FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF
WYOMING. (D.C. No. 1:12-CR-00245-ABJ-1).
Russell Smith, Research and Writing Specialist, Cheyenne,
Wyoming (Virginia L. Grady, Federal Public Defender,
Districts of Colorado and Wyoming, Jim Barrett, Assistant
Federal Public Defender, Cheyenne, Wyoming, with him on the
briefs), for Defendant - Appellant.
M. Conder, Assistant United States Attorney (Christopher A.
Crofts, United States Attorney, District of Wyoming,
Stephanie I. Sprecher and David A. Kubichek, Assistant United
States Attorneys, on the brief), District of Wyoming, Casper,
Wyoming, for Plaintiff -- Appellee.
HARTZ, O'BRIEN, and PHILLIPS, Circuit Judges.
O'BRIEN, J., concurring. PHILLIPS, Circuit Judge,
Marvin Iverson was convicted after a jury trial of engaging
in a scheme to defraud JPMorgan Chase and Big Horn Federal
Savings. See 18 U.S.C. § 1344. The statute
requires that the victims be " financial
institutions." Id. To establish that element of
the offense, the government offered the testimony of an FBI
agent to try to prove that JPMorgan and Big Horn were insured
by the Federal Deposit Insurance Corporation (FDIC). See
id. § 20(1) (defining financial
institution to include " an insured depository
institution (as defined in [12 U.S.C. §
1813(c)(2)])" ); 12 U.S.C. § 1813(c)(2) (" The
term 'insured depository institution' means any bank
or savings association the deposits of which are insured by
the [FDIC] pursuant to this chapter." ).
appeal Defendant argues that the agent's testimony was
inadmissible hearsay and violated the best-evidence rule. He
also argues that even if the evidence was admissible, it was
insufficient to prove that JPMorgan and Big Horn had FDIC
insurance at the time of the offense. Despite the
government's concession to the contrary, we hold that the
agent's testimony was not inadmissible hearsay; it was
either not hearsay or fell within a hearsay exception. As for
the best-evidence rule, Defendant did not raise the issue
below and he has not shown plain error. Finally, because
there was sufficient evidence that JPMorgan had FDIC
insurance at the time of the offense, we reject
Defendant's sufficiency-of-the-evidence challenge.
has been a member of the " sovereign citizens"
group called " Wyoming Free State." Among other
practices, such groups instruct their members on various
debt-elimination schemes. The scheme here was called the
electronic-funds-transfers (EFT) scheme. A member writes a
check on a closed account to pay off a debt, with the hope
that an unaware financial institution will release title or a
lien before the check bounces.
used the EFT scheme to try to eliminate debts owed to
JPMorgan and Big Horn. First, on June 22, 2012, using a
closed checking account with First Interstate Bank, Defendant
wrote Big Horn two checks totaling over $27,000 to pay off a
vehicle loan and a mortgage. On the back of each check was
Not for deposit
For discharge of debt
Marvin Leslie Iverson
R., Vol. 2 at 28 (internal quotation marks omitted). Despite
this notation, the checks were processed by Big Horn, and the
vehicle lien and mortgage were released. After being notified
that the checks were drawn on a closed account, the bank
demanded that Defendant pay the debt. Defendant refused until
he was arrested for this offense. Second, on August 18, 2012,
Defendant wrote a check from his closed First Interstate
account to JPMorgan in the amount of $369,300 to pay off his
daughter's mortgage. The check had the same EFT notation
as before. JPMorgan did not process the check or release the
was charged with scheming to defraud the financial
institutions in a one-count indictment filed in the United
States District Court for the District of Wyoming. The case
went to trial on July 28, 2014. Defendant represented himself
with the aid of standby counsel.
issues on appeal focus on the prosecutor's afterthought
questioning of FBI Special Agent Kent Smith:
[PROSECUTOR]: I don't have any other questions. Thank
[DEFENDANT]: No questions.
THE COURT: You may step down.
[PROSECUTOR]: Your Honor, I neglected to ask one question.
THE COURT: Very well.
. . . .
Q. Agent, did you do any research to determine whether or not
JPMorgan Chase and Black--or Big Horn Federal Savings were
FDIC insured or federally insured institutions?
A. Yes, and both First Interstate--you said Big Horn?
Q. Big Horn.
A. Yes, Big Horn Federal Savings is. I received the F--
[DEFENDANT]: Objection. Foundation.
THE COURT: Sustained.
. . . .
Q. What research did you do?
A. Different for different banks. On JPMorgan Chase I pulled
up the FDIC website and found their information and their
certificate number. For Big Horn Federal Savings Bank, having
been to that actual bank, I requested a copy of their FDIC
certificate which included their number.
Q. All right. I ask again. Can you--when you, when you looked
at the website--
[Standby Defense Counsel]: Hearsay.
. . . .
Q. --is that a normal course of business to check to see if a
bank is FDIC insured--
. . . .
Q. --in your normal course of business as an FBI agent?
A. To determine if they're FDIC insured?
A. Yes, it is.
Q. And do you rely on those records to be accurate to
determine if a bank is FDIC insured?
A. Yes, we do.
Q. And I'd ask again. Do you know if the banks of Big
Horn Federal Savings and--
. . . .
Q. --JPMorgan Chase are federally insured?
[DEFENDANT]: Hearsay again.
THE COURT: Overruled.
A. Yes, in my research both Big Horn Federal Savings Bank and
JPMorgan Chase bank are federally insured.
R., Vol. 3 at 84-86.
Admissibility of the Evidence
raises two challenges to the admissibility of the testimony
that the victim institutions were FDIC insured. He claims (1)
that Agent Smith's testimony about FDIC insurance
coverage was hearsay and (2) the testimony violated the
best-evidence rule, which required introduction into evidence
of the FDIC certificates of coverage. Both the hearsay rule
and the best-evidence rule are exceptions to the general rule
that a witness can testify to what the witness saw or heard.
The hearsay rule ordinarily excludes testimony about what
someone wrote or said out of court when " offer[ed] in
evidence to prove the truth of the matter asserted in the
statement." Fed.R.Evid. 801(c). And the best-evidence
rule ordinarily excludes testimony about what appeared in a
document when offered to prove " its content."
review a district court's evidentiary decisions for abuse
of discretion. See United States v.
Trujillo, 136 F.3d 1388, 1395 (10th Cir. 1998). The
government confesses error on Defendant's hearsay issues,
but we are not bound by this concession. See
United States v. Resendiz-Patino, 420 F.3d 1177,
1182-83 (10th Cir. 2005). We first address hearsay and then
the best-evidence rule.
Smith's testimony about Big Horn's FDIC-insured
status was based solely upon his review of the bank's
FDIC certificate. In essence he was reporting on what the
certificate said. His testimony about JPMorgan was based on
his review of the FDIC website. There are two possible
assertions in this testimony. One is Agent Smith's
assertion that he is accurately reporting what he saw
concerning the certificate and the website. The other is what
the certificate and website said was true--that the banks
were insured by the FDIC. The first assertion presents no
hearsay problem because the assertion is made by the witness
at trial. See Fed.R.Evid. 801(c)(1) (hearsay is
limited to " a statement that . . . the declarant does
not make while testifying at the current trial or
hearing" ). Agent Smith could be carefully
cross-examined about the accuracy of his perception and
memory of what he saw. (The probability of witness error in
reporting the content of a document is, however, a concern of