Federal Criminal Lawyer Blog

Federal Criminal Charges were announced yesterday here in Atlanta by the U.S. Attorney. The feds have indicted a well-known State legislator, Representative Tyrone Brooks. According to the indictment, Representative Brooks committed mail fraud, wire fraud, and tax crimes. The grand jury returned a 30-count indictment which charges that, from the mid-1990s through 2012, Brooks solicited contributions from individuals and corporate donors to combat illiteracy and fund other charitable causes, but then used the money to pay personal expenses for himself and his family.

It seems there are three basic sets of crimes alleged in the indictment. First, there are two separate supposed frauds, followed by allegations that Representative Brooks violated the tax laws.

The first of the two fraud schemes supposedly involves a tax-exempt charity, Universal Humanities, Inc., that Brooks established in the early 1990s. The grand jury alleges that Brooks solicited contributions from corporate and individual donors purportedly to combat illiteracy in disadvantaged communities in Georgia and across the southeastern United States, eventually raising more than $780,000. The feds claim that Representative Brooks made specific false representations about the work that Universal Humanities was doing and how the donated funds would be used. Prosecutors also contend that in reality, Brooks did not use the donations to promote and address literacy in Georgia or elsewhere. Instead, the indictment alleges that Brooks used the money to pay personal expenses for himself and members of his family.

The second fraud scheme alleged involved the organization Georgia Association of Black Elected officials (GABEO). The indictment alleges that Brooks diverted charitable donations he solicited on behalf of GABEO and used much of the money to pay personal expenses for himself and his family.

The indictment alleges that Brooks solicited contributions to GABEO from corporations, organizations and individuals. The feds contend that Brooks secretly opened a second GABEO bank account, and set himself up as the sole signatory on this account, and had the account statements sent to his address rather than the address of the GABEO Treasurer. Brooks then deposited the donations he solicited on behalf of GABEO into this undisclosed account, and used much of these funds to pay personal expenses for himself and his relatives.

Finally, the indictment charges that Brooks underreported his income to the IRS for the years 2007 through 2011. Prosecutors contend that Representative Brooks misappropriated of hundreds of thousands of dollars through the two fraud schemes concerning Universal Humanities and GABEO, yet his tax returns for the years between 2008 through 2011 falsely reported income of only approximately $35,000 annually.

This indictment is like so many we have seen when we have represented public officials who face federal criminal charges. While often the defense team can show there was no fraud, or at least some confusion as to the fraud charges, it is exceedingly difficult to defend the tax charges when they come up with specific expenditures that clearly show the Defendant had income, yet that same income never shows up on the Defendant's tax return. We have represented a number of public officials facing similar charges, and look forward to seeing how the defense responds to these allegations.

Like our federal cases here in Atlanta and throughout the country, it is important to keep in mind how a federal sentencing hearing takes place. The various phases of the federal sentencing process require the Defendant's attorney to not only know the law, but also to know the procedure, so that "objections" are properly preserved. A decision issued today by the United States Court of Appeals for the Eleventh Circuit makes this point. In that case, the attorney properly objected, thus preserving the issue for appeal. In the Court of Appeals, the Defendant raised the same argument, and the appellate tribunal agreed. The result is a lower sentence for the Defendant. The case is United States v. Washington.

Mr. Washington was charged in a large fraud scheme involving banks and credit card customers. He pled guilty. As a result, the United States Probation Officer prepared the very important document called the "Presentence Investigation Report", which is often called the "PSR". The PSR has two major parts, one of which is sort of a miniature biography of the Defendant. The second part of the PSR is where the probation officer makes some recommendations as to how the complex Federal Sentencing Guidelines should apply.

In a federal fraud case, there is a specific enhancement under the Sentencing Guidelines that is based on the number of victims. For example, if there are more than 250 victims, then a six-level enhancement is added to the Guideline score.

Mr. Washington was one of many people charged in this particular fraud scheme. The same judge had found more than 250 victims while imposing sentence on some of the other Defendants. However, Mr. Washington's lawyer properly objected to the enhancement for more than 250 victims, because the prosecutor never produced any evidence. In response to Mr. Washington’s objections, the probation officer stated that he had been provided with “spreadsheets detailing the victims,” and that the number exceeded 250. The prosecutor said that “thousands of individuals” had their credit card numbers stolen. However, the prosecutor did not submit any evidence to support this assertion. During the sentencing hearing, the Defendant's lawyer reiterated his objection, but was interrupted by the Judge. “That’s the figure that’s been applied to other defendants." Therefore, the Judge used the enhancement for more than 250 victims.

The Court of Appeals reversed the sentence. First, they repeated what has been said in numerous previous cases: the prosecution bears the burden of producing at least some evidence to support any enhancement of the Guidelines. Mere argument is not enough. Also, it's not good enough to simply refer to evidence from a co-Defendant's case, unless the record shows that the Defendant and his attorney at least had a chance to review such evidence and contest it.

Perhaps the most important part of the case is what happens next. The Court of Appeals noted that sometimes it sends the case back so the prosecution can basically "fix" the problem. They refused to take that approach here. The government had its chance, and blew it. No "do-over", said the appellate court. As a result, they ordered that the lower court resentence Mr. Washington without using the 6-level enhancement, which will almost certainly reduce his Guideline range and probably the overall sentence.

Again, it is important to hire a lawyer who knows the law and procedure. Mr. Washington's attorney knew when to object, and likely saved his client additional time in prison.

Many public corruption investigations turn into federal criminal cases, here in Atlanta and around the country. Our firm is involved in several of these matters right now. Most of these "white collar" cases result in our clients being charged with some variety of fraud. The feds almost always resort either to the mail or wire fraud statutes. Each of these laws requires a "scheme or artifice to defraud" another out of money or property. A 1988 law says that these statutes include schemes to defraud another out of the "intangible right of honest services." A 2010 case from the United States Supreme Court restricted the "honest services" version to cases involving bribes and kickbacks, and held that these statutes cannot be used to prosecute a person merely because the Defendant violated some fiduciary duty to a governmental agency or other entity or otherwise engaged in a conflict of interest. I wrote a recent post about how the local federal court of appeals issued a recent decision upholding the conviction of a man in Jacksonville, Florida. That case was an example of how the feds try to get around the recent restrictions on the honest services theory.

The feds recently made a splash in New York, arresting a politician who allegedly was trying to buy his way into the Republican race for Mayor. This is but the latest in a string of high-profile cases in that city involving allegations of bribery, payoffs and the like. A recent article I came across notes that despite the restrictions on the honest services theory, federal prosecutors continue to use this species of fraud when going after politicians. The article quoted a former high ranking federal prosecutor as saying that the restrictions on honest services actually helped the government when making such cases.“I thought the court did us — prosecutors — a favor, because I never thought juries liked conflict-of-interest cases. ... Juries want to see bribes or kickbacks" because conflicts of interest “seem more like ethical violations than criminal.”

I thought this article was worth noting for a couple of reasons. First, it is further evidence that federal public corruption cases continue, even after the restrictions on the honest services theory. More importantly, the quote from the article explains something I have mentioned previously, namely, that decisions which seem on the surface to hurt law enforcement actually help prosecutors and policemen in the long run. The famous Miranda warnings are but one example, for once the warnings are given, there is no doubt that the Defendant's statements will be admissible. Many of these rulings at first were criticized by law enforcement, but over the years, many policemen and women have told me they end up doing a better job when complying with these restrictions. And, we all have the added benefit of protecting individual liberties!

As I noted in this post, on Tuesday the Supreme Court granted certiorari in Kaley v. United States, a case calling on the Justices to answer the question of whether the Sixth and Fifth Amendments afford a Defendant the right to a pretrial hearing to challenge the seizure of her assets under the federal forfeiture laws when that seizure basically prevents her from hiring and paying for counsel of her choice. It is more than a little ironic that they decided to review the case on the same day we were all celebrating the 50th anniversary of Gideon v. Wainwright, the landmark case ruling by the Supreme Court that everybody facing felony charges has the right to an attorney, even if he or she cannot afford to pay the lawyer. While we have made strides in the past five decades, in many ways we are worse off when a person faces the wrath of the federal government bent on a criminal prosecution.

On the one hand, we still have a long way to go when we provide counsel to people who cannot afford to pay for a lawyer. Many wonderful lawyers are public defenders who struggle to provide the best defense they can while handling massive and crushing caseloads. While Defendants have the "right" to an attorney, far too often the system is set up so that the public defender simply cannot spend much time with any one client, more or less rendering meaningless the Constitutional "right to counsel" enshrined in the Gideon case.

On the other hand, people facing federal criminal prosecutions face additional difficulties. First, as we have mentioned many times, and as I have written and spoken about on numerous occasions, there is a big difference between a State criminal case and a prosecution handled by the federal government. Federal criminal cases are often exceedingly complex, time-consuming, and beyond the abilities of many otherwise fine lawyers who simply are not equipped to handle the often arcane and weird aspects of defending a criminal case in federal court. Federal criminal defense is a speciality, and like other professions, specialists usually cost a lot more money, which makes it difficult for many people to defend themselves against charges in federal court. Second, defending a case in federal court also puts a Defendant (and his or her attorney) up against a series of very pro-prosecution laws. During the 1980's and 1990's, the U.S. Congress regularly enacted more and more "tough on crime" laws. Some of these laws increased sentences (like the horrible crack cocaine laws and mandatory minimum punishments). Other "crime prevention" legislation was aimed at people in the drug trade, and many statutes were designed to go after the money involved in the drug business. One of these laws greatly increased the scope of the federal forfeiture statutes, which are the laws that permit the feds to sometimes get money or property that was involved in or obtained from certain crimes. And, here's where it all comes back to the Kaley case accepted by the Supreme Court. That is the case where the Justices will need to answer the question of whether the feds can "restrain" a Defendant's assets even before a trial, without the need for a hearing where the Defendant can challenge the prosecutor's evidence. The expansion of forfeiture laws, which were mostly designed to go after dope dealers, is now being used against businesspeople like Mrs. Kaley, in a case that seems from the surface to be a contract dispute!

The right to counsel is important, whether or not a person has the assets to hire counsel, and regardless of whether the case is in State or federal court. We certainly hope that the Justices will recognize that Defendants in federal cases should have the right to use their assets to hire the specialists needed to defend matters in federal court, which is just as important as providing counsel for those without such assets.

Defending federal crimes is always difficult, whether the client is a "white collar" defendant charged with fraud or whether prosecutors charge other crimes, like drug violations. However, the defense is made more difficult in federal court by virtue of the prosecutor's ability to sometimes freeze and then forfeit all of the Defendant's assets. Making it more difficult still, the laws sometimes permit prosecutors to freeze the Defendant's assets even without a hearing in front of a judge! After many years of uncertainty, the Supreme Court the other day agreed to hear a case as to whether the pretrial restraint (or freezing) of a Defendant's assets is permissible if done without a hearing. The case is Kaley v. United States, and the certiorari petition is here.

Ms. Kaley was in the business of selling medical equipment. She and her husband apparently made a good living selling equipment that certain manufacturers no longer wanted. The federal authorities claimed these practices were fraudulent, and indicted the couple. Prosecutors also filed an ex parte request to restrain and freeze much of the couple's assets, claiming that the money they had in the bank and which they'd used to buy their house was obtained as proceeds of the fraudulent conduct charged in the indictment. A Federal Magistrate Judge agreed, and issued an order freezing their assets so they could not be used by the couple to defend themselves. The case has had a complex history, with two trips already to the Court of Appeals here in Atlanta before the defense team finally got the Supreme Court to agree to hear the case.

Under 18 U.S.C. §853(e), when a Defendant has already been charged in an indictment the prosector can file an ex parte motion seeking restraint of assets that are subject to forfeiture upon conviction. The law does not specifically allow for a pretrial adversarial hearing where the indicted defendant may challenge the propriety of the restraints.

Back in 1989, the Supreme Court rejected the idea that such pretrial restraint violated either the Fifth or Sixth Amendments. United States v. Monsanto, 491 U.S. 600 (1989). However, a footnote in that case explicitly left open the question as to whether the Due Process Clause requires a hearing before a pretrial restraining order can be imposed. Since that time, the courts have issued contrary rulings resulting in a firmly entrenched split among the eleven circuits that have addressed the issue.

Ms. Kaley's defense team convinced the Supreme Court to accept her case in order to answer the following question:

"When a post-indictment, ex parte restraining order freezes assets needed by a criminal defendant to retain counsel of choice, do the Fifth and Sixth Amendments require a pretrial, adversarial hearing at which the defendant may challenge the evidentiary support and legal theory of the underlying charges?"

This case has huge ramifications in situations where the feds go after Defendants with enough funds to hire good lawyers, but those attorneys cannot be paid because a judge agrees with the prosecutors to freeze the assets even without hearing from the defense. We will follow the case closely.

Here in Atlanta, the local federal Court of Appeals just affirmed a conviction in a mail fraud and bribery white collar case out of Jacksonville, Florida. The case is but the latest saga in the long-running debate over the contours of "honest services fraud", the species of fraud so often used by federal prosecutors when they go after what they perceive to be "local corruption." In a 2-1 decision, the majority held that the Defendant's convictions should be affirmed, even though one of the two judges in the majority had real problems upholding the lower court's rulings. Judge Hill issued a blistering dissent, perhaps foreshadowing a more full review by the entire court. The case is US. v. Nelson, and can be found here.

Mr. Nelson was the chairman of the board of Jaxport, the entity that basically oversaw the port authority in Jacksonville. The board members worked part-time, were not paid, and were prohibited from voting on any matter in which they had a financial interest.

Mr. Nelson lobbied on behalf of a company named SSI, received payments from SSI, and therefore did not vote on any SSI-related matters that came before the JaxPort board. He did urge staff members to help SSI on certain payment issues, but as noted by the dissent, "The evidence was that no economic harm befell JaxPort as the result of Nelson’s lobbying for SSI". At one point he got an opinion from the City's chief legal officer that he would have no problems in continuing his lobbying on behalf of SSI so long as he did not vote on anything that affected that company. His biggest problem was that he and SSI concealed the payments he received, the money was routed through a couple of other intermediary companies before it got to Nelson. The FBI got wind of the relationship between Nelson and SSI, they tapped their phones, and one morning agents showed up at Mr. Nelson's house for a "talk." He told them that once they arrived on his doorstep he then knew the payments were wrong, but did not say he previously was aware of the wrongfulness of his conduct.

Despite all this, the feds indicted Mr. Nelson for "honest services" mail fraud and federal services bribery. Many of us know the history of the honest services theory, a method of criminalizing what is basically the violation of a fiduciary duty. In the famous Skilling case, the U.S. Supreme Court restricted the honest services theory to "core" cases involving bribery and kickbacks, and seemed to hold that concealing one's financial relationship is not the sort of conduct which can be prosecuted under these laws.

The majority in Nelson used a round-about way of deciding that he was guilty. Although he could lobby on behalf of SSI, and although he did abstain from voting on SSI business, the concealment of his payments from SSI meant that he had the intention to accept a bribe. Judge Hill's dissent seems to be far more on point: "[C]oncealment alone is legally insufficient to prove Nelson had corrupt intent to be bribed. If Nelson had no duty to disclose his financial relationship with SSI, as Skilling says, and the payments were permitted, as he was told, then the jury was not permitted to infer a corrupt intent to be bribed by his concealment. The government’s theory was that – although concealment is not a crime – it was evidence of corrupt intent and this mens rea turned lawful lobbying into unlawful bribery. I disagree. Bribery requires a corrupt agreement to perform an unlawful official act – an actus reus. In this case, Nelson agreed to perform a lawful act. The lobbying was permitted. An agreement to perform a lawful act is called a contract, not bribery."

The case also involved some serious problems with the jury instructions. Again, however, the trial lawyers failed to object, letting the appellate court use the "plain error" standard way of gutting the argument. As I have noted many times before, none of us is perfect, as trial lawyers we all make mistakes, but we also all need to remember to try and object as often as possible to any potential problem with jury instructions.

I came across this story about two Defendants in New York who were appealing to the Second Circuit Court of Appeals their convictions for "insider trading", which as we all know is a rarely prosecuted federal crime arising out of a securities investigation that usually starts with the SEC. These Defendants also argued on appeal that their sentences were too long. Both issues, the insider trading question and sentencing arguments, are matters we have come across frequently, and we will be following the case closely.

The basic idea of an "insider trading" case is that someone learns about "material non-public information", such as the fact that one company might be in the process of buying another company. When companies prepare to engage in such moves, they need to hire bankers, lawyers, accountants, printers and lots of folks who work on the deal. It is illegal for anyone who learns such "material non-public" information to give a "tip" to anyone, and for the recipient of the tip (the "tippee") to make trades (such as buying the stock of the company that is about to be purchased.)

Attorneys for Zvi Goffer, a former securities trader , and Michael Kimelman, co-founder of a trading firm, recently asked the United States Court of Appeals for the Second Circuit to vacate their clients' 2011 convictions. Prosecutors claimed that Mr. Goffer (a securities trader), was the ringleader of a scheme which traded on material non-public information prior to public announcement of deals involving computer network equipment makers and drug companies. Mr. Kimelman, the other Defendant, apparently worked with Goffer's brother. Although the attorney for the securities trader claimed that his client had not breached anyone's trust, one of the judges noted that the trader apparently paid kickbacks to lawyers at a large law firm in return for information on upcoming corporate acquisitions.

Perhaps the more interesting aspect of this appeal concerns the challenges to the sentences imposed for insider trading. The trial judge imposed a 10-year sentence on Mr. Goffer, and two and one-half years for Mr. Kimmelman. The defense lawyers contrasted the treatment their clients received with the high-profile insider trading case against Rajat Gupta, the former Goldman Sachs director convicted for leaking non-public information to Galleon founder Raj Rajaratnam. Gupta got a shorter two-year prison sentence in October. The scheme involving Gupta and Rajaratnam supposedly netted $50 million, far more than what was involved here, the defense attorneys argued, yet the sentences were almost as severe.

We are very sensitive to sentencing arguments in federal court, for we handle many similar matters. Likewise, we also occassionally represent people caught up in SEC investigations, some of which turn into federal insider trading criminal cases. We had some good luck on appeal for a bank executive caught up in an insider trading case. We convinced the trial judge to impose no jail time, but the prosecutors appealed, similar to the situation described in this post. However, in our case, we convinced the Court of Appeals to reverse itself and affirm the sentence of probation. Because of that and similar cases, we look forward to seeing how the Second Circuit resolves these cases.

More and more both here in Atlanta and around the country we see news stories about bankers getting indicted, financial professionals being accused of fraud, and other white collar criminal actions brought against people working in the financial sector. Also, in a recent post, I wrote about a federal criminal case where the indictment did not even charge a federal crime, yet none of the lawyers nor judges noticed the problems until the judges on the Court of Appeals brought up the issue after the case was on appeal. The combination of these two stories reminded me of how important it is for lawyers to carefully scrutinize the charging documents when the attorney is defending a person in the financial industry against criminal charges.

This also reminded me about a case we had a couple of years ago where we represented a young banker here in Georgia. Back when the real estate market was flying high, he was a superstar, bringing in millions of dollars in loans to developers who were fueling the Atlanta housing boom. When the market began getting soft, he was dismayed by how his bosses were treating him, so he took his book of business to another local bank. The bosses at the first bank did an "investigation", and turned over to the authorities the dirt they had supposedly uncovered on this young banker. The local District Attorney thought he'd be a star also, and could get his name in the papers by indicting a banker just as the housing market was collapsing. They accused our client of claiming in memos to the loan committee that his developer/clients were putting 10% into the deals, when in fact they were not. The DA then got an indictment that charged our client with making "false entries" in the "books reports or statements" of a financial institution.

We were hired, and, like attorneys should do in every case, we went over everything with a fine-toothed comb. We discovered that the law they charged in the indictment had not been used for over 50 years! Next, we compared this old law, and the few cases interpreting it, to the actual language in the indictment. We came to the conclusion that the memos to the loan committee were not "false entries", and even if they were, a memo to the loan committee is not a "book, report or statement" of a financial institution.

We took the unusual step of filing what is called a "demurrer" in Georgia. By this step, we basically argued that even if we admitted to the facts in the indictment, those facts did not constitute a crime. The judge was convinced we were right. He had us write up an order, which he then signed, and the judge then dismissed all the charges. This young banker got his life and career back, and we occasionally hear of how well he is doing.

None of us are perfect. But when as lawyers we are asked to defend another human being, that enormous responsibility requires that we look at every possibility when defending our clients. I know that most lawyers representing the growing number of indicted bankers face many of the same challenges.

In an amazing opinion issued in Atlanta by the Eleventh Circuit, the court reversed a series of federal criminal convictions because the indictment did not even charge a crime. And, they did so even though none of the lawyers for either side bothered to address whether the indictment properly charged a federal criminal offense! The whole issue came down to whether the Defendant's actions were "contrary to law", and because they were not, the court of appeals reversed all their convictions.

The Defendants and their company imported dairy products into the U.S. from Central America. Apparently, several of their imported products were contaminated with E. Coli and salmonella.

Some of the post-9/11 laws beefed up the statutes that criminalize the unlawful importing of goods into the United States. One of those laws is 18 U.S.C. § 545. The unlawful importation charges in the indictment here were based on violations of a Customs regulation, alleging the failure to deliver, export, and destroy with FDA supervision certain imported goods found to be adulterated. See 19 C.F.R. § 141.113(c). Failure to comply with this regulation typically gives rise to a civil remedy of liquidated damages in the amount of three times the value of the goods.

The criminal statute, 18 U.S.C. §545, says it is a crime to import items if doing so is "contrary to law". To summarize what is a quite lengthy decision, the Court of Appeals decided that the regulation is not the kind of "law" referred to in this particular criminal statute.

To me there are two notable items from this decision. First, the Court of Appeals itself brought up the whole issue of whether the indictment even charges a crime. The judges told the lawyers for both sides to file more briefs on the questions of whether 1) the appeals court can even address the issue if no one raised it (they decided they could), and 2) whether the charges, as set out in the indictment, even alleged a crime. I've been doing this a very long time, but cannot ever remember a similar case.

The second thing that popped out to me when reading the opinion is that the Court of Appeals totally rejected the prosecutor's arguments that any problems with the indictment could be fixed by "inferring" the missing pieces. My law partner, Carl, and I have been fighting this fight for over a decade now. Prosecutors get invalid indictments that do not allege everything needed to prove a crime, but judges have been increasingly letting them get away with it by referring to some faulty and flimsy earlier rulings where the missing elements of the crime are put back in by the process of making an "inference.

It is cases like this that re-energize me. I am glad to see judges who take their jobs seriously and who do not think they are supposed to merely rubber stamp every conviction that comes along. While such cases get my juices flowing, the decision also reminds me that all lawyers need to take a good long look at the charges in an indictment, and not just assume the charging document actually alleges a crime.

Ellen Podgor over at the White Collar Crime Prof Blog recently pointed out a significant decision out of the Ninth Circuit involving the federal mail fraud statute which could be helpful to those of us that handle white collar cases in federal court. Specifically, in United States v. Phillips, Judge Rackoff, writing for the panel and sitting by designation as a visiting judge, reversed the defendant's mail fraud conviction, concluding that the Government failed to prove that the mail system was used for the purpose of executing the scheme at issue.

The facts in Phillips were relatively unremarkable. In essence, Phillips executed a scheme in which he improperly used company funds to purchase a $10,000 watch for himself. After he paid for the watch, the jeweler mailed the watch to Phillips. In prosecuting him for mail fraud, the Government attempted to use the mailing of the watch to Phillips to satisfy the mailing requirement of the federal mail fraud statute. After he was convicted at trial, Phillips appealed and argued that the mailing of the watch was not in furtherance of the fraudulent scheme to defraud his company, and that he was instead simply using the money he obtained from his company to purchase a watch.

Judge Rackoff and the panel agreed, relying on the Supreme Court's 1974 decision in United States v. Maze. In Maze, the Court reversed the defendant's mail fraud conviction because the success of the defendant’s scheme did not depend in any way on the mailings at issue. According to Judge Rackoff and the rest of the panel, the facts presented in Phillips justified the same result as the Court reached in Maze.

In Phillips, as in Maze, the success of Phillips’s fraudulent scheme did not depend in any way on the use of the mails. According to the Ninth Circuit: "The fact that Phillips purchased a watch with $30,000 of fraudulently obtained [company] funds, instead of using the funds for his personal benefit in some other fashion, did not in any way affect the scheme “to defraud [the company] and to obtain money from [the company] . . . .”" In other words, the "fact that payment eventually was made to a watch dealer and that watch dealer mailed a watch in return was not a part of the scheme to defraud [the company] and to obtain money from [the company] – it was simply the byproduct of that scheme. For this reason, the Ninth Circuit reversed Phillips's conviction on the mail fraud charge.

As professor Podgor points out, Judge Rackoff is no stranger to the federal mail fraud statute. Indeed, over twenty-five years ago, he published a law review article entitled "Federal Mail Fraud (Part I)." Congress enacted the federal mail fraud statute in 1872. And what is amazing to me, however, is that to this day, uncertainty still exists regarding the breadth and meaning of the statute, particularly in the area of honest services fraud. It is great to see Judge Rackoff and the Ninth Circuit apply the Supreme Court's decision in Maze and limit the statute in a meaningful way in Phillips's case. The opinion in Phillips can be found here.