The defendant was a lawyer and a guardian of Veterans’ Administration (VA) funds for a disabled World War II veteran. He mismanaged funds and committed embezzlement and mail fraud.
Judgment of the trial court was affirmed by the appellate court.
It is a crime for a guardian who has custody of money in a fiduciary capacity in the Veterans’ Administration to embezzle or in other manner misappropriate the money trusted him [38 U.S.C.S. § 3501(a)]. According to 18 U.S.C.S. § 656 intent to return property appropriated without proper fiduciary cause and informing the owner should not be a defense to embezzlement.
Whether the initial court erred in judgment against defendant and in sentencing him.
The US Court of Appeals defined that “a mere incident to the carrying out of a fraudulent scheme, does not prevent the act from being embezzlement. The mere fact that the transaction may take the form of a loan does not necessarily deprive it of its criminality”. In this regard, it was further admitted “intent to return” money or property does exclude of mitigate liability for embezzlement. This is true even when the embezzler he did return misappropriated property.
The appellate court stated that the evidence provided by the prosecutor was sufficient to support a finding of criminal intent and not just mismanagement of the funds. To that, “all the elements of “fraudulent conversion” by defendant contrary to his fiduciary duties were established. Defendant’s deceptive letters to the VA to cover his actions both supported the mail fraud conviction and permitted the trial court’s use of the U.S. Sentencing Guidelines because they were written after the Guidelines went into effect. It was not error to deny defendant’s jury instruction of an “intent to return” defense, because neither intending to nor actually returning embezzled funds constituted a defense”. Defendant’s claims of error were without merit.