Texas Criminal Lawyer Blog

A Federal Grand Jury can be used by a United States Attorney to return indictments on cases presented through agents of various Federal investigative agencies, such as the FBI, DEA, AT&F, Secret Service, and other agencies charged with the enforcement of Federal Criminal Statutes. They usually meet once a month, to hear evidence from the Federal agent in charge of the case. The cases are presented under the direction of an Assistant United States Attorney.

I presented hundreds of such cases in my 12 year stint with the United States Attorney's office in Houston. In these cases, evidence is presented in the form of "hearsay" testimony from a testifying agent with knowledge of the particular case. Many times in large jurisdictions such as the Southern District of Texas, over a dozen cases will be presented during a day's session. I have seen cases where over 35 indictments were returned at one session. These sessions are recorded by a court reporter; however, the accused is not entitled to a lawyer in the room during the presentation of evidence and certainly not during the Grand Jury's deliberation. The accused may request to be heard by the Grand Jury,but defense attorneys must wait outside. A helpful link to find a good outline of how a Federal Grand Jury works can be found at the University of Dayton's website entitled Federal Grand Juries.

A second purpose of a Federal Grand Jury is to serve as an investigative tool of the United States Department of Justice. Local United States Attorneys, as well as Justice Department prosecutors based in Washington, D.C., can utilize the Grand Jury process to conduct investigations of complex "white collar" crimes involving public corruption, Federal Mortgage Fraud (involving Federal agencies such as HUD or FHA or VA), as well as Mail Fraud, Money Laundering, Bank Fraud, and Conspiracy. A Federal Grand Jury has broad subpoena powers to compel the production of documents such as bank records, corporate records, ledgers, computer hard drives, and other materials in addition to live witnesses. The Government can extend the life of the Grand Jury if necessary to complete a lengthy investigation. Some of the cases in which I was involved lasted over two years. Sometimes prosecutors find it necessary to empanel a brand new Grand Jury and then present testimony in summary form from the last Grand Jury, in order to keep the investigation going forward after the term of the previous Grand Jury has expired.

Any individual who receives a subpoena from a Federal Grand Jury should contact an experienced Federal Criminal Defense Attorney immediately.

Posted by Michael J. Brown | Permalink | Email This Post

Posted In: Federal Crimes

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Along with the acceleration of foreclosures in the rapidly falling real estate market comes the inevitable increase in Mortgage Fraud Indictments by Federal Grand Juries in Texas and other Federal Districts throughout the United States.

Federal Mortgage Fraud ranges from deliberate overstatement of income by borrowers in order to qualify for larger mortgage loans, to complex schemes by multiple parties to defraud lenders of large amounts of cash. These indictments involve borrowers, lenders, appraisers, real estate brokers, loan brokers, bankers, and, yes, even attorneys.

Mortgage Fraud Rings will use a "straw borrower" with a good credit report together with an appraiser to overstate the value of the mortgaged property, along with a participating property owner and a dishonest attorney to prepare duplicate sets of HUD closing documents. Some of these complex white collar frauds can go on for a number of years and involve many different parties. For example, a recent case in California has resulted in a guilty plea by a mortgage company loan officer to lying under oath to a Federal Grand Jury in connection with a mortgage fraud investigation extending from 2001 to 2006. In that case, the loan officer had lied about taking over $100,000 from a mortgage broker to process fraudulent loan applications referred by the broker.

Some Federal Districts have been prosecuting cases involving multiple loans taken out by a buyer or buyers for the same house at the same time. After funding, the buyer often leaves the country with the money. This practice is often referred to as "Shotgunnning".

"Cash Back" schemes are another method of mortgage fraud where a buyer and seller or buyer and real estate agent conspire to deceive the lender as to the sale price of the mortgaged property, and then the buyer gets a cash kickback which of course is not disclosed to the lender.

Federal Mortgage Fraud cases can also involve failure to disclose liabilities and overstatement of income by mortgage applicants. These type cases can insnare the unwary applicant who might lack any criminal intent, but who might find himself the subject of a Federal Indictment because of a "puffed up" financial statement or a sloppy or inflated Mortgage application.

All of the Federal Judicial Districts in Texas have a number of these cases on their dockets, and the FBI is busily investigating many others. They are expensive to defend, and must have proper investigation and preparation by competent white-collar defense attorneys skilled and experienced in these areas. As is the case with all white-collar cases, a good lawyer should be contacted as soon as an individual thinks he or she may be a target of such an investigation.

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Posted by Michael J. Brown | Permalink | Email This Post

Posted In: Federal Crimes

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The United States Supreme Court returned two decisions this week which should result in more discretion for sentencing judges. Before these decisions, Federal District Judges were required to justify departure from The Federal Sentencing Guidelines, which were passed by Congress to limit the sentencing power of Federal Judges. One of the cases, Gall v. United States, involved a college student sentenced to 3 years probation for involvement in an ecstasy drug distribution ring. The Guidelines called for 30 to 36 months in prison. The United States Court of Appeals for the Eighth Circuit reversed this sentence, ruling that such an "extraordinary" variance required an equally extraordinary justification. Not so, said United States Supreme Court Justice John Paul Stevens; rather, he chided the court of appeals for failing to give deference to the District Court's "reasoned and reasonable decision." In other words, the Supremes told the lower appellate courts to lay off the trial judges and let them make their own sentencing decisions, and not to overrule them just because those decisions were outside the guidelines.

The other decision, Kimbrough v. United States, returned at the same time, overturned a 4th Circuit Court of Appeals' reversal of the sentencing District Judge's departure from the Guidelines based on his disagreement with the disparity in sentencing between crack and powder cocaine offenses. Justice Ruth Ginsberg reasoned that since Congress had not blocked recently amended guidelines lowering the penalty for crack cocaine, then judges should also have discretion to depart from the Guidelines themselves, and that it was not unreasonable for them to do so.

To add more to the mix, on Tuesday the U.S. Sentencing Commission voted to make retroactive their previous decision to lower the guideline sentences on crack cocaine offenders. This means that more than 19, 500 Federal prisoners will be free to seek reductions in their crack cocaine sentences.

I think these decisions will result in an increase in the ability of sentencing U.S. District Judges to sentence according to their own take on the entire set of facts before them; that is, the Guidelines will be but a single factor, and the judge can take many more factors into consideration in sentencing rather than blindly following the Guidelines.

Posted by Michael J. Brown | Permalink | Email This Post

Posted In: Drug Offenses , Federal Crimes

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