United States v. Willena Stargell
2013 U.S. App. LEXIS 20992
| 9th Cir. | 2013Background
- Willena Stargell, a former tax preparer, operated Liberty Bell Tax Service and prepared 143 federal returns containing false wage/withholding figures and refund claims; some returns led to refund anticipation loans (RALs).
- The superseding indictment charged wire fraud affecting a financial institution (Counts 1–6), aiding/assisting preparation of false returns (Counts 7–12), wire fraud (Counts 13–15), and aggravated identity theft (Counts 16–18); several counts were dismissed or resulted in acquittal on motion, and Stargell was convicted on the remaining counts.
- The government’s summary witness (IRS Special Agent Marquez) presented a Rule 1006 chart showing $598,657 in refunds claimed and $276,331.74 actually issued before the IRS stopped other refunds; banks ultimately lost $107,931.96 on the set of returns.
- At sentencing, Stargell’s former counsel, Kay Otani, testified about requested audit files and document discovery; Stargell objected on Sixth Amendment and privilege grounds.
- The district court adopted the government’s loss calculation, found an offense level of 22, and sentenced Stargell to 42 months, a $1,200 special assessment, and $362,796.07 restitution.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether fraudulent tax returns “affected a financial institution” under 18 U.S.C. § 1343 | Govt: increased risk of loss to banks suffices to show effect | Stargell: no actual bank loss on some counts so § 1343 not satisfied | Court: Increased/new risk of loss is sufficient; convictions on Counts 1,2,4,5 affirmed |
| Whether aggravated identity theft convictions could rest on pre‑§1028A conduct | Govt: predicate wire fraud occurred after §1028A enactment because transmission (filing) was in Jan 2005 | Stargell: prosecution emphasized pre‑enactment conduct so convictions may rest on pre‑enactment acts | Court: Wire transmissions occurred in Jan 2005 (post‑enactment); convictions valid |
| Whether calling former counsel to testify violated Sixth Amendment or attorney‑client privilege | Govt/district: former counsel was called by defendant’s new counsel and testified about non‑privileged discovery matters | Stargell: testimony infringed core defense functions and breached privilege absent her consent | Court: No Sixth Amendment interference; testimony did not disclose privileged communications |
| Whether district court clearly erred in loss/restitution calculations | Govt: use total claimed refunds (intended loss) and actual bank losses for restitution; district court adopted govt figures | Stargell: court failed to make explicit finding; court improperly included refunds taxpayers might have been entitled to | Court: District court adopted government’s loss finding by clear and convincing evidence; used reasonable estimate and properly included intended-loss tax figure and restitution based on proximate losses |
Key Cases Cited
- Jackson v. Virginia, 443 U.S. 307 (standard for reviewing sufficiency of evidence)
- United States v. Mullins, 613 F.3d 1273 (10th Cir.) (new or increased risk of loss suffices to show fraud “affects” a financial institution)
- United States v. Serpico, 320 F.3d 691 (7th Cir.) (bank exposure to risk of loss suffices even without actual loss)
- United States v. Yeung, 672 F.3d 594 (9th Cir.) (requirements for district court reasoning on loss/restitution findings)
- United States v. Riley, 143 F.3d 1289 (9th Cir.) (use intended loss when greater than actual loss)