Transferring stolen funds by wire to out of state investment account after fraudulent scheme is complete cannot constitute wire fraud

INDICTMENT/WIRE FRAUD/BRADY United States v. Redcorn, No. 06-5206, ___ F.3d ___ (10th Cir. Jun 9, 2008)(N.D. Oklahoma). Appeal of convictions for embezzlement from a health care benefit program, wire fraud, and money laundering in violation of 18 U.S.C. §§ 669, 1343, and 1957(a). HELD: (1) Indictment’s prefatory factual allegations that are inconsistent with one count of a multi-count indictment cannot warrant dismissal of that count. Each count in an indictment is regarded as if it was a separate indictment. Therefore, an indictment need not contain introductory or prefatory matter at all. Accordingly, if an indictment does contain such content, that content is superfluous unless expressly incorporated into one of the counts. (2) Where defendants fraudulently moved funds from health insurance company bank account into their personal accounts at the same bank, fraudulent scheme was complete. Therefore, transferring those funds from personal bank accounts in Oklahoma to investment accounts in Florida could not constitute wire fraud. That defendants chose to transfer part of their stolen money to broker in Florida is incidental to fraudulent scheme. For example, defendants could have decided to spend money on luxury vacation. Without closer connection to mechanism of their fraud, what defendants did with stolen money after obtaining it cannot be an essential part of scheme sufficient to support independent charge of wire fraud. (3) It was not plain error for district court to deny defendant’s motion for new trial based on claim of newly discovered evidence where evidence in possession of state insurance regulatory agency had not been turned over to defendant until after trial and defendant alleged for first time on appeal that government violated duty under Brady v. Maryland, 373 U.S. 83, 87, 83 S.Ct. 1194, 10 L.Ed.2d 215 (1963), to disclose exculpatory evidence. Federal prosecutors may not be held responsible for omissions of state regulatory agency, an arm of a different government. Read the opinion here.