. § 1344) | Government: omissions and false financials intentionally defrauded First Commercial; jury verdict supported. | Gardner: omissions were not knowing or fraudulent; could be innocent mistakes. | Affirmed — evidence permitted a reasonable jury to find knowing intent to defraud. |
| Sufficiency of evidence for false statements to a financial institution (18 U.S.C. § 1014) | Government: false certified statements were made to influence bank action. | Gardner: lacked requisite knowledge/intent; statements could be innocent. | Affirmed — jury could infer knowing falsehoods to influence the bank. |
| Loss-amount sentencing enhancement (U.S.S.G. § 2B1.1(b)(1)) | Government/district court: loss exceeded $3,500,000; fraudulent conduct began by July 1, 2006. | Gardner: fraud began later (no earlier than March 2, 2007); therefore lower loss. | Affirmed — district court’s finding of fraud by July 1, 2006 and resulting loss calculation not clearly erroneous. |
| Role-in-offense enhancement (U.S.S.G. § 3B1.1) | Government: Gardner supervised CFO Essen who drafted misleading investor communications. | Gardner: disputed supervisory role or that supervision supported enhancement. | Affirmed — record shows Gardner directed at least one participant, justifying the two-level enhancement. |
Key Cases Cited
- United States v. Moran, 612 F.3d 684 (8th Cir.) (standard for sufficiency review)
- United States v. Baker, 98 F.3d 330 (8th Cir.) (verdict should not be overturned lightly)
- United States v. Nabors, 762 F.2d 642 (8th Cir.) (evidence need not exclude every reasonable hypothesis except guilt)
- United States v. Erdman, 953 F.2d 387 (8th Cir.) (jury verdict upheld if reasonable interpretation supports guilt)
- United States v. Lopez, 431 F.3d 313 (8th Cir.) (role-in-offense adjustment may apply if defendant supervised one participant)