U.S. v. Burfoot, Fourth Circuit Court of Appeals, Filed August 8, 2018: How Bribery Charges Become Conspiracy to Commit Wire Fraud

Earlier this month, the Fourth Circuit upheld a Norfolk City Council member’s convictions for wire fraud, extortion, conspiracy, and perjury.

Anthony Burfoot was accused of soliciting and accepting bribes from real estate developers in exchange for favorable treatment for their real estate projects, and he was accused of lying about his role in a federal trial of one of the real estate developers.

The Fourth Circuit considered, and rejected, each of his arguments on appeal.

Wire Fraud and Conspiracy to Commit Wire Fraud

Whether there was enough evidence of an intent to commit wire fraud seems questionable to me, but the Fourth Circuit affirmed Burfoot’s convictions for wire fraud and conspiracy to commit wire fraud.

A conspiracy to commit wire fraud requires proof that the defendant:

  • Agreed with one or more other persons to commit wire fraud; and
  • Willfully joined the conspiracy with the intent to further its unlawful purpose.

Where’s the Wire Fraud?

In an “ordinary” wire fraud case, a group of people conspire to defraud others by persuading people to send money via wire transfers – the type of scam varies, but, usually, the use of wire transfers is an integral part of the scheme.

This wasn’t a “wire fraud” case – it was, at its heart, a prosecution for bribery and perjury. The testimony related to wire fraud was that Burfoot demanded that one co-conspirator pay the tax delinquencies for another co-conspirator, thereby keeping the development project alive and persuading city council to approve the project.

Because the co-conspirator paid the tax delinquency using a wire transfer (a credit card was used), the government argued, and the Court accepted, that Burfoot was guilty of wire fraud and conspiracy to commit wire fraud – even though 1) Burfoot arguably did not know that a wire transfer would be used to make the payment, and 2) Burfoot was the Chief Deputy Treasurer and his job required him to ensure tax delinquencies were paid.

The Fourth Circuit found that the use of a wire transfer to pay the delinquent taxes was foreseeable, and that there was enough evidence for the jurors to find that the wire transfer paying the delinquent taxes was part of the scheme to defraud…

Constructive Amendments are Grounds for Reversal

A “constructive amendment” is when the court’s instructions to the jury exceed or expand on the allegations in the original indictment – the Fifth Amendment “guarantees that a criminal defendant will be tried only on charges in a grand jury indictment,” so “only the grand jury may broaden or alter the charges.”

In this case, the indictment’s counts for extortion under the Hobbs Act alleged that Burfoot had obtained a total of $50,000. The Court instructed the jurors, however, that Burfoot only needed to have obtained something of value – implying that the jurors did not need to find the alleged amount of $50,000.

Because proof of a specific dollar amount is not a requirement to find someone guilty of extortion under the Hobbs Act, the trial court’s instructions did not expand on the allegations in the indictment, and so the Fourth Circuit did not reverse the conviction.

Earlier this month, the Fourth Circuit upheld a Norfolk City Council member’s convictions for wire fraud, extortion, conspiracy, and perjury.

Anthony Burfoot was accused of soliciting and accepting bribes from real estate developers in exchange for favorable treatment for their real estate projects, and he was accused of lying about his role in a federal trial of one of the real estate developers.

The Fourth Circuit considered, and rejected, each of his arguments on appeal.

Wire Fraud and Conspiracy to Commit Wire Fraud

Whether there was enough evidence of an intent to commit wire fraud seems questionable to me, but the Fourth Circuit affirmed Burfoot’s convictions for wire fraud and conspiracy to commit wire fraud.

A conspiracy to commit wire fraud requires proof that the defendant:

  • Agreed with one or more other persons to commit wire fraud; and
  • Willfully joined the conspiracy with the intent to further its unlawful purpose.

Where’s the Wire Fraud?

In an “ordinary” wire fraud case, a group of people conspires to defraud others by persuading people to send money via wire transfers – the type of scam varies, but, usually, the use of wire transfers is an integral part of the scheme.

This wasn’t a “wire fraud” case – it was, at its heart, a prosecution for bribery and perjury. The testimony related to wire fraud was that Burfoot demanded that one co-conspirator pay the tax delinquencies for another co-conspirator, thereby keeping the development project alive and persuading the city council to approve the project.

Because the co-conspirator paid the tax delinquency using a wire transfer (a credit card was used), the government argued, and the Court accepted, that Burfoot was guilty of wire fraud and conspiracy to commit wire fraud – even though 1) Burfoot arguably did not know that a wire transfer would be used to make the payment, and 2) Burfoot was the Chief Deputy Treasurer and his job required him to ensure tax delinquencies were paid.

The Fourth Circuit found that the use of a wire transfer to pay the delinquent taxes was foreseeable and that there was enough evidence for the jurors to find that the wire transfer paying the delinquent taxes was part of the scheme to defraud…

Constructive Amendments are Grounds for Reversal

A “constructive amendment” is when the court’s instructions to the jury exceed or expand on the allegations in the original indictment – the Fifth Amendment “guarantees that a criminal defendant will be tried only on charges in a grand jury indictment,” so “only the grand jury may broaden or alter the charges.”

In this case, the indictment’s counts for extortion under the Hobbs Act alleged that Burfoot had obtained a total of $50,000. The Court instructed the jurors, however, that Burfoot only needed to have obtained something of value – implying that the jurors did not need to find the alleged amount of $50,000.

Because proof of a specific dollar amount is not a requirement to find someone guilty of extortion under the Hobbs Act, the trial court’s instructions did not expand on the allegations in the indictment, and so the Fourth Circuit did not reverse the conviction.

The Fourth Circuit upheld all of Burfoot’s convictions, but the biggest lesson here may be that you can be convicted of conspiracy to commit wire fraud even when wire fraud was not a part of the overall scheme – in a bribery case, for example, where one or more payments are made using any kind of wire transfer, even if that was not your intent, you can be prosecuted for wire fraud in addition to the primary allegations.

Leave a Reply

Your email address will not be published. Required fields are marked *