United States v. Roger Allen Doane

• Court: Court of Appeals for the First Circuit
• Decided: September 11, 1992
• Docket: 91-2214
• Status: Published

Opinion

USCA1 Opinion

September 11, 1992  UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT
                                 ____________________

No. 91-2214

                                    UNITED STATES,

                                 Plaintiff, Appellee,

                                          v.

                                  ROGER ALLEN DOANE,

                                Defendant, Appellant.

                                 ____________________

                     APPEAL FROM THE UNITED STATES DISTRICT COURT

                          FOR THE DISTRICT OF NEW HAMPSHIRE

                       [Hon. Shane Devine, U.S. District Judge]
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                                 ____________________

                                        Before

                                  Cyr, Circuit Judge,
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                            Roney,* Senior Circuit Judge,
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                            and Pieras,** District Judge.
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                                 ____________________

            Jonathan R. Saxe, by Appointment of the Court, with  whom Twomey &
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        Sisti Law Offices was on brief for appellant.
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            Barbara N. Bandfield, Trial Attorney, United States Department  of
            ____________________
        Justice, with whom Jeffrey  R. Howard, United States Attorney,  was on
                           __________________
        brief for appellee.

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        _____________________
        *  Of the Eleventh Circuit, sitting by designation.
        ** Of the District of Puerto Rico, sitting by designation.

PIERAS,  District Judge.    Appellant Roger  Allen Doane,  a
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          licensed attorney  practicing  in Salisbury,  Massachusetts,  was

          convicted after a jury trial in the District  of New Hampshire of

          bank  fraud  (18 U.S.C.     1344),  interstate transportation  of

          securities taken by fraud (18 U.S.C.    2314), and four counts of

          embezzlement  (18 U.S.C.   656).   On this appeal, he attacks his

          conviction  alleging an  incorrect jury  instruction  relating to

          Section  2314, insufficient  evidence to  sustain his  conviction

          under Section 656, and an incorrect and prejudicial denial of two

          motions to suppress.  Finding no merit in appellant's  arguments,

          we affirm.

                                      Background    
                                      Background
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               The various charges against appellant were based on a series

          of different  transactions.  The fraud-related  counts involved a

          scheme  devised and  carried  out by  Doane  in early  1987,  the

          purpose  of  which was  to obtain  funds  from the  United States

          Savings  Bank  of   America  (hereinafter  "USSBA")  located   in

          Seabrook,  New  Hampshire,  and  to deposit  these  funds  in  an

          overdrawn account maintained at USSBA for the benefit of a health

          care clinic called Primacare, which Doane owned.  Doane created a

          sham trust and  held himself out as its attorney while naming the

          girlfriend of a former  employee as its trustee.   The collateral

          given for  the  loan was  a  mortgage on  a  beach house  already

          subject  to four  other  mortgages  which  was  owned  by  Marion

          Heffron, a USSBA  employee who  had been  Doane's bookkeeper  for

          several years and continued to receive money from him after being

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employed by USSBA.  Doane directed the submission to USSBA of  an

          application  for  a mortgage  loan to  the  trust and,  using his

          influence  over  Heffron, directed  her to  draw  a check  in the

          amount  of $131,500.00 for the  benefit of Doane  as attorney for

          the trust.   He then directed  his new bookkeeper to  pick up the

          check and  deposit it into a  law firm trust fund  account at the

          First National Bank of Boston ("FNBB"), located in Massachusetts.

          Soon  thereafter, appellant drew a  check on the  FNBB account in

          the  amount  of  $110,000.00,  payable  to  Primacare,  and  four

          additional  checks  totalling $23,533.00  payable to  himself for

          "fees and costs." 

               The  embezzlement-related counts  involved  two other  USSBA

          loans,  the proceeds of which Doane embezzled after the funds had

          been deposited in law office client trust  accounts maintained at

          USSBA.    The  first loan,  in  the  amount  of $140,000.00,  was

          obtained for  Arthur and Valerie McCaskill,  who were represented

          by Diane Loman, an attorney in Doane's office.  The proceeds were

          to be  used to  pay  off a  pre-existing  first mortgage  on  the

          McCaskills' home and to make disbursements identified by Loman on

          a settlement sheet; however, after the proceeds were deposited in

          a client trust fund account, Doane directed his bookkeeper not to

          pay off the pre-existing  mortgage or make any of  the identified

          disbursements.  Instead, seven  checks totalling $141,855.14 were

          issued  for  various  other  purposes,   including  three  checks

          totalling $82,426.81 which were  made payable to Doane  for "fees

          and costs."  Doane for  a short period of time arranged  that the

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monthly  payments on  the pre-existing  loan be  paid out  of law

          office  funds,  but  then   discontinued  the  payments.    Doane

          eventually gave the McCaskills a check for $99,536.00,  but later

          instructed his bookkeeper to place a stop payment on the check.

               The  second loan was handled  by Doane's law  firm after the

          USSBA directed the borrowers, Gary and Darlene Richie, to use the

          services  of   Doane's  firm.    The   loan  proceeds,  totalling

          $85,000.00,  were deposited into  a client trust  fund account at

          USSBA.  After closing, Doane directed that a check in  the amount

          of  $41,887.00 be sent to pay off the seller's existing mortgage.

          When Doane learned approximately two  months later that the check

          had  not been negotiated, he  directed his bookkeeper  to place a

          stop payment on  the check.   Thereafter, three checks  totalling

          $41,762.94  were drawn  on the  account, all  signed by  and made

          payable to Doane for "fees and costs."  USSBA eventually issued a

          treasurer's check to pay off the existing mortgage.

                                   Jury Instruction
                                   Jury Instruction
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               Appellant   asserts  that   the  district   court  committed

          reversible error by submitting to the jury an aiding and abetting

          instruction without  a correlative  instruction  that the  mental

          state of an aider and abettor  must be the same as the principal.

          The  precepts  controlling our  review  of a  trial  court's jury

          instructions  are well established.   Primary  among them  is the

          axiom that "a  single instruction to a jury may  not be judged in

          artificial  isolation, but must be  viewed in the  context of the

          overall charge."  Cupp v. Naughten, 414 U.S. 141, 146-47 (1973).
                            ________________

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With this  directive in mind, we conclude  that the district

          court's charge was not prejudicial,  primarily because it was not

          in fact an instruction on aiding and abetting.   In setting forth

          the  elements required under 18 U.S.C.   2314 to prove interstate

          transportation of securities taken  by fraud,1 the district court

          instructed the jury:

               It is not  necessary for the  Government to prove  that
               the defendant  actually transmitted or  transported the
               money himself,  as it  is sufficient to  prove that  he
               caused such transportation to  be done.  Otherwise put,
               the defendant  may be  found guilty  of a  violation of
               Title 18, United States Code, Section 2314, if the jury
               finds  beyond  a reasonable  doubt  that  the defendant
               committed the  offense himself, or if it finds beyond a
               reasonable doubt that the defendant aided or caused the
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               commission of the offense by others.  

          Transcript at 94  (June 20,  1991) (emphasis added).   We  cannot

          agree with appellant's contention that  this language constituted

          an  instruction on aiding and  abetting.  The  district court was

          merely   explaining  to   the  jury   that  in   order  to   find

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        1 18 U.S.C.   2314 provides, in pertinent part (emphasis added):

                  Whoever  transports,  transmits,  or   transfers  in
               inter-state  or  foreign  commerce  any  goods,  wares,
               merchandise,  securities  or  money, of  the  value  of
               $5,000 or more,  knowing the same to  have been stolen,
               converted or taken by fraud; or 

                  Whoever,  having devised or  intending to devise any
               scheme  or  artifice to  defraud  . .  .  transports or
               causes  to be  transported,  or induces  any person  or
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               persons  to   travel  in,  or  to   be  transported  in
               interstate  or  foreign commerce  in  the execution  or
               concealment  of a  scheme or  artifice to  defraud that
               person or persons  of money or property  having a value
               of $5,000 or more . . .

                  .  . .  [s]hall be  fined not  more than  $10,000 or
               imprisoned not more than 10 years, or both.

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transportation in interstate commerce it must find that money was

          moved  or caused  to  be moved  by  the defendant  in  interstate
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          commerce.  The court used the  word "aided" only to flesh out for

          the  jury the meaning of the phrase "causes to be transported" as

          used in the statute.   While the court's use of the  word "aided"

          was perhaps  ill-advised, it could not alone yield an instruction

          on aiding and abetting.

               The  jury   could  not   have  concluded  otherwise.     The

          indictment,  which was read to the jury on several occasions, did

          not  charge the defendant with aiding and abetting.  In addition,

          the court's charge included an instruction on specific intent, as

          well as instructions on  voluntary and intentional conduct, which

          taken together required the jury to find that the defendant acted

          knowingly  and intentionally.    Under  these  circumstances,  we

          determine  that the  trial court's  instruction did not  create a

          substantial risk of a  miscarriage of justice.  Accord  Cupp, 414
                                                          ______  ____

          U.S.  at 147-48; Allen v. Commonwealth of Massachusetts, 926 F.2d
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          74, 79-80 (1st Cir. 1991).

                               Sufficiency of Evidence
                               Sufficiency of Evidence
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               Appellant also  asserts that  the evidence adduced  at trial

          was insufficient to sustain his conviction for embezzlement under

          18 U.S.C.   656.  Section 656 provides, in pertinent part:

                  Whoever,  being  an  officer,  director,   agent  or
               employee  of, or  connected  in any  capacity with  any
               Federal  Reserve  Bank  .  .  .  embezzles,  abstracts,
               purloins  or willfully  misapplies any  of  the moneys,
               funds  or credits of  such bank  . .  . or  any moneys,
               funds, assets or securities intrusted to the custody or
               care of such bank  . . . or to the  custody or care any
               such  agent,  officer, director,  employee  or receiver

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shall be  fined not more than  $1,000,000 or imprisoned
               not more than 30 years, or both.

          Appellant contends that the evidence against him was insufficient

          to show (i) that he was an officer, director, agent  or employee,

          or otherwise connected in  any capacity with USSBA and  (ii) that

          the money involved  in the  offenses was  not money  of USSBA  or

          entrusted to its care or to the care of its agent.  We disagree.

               First, the  evidence was  sufficient to show  that appellant

          enjoyed  an agency relationship with the bank.  See United States
                                                          ___ _____________

          v. Davis,  953 F.2d 1482,  1488 (10th Cir.  1992).  The  evidence
          ________

          showed that  (i) bank  employees sought professional  advice from

          appellant  on  matters  related  to  the bank;  (ii)  the  bank's

          accountant testified that Doane  was "the bank's attorney"; (iii)

          appellant's  employee acted  as  the sole  closing  agent on  the

          loans,  creating a  fiduciary  duty between  the appellant's  law

          office  and the bank; and (iv) most strikingly, the bank required
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          one of the  victims to use the services of  appellant to obtain a

          loan.  This final aspect of the evidence reflects the inescapable

          fact that an attorney  who drafts and executes loan  documents at

          the instigation of a bank acts  as the bank's lawyer and seeks to

          protect the  interests of the  bank as a  creditor.2  From  these
                            
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        2 As  a practical matter, when  a bank "suggests" that  a borrower use
        the services of a particular attorney, the bank is in effect requiring
        that the borrower use that attorney's services in order to obtain  the
        requested  loan.    In addition,  since  the  primary  interest to  be
        protected in a loan context is the interest of the bank as lender, the
        "suggestion"  that  a certain  attorney be  used  is tantamount  to an
        appointment of that attorney as a fiduciary of the bank.  As a result,
        although the  attorney might  be paid  by the borrower  to act  as its
        attorney  for purposes  of closing  the  loan, the  attorney's primary
        mandate  is to protect  the interest of  the bank.   In other types of

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facts, viewed in a  light most favorable to the  prosecution, the

          jury could have reasonably concluded  that appellant was an agent

          of USSBA.

               Second,   the  funds  which   were  embezzled  were  clearly

          "intrusted to  the care of [a  USSBA] agent," as required  by the

          statute -- that agent being Doane himself.  Appellant argues that

          he did  not embezzle  "funds  . .  . of  [the]  bank" within  the

          meaning of Section  656 because  title to the  loan proceeds  had

          already passed from  USSBA to his  clients at the time  they were

          deposited  into the  client trust fund  accounts.   Assuming this

          fact to be  true, Doane  is not delivered  from conviction  under

          Section 656.  The statute applies with equal force when the funds

          embezzled  are  under the  custody of  an  agent of  a federally-
                                                     _____

          insured  bank.3   Once  the funds  passed  into escrow  and  were

          deposited   in  client   trust  funds   accounts  maintained   by

          appellant's  law office,  they were  clearly "intrusted  to [his]

          custody or care."  His embezzlement of the funds  while they were

          in his custody is conduct that falls squarely within the statute.
                            
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        transactions where  the bank  is involved  only  peripherally and  its
        interest is not directly at risk, a suggestion by an officer of a bank
        that  a particular  attorney  be used  does  not similarly  reflect  a
        fiduciary relationship between the bank and the attorney.

        3 The Court notes that all cases concerning embezzlement of bank funds
        or funds intrusted to the care of a bank are inapposite  to this case.
        Cf., Golden v. United  States, 318 F.2d  357 (1st Cir. 1963)  (whether
        ___  ________________________
        funds  directed to bank official  in his private  capacity ever became
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        "funds" of bank is question of fact for jury, not a question of  law);
        United  States v.  Mott, 603  F. Supp.  1322, 1323-24  (S.D.N.Y. 1985)
        _______________________
        (bank  initially used "funds of  the bank" to  reimburse bank employee
        who  submitted fraudulent  expense  billings, despite  fact that  bank
        intended  to obtain  substantial reimbursement  from clients  at later
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        date).

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Suppression of Evidence
                               Suppression of Evidence
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               Appellant's  final issue  on  appeal  involves the  district

          court's denial  of  two  motions  he filed  to  suppress  certain

          documents  delivered to  the Federal  Bureau of  Investigation by

          their  custodian, a bankruptcy  trustee, and by  the president of

          the  corporate  entity   whose  records  were   delivered,  which

          documents  he  contends  were   obtained  by  the  government  in

          violation  of the Fourth  Amendment.  The  government has offered

          several  procedural  and  substantive reasons  why  the  district

          court's orders should be upheld.  We do not address each of these

          issues.  

               The  exclusionary  rule  provides  that  illegally  obtained

          evidence,  to  which a  timely  objection  was  made,  cannot  be

          admitted  into  evidence.    The  rule  reflects not  a  personal

          constitutional  right  of  the  person aggrieved  but  instead  a

          judicially created  remedy designed  primarily to  deter improper

          conduct by law enforcement officials.  United States v. Leon, 468
                                                 _____________________

          U.S. 897 (1984);  Michigan v.  De Fillippo, 443  U.S. 31  (1979).
                            ________________________

          None  of the  documents appellant moved  to have  suppressed were

          introduced  into evidence at trial.   As a  result, even assuming

          arguendo that the motions to suppress were improperly denied, the
          ________

          exclusionary rule provides no remedy in this case. 

               Affirmed.
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