American Automotive Accessories, Incorporated (“American”) and Emalfarb Investment Corporation (“Emalfarb Investment”) filed this action for civil damages against Alan Fishman based on alleged violations of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1962(c) and (d). The complaint alleges that Fishman, the owner of a currency exchange, fraudulently cashed some seventy checks embezzled by American and Emalfarb Investment employee Nick Favia over a period of six years. With the consent of the parties, the matter was referred to a United States Magistrate Judge for resolution pursuant to 28 U.S.C. § 636(c)(1). The magistrate judge granted summary judgment to Fishman. American and Emalfarb Investment appeal.
I. BACKGROUND
American and Emalfarb Investment are real estate development companies. Mark Emalfarb served as the President and Chief Executive Officer of both American and Emalfarb Investment. Throughout 1991, Emalfarb Investment was engaged in the development of townhouses in Mun-delein, Illinois. From 1992 to 1996, American was in the business of building single-family homes in Round Lake Beach, Illinois. Nick Favia was employed by Emal-farb Investment and, subsequently, by American and served as project manager for the two developments.
Favia’s duties as project manager included making check requests and delivering payments to vendors, subcontractors, and suppliers. When Favia needed a check from Emalfarb Investment or American, he would prepare a check request form which included the amount of the payment and the name of the vendor to whom the check was to be made payable. Favia would mail the request form to Mark Emalfarb who lived in Jupiter, Florida. The check then would be prepared in Emalfarb’s Florida office and signed by Emalfarb. The executed checks were mailed back to Favia in Illinois for distribution. Occasionally, Favia or the Illinois offices would prepare the checks and then send them to Florida for Emalfarb’s signature.
In February 1995, Emalfarb discovered that Favia had been requesting checks made payable to fictitious payees.- Emal-farb asked Favia several times for backup documentation on several checks made out to Libertyville Lumber. When Favia failed to provide documentation for the payments, Emalfarb contacted Libertyville Lumber to request copies of the invoices. *538 He was told that Libertyville Lumber had no record of any invoices sent to either American or Emalfarb Investment and no record of any payments received from the developments or from Nick Favia. Emal-farb and an assistant then inspected all of the canceled American and Emalfarb Investment checks made out to Libertyville Lumber and discovered that each of the checks had been cashed at the Loyola “L” Currency Exchange. Further investigation revealed the broad scope of Favia’s misconduct. Favia had submitted sixteen phony check requests to Emalfarb Investment, totaling $27,363.76, and fifty-four fictitious check requests to American, totaling $156,807.36. Those checks, made out to a number of fictitious payees, all had been cashed at the Loyola “L” Currency Exchange.
Emalfarb confronted Favia with this information. As a part of the present litigation, Mark Emalfarb executed a declaration describing events following this confrontation. The declaration sets forth the following scenario. When confronted, Favia confessed that he had been sending Emalfarb fictitious check requests and then cashing the checks himself. Favia stated that, in 1991, he had discussed his need to cash checks made out to third-party payees with a friend and neighbor, Joe Lewis. Favia told Emalfarb that Lewis introduced him to Alan Fishman, the owner of the Loyola “L” Currency Exchange, and told him that Fishman would cash checks to third-party payees as long as there was money behind them.
According to Emalfarb’s declaration, Fa-via stated that he then went to the Loyola “L” Exchange where he met Fishman and gave him the first third-party check. Fa-via said that Fishman approved the check and gave it to a Loyola “L” cashier who cashed the check, deducting Loyola “L” ’s standard 1-1.5% processing fee. Favia told Emalfarb that he continued to cash American and Emalfarb Investment checks made payable to third-party payees at the Loyola “L” Exchange for the next several years. According to Favia, if a new cashier was working and questioned Favia about the checks, he would tell her to call Fishman or Fishman’s son, Ira, for authorization. Favia stated that the Loyola “L” cashiers would always cash the checks for him.
Favia’s employment with American was terminated on February 21, 1995. Favia has conceded that he owed $459,309.03 to American and Emalfarb Investment as restitution for his fraudulent check scheme. This amount included the $184,-171.12 actually embezzled as well as amounts for the repayment of wages, interest, attorney’s fees, and other losses. On February 23, 1995, Favia and his wife entered into an initial settlement agreement with American. Pursuant to this agreement, the Favias deeded their home to American as partial repayment for the amount owed. However, the Favias were allowed to retain use and occupancy of the property until August 31,1995 in exchange for monthly rent payments to American. In the February agreement, the Favias waived any claims they may have had against Appellants; however, the agreement specifically noted that American did not intend to grant Favia a release of any kind under this agreement.
On March 1, 1995, Robert Levin, an attorney for Emalfarb, American, and Em-alfarb Investment, had a telephone conversation with Favia regarding the phony checks. Levin executed a declaration outlining this conversation. This declaration restates much of the Emalfarb declaration. One notable difference between the declarations is that Levin asserts that Favia told him that he could only recall being questioned by a cashier one time, when he presented a check made payable to “Ed Gottlieb.” Favia stated that when the cashier challenged him, he told her to call Fishman. According to Favia, the cashier made a phone call and then cashed the check.
On August 24, 1995, Favia and his wife entered into a second settlement agree *539 ment with American, Emalfarb Investment, and Mark Emalfarb. Under this agreement, the Favias turned over possession of their home to American, tendered a payment of $45,000, agreed to cooperate with American and Emalfarb Investment in civil litigation resulting from the check-cashing scheme, and obtained Appellants’ agreement that they would not seek to recover any additional amounts from the Favias, subject to their performance under the agreement. Including the value of his home, Favia made a total repayment of $196,528.04 to American and Emalfarb Investment. Appellants contend that this amount covered repayment of wages, interest, attorney’s fees, and other losses, but not the $184,171.12 actually embezzled.
On September 8, 1995, Appellants filed their initial complaint in the present lawsuit. The complaint named Fishman as a defendant and included other named and unnamed defendants, including Favia. By the time Appellants filed their First Amended Complaint in March 1996, they had dropped all of the defendants except Fishman.
At his deposition in the present case, on October 15, 1996, Favia, who was represented by counsel, exercised his Fifth Amendment right against self-incrimination. Favia indicated that he would continue to assert his Fifth Amendment right if called to testify at a later deposition or at trial. During discovery, Joe Lewis signed an affidavit in which he denied having any knowledge of or involvement in establishing a check-cashing scheme. Fishman signed an affidavit denying any knowledge of or involvement in a check-cashing scheme with Favia and asserting that he never gave approval for the cashing of any checks presented by Favia after Favia’s initial visit. At the close of discovery, Fishman moved for summary judgment based on the Lewis and Fishman affidavits and Favia’s assertion of his Fifth Amendment right. In response to Fish-man’s summary judgment motion, American and Emalfarb Investment produced the declarations by Mark Emalfarb and Robert Levin, setting forth the alleged statements made by Favia to Emalfarb and Levin in February and March 1995 which outlined Fishman’s involvement in the check-cashing scheme. Fishman moved to strike the declarations as hearsay. American and Emalfarb Investment argued that the declarations were admissible under Federal Rule of Evidence 804(b)(3).
On October 29, 1997, Magistrate Judge Levin granted Fishman’s motions to strike the Emalfarb and Levin declarations. Magistrate Judge Levin then ordered American and Emalfarb Investment to submit an amended response to Fishman’s motion for summary judgment. After receiving the amended response and Fish-man’s reply, Magistrate Judge Levin granted summary judgment to Fishman. This appeal followed.
II. ANALYSIS
Appellants first argue that the magistrate judge erred in excluding the Emal-farb and Levin declarations as hearsay. Secondly, Appellants contend that, even without the declarations, they have presented sufficient evidence to withstand Fishman’s motion for summary judgment. We address each issue in turn.
A. The Declarations
The portions of the Emalfarb and Levin declarations dealing with alleged statements by Favia are clearly hearsay, out-of-court statements offered to prove the truth of the matter asserted. As a general rule, hearsay statements are not admissible. Fed.R.Evid. 802. However, the Federal Rules of Evidence provide exceptions to the hearsay exclusion for certain types of hearsay statements which bear specific indicia of reliability. Rule 804 provides exceptions to the general rule for certain cases in which the declarant is unavailable as a witness. Appellants argue that the Emalfarb and Levin declarations are admissible as statements against *540 penal interest by an unavailable declarant under Rule 804(b)(3) and that the magistrate judge erred in excluding them. We review the magistrate judge’s construction of the evidentiary rules de novo and his application of the rules for abuse of discretion. 1
An out-of-court statement by an unavailable declarant will not be barred by the hearsay rule if the statement was
at the time of its making so far contrary to the declarant’s pecuniary or proprietary interest, or so far tended to subject the declarant to civil or criminal liability, ... that a reasonable person in the declarant’s position would not have made the statement unless believing it to be true. A statement tending to expose the declarant to criminal liability and offered to exculpate the accused is not admissible unless corroborating circumstances clearly indicate the trustworthiness of the statement.
Fed.R.Evid. 804(b)(3). The proponent of the out-of-court statement bears the burden of showing that the statement qualifies under Rule 804(b)(3).
United States v. Nagib,
The magistrate judge found that American and Emalfarb Investment had not met their burden under
Garcia
of showing corroborating circumstances indicating the trustworthiness of Favia’s statements as set forth in the declarations. The magistrate judge noted that a reasonable inference, based on the timing and content of the settlement agreements, was that Fa-via’s statements were made to curry favor with Appellants. On appeal, American and Emalfarb Investment contend that the corroborating circumstances requirement outlined in
Garcia
should not apply to incul-patory statements in civil cases. This is a two-part argument. First, Appellants argue that the Rule 804(b)(3) corroboration requirement applies only to exculpatory and not inculpatory statements following the Supreme Court’s decision in
Williamson v. United States,
Rule 804(b)(3) expressly requires corroborating circumstances only for statements exculpating the accused. The Supreme Court examined the scope of Rule 804(b)(3) in Williamson; however, the Court expressly declined to address whether Rule 804(b)(3) requires that statements offered to inculpate a third party also be supported by corroborating circumstances.
Williamson,
Appellants further argue that the purpose for the corroborating circumstances requirement adopted in
Garcia
was to square Rule 804(b)(3) with the Sixth Amendment confrontation clause. Since the confrontation clause does not apply in the present case, a civil suit for damages, Appellants urge us to dispense with the corroboration requirement. Appellants fail to note, however, that, in
Garcia,
we adopted the three-prong
Alvarez
test under our Rule 804(b)(3) analysis.
Garcia,
Having determined that the corroborating circumstances requirement applies to the Emalfarb and Levin declarations, we must now ascertain whether Appellants are able to meet their burden of showing corroborating circumstances under the facts of this case. There are several factors to consider in determining whether corroborating circumstances exist for Rule 804(b)(3) purposes. These include the relationship between the declarant and the accused; whether the statement was voluntary and made after the declarant was advised of his
Miranda
rights; and whether there was any evidence that the statement was made to curry favor with authorities.
Nagib,
There is nothing in the record to indicate that Favia’s statements were not voluntary, and the context in which the statements were made did not trigger a Miranda warning. Furthermore, there is no evidence of animosity between Favia and Fishman. However, it is undisputed that Favia made the statements only after he had been confronted with Emalfarb’s *542 discovery of his misconduct. Favia made the statements to adversaries, to whom he was liable for over $450,000, which supports the inference that Favia may have been attempting to secure a lesser punishment for himself through cooperation. Additionally, after Favia’s statements, the parties entered into an agreement under which Appellants agreed to accept payment of only $196,528.04 in satisfaction of Favia’s acknowledged $459,309.03 debt in exchange for Favia’s cooperation in the civil litigation in the matter. Given this set of facts, the magistrate judge did not abuse his discretion in finding that Favia’s statements were made in an attempt to curry favor with his interrogators. The declarations were properly excluded.
B. Summary Judgment
On January 6, 1998, Magistrate Judge Levin granted summary judgment to Fishman. We review this grant of summary judgment
de novo. Kolman v. Sheahan,
Appellants’ complaint alleged that Fishman violated RICO § 1962(c) which makes it “unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to' conduct or participate, directly or indirectly, in the conduct of such enterprise’s affairs through a pattern of racketeering activity.” 18 U.S.C. § 1962(c). “Any person injured in his business or property by reason of a violation of § 1962” may bring a civil action under RICO to recover “threefold the damages he sustains and the cost of the suit, including a reasonable attorney’s fee.” 18 U.S.C. § 1964(c). In order to state a claim under § 1962(c), a plaintiff must show by a preponderance of the evidence: “(1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity.”
Sedima, S.P.R.L. v. Imrex Co.,
In the present case, the parties agree that the Loyola “L” satisfies the definition of a RICO enterprise. Under RICO, “racketeering activity,” also referred to as “predicate acts,” is defined “as acts indictable under any one of several federal or state offenses, including mail fraud under 18 U.S.C. § 1341, and wire fraud under 18 U.S.C. § 1343.”
McDonald v. Schencker,
Appellants contend that the predicate acts in the present case are “in excess of fifty mail and/or wire frauds executed by Favia over a five year period.” It is undisputed that all checks cashed at the Loyola “L” are transported to the bank via a private armored carrier service, and there is no evidence that Fishman person *543 ally used the mail or interstate wire services in connection with the checks cashed by Favia. Additionally, there is no evidence that Fishman caused the mail or wire services to be used under the definition set forth in Alexander. Appellants contend that “Fishman or his office” personally authorized the cashing of Favia’s checks on at least three occasions, with the knowledge that Mark Emalfarb, the person signing the checks, was in Florida. Taking Appellants’ assertions as true, Fishman, on two occasions personally authorized the cashing of checks presented by Favia after Joe Lewis vouched for Fa-via. On one other occasion, Fishman’s son, Ira, authorized the cashing of a check presented by Favia. There is no evidence that Fishman acted with intent to defraud Appellants. There is insufficient evidence to establish Fishman’s direct liability under § 1962(c).
Alternatively, Appellants argue that Fishman was liable for violating § 1962(c) under an aider and abettor theory. This court has not yet determined whether aiding and abetting liability applies in civil RICO actions, although several other circuits have recognized it in such cases.
See In re Vicars Ins. Agency, Inc.,
Appellants also brought a claim against Fishman under 18 U.S.C. § 1962(d), which prohibits a conspiracy to violate any of RICO’s substantive provisions. Appellants allege that Fishman conspired with Favia to violate § 1962(c). To establish liability under § 1962(d), Appellants must demonstrate, by a preponderance of the evidence, “an agreement to participate in an endeavor which, if completed, would constitute a violation of the substantive statute.”
Goren,
The record contains no direct evidence that Fishman entered into an agreement to violate RICO; in fact, Fishman has made a sworn statement to the contrary. Appellants therefore rely on circumstantial evidence to support their claim. They contend that the record shows that Fishman on two occasions personally authorized the cashing of third-party checks presented by Favia and that from this evidence it can be inferred that Fishman agreed to the commission of at least two predicate acts. Even taking this assertion as true, there is no evidence to support an inference that Fishman was aware of the nature and the scope of Fa-via’s scheme and agreed to participate in it. Fishman expressly denied any knowledge of the scheme and stated that he personally authorized Favia’s initial check cashing only because Joe Lewis vouched for him. Appellants have failed to point to any evidence which would support the essential finding that Fishman agreed to participate in Favia’s check-cashing scheme. The magistrate judge’s grant of summary judgment on Appellants’ § 1962(d) claim was proper.
III. CONCLUSION
The decision of the district court is Affirmed.
Notes
. Appellants urge us to apply a
de novo
standard of review to the district court's admissibility decision. However, "the standard of review with respect to evidentiary rulings is abuse of discretion, even when we are reviewing the grant of summary judgement.”
Bradley v. Work,