US v. Keith Arthur Vinson, No. 15-4384 (4th Cir., filed 3/24/17) Misdeeds in the Blue Ridge Mountains

This case involves a woeful tale of real estate hijinks in the beautiful mountains outside of Hendersonville, NC.  Vinson was indicted and convicted for a number of fraudulent activities he engaged in during his attempt to develop an Arnold Palmer golf course and resort area called Seven Falls.  This was all a very swank affair, with a Founder’s Day promotion at the Biltmore Estate and ribbon cutting for the “fabulous golf academy.” Unfortunately, it also contributed to the insolvencies of the Bank of Ashville and Pisgah Community Bank. To read about how NOT to structure loans with banks and others (pro tip:  do not use straw borrowers, parking arrangements, nor should you shut down a co-developer’s access to your joint bank account), read the lengthy exegesis provided by the opinion.  But long story short, there were a number of people who sought to profit from Vinson’s activities, and they all flipped and testified against him.  He, alone, stood trial for these misdeeds and he was convicted and sentenced to 18 years in prison.  This appeal follows. He raised three claims on appeal: 1) the evidence was insufficient to support his conviction, 2) the trial court judge erred by giving a willful blindness instruction to the jury, and 3) his sentence was substantively unreasonable.

Appellate courts review sufficiency claims under a de novo standard.  United States v. Barefoot, 754 F.3d 226 (4^th Cir. 2014). Challenging the sufficiency of trial evidence presents a heavy burden for an appellant, as “[r]eversal for insufficient evidence is reserved for the rare case where the prosecution’s failure is clear.”  See United States v. Ashley, 606 F.3d 135, 138 (4^th Cir. 2010).  The Court quickly (and thoroughly) dispensed with this argument by pointing out evidence that Vinson knew the criminal objective of the conspiracy and willfully joined the conspiracy with the intent to further its unlawful purpose.  Indeed, he was the primary beneficiary of the conspiracy and received roughly $10 million for his use on the Seven Falls development.  The Court also dispensed with this argument relating to the straw purchaser agreements, noting that that material terms of the loans were not disclosed to the bank. The Court also found ample evidence of Vinson’s participation in these fraudulent schemes as an aider and abettor, and that he improperly converted funds from another for his Seven Falls development.

Vinson also argued the trial court erred by instructing the jury on willful blindness.  Under the willful blindness doctrine, the government may “prove knowledge by establishing that the defendant deliberately shielded himself from clear evidence of critical facts that are strongly suggested by the circumstances.”  United States v. Jinwright, 683 F.3d 471, 478-79 (4^th Cir. 2012). A willful blindness instruction is appropriate when the defendant asserts a lack of guilty knowledge but the evidence supports an inference of deliberate ignorance. See United States v. Abbas, 74 F.3d 506 (4^th Cir. 1996).   Again, the Court pointed to myriad factors that showed that Vinson knowingly and intentionally engaged in fraudulent activities.  The trial court did not abuse its discretion in giving that jury instruction to the jurors.

Lastly, Vinson argued that his sentence was substantively unreasonable.  In support of this claim, he pointed to the sentences given to his co-conspirators which were significantly lower than his sentence.  Unfortunately, the court did not agree.  “[C]omparing the sentences of defendants who helped the Government to those of defendant who did not…is comparing apples and oranges.”  See United States v. Perez-Pena, 453 F.3d 236, 243 (4^th Cir. 2006).  All of these co-conspirators pleaded guilty.  Vinson was the only one who insisted on trial.  The Court found that, in these circumstances, the presumption of reasonableness applied and his sentence should stand.

The Court affirmed both Vinson’s guilt and 18-year sentence.