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I. COMMON LAW:
A. RULE: Corporations can be held criminally liable for the
actions of its agents and officers. New York Central (S.Ct.)
1. FACTS: assistant traffic manager paid rebates to suger
shippers and thier consignees in violation of Elkins Act.
2. FACTORS: (New York Central):
a. agents has requisite knowledge and intent;
b. corp intrusted authority for agent to act in subject
c. agent's knowledge and purpose attributable to corp.
d. who commited (Heaton)
e. how many time comitted (Heaton)
f. acts ratified by higher authority (Heaton)
a. Majority of transactions conducted through corps;
b. giving corps immunity would take away means of
effectively controling corp conduct;
c. (H) otherwise incentive created for top management to
delegate and insulate corp liability.
d. structure of corp makes difficult to pinpoint individual
e. provides incentive for corp to watch employees more
f. stigma of corp guilty image = deterence
II. MODEL PENAL CODE (2.07):
A. NOTE: Only 8 states define corp liability as strictly as
MPC 2.07. Many other states that follow the MPC extend MPC
liability of corp to include those who supervise subordinate
employees in managerial or non-managerial capasity. p.35
B. Photo Copy of p8,9 and 12 (MPC Section 2.07)
C. RULE: Corp can be held responsible for unauthorized acts
of agents. Chapman Dodge (La.) [but not in chapman]
D. RULE: When a corp is accussed of crime requiring intent,
it must be determined who within the corp had the intent to commit
the crime. Chapman
1. FACTS: Retention of illegal funds by manager for corp,
but not authorized nor knowen by corp officers.
2. ISSUE: Role of intent/proving corp intent when corp is
3. DECISION: Evidence insufficant to hold corp liable for
a. NOTE: explicit or tacit evidence of officers or board of
director approval would be enough.
E. RULE: A corp's agent's intent can be transferred to corp
even if person is not convicted. Heaton on Christy Pontiac
F. RULE: If the corp is to be criminally liable, it must be
clear that the crime must not be a personal abberation of an
employee acting on his own; the criminal activity must in some
sense, reflect corp policy so that it is fair to say that the
activity was the activity of the corp. Christy Pontiac (Minn.)
G. FACTS: Salesman/fleet manager forged new car purchusers
name and backdated forms to get GM rebate for dealership. Car
dealership = corp.
H. RULE ELEMENTS (of holding corp responsible for specific
intent crime) Christy Pontiac:
1. agent acting in the course and scope of employement;
2. authority of agent to act for corp with regard to
3. agent was acting, at least in part, in furtherence of
the corp's business interest;
4. criminal acts were authorized, tolorated, or ratified by
a. NOTE: Corp can be liable for expressly forbidden
activity. Prosecution could show those in managerial authority or
positions of responsibility acted or failed to act in such a
manner that the criminal activity reflects corp policy.
III. HYPOS ON PAGE 19
A. Corp criminally liable for vehicular homicide under MPC
for mechanic's failure to install mirrors on bus?
1. Mechanic is not "high managerial agent" under MPC
2.07(1)(c); but if statutorily the offence imposes corp liability
then agent need only acting within scope under MPC 2.07(1)(a) -
unlikely in this case since offence of no mirrors is
general/simple vehicular statute.
IV. RESPONDEAT SUPERIOR (case law developed/especially Fed)
A. NOTE: "By and large, the fed courts observe the
respondeat superior rule of corp liability." p34
B. NOTE: More states recognize respondeat superior than
strict MPC approach.
1. NOTE: 19 states extend the general respondeat superior
rule to include acts of corp agents under any statute that
imposes, or clearly/plainly indicates a legislative purpose to
impose, criminal liability on corps.
C. GENERAL RULE: Allows imposition of corp liability for
criminal acts performed by officers and agents in the course of
thier employment, without regard to thier status in the corp
hierarchy or if there was an absense of management complicity.
1. NOTE: Conflicts with MPC regime.
D. LIMITATION: Agent who commits the crime must be acting
within the scope of his or her authority and on behalf of the
1. DEF: "Scope of Authority"= agent must perform acts on
behalf of the corp and that the acts must be directly related to
the performance of the type of duties the employee has general
authority to perform.
2. DEF: "acting on behalf of corp" = acting with the
purpose of forwarding corp business (aka an intent to benefit
E. RULE: Under Respondeat Superior a corp may incur
liability for wrongful acts committed by an independant
contractor, a subsidiary, or a division. pg 27
F. RULE: New corp. entity resulting from merger can be
criminally liable for pre-merger activities of former
corp/division. Central National Bank (5th Cir)
1. NOTE: Case focused on whether the state's merger
2. LOGIC: State Merger statute allows merged corp to exist
for three years after merger for civil liability purposes, no
reason not to apply to criminal/ prevents immunity through
G. RULE: Corps can be held strictly liable for agents even
if they take resonable precautions to prevent violation. Dollar
Steamship (9th Cir).
1. FACTS: Despite company issuing orders, posting signs,
locking chutes and lack of officer knowledge, company held
strictly liable for employee dumping of garbage in harbor.
Violation of strict liability anti-dumping law.
2. NOTE: Under Fed sentencing guidlines complience plans by
corp can reduce penalties for agent's violation.
H. RULE: Corp liable under Sherman Act for agent's actions
committed in the scope of thier employment, even though contrary
to general corp policy and express instructions to agent. Hilton
Hotels (9th Cir)
1. FACTS: Despite telling thier purchusing agent twice not
to threaten supplier with loss of Hilton business unless supplier
paid an association fee used to attract coventions to the city,
corp held liable under Sherman Act.
2. NOTE: Logic of decision centered on public purpose of
Sherman Act; but book notes overwhelming authority that is that
"good faith" efforts or due dilegence to prevent is not a defence
for the corp. p33-34.
a. NOTE: Efforts by managment to prevent criminal
misconduct may affect prosecutor's decision to prosecute. p34
3. FACTOR: (Heaton) Clear that Hilton benefits from
criminal activity despite repeated warnings to employee.
A. Some Statutes expressly make corps criminally liable:
1. e.g. Sherman Anti-Trust Act
INDIVIDUAL LIABILITY OF CORP EMPLOYEE FOR CORP CONDUCT
II. MPC 2.07:
A. NOTE: MPC codifies that corp officers and agents are
personally accountable for crimes committed in the name of the
III. FACTORS which make individual accountibility reasonable
1. Responsibility for act in question;
2. did act benefit corp;
3. knowledge of act;
4. repetiveness of the conduct;
5. severity of penelty under Fed guidlines.
IV. US v. Wise (S.Ct,)
A. RULE: Sherman Act imposes criminal sanctions for
individually responsible officers/director/agent as well as the
corp. even if agent was acting only for corp and not as an
B. FACTS: Corp officer acting soley for corp and not as an
individual, held criminally liable for violating the Sherman Act.
V. Burgeiois (Va.)
A. No oath requirement:
1. Statute does not contain an oath requirment, instead it
punishes unsworn falsifications relating to any matter within
jurisdiction of a fed dept or agency.
1. To prevent the use of fraud or trickery to subvert the
governmental processes as conducted by gov agencies/departments.
2. Prosecution typically involves using false info to:
(1) obtain monetary benefit;
(2) obtain a priviledge from the gov;
(3) resist monetary claims by the gov;
(4) frustrate a lawful regulation.
A. Section 1001 punishes only the making of false
statements. Misleading but true statements are not within the
reach of this provision. Thus, the gov must prove the statement's
falsity at the time it was made (p202).
VIII. 18 U.S.C. 1001 (Three Operative Clauses):
A. All Three Clauses Require:
1. Any matter within jurisdiction of gov dept or agency;
a. RULE: "dept" under 1001 includes all three branches
(exec, judic, cong). Bramblett
(1) NOTE: Possible to argue a legislatures statements to
another legislator in course of formal congressional proceedings
should come under Morgan judicial proceeding exception listed
b. RULE: Tax court (which is an executive and not a
judicial agency) is covered under 1001 and Morgan exception does
not apply. Stein (5th Cir)
c. RULE: In judicial setting, 1001 only applys to admin
functions and not formal judicial proceedings. Morgan (DC Cir)
(1) FACTS: Def's lie about his identity as a lawyer is
admin related and thus comes under 1001.
(2) EXAMPLE FROM HYPO: Def lying about his identity at
bail hearing does not come under 1001 since = judicial proceeding.
(3) LIMITATION: Morgan line drawn in Stein as court
refused to apply to tax court proceeding (tax court is an
executive and not a judicial agency).
d. RULE: A statement that was never actually submitted to
gov may satisfy requirment provided it was to be utilized in a
matter which was within the juris of a dept or agency. Candella
e. RULE: Statute covers keeping false business records that
may later be audited or inspected by a federal official.
(1) EXAMPLES: plasma center bleeding records, narcotic
f. EXAMPLE: Plane canopy maker shipped canopies to Navy
without proper inspection by switching approval and serial stamps.
Within gov juris since sub-K provided that canopies were subject
to inspection by representaives from the Navy and def intended
scheme to defraud Navy. Steiner (2d Cir)
(1) FACTORS: Target, K provision.
g. EXAMPLE: Def's statements to FBI about wife wanting to
kill prez covered uner 1001. Rodgers (S. Ct.)
(1) FACTORS: Statutes use of "any" matter within juris of
gov. Wouldnt deter crime reporting since falsity must be made
knowingly and willfully.
2. must be committed knowingly and willfully;
a. RULE: No def knowledge/mental state of gov jurisdiction
over matter is required. Yermian and Green
3. must be a material fact;
a. RULE: Legal not jury determination.
b. MATERIAL = Capability or ability to influence gov agency
about decision to be made. Gov need not show loss, relience or
capable of being affected. Need not show statement made to Gov.
(1) Can only be non-material if incapable of influencing
an agency to do anything.
B. PLUS One of the Following Three operative clauses:
1. a trick, scheme or device that falsifies, conceals or
covers up; OR
a. NOTE: No statement neccessary and dosen't matter if
cover up of truth or falsity.
(1) EXAMPLE: Inspection stamp scheme used to conceal non-
inspection enough to prove, need not show evidence that canopies
were in fact defective. Steiner
2. makes false, ficticious or fraudulent statement or
a. RULE: Gov must prove falsity at time statement was
3. makes or uses any false writing or doc.
a. RULE: Gov must prove falsity at time statement was
C. Alterntive Pleading:
1. Gov can argue any or all of the three operative
componets of 1001, but cannot add penalties together if prove all
D. RULE: Most courts say an ommission can suffice under
1. Look at entire admission, if all answered but one =
false statement by creating a false representation by implying no
info was available.
2. EXAMPLE: Steiner canopy leaves blank box on form asking
if any canopies have been previously rejected.
IX. COMMON DEFENCES:
A. Argue no requisite intent:
1. "I didnt know it was false when I said it";
2. "Someone else told me to write it that way";
3. "I didnt read it carefully before I signed it".
B. Argue that a Morgan exception should apply/ be extended
to the area covered by the facts.
1. NOTE: Morgan line drawn in Stein as court refused to
apply to tax court proceeding (tax court is an executive and not a
X. EXCULPATORY NO'S DEFENCE/EXCEPTION TO 1001 LIABILITY:
A. ISSUE: Def argues that a simple "no" answer, when
questioned by gov, is not a "statement" under 1001.
B. RULE: (Courts Split) An exculpatory no answer without
any affirmative, aggressive or overt misstatement on the part of
the def does not come within the scope of 1001. Paternostro (5th
1. LIMITATION: Seems to only apply when questioned by gov
or anser to question is solisited.
2. FACTOR SOME COURTS IDENTIFY:
a. If def is sworn, allowing prosecution under 1001 would
undermine perjury statute. Levin
b. Not statement since a no did not subvert the functioning
of a gov agency. Davey
c. 5th amend concerns - would truthful answer incriminate.
If yes then should not allow a no to fall under 1001 prosecution.
PERJURY AND FALSE DECLARATIONS
II. DIFFERENCES/SIMULARITIES BETWEEN PERJURY 18 USC 1621 AND
FALSE DECS 1623:
A. Both apply to sworn falsifications made before Fed cts
and grand juries.
B. Both have liability predicated on lying under oath
although no particular form of oath is required and no proof need
establish administration of oath by someone who had authority to
do so. All the gov must do is prove that the falsehood was made
after administration of an oath authorized by law. (p 233)
C. Perjury statute applies to a broader range of
D. Perjury statute requires more rigorous proof of falsity;
E. Unlike perjury, false dec statute provides limited
defence of recantation.
III. PERJURY 1621 (ELEMENTS/REQUIREMENTS):
A. False statement (written or oral/testimony, deposition);
1. NOTE: Gov therfore must identify which statement was
false, unlike in 1623.
2. HYPO: Def thought he had no bank account, but he really
did. When asked if he did he said yes in attempt to decieve.
a. No, technically he made a truthful statement even though
he intended to lie.
B. Regarding a material matter;
1. DEF: whether the statement has the capacity or tendency
to influence the outcome of the proceeding.
a. RULE: Actual effect not required.
b. RULE: Materiality is matter of law.
2. RULE: Answer that is literally true but not responsive
or possibly misleading to question asked, is not subject to fed
perjury prosecution. Bronston (S.Ct.)
a. LOGIC: Def attorney's job to question further when def
evades, don't want to discourage testifying by going after
possible witness misunderstanding. Precident reflects desire to
narrowly constue perjury statute.
3. RULE: Person who knowingly causes a false doc to be
entered into evidence can be guilty of false dec under 18 USC 2
(aiding and abetting statute) Walser (11th Cir):
a. 2 does not create seperate crime rather it permits
aider to be punished as principal.
b. Aider can be guilty even if intermediary had no criminal
c. Section 2 applies generally to all Fed crimes.
d. LOGIC: Section 2 operates to unite intermediary
innnocent third party's capacity to commit perjury with def's
intent that perjury be committed.
C. made ("used" if doc) willfully;
1. EXAMPLE: Def asked if had Swiss bank account and said no
because he forget. Not perjury since not willfully false.
2. DEFENCE TACTIC: Can destroy willfullness by
saying/admitting a doc is false before turning over when doc is
D. made with the knowledge of its falsity;
E. made under oath (lawfully authorized oath);
F. made before a competent authority.
1. Applies to fed court or grand jury, cong. committee, gov
dept or agency, or notary pubic.
G. SEE 2 witness rule below!
IV. FALSE DECLARATION 1623 (ELEMENTS/REQUIRMENTS):
A. Same as for purjury; except
1. no 2 witness rule req
2. must be made before or ancillary to Fed court or grand
a. EXAMPLE: Interview in lawyer's office under oath does
not qualify as ancillary. Dunn (S.Ct.)
3. Gov need only show falsity/inconsistancy, not which
statement is false to get 1623 coviction.
a. NOTE: Need to have both statements qualify under 2 for
this rule to apply.
4. DEFENCE OF RECANTATION:
a. Apply section (d) - def must meet critera.
(1) NOTE: Courts split if "or" means "and". If "or" means
"and" then def must show both not affect and not manifest. If "or"
means "or" def need only show one critera as ruled in Moore case.
b. LIMITATION: A discovered lie/falsity acts as a bar to
the use of the recantation defence.Moore (DC Cir).
V. TWO WITNESS RULE FOR PERJURY CONVICTION:
A. Evidentary rule that requires that the falsity of the
def's statements must be proved by:
1. the testomony of two witnesses; or
2. the testomony of one witness + corroberating evidence.
a. RULE: Corr. ev need only be circumstantial in nature,
does not have to independently sufficiant.
b. RULE: Corr. ev is sufficiant if it, together with direct
evidence, is inconsistant with the innocence of the def.
(1) EXAMPLE: Signed admissions of def enough to satisfy
corrab. ev. Davis (9th Cir)
VI. IMUNIZED TESTIMONY & WHEN CAN STILL GET FOR PERJURY:
A. RULE: Gov can use non-false immunized statements to show
perjury commiteed during immmunized testomony. Apfelbaum (S.Ct.)
B. NOTE: Court likely to not allow use of truthful, later
immunized testomony against previous lies in different
->[truth/immune] = not prosecute
C. NOTE: Probably can use truthful statements from second
proceeding against non-immunized lie in 3rd proceeding.
1. [lie/nonim]-->[truth/immu]--->[lie/nonim]= pros OK
D. NOTE: Probably cannot use truth in immunized statement
in second proceeding against past lie.
[truth/immune] = not pros
II. 18 USC 201:
1. preventing public officials from accepting anything of
value in exchange for particular decisions or actions taken or to
be taken by public officials in thier official capacity.
2. Bribary should not substitite the will of an interested
person for the judgement of a public official as a controlling
factor in the offical decision. Muntain
1. condemns the use of public office for private gain and
punishes both the giving and the receipt of bribes and
2. DEFENCE TACTIC NOTE: Bribary has harsher sentence than
gratuity (15 vs 2 years impris). Often gratuity is a lesser
included offence in bribery prosecutions. Can try to cut
deal/argue gratuity applies.
C. ELEMENTS: (See statute)
1. pubic offical as defined by law
2. def did corruptly ask, demand, exact, solicit, seek,
accept, recieve and agree to recieve money;
3. def represented or caused to be rep. that the thing of
value was in return for influence in the performance of an
D. Two distinct crimes:
a. corruptly attempting to influence a public official in
the performance of official acts through the giving of valuable
b. when a public official seeks something of value in
return for being influenced in the performance of any official
c. appies to both offers and promises of bribes.
d. No need to prove actual bargin fullfilled,
acceptance/offer of a bribe is a violation.
(1) RULE: Thus, members of congress that can only be
prosecuted under a criminal statute if the gov dosent inquire how
member spoke, debated, voted or did anything in the
chamber/committee (because of Speech or Debate Clause) can be
prosecuted by proving acceptance of the bribe. Brewster (S.Ct.)
e. The payment and receipt of a bribe are not
interdependant offences, for obviously the donor's intent may
differ from the donee's. Thus the donor may be convicted of giving
a bribe despite the fact that the recipient had no intention of
altering his official activities, or even lacked the power to do
f. INTENT REQUIRED: bribe be given or recieved corruptly.
a. rewarding a public official on account of or because of
an official act, whether or not the payor acts with corrupt
b. unlike bribary section, gratuity applies to both past
and future official acts. Campbell (DC Cir).
c. payments to public officials for acts that would have
been perofrmed anyway, whether before or after act has occurred,
is probably a gratutity and not a bribe. Campbell
d. may be hard to distinguish illegal gratuities from
innocent campaign contributions. Brewer
(1) RULE: Federal Campaign Act prohibits direct corp
campaign contributions and authorizes criminal penalties for
knowing and willful violations. (p330)
e. INTENT REQUIRED: No specific intent required only
requires value given "otherwise than as provided by law for the
proper discharge of an official duty".
f. RULE: Economic coersion is not defence. Barash
III. "Official Act":
A. RULE: The determinative factor is whether def's actions
involve a matter or issue that could properly, by law, be brought
before him in his official capasity. Muntain (DC Cir)
B. RULE: Not neccesary that the public official actually
have the power to perform the act that he promises in return for
the money. What is neccessary is that the public offical solicit
or recieve the money on the representation that the money is for
the purpose of influencing his performance of an official act.
Arroyo (7th Cir)
IV. "THING OF VALUE":
A. RULE: In order to put the underlying policy of the
statute into effect, the term "thing of value" must be broadly
B. RULE: Statute focuses on the value that the def
subjectively attached to the items given/recieved, (whether or not
the def correctly assessed the worth of the bribe). Williams
V. "PUBLIC OFFICIAL":
A. To be a public official under 201(a), an individual must
possess some degree of official responsibility for carrying out a
federal program or policy. Dixson (S.Ct.)
1. LIMITATION: Thus, the mere presense of fed program does
not automatically bring within 201, nor neceessarily all
2. FACTS: Private non-profit agency officer that
contractually was acting on behalf of US gov in admin of fed grant
program = public official under 201.
3. FACTORS: Position of public trust, determined who would
get fed dollars, K, def salary paid by gov grant, defs personal
4. FACTS: Abscam senator recieved worthless stocks in
return for influence. Fact that stock was worthless not relevent
given senator's expected/percieved long term value of stocks.
VI. FOREIGN CORRUPT PRACTICES ACT (p350-351)
A. Act prohibits corruptly making payments to foriegn
officials to influence an official act or deicision or to
influence a foreign gov or its instrumentality to affect an
official act or decision.
B. RULE: Grease payments are excluded from the Act.
C. RULE: Cannot charge foreign officials with conspiricy to
violate FCPA. Blondek (5th Cir)
D. TWO DEFENCES TO FCPA:
1. good faith payment of reasonable and bona fide
promotional and performance expenses.
2. payment is lawful under the written laws and regulations
of the foriegn country.
A. to address infultration of legitamate business by
A. RULE: Activity is only brought into RICO jurisdiction is
it affects interstate or foreign commerce.
1. NOTE: juris req can be satisfied by presence of minimal
contact with interstate commererce.
2. RULE: prosecution need only show that the enterpise
itself has some involvement with commerce, not the that the
activity actually affects interstate commererce. (p363)
B. RULE: Construe broadly to effect congressional intent.
C. RULE: RICO not limited to organized crime. Northwestern
1. LOGIC: Such interp is at odds with cong intent.
D. NOTE: Provision for civil action with treble damages.
A. Listed on Heaton Handout
1. RULE: The statute does not exclude identification of a
governmental office as a RICO enterprise. Thompson (6th Cir)
a. LOGIC: "group of individuals associated in fact although
not a legal entity" which made use of the Office of Tenn. govoner.
2. RULE: An association of corporations or an association
of individuals and corporations may constitute a RICO enterprise.
3. RULE: In most circuits, definition does not specifically
require economic motivations for establishing a RICO enterprise.
However, some circuits require a showing of financial purpose
before association will be deemed a RICO enterprise. (p358)
4. NOTE: Courts divided if "structure" is a required
element to = an enterprise. (Heaton)
a. Those that dont require an asertainable structure, will
apply RICO to situations where the enterprise was no more than the
sum of the predicate racketeering acts. United Energy Owners
5. RULE: Def's position within the enterprise need not take
a particular form. [Heaton]
6. RULE: Sole proprietership can = an enterpise, but the
sole prop must be seperate from the individual. This can occur if:
(1) incorperated (due to statutes def)(aka a "formal
seperation" of indiv & entrerprise)
(2) if it has other employees (because then "it is a group
associated in fact")(aka a "practical" seperation of individual
B. SECTION A (no seperate requirement):
1. RULE: Allows corps to serve both as the RICO person and
the RICO enterprise. Scholfield
C. SECTION C (seperate/dinstinct requirement):
1. RULE: Requires a relationship of employement or
association between the person and the enterprise, thus this
requires the person who engages in the pattern of rack be an
entity seperate/deistinct from the enterpise. Scholfield
2. RULE: Section does not extent liability to the
enterprise itself Scholfield
a. LOGIC: Can get enterprise under section A, congress
b. NOTE: Cannot use respondeat superior to hold corp liable
in section C prosecution since section C directly denies holding
the enterprise liable.
3. RULE: Non-economic activities are within RICO if
activity affects commerce. NOW
VI. PATTERN OF RACKETEERING ACTIVITY:
A. Term includes more than 3 dozen listed crimes.
B. DURATION REQUIRMENT:
1. Statute says at least 2 acts within 10 years.
2. RULE: In determining the duration of a scheme involving
mail fraud, the relevent criminal conduct is the def's deceptive
or fraudulent activity, rather than otherwise innocent mailings
that may continue for a long period of time. Kehr Packages (3rd
C. RULE: prosecuter must show that racketeering predicates
are related and that they ammount to or pose a threat of continued
criminal activity. Northwestern Bell (Sct)
1. Need coninuity, threat of continuity + relationship:
(1) is acts form a pattern by embracing the same results,
purposes, participents, victims, or methods.
(2) HEATON FACTORS:
(a) number of acts
(c) type of acts
(d) hurt on some way
(e) relevence of seperate schemes
(1) Satisfied by a showing of a series of related acts
extending over a substantial period of time.
(a) NOTE: SCT said given congress intent & RICO, acts
extending over a few weeks or months may not be enough.
(b) FACTS (NW Bell): Bribes extending repeatedly over 6
c. Threat of Continued Activity:
(1) Depends on specific facts.
(2) threat can be explicit or implicit.
(3) May be established if predicate acts or offecnces are
part of an ongoing entity's way of doing business.
VII. DINGUISHING ENTERPRISES FROM RACKETEERING ACTIVITY:
A. Rule: Under RICO, an enterprise must be "an entity
seperate and apart from the pattern of racketeering activity in
which it engages."
1. RULE: Proof of the two elements may "coalese" even
though proof of one neccessarily does not establish the other.
VIII. PROHIBITED CONDUCT:
A. RULE: Activity need not advance the interests of the
IX. REQUISITE RELATIONSHIP TEST:
A. NOTE: Courts disagree over which is the correct test.
B. TEST #1: (2 parts/either will satisify):
1. whether def was able to engage solely by position or
control in enterprise; or
2. whether racketeering act is related to enterprises
C. TEST #2: (All 3 parts required):
1. def must have committed acts;
2. def's position in the enterprise facilitated committion;
3. acts must have some indirect or direct affect on
a. NOTE: Does not require enterprise profit, only that
enterprise was affected.
X. STATE PREDICATE CRIMES:
II. FOUR TYPES OF CASES:
A. 7201 (Tax Evasions) (5yr)(Commonly brought when false
1. must prove additional tax was due and owing;
a. can prove by direct (eg specific expence not reported)
or indirect proof.
b. RULE: gov need not prove exact amount of tax evaded.
2. def committed affirmative act to evade;
B. 7206(1) (Subscribing to False Return)(3yr)
1. filed or caused to be filed written declaration signed
under the penalty of perjury;
2. def who made or signed doc;
3. def knew doc was false regarding some material matter;
4. willfullness (def acted willfully).
5. NOTE: do not have to prove additional tax in owing.
C. 7206(2) (Aid/Abeit)(3yr)
1. def aided, assited, counceled, advised i nthe
preperation of the doc;
2. falsity as to a material matter;
4. NOTE: dont have to have perosn who signed doc.
5. NOTE: dosen't have to be formal return (eg can be w-4's)
D. 7203 (1yr Misdemenor actions)
1. failure to file return;
(1) law requiring filing;
(2) failure to file at time required;
(3) failure was willful.
2. failure to pay tax;
3. failure to maintain records;
4. failure to supply required info.
III. STAGES OF INVESTIGATION:
A. Investigators into tax matters can be either grand jury
or administrative (eg IRS).
1. IRS has supeana power
2. investigators refer to IRS office of prosecution (tax
a. NOTE: Can intervene for client at this stage and say why
pros would not win (eg willfullness), youll fight at trial and
that your client would repay if charges dropped.
(1) IF DEAL: IRS requires def at minimum to plead guilty
to highest count for plea deal, no exceptions.
3. IRS pros office refers to local area prosecutors
a. NOTE: Less flexible to make deal since IRS must approve
all pleas and IRS dosent allow local prosecutors to use mail
fraud, and tax crimes cannot be charged under RICO (not listed as
a predicate act).
A. RULE: Defined generally as a voulentary, intentional
violation of a knowen legal duty. Pomponio
B. RULE: A consistant pattern of understating income may be
used to establish willfullness. Rischard
C. RULE: Judge can properly consider the general
educational background and experience of def as bearing on def's
ability to form requisite intent. Rischard
1. NOTE: In this case court rejected based on facts, that
def amended returns (because he amended after gov found out) and
lack of experience.
D. RULE: Honest relience on expert advise, conditional on
the def giving the expert all the facts, is a factor to consider
in the willfullness requirement. Burnstein
E. RULE: Objectively reasonable mistakes negate the
neccessary mentle state for tax offences. Buckner (7th Cir).
1. LIMITATION: Believing an incorrect proposition of law is
a reasonable mistake only if there is a boba fide dispute about
it. Buckner (7th Cir)
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