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263 F.3d 1056 (9th Cir. 09/04/2001)
U.S. Court of Appeals, Ninth Circuit
1 Cal. Daily Op. Serv. 7741, 2001 Daily Journal
September 04, 2001
UNITED STATES OF AMERICA, PLAINTIFF-APPELLEE
EDWARD KEITH HOWICK, DEFENDANT-APPELLANT
D.C. No. CR-99-00011-DWM Appeal from the United States District Court for the
District of Montana Donald W. Molloy, District Judge, Presiding
Counsel John P. Rhodes, Assistant Federal Defender, Federal Defenders of Montana,
Missoula, Montana, for the defendant-appellant. Kris A. McLean, Assistant United
States Attorney, United States Attorney's Office, Missoula, Montanta, for the
Before: Donald P. Lay,*fn1 Stephen S. Trott and Marsha S. Berzon, Circuit
The opinion of the court was delivered by: Berzon, Circuit Judge
Argued and Submitted May 8, 2001--Seattle, Washington
Edward Howick appeals his jury convictions of possession of counterfeit currency,
possession of fictitious documents, and bringing counterfeit currency into
the United States. We affirm.*fn2
A. Discovery and Delivery of the Unlawful Instruments
In 1999, a Customs Inspector in Anchorage, Alaska intercepted a suspicious
package entrusted to Federal Express for delivery. Addressed to defendant Howick
at his Bozeman, Montana residence, the package had been sent from the Phillippines
by one Fred Pfahl. According to the attached manifest, the contents of the
package were "legal documents." As we develop later, "illegal
documents" would have been more like it. Inside were counterfeit gold
and silver certificates,*fn3 fictitious Series 1935 Federal Reserve notes,*fn4
a packet of fictitious "Tiger Zebra" bonds, and other contrived obligations.
At the behest of the Secret Service, a Federal Express employee phoned Howick
to confirm that the package would be arriving soon. Using a vehicle and uniform
provided by Federal Express, Secret Service agent Kal Bedford then delivered
the package to Howick, who volunteered that he had been expecting it.
Bedford returned to Howick's residence shortly thereafter, having exchanged
his Federal Express regalia for a federal search warrant. While Bedford and
other agents performed a security sweep of the premises, Special Agent Timothy
Christine remained with Howick. After affirmatively waiving his Miranda rights,
Howick discussed matters relating to the phony currency with Christine and
later with Bedford.
B. Howick's Statement
In those discussions, Howick admitted that a number of financial documents
were present in his home, but offered an innocent explanation for them. He
claimed that the materials purporting to be United States obligations came
from two sources: Fred Pfahl, in the Philippines, and Clyde Beverly, a resident
of Oklahoma for whom Howick, a licensed attorney, had previously done legal
work. Howick's tale of how those individuals, and later Howick himself, came
to be in possession of what turned out to be in excess of eighteen-billion
dollars of bogus financial instruments was set forth in a typed statement prepared
by Howick while his house was being searched.
Howick asserted in the statement that he had been recruited for "this
project" by Beverly, who claimed to have information on a large amount
of currency discovered aboard United States military aircraft that had crash-landed
in the Phillippines decades earlier. Also found on the aircraft, reportedly,
were the skeletal remains of eight men, their dog tags, and approximately 50
containers marked "U-235 007, " possibly referring to the U-235 isotope,
of which fissionable uranium is comprised. Howick's role in the project, he
explained, was to attempt to authenticate the putative obligations, with the
eventual aim of repatriating them--for a fee, of course.
Toward that end, Howick contacted the offices of two elected federal officials
from Utah to enlist their aid in the authentication process. After discussing
the matter with the Secret Service, the office of Senator Robert Bennett informed
Howick that the documents were apparently phony, a conclusion Howick chose
to accept. Howick also contacted certain private parties regarding the putative
financial instruments, including his "associate," Joe Wersal. "Although
it was suggested that Joe tried to arrange some method of using them," Howick
wrote in his statement, "it was always the intent that each material be
thoroughly authenticated before anything was done with it."
As for his own views on the documents' authenticity, Howick conceded in his
written statement that one piece of currency, supposedly decades old, "raised
questions " because it showed an oversized portrait of Benjamin Franklin,
a 1996 design innovation in United States currency. According to Agent Christine,
Howick also conceded that certain silver certificates in his possession were "obviously
false." At the same time, Howick maintained in his statement that he was"aware
of no illegal activity on the part of anyone involved in this matter."
C. Fruits of the Initial Search
The search of Howick's apartment turned up numerous contrived obligations
and related documents, including some that had not arrived in the controlled
delivery performed by Agent Bedford. Some of the bogus currency contains defects
easily discoverable by a skeptical observer, such as the over-sized, off-center
presidential portraits, noted by Howick, on currency ostensibly lost at least
forty years ago. Both the silver and gold certificates were, according to Agent
Christine, printed by the ink-jet technology commonly associated with personal
computers rather than the intaglio method favored by the United States Treasury.
Particularly unusual among the ostensible currency in Howick's possession
were federal reserve notes in the improbable denominations of $100,000,000
and $500,000,000. Printed by silk screen, the notes are completely blank on
one side and approximately twice as large as ordinary bills. The first note
shows the phrase "ONE HUNDRED MILLION DOLLARS" beneath a portrait
of George Washington--the same one seen on one-dollar bills--while the numeral "100" is
printed to the right of the portrait over the Treasury Department's seal, and
in each of the four corners. The second note looks substantially similar to
the face of the now-withdrawn five-hundred dollar bill, with the numeral "500" over
the Treasury Department's seal and in each corner, framing a portrait of William
McKinley. The only indication of the bill's "true" value is the ornamental
phrase beneath the portrait, which reads: "FIVE HUNDRED MILLION DOLLARS." The
notes' eye-poppingly large denominations are thousands of times higher than
the highest-denomination currency ever actually printed--$100,000 gold certificates--which
were in any event never publicly circulated.*fn5
Certain defects in the contrived certificates and notes were not obvious to
an untrained eye. Some had serial numbers printed in yellow, rather than green,
ink. The Treasury seals on certain documents were of poor quality. Some bills
marked "Series 1935" listed Francine Neff as Treasurer of the United
States, although Ms. Neff did not occupy that position until 1974. The paper
on which the bills were printed was sometimes tinted a brownish color, possibly
intended to simulate aging.
In addition to the bogus obligations, agents discovered various materials
apparently related to the currency-manufacturing enterprise. These included
handwritten notes concerning the serial numbers of the putative financial instruments;
a letter on "Bank of Richmond" letterhead falsely stating that a
$500,000,000 Federal Reserve note had been issued; photographs of dog tags;
simulated microfilm relating to the "Tiger Zebra" bonds; a catalogue
of U.S. currency; and annotated lists of Secretaries of the Treasury.
D. The November Search
On November 9, 2000, approximately one month after the controlled delivery
and initial search, a second search warrant was executed on two computers in
Howick's residence. The search, which Howick challenges, see infra, yielded
few useful materials. The government did, however, seize computer files containing
four versions of Howick's resume, each slightly different from the others.
E. Procedural History
In a three-count superseding indictment, Howick was charged with (1) possession
with intent to defraud of fictitious documents "appearing, representing,
or contriving " to be an actual financial instrument (specifically, a
one-hundred million dollar Federal Reserve note and a five-hundred million
dollar Federal Reserve note) with intent to pass, utter, or present the same,
in violation of 18 U.S.C. § 514(a)(2); (2) possession of counterfeit obligations
(specifically, gold and silver certificates), in violation of 18 U.S.C. § 472;
and (3) bringing counterfeit obligations (specifically, gold and silver certificates)
into the United States, in violation of 18 U.S.C. § 472.
The jury convicted Howick on all three counts. Although the guideline range
for Howick's offense level is 97 to 121 months imprisonment, Howick was sentenced
to a term of only 24 months, reflecting the district judge's determination
that the "[o]ffense level overstates the seriousness of the offense." This
A. Suppression of Evidence
Before trial, Howick moved to suppress the four copies of his resume seized
in the November 9 search of his personal computers. The district court denied
the motion. Howick now challenges that ruling, arguing (1) that the affidavit
in support of the warrant did not set forth particularized facts sufficient
to make out probable cause; and (2) that if the affidavit did contain particularized
facts, those facts were stale by November 9, 1999, the date the warrant was
executed. We find it unnecessary to resolve either question because we conclude
that the government has successfully shown beyond a reasonable doubt that the
error, if any occurred, was harmless. See Arizona v. Fulminante, 499 U.S. 279,
307-08 (1991) (the erroneous admission of evidence does not require reversal
when harmless beyond a reasonable doubt).
True, the government relied on the disputed resumes to cross-examine Howick
about his professed "considerable experience in international finance," and
later, during closing argument, to shore up its assertion that Howick"was
a very educated con man." But Howick himself attested to his experience
in such matters, stating during direct examination that he had been recruited
for the project because "there are some [financial] instruments . . .
that I have dealt with over the years that people have called me and asked
if I would assist them in doing things with them." He also testified about
the proper methods of authenticating and placing financial instruments, suggesting
that he had expertise in these areas.
Howick's purposes in offering this testimony are not difficult to discern.
After all, the fact that Howick was knowledgeable about financial instruments
cuts in both directions: It favors the government insofar as it suggests that
Howick ought to have realized that the currency was bogus. But it favors the
defense insofar as it suggests that Howick, in light of his known experience,
might have been contacted by others involved in a fraudulent scheme in the
hope that he would, innocently and in good faith, agree to become involved
in the project and, by doing so, lend it an aura of credibility. Having provided
information to the jury himself to advance the latter purpose, Howick rendered
harmless any error that may have resulted in substantially the same information
being provided by the government to advance the former purpose. See United
States v. Haili, 443 F.2d 1295, 1300 (9th Cir. 1971) ("In any event, the
error alleged is harmless since [the defendant] admitted [the same information].").
B. Constructive Amendment of the Indictment
Count I of the superseding indictment charged that "Howick did, with
the intent to defraud, possess false or fictitious documents . . . with the
intent to pass, utter, present, the same." The language of the operative
statute is broader: It reaches anyone who with intent to defraud "passes,
utters, presents, . . . or attempts or causes the same , or with like intent
possesses" fictitious documents. 18 U.S.C.§ 514(a)(2) (emphasis added).
As we interpret this provision,"attempts . . . the same" means attempts
to pass, utter, or present. Similarly, "with like intent possesses" means
possesses with intent to pass, utter, or present.
Attempting to pass documents and possessing documents with intent to pass
them are, of course, discrete acts and either one can serve as the predicate
of a section 514 offense. Thus, while the grand jury could have charged Howick
with attempting to pass fictitious documents fraudulently, it actually charged
him only with possessing fictitious documents with the intent to pass them
The district court nonetheless instructed the jury that the first element
it must find to convict Howick of Count I is that he "possessed, with
the intent to pass, utter or present or to attempt or cause the same," fictitious
obligations. Howick argues that the variation between the superseding indictment
and the jury instruction amounts to a constructive amendment of the indictment,
in violation his Fifth Amendment right to due process and his Sixth Amendment
right to notice. Howick's challenge focuses only on the presence of the"attempt" phrase
in the jury instruction; he does not object to the addition of the term "cause." Our
review is de novo. United States v. Pisello, 877 F.2d 762, 764 (9th Cir. 1989).
In general, "after an indictment has been returned its charges may not
be broadened through amendment except by the grand jury itself." Stirone
v. United States, 361 U.S. 212, 215-16 (1960); see also United States v. Stewart
Clinical Laboratory, Inc., 652 F.2d 804, 806 (9th Cir. 1991). "[A] constructive
amendment occurs when `the crime charged [is] substantially changed at trial,
so that it [is ] impossible to know whether the grand jury would have indicted
for the crime actually proved.' " Pisello, 877 F.2d at 765 (quoting United
States v. Von Stoll, 726 F.2d 584, 586 (9th Cir. 1984)).
There is no doubt that the language in the jury instructions concerning attempt
was not present in the superseding indictment. The question is whether the
addition unconstitutionally broadened the charges against Howick. We conclude
that it did not.
The supplemental language in the jury charge--"possessed, with the intent
to pass . . . or to attempt . . . the same,"--did not accurately track
the attempt language of section 514--"passes . . . or attempts . . . the
same, or with like intent possesses." The difference is significant. As
it happened, the court did not instruct the jury that it could find Howick
guilty for attempting to pass fictitious obligations, an instruction that would
have permitted conviction on a theory available under the statute but not included
in the indictment. Rather, the message to the jury was that a conviction must
be predicated upon a finding that Howick intended to pass the documents, as
charged in the superseding indictment, or upon a finding that he intended to
attempt to pass them.
The second possibility does not constitute a separate basis for liability,
such that adding it to the jury instruction would work an unconstitutional
amendment of the superseding indictment. An "intent to pass" something
necessarily includes an "intent to attempt to pass" it. Conversely
an "intent to attempt to pass" will amount to an "intent to
pass" so long as the attempter does not hope to fail, an unlikely scenario
not at issue here. So the jury instructions, while adding unnecessary verbiage,
did not make available any theory of liability not charged in Count I of the
superseding indictment. Accordingly, we reject Howick's contention that his
conviction on Count I must be vacated because the superseding indictment was
C. Sufficiency of the Evidence
1. Bringing Counterfeit Currency into the United States.
Count III of the superseding indictment charges Howick with bringing counterfeit
currency into the United States, in violation of 18 U.S.C. § 472. In relevant
part, the statute provides for a criminal sanction against any person who "brings
into the United States or keeps in possession or conceals " counterfeit
currency. 18 U.S.C. § 472.
At the close of evidence, Howick moved for a judgment of acquittal with regard
to Count III pursuant to Federal Rule of Criminal Procedure 29(a). He argued
that a conviction on this Count would require a showing by the government that
Howick had personally transported counterfeit currency across the border, a
fact the government concededly had not demonstrated. The government opposed
the motion, arguing that a conviction could be predicated on the evidence that
Howick had caused the relevant documents to be brought into the country by
requesting them from Pfahl. The district court elected pursuant to Federal
Rule of Criminal Procedure 29(b) to withhold its ruling until after the jury
returned its verdict.
During deliberations, the jury inquired into this very issue, asking the court
whether a conviction on Count III required a "physical" bringing
in of counterfeit currency, or whether causing documents to be brought into
the country would suffice. According to the district court, Howick requested
that no further instructions be given regarding the offense and the court agreed,
telling the members of the jury only that they should "apply their common
sense." United States v. Howick, 96 F. Supp. 2d 1099, 1100 (D. Mont. 2000).
The jury returned a verdict of guilty.
Afterward, the district court issued an order rejecting Howick's Rule 29 motion,
concluding that section 472 does not "require a `physical' bringing in
of the counterfeit . . . items." Id. Howick now appeals that order. Our
review is de novo. United States v. Pacheo-Medina, 212 F.3d 1162, 1163 (9th
We agree that the government need not show physical transportation of counterfeit
currency into the United States to establish criminal liability. We look first
to 18 U.S.C. § 2(b), which provides: "Whoever willfully causes an
act to be done which if directly performed by him or another would be an offense
against the United States, is punishable as a principal."
Admittedly, the superseding indictment did not charge Howick expressly with
causing documents to be brought into the country, but, as we have previously
explained, this omission does not foreclose a subsequent conviction on a causation
theory. "In keeping with the provisions of§ 2, it has long been held
that an indictment need not specifically charge . . . `causing' the commission
of an offense against the United States, in order to support a jury verdict
based upon [such] a finding . . . . All indictments must be read in effect,
then, as if the alternatives provided by 18 U.S.C. § 2 were embodied in
each count thereof." United States v. Armstrong, 909 F.2d 1238, 1241 (9th
Cir. 1990) (quoting United States v. Lester, 363 F.2d 68, 72 (6th Cir. 1966)).
Accordingly, we conclude that the district court correctly determined that
a section 472 offense may be established by evidence that a defendant caused
counterfeit documents to be brought into the country. Since the superseding
indictment may be read to have so charged, the prosecution so argued, and the
jury so found, we reject Howick's challenge to the sufficiency of the evidence
on this ground.
2. The Counterfeit Documents.
Howick also moved for judgment of acquittal on Counts II and III of the indictment--charging
him with possessing counterfeit currency and with bringing it into the country,
respectively--on the ground that the subject documents were not sufficiently
similar to actual currency to support a conviction. Reviewing de novo, Pacheo-Medina,
212 F.3d at 1163, we will reject a challenge to the sufficiency of the evidence
if, viewing the evidence in the light most favorable to the prosecution, any
rational trier of fact could find the essential elements of the crime beyond
a reasonable doubt. United States v. Iriarte-Ortega, 113 F.3d 1022, 1024 n.2
(9th Cir. 1997).
Both Counts II and III of the indictment, based on the counterfeit gold and
silver certificates, alleged violations of 18 U.S.C. § 472, which provides:
Whoever, with intent to defraud, passes, utters, publishes, or sells, or attempts
to pass, utter, publish, or sell, or with like intent brings into the United
States or keeps in possession or conceals any falsely made, forged, counterfeited,
or altered obligation or other security of the United States, shall be fined
under this title or imprisoned not more than fifteen years, or both.
We have previously held that a conviction under section 472 must be predicated
on documents that "bear such a likeness or resemblance to genuine currency
as is calculated to deceive an honest, sensible and unsuspecting person of
ordinary observation and care when dealing with a person supposed to be upright
and honest." United States v. Johnson, 434 F.2d 827, 829 (9th Cir. 1970)
(internal quotation marks omitted); see also United States v. Taftsiou, 144
F.3d 287, 290 (3d Cir. 1998).
According to Howick, the gold and silver certificates did not satisfy this
standard because they possessed flaws rendering them "obviously fake," namely:
the one-hundred dollar certificates, purporting to be Series 1935, had oversized
portraits of Benjamin Franklin, a design that appears only on genuine currency
marked Series 1996 or later; the certificates were printed on paper that lacked
the "very small nylon fibers embedded throughout" that are found
in actual currency; the certificates were not printed by the intaglio method
used by the Bureau of Engraving and Printing on behalf of the United States
Treasury; and the serial numbers were printed on the certificates, whereas
the serial numbers on actual currency are, in effect, stamped into the paper.
Howick's challenge falls well short of establishing insufficiency of the evidence
with regard to Counts II and III. The certificates' defects may have been apparent
to a skeptical examiner trained in the detection of counterfeit currency, but
they could easily have been overlooked by an ordinary person who had no grounds
for suspicion. It is not common practice to verify that the money in one's
pocket bears a design in accordance with its Series date, or to run one's fingers
across the bills' corners to find the hallmarks of the intaglio printing method.
Bogus currency that can be detected by such means may therefore still be "calculated
to deceive an honest, sensible and unsuspecting person of ordinary observation
and care when dealing with a person supposed to be upright and honest." Johnson,
434 F.2d at 829.
Accordingly, we conclude that a rational trier of fact could have found the
essential elements of the offenses charged in Counts II and III of the indictment,
and therefore affirm Howick's convictions on those Counts.
3. The Fictitious Documents.
More difficult to resolve is Howick's challenge to the sufficiency of the
evidence supporting Count I of the superseding indictment. The substance of
the challenge is the same--that the relevant documents are clearly fake and
therefore cannot support a conviction--but both the factual and legal circumstances
are different in the following respects: Howick's factual claim that the documents
are obviously false is considerably stronger, but the legal question whether,
and if so to what degree, the relevant documents must appear genuine to be
unlawful is as yet unsettled.
Count I of the superseding indictment, based on the $100,000,000 and $500,000,000
federal reserve notes, charged Howick with possession of fictitious obligations,
in violation of 18 U.S.C. § 514, as opposed to counterfeit obligations
covered by section 472, as were at issue in Counts II and III. The fictitious
obligation statute provides:
Whoever, with the intent to defraud . . . passes, utters, presents, offers,
brokers, issues, sells, or attempts or causes the same, or with like intent
possesses, within the United States; . . . any false or fictitious instrument,
document, or other item appearing, representing, purporting, or contriving
through scheme or artifice, to be an actual security or other financial instrument
issued under the authority of the United States, a foreign government, a State
or other political subdivision of the United States, or an organization, shall
be guilty of a class B felony. 18 U.S.C. § 514(a)(2).
Section 514 is a rather new statute; under it, prosecution appears to be infrequent.
It differs from the pre-existing counterfeit statute, section 472, which reaches"falsely
made, forged, [and] counterfeit" obligations, in that section 514, reaches "false
or fictitious" obligations, so long as they appear to be "actual." Plainly,
section 514 was intended to criminalize a range of behavior not reached by
We find the legislative history of section 514 helpful in illuminating more
precisely the differences between that provision and section 472. The need
to criminalize possession of fictitious, as opposed to counterfeit, documents
was explained in 1995 by then-Senator Alfonse D'Amato, who introduced the legislation:
Mr. President, I am today introducing the Financial Instruments Anti-Fraud
Act of 1995.
This legislation combats the use of factitious *fn6 financial instruments
to defraud individual investors, banks, pension funds, and charities. These
fictitious instruments have been called many names, including prime bank notes,
prime bank derivatives, prime bank guarantees, Japanese yen bonds, Indonesian
promissory notes, U.S. Treasury warrants, and U.S. dollar notes. . . .
Because these fictitious instruments are not counterfeits of any existing
negotiable instrument, Federal prosecutors have determined that the manufacture,
possession, or utterance of these instruments does not violate the counterfeit
or bank fraud provisions contained in chapters 25 and 65 of title 18 of the
United States Code. The perpetrators of these frauds can be prosecuted under
existing Federal law only if they used the mails or wires, or violated the
bank fraud statute.
Mr. President, we have worked closely with the Treasury Department and various
U.S. Attorneys' Offices to prepare the Financial Instruments AntiFraud Act
of 1995. This bill makes it a violation of Federal law to possess, pass, utter,
publish, or sell, with intent to defraud, any items purporting to be negotiable
instruments of the U.S. Government, a foreign government, a State entity, or
a private entity. It closes a loophole in Federal counterfeiting law. 141 Cong.
Rec. S9533-34 (emphasis added).
The distinction that emerges is this: A "counterfeit" obligation
is a bogus document contrived to appear similar to an existing financial instrument;
a "fictitious" obligation is a bogus document contrived to appear
to be a financial instrument, where there is in fact no such genuine instrument,
and where the fact of the genuine instrument's nonexistence is presumably unknown
by, and not revealed to, the intended recipient of the document.
In keeping with this distinction, we interpret the phrase "false or fictitious
instrument" in section 514 to refer to non-existent instruments, whereas
the phrase "falsely made, forged, counterfeited, or altered obligation" in
section 472 refers to doctored up versions of obligations that truly exist.
So, for example, a phony hundred-dollar bill might be unlawful pursuant to
section 472, the counterfeit statute, while a document purporting to be a negotiable "Federal
Treasury Warrant," of which there are no genuine versions, might fall
under the fictitious obligation statute, section 514.
The question we face--one of first impression--is whether section 514 contains
a threshold requirement with respect to the credibility of the contrived documents
and, if so, whether the $100,000,000 and $500,000,000 bills were sufficiently
credible to support a conviction.
Howick urges us to read a "similitude" requirement into section
514, akin to the requirement in section 472 that the offending documents must "bear
such a likeness or resemblance to genuine currency as is calculated to deceive
an honest, sensible and unsuspecting person of ordinary observation . . . ." Johnson,
434 F.2d at 829; see supra. We find the notion of similitude ill-suited to
the fictitious obligation statute. As stated, section 514 applies to documents
that are not forgeries of any existing financial instrument. What, then, would
a fictitious obligation have to be similar to?
More appropriate under these circumstances is the idea of verisimilitude--the
quality of appearing to be true or real. Section 514 reaches documents "appearing,
representing, purporting, or contriving . . . to be an actual security or other
financial instrument." 18 U.S.C. § 514(a)(2) (emphasis added). The
significance of the term "actual" in this context requires some explanation,
since the very purpose of the statute is to supplement the pre-existing counterfeit
laws by criminalizing bogus obligations that are not copies of any actual obligation.
What is perhaps the most natural interpretation of "actual . . . financial
instrument"--an instrument that really exists--is therefore unavailable.
Put differently, because, for example, "actual Federal Treasury Warrants" is
a null set, it cannot be that to violate section 514 a purportedly negotiable "Federal
Treasury Warrant" must appear to be an actual one.
To give meaning to the phrase"actual security or other financial instrument," then,
we must read the statutory langauge more generally. An unlawful fictitious
obligation, we conclude, is one that appears to be "actual" in the
sense that it bears a family resemblance to genuine financial instruments.
The offending document must, in other words, include enough of the various
hallmarks and indicia of financial obligations so as to appear to be within
that class. The test, then, is not whether the document is similar to any financial
obligation in particular, but whether taken as a whole it is apparently a member
of the family of "actual . . . financial instrument[s]" in general.*fn7
This is by necessity an ad hoc analysis, for the range of possible financial
obligations is limitless and so too, for that reason, is the range of fictitious
ones. No particular mark or characteristic is independently determinative such
that its presence or absence alone could resolve the question whether a document
purports to be a negotiable instrument. The question is whether the document's
features are among the various and sundry ones commonly found in genuine obligations,
and, relatedly, whether it is free of disqualifying marks. We do not attempt
to set forth an exhaustive list of the relevant attributes, but they include
such things as official seals; serial numbers; portraits of government buildings,
officials, or statespersons; symbols or mottos of the issuing nation or entity;
official signatures; dates of issue; and statements to the effect that the
document shall serve as legal tender or shall be redeemable for something of
The standard we announce today is not a stringent one. We are mindful of the
fact that section 514 was enacted to reach documents not striving to duplicate
any existing obligation. Individuals who accept such documents as negotiable
instruments will have ignored or deemed unimportant a significant ground for
suspicion: that the putative obligation is largely or entirely unfamiliar.
Having blundered ahead that far, they will be without clear guidelines to discern
authentic obligations from false ones because they will have no precise model
of what the bona fide articles look like.
Thus, those who regard fictitious obligations as genuine will likely include
persons of a rather credulous nature, and moreover persons who lack a key protection
available to the intended recipients of counterfeit currency: the ability to
detect bogus obligations by noticing variations between the phony document
and the real McCoy. Accordingly, by enacting section 514, Congress provided
protection from fraud to a particularly vulnerable class of victims. In keeping
with that objective, we conclude that the statute criminalizes even bogus obligations
that a prudent person might upon consideration be unlikely to accept as genuine,
so long as those documents bear a family resemblance to actual financial obligations.
To trigger liability, in other words, the document need only credibly hold
itself out as a negotiable instrument.
Thus, for example, a putative financial obligation bearing a large portrait
of a dog smoking a cigarette would probably not appear to be an actual financial
instrument, and therefore would probably not support a section 514 conviction.
But an ostensible "United States Bank Certificate" with a portrait
of President Monroe might, even if a prudent person would look at the document
and say, in effect: "It appears to be some sort of money, but I've never
seen anything like it, I don't believe that it's United States currency, and
I won't take it in lieu of ordinary money."
In so departing from the reasonable victim standard applicable to section
472, see Johnson, 434 F.2d at 829, we reject the suggestion that a parade of
horribles will follow in which defendants are convicted of violating section
514 for possession of "Monopoly money" and other mock currency. Two
factors support this conclusion: First, section 514 convictions must be based
on documents that appear objectively to be "actual" obligations,
and mock currency will fail that test. Second, section 514 contains the subjective
element of"intent to defraud," and as a practical matter, documents
that are obviously not negotiable instruments will rarely be employed in a
fraudulent scheme to persuade others that they are negotiable. Thus, the implausibility
of mock currency may count as circumstantial evidence that the requisite intent
to defraud was not present.
Applying this standard to the facts at hand, we conclude that a rational trier
of fact could have found the essential elements of a section 514 violation,
and therefore affirm Howick's conviction on Count I of the superseding indictment.
The offending documents contained many of the indicia of genuine financial
instruments, including presidential portraits used on genuine currency; official
seals; ornamental phrases; official signatures; series dates; and statements
that the notes are "legal tender for all debts public and private," and
in the case of the $500,000,000 bill, that it is"redeemable in lawful
money at the United States Treasury or at any Federal Reserve Bank." The
bills were also free of disqualifying marks, such as, for example, a statement
that the document is not negotiable. Indeed, during trial Howick's defenses
included the claim that he himself believed that the notes may have been authentic,
a position in obvious conflict with his present claim that the notes are so
implausible that they do not appear to be actual obligations.
The evidence also showed that Howick made reference to the $100,000,000 and
$500,000,000 notes in one fax and one email to private parties not directly
involved in the project, apparently sent to advance the goal of eventually
placing the bogus documents. The jury was properly instructed that to convict
Howick of possessing the notes, it had to find that he intended to defraud
others with them. Apparently, it did so find.
In these circumstances, and in light of our construction of the statute set
forth above, we cannot say that no rational trier of fact could have found
the essential elements of the offense beyond a reasonable doubt.
*fn1 The Honorable Donald P. Lay, United States Circuit Judge for the Eighth
Circuit, sitting by designation.
*fn2 Howick also appeals the district court's method of calculating the
loss that Howick intended to cause by his crimes, a figure that may affect
offense levels pursuant to U.S.S.G. § 2F1.1(b)(1). Howick argues that
the intended loss should have been calculated according to the "economic
reality" theory, a claim that he concedes is foreclosed by our decision
in United States v. Koenig, 952 F.2d 267 (9th Cir. 1991). We reject Howick's
argument, but note that he has raised it in order to preserve the issue
for further review.
*fn3 Gold certificates were issued by the U.S. Treasury Department from 1865
until 1933 in exchange for gold coin and bullion. Silver certificates were
issued in exchange for silver dollars from 1878 until 1963, when the first
one-dollar Federal Reserve notes were introduced.
*fn4 Federal Reserve notes, the only paper currency still issued, are the
familiar $1, $2, $5, $10, $20, $50, and $100 bills. Notes in denominations
of $500, $1,000, $5,000, and $10,000 have not been printed since 1946,
and have not been distributed since 1969. The "Series date" of
paper currency is not the calendar year in which the currency was printed
the last year in which the design of the currency was changed.
*fn5 Printed in 1934-35, before wire transfers were available, these certificates,
bearing a portrait of Woodrow Wilson, were used only to transfer wealth within
the Federal Reserve system.
*fn6 The term "factitious" means produced by artifice. We are not
aware whether "fictitious" or "factitious" was intended
here, but we leave the printed version of Senator D'Amato's remarks unaltered.
*fn7 Having thus interpreted the statute, we reject Howick's contention that
if section 514 does not contain a similitude requirement, it is void for vagueness.
The statutory language is not so vague, nor is our construction of it so unexpected,
as to deprive defendants of fair warning of the conduct made criminal. Rogers
v. Tennessee, 121 S. Ct. 1693, 1698 (2001).