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United States v. Michael Berkley and Val Jean Hillman

Citation: 333 F.3d 776Docket: 02-1662, 02-1949

Court: Court of Appeals for the Seventh Circuit; July 16, 2003; Federal Appellate Court

Narrative Opinion Summary

This case involves the prosecution of two defendants, Hillman and Berkley, for their roles in a fraudulent property transaction scheme in Chicago, leading to significant financial losses for mortgage lenders. Hillman was convicted of three counts of wire fraud under 18 U.S.C. 1343, while Berkley was found guilty on one count. The scheme involved acquiring properties at fair market value and misrepresenting their value to secure inflated mortgage loans, resulting in over $2 million in losses when buyers defaulted. Hillman challenged the sufficiency of the evidence, arguing the indictment's specificity did not encompass his actions, particularly regarding the financial institutions allegedly defrauded. The court, however, found substantial evidence of Hillman's complicity and intent, affirming his conviction. Berkley, who falsified loan applications, also appealed on grounds of ignorance of the fraudulent nature, but the court upheld his conviction based on testimonies of his awareness. Both defendants were sentenced to 27 months in prison and ordered to pay restitution. The court's decision underscored the adequacy of the indictment and jury instructions, maintaining the convictions despite the appeals.

Legal Issues Addressed

Aiding and Abetting Liability

Application: Hillman's conviction involved aiding and abetting in the commission of wire fraud, demonstrating his participation in the fraudulent scheme.

Reasoning: Counts 1 and 3 of the indictment against Hillman allege wire fraud under 18 U.S.C. 1343 and aiding and abetting, specifically targeting Plaza Home Mortgage and Capstead Mortgage Corporation as victims.

Indictment Specificity and Expansion

Application: The court addressed Hillman's argument that the indictment improperly expanded beyond the specified lenders, but found the specificity was adequate for the charges.

Reasoning: Hillman contends that the government must demonstrate his specific intent to defraud Plaza Home and Capstead, arguing that the evidence shows he only intended to defraud UMG.

Jury Instructions and Indictment Alteration

Application: The district court's jury instructions, which allowed for a conviction based on intent to defraud any financial institution, were deemed not to constitute reversible error.

Reasoning: Regarding jury instructions, the district court's broadening of the indictment to allow conviction for intent to defraud any financial institution did not constitute a reversible error.

Restitution and Sentencing

Application: The court sentenced Hillman and Berkley to imprisonment and ordered restitution, reflecting the financial impact of their fraudulent activities.

Reasoning: They were sentenced to 27 months in prison and required to pay restitution.

Sufficiency of Evidence for Conviction

Application: Hillman contested the sufficiency of evidence for his conviction, but the court upheld the verdict based on substantial evidence indicating his knowledge and involvement in the fraud.

Reasoning: Hillman contested the sufficiency of the evidence supporting his conviction, arguing that he did not explicitly admit to participating in the scheme.

Wire Fraud Under 18 U.S.C. 1343

Application: The court evaluated the application of wire fraud charges against Hillman, focusing on his involvement in fraudulent property transactions that defrauded lenders.

Reasoning: Hillman was convicted on three counts of wire fraud, while Berkley was found guilty on one count.