SHIN v. UNITED STATES OF AMERICA
Filing
28
OPINION. Signed by Judge Renee Marie Bumb on 4/11/2018. (dmr)
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
CAMDEN VICINAGE
JONG SHIN,
Petitioner,
v.
UNITED STATES OF AMERICA,
Respondent.
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Civil Action No. 15-7248(RMB)
OPINION
This matter comes before the Court on Petitioner Jong Shin’s
(“Shin”) Motion Under 28 U.S.C. § 2255 to Vacate, Set Aside, or
Correct Sentence by a Person in Federal Custody (“2255 Mot.,” ECF
No. 1; Petr’s Mem., ECF No. 1-2). The Government filed an answer
and brief opposing the motion. (“Answer,” ECF NO. 9.) Shin filed
a reply brief in support of her motion to vacate. (“Petr’s Reply
Brief,” ECF No. 15.)
Shin
then
filed
a
motion
for
release
on
bail
pending
disposition of her § 2255 motion (“Mot. for Bail,” ECF No. 22),
and a motion to dismiss the Superseding Indictment for Lack of
Subject Matter Jurisdiction. (“Mot. to Dismiss,” ECF No. 27.) The
Government filed a brief in opposition to the motion for bail.
(“Opp. to Mot. for Bail,” ECF No. 23), and Shin filed a rebuttal
(“Petr’s Rebuttal,” ECF No. 24.) Shin also submitted a Motion for
Disqualification Under 28 U.S.C. 455(a) and an Amended Memorandum
of Facts in support thereof (“Disqual. Mot.” ECF No. 25; “Am. Mem.
of Facts in Supp. of Disqual. Mot.” ECF No. 26.) For the reasons
discussed below, the motion to disqualify is denied, the § 2255
motion is denied; and the motions for release on bail and to
dismiss the Superseding Indictment for lack of jurisdiction are
dismissed as moot.
I.
BACKGROUND
On April 20, 2011, a federal grand jury returned a four-count
Superseding Indictment against Shin and co-conspirator Esther Zhu.
(United
States
v.
Shin,
10cr208(RMB)-1
(D.N.J.)(Superseding
Indictment, ECF No. 23.)) Count One charged them with conspiracy
to commit wire fraud, contrary to 18 U.S.C. § 1343, in violation
of 18 U.S.C. § 1349. (Id. at 1.)1 Count Two charged Shin with
conspiracy to commit money laundering in violation of 18 U.S.C. §
1956(h) and contrary to § 1957(a). (Id. at 16.) Counts Three and
Four charged Shin and Zhu with making false statements on a loan
or credit application, in violation of 18 U.S.C. § 1014, and 18
U.S.C. § 22 for properties at 136 South Bellevue Avenue (Count
Three) and 1929 Blaine Avenue (Count Four). (Id. at 19, 21.)
1
ECF page citations are to the page of the document assigned by
the Court’s Case Management/Electronic Case Files (CM/ECF).
2
18 U.S.C. § 2 describes the liability of principals and aiding
and abetting commission of an offense against the United States.
2
The jury trial began on October 3, 2011. (United States v.
Shin, 10cr208(RMB)-1 (D.N.J.), Trial Tr., ECF No. 65.) Ten days
later, the jury found Shin guilty of all charges. (Id., Jury
Verdict, ECF No. 72.) Shin moved for a judgment of acquittal on
all counts, pursuant to Federal Rule of Criminal Procedure 29(c).
(Id., Mot. for Acquittal, ECF No. 73.)) This Court denied the
motion by Opinion and Order dated April 18, 2012. (Id., Opinion
and Order, ECF No. 81.) On September 10, 2012, judgment was entered
and Shin was sentenced to a 186-month term of imprisonment, with
a five-year term of supervised release. (Id., Judgment, ECF No.
95.)
On September 14, 2012, Shin filed a timely notice of appeal.
(Id., Not. of Appeal, ECF No. 96.) The U.S. Court of Appeals for
the Third Circuit denied Shin’s appeal and affirmed her conviction
on March 19, 2014. (Id., Judgment of USCA, ECF No. 101.)
On direct appeal, the Third Circuit Court of Appeals stated
the relevant facts:
From May 2006 to December 2006, Shin
orchestrated a scheme to flip real estate in
Atlantic City, New Jersey at a substantial
profit
by
submitting
fraudulent
loan
applications,
inflated
appraisals,
and
falsified closing documents to mortgage
lenders. Between May and October 2006, Shin
purchased seven Atlantic City properties.
Without having improved any of the properties,
Shin re-sold them at inflated prices to five
straw purchasers she had recruited. To lure
the straw purchasers, Shin paid them a few
thousand dollars and promised to make the
3
mortgage payments if they submitted mortgage
applications, went to the closing, and signed
the appropriate paperwork.
To obtain the mortgages, Shin and a mortgage
broker at Summit Mortgage Bankers arranged and
prepared
Uniform
Residential
Loan
Applications (URLAs) for each straw purchaser,
containing
false
statements
about
the
purchasers' employment, income, and plans to
reside at the properties. Shin also paid a
real estate appraiser to prepare fraudulent
appraisals, inflating the value of the
properties. Finally, Shin paid a closing agent
at Equity Title to prepare fraudulent closing
documents that hid the fact that the straw
purchasers had not invested any money in the
properties, and that Shin (as opposed to the
straw buyers) received the loan proceeds in
each of the transactions. Shin participated in
at least ten fraudulent real estate closings
and collected approximately $1.2 million. All
of the mortgages eventually went into default
and most of the properties were foreclosed
upon by the lender. By the end of Shin's
scheme, the victim banks were owed an amount
exceeding $4,600,000.
. . .
At sentencing, after calculating a Guidelines
range of 168–210 months' imprisonment based on
a total offense level of 35 and a criminal
history category of I, the District Court
sentenced Shin to 186 months' imprisonment.
United States v. Shin, 560 F. App’x 137, 138 (3d Cir. 2014).
Shin raised the following arguments on direct appeal:
(1) the District Court's jury instruction on
“reasonable doubt” was improper; (2) the
District Court plainly erred in admitting coconspirators' plea agreements during direct
examinations; (3) the District Court did not
have
jurisdiction
because
there
was
insufficient evidence of a federal offense;
4
(4) the sentence imposed was substantively
unreasonable;
and
(5)
Shin
received
ineffective assistance of counsel at trial and
at sentencing.
Shin, 560 F. App’x at 139-40.
For her third argument on direct appeal, Shin maintained that
she did not violate federal law because she did not personally
submit a URLA to a federally insured bank. Id. The Third Circuit
stated, “[w]e have never held that to be liable under [18 U.S.C.]
§ 1014 a defendant must personally submit the false statements to
the federally insured bank; rather, use of a third party conduit
could suffice.” Id. at 141. Further, the Third Circuit noted the
Fifth and Ninth Circuits had also held it is enough to convict
under § 1014 if the defendant knew the false statements were to be
presented to a bank, whether or not that institution was federally
insured. Id.
The Third Circuit found the following evidence was sufficient
to convict Shin under § 1014: (1) J.P. Morgan Chase Bank (“Chase”)
provided loans in at least three real estate transactions in which
Shin was indicted; (2) Shin prepared false URLAs for at least two
of her straw purchasers, and directed them to submit their URLAs
to her co-conspirator, Zhu; (3) Zhu submitted the URLAs to Chase;
and
(4)
based
on
the
fraudulent
URLAs
and
other
fraudulent
documents, Chase funded the loans. Id. The Third Circuit agreed
5
with this Court that there was sufficient evidence for a jury to
find Shin guilty on any of these three alternate theories:
(1) [Shin's] knowledge, when she prepared the
fraudulent loan applications at issue, that
they would ultimately be submitted to Chase;
(2) [Shin's] aiding and abetting of her coconspirators in committing these offenses; and
(3) the fact that [ ] these offenses were
committed in the scope and in furtherance of
the wire fraud conspiracy and the acts were
reasonably foreseeable consequences of the
conspiracy.
Shin, 560 F. App’x at 142.
Shin’s also claimed on direct appeal that her trial counsel
was ineffective for failing to move to dismiss the indictment on
the insufficiency of the charges. Id. The Third Circuit held that
Shin could not establish prejudice based on trial counsel’s failure
to make a motion to dismiss the indictment because the evidence
was sufficient for a reasonable jury to convict. Id. Therefore,
Shin could not establish prejudice by the alleged failures of
counsel. Id.
Shin filed a petition for writ of certiorari. Jong Shin v.
United States, 135 S. Ct. 244 (2014). The Supreme Court denied the
writ on October 6, 2014. Id. On October 1, 2015, Shin filed the
instant Motion to Vacate, Set Aside or Correct Judgment, pursuant
to 28 U.S.C. § 2255. (2255 Mot., ECF No. 1.) Shin raised the
following grounds for relief:
Ground One (a)(1), (2)
6
1. There was no federal jurisdiction over
Counts One and Two, inter alia, because
there was no showing that petitioner Shin
agreed that funds should be transferred
interstate, as required by the plain
language of the statute, which addresses
only wire communications “in interstate or
foreign commerce.”
2. There was no federal jurisdiction over
Counts 3 and 4 prior to 2009.
Prior to
2009, false information submitted to a
mortgage brokerages was not covered by 18
U.S.C. § 1014 even if those brokerages then
obtained FDIC-insured mortgages for the
applicant.
In 2006, when Shin committed
the acts, there was no federal jurisdiction
over the submission of false information to
mortgage brokerages.
Application of the
Post-2009 version of 18 U.S.C. § 1014 to
Shin’s conduct in 2006 violated the Ex Post
Facto Clause.
Ground Two: Because the Government introduced
perjured testimony, failed to correct perjured
testimony, and argued facts it knew to be
untrue, Jong Shin’s constitutional right to
Due Process of Law was violated.
Ground Three (a)(1-6)
1.
Defense counsel was ineffective for
failing to seek to call Esther Zhu to the
witness stand or, if she was unavailable,
to seek a missing witness instruction. Zhu
made a statement, turned over in 3500
material, that she sold mortgages to other
banks as part of her employment with SMB
and received a 1 point commission for so
doing. Her testimony would have undermined
the government’s theory that Shin aided Zhu
in submitting false information to Chase.
2.
Counsel failed to argue lack of
jurisdiction over the various counts of the
Indictment, as in Point One[.]
7
3. Defense counsel was ineffective for
failing to object to instructions on
conspiracy to commit wire fraud.
4. Defense counsel was ineffective for
failing to object to Jury Instructions 54,
55 & 56, on Counts 3 and 4, as:
a.
The
instructions,
as
written,
violated the ex post facto clause;
b.
The instructions failed to require
mens rea; and
5. Defense counsel failed to object to the
constructive amendment of the Indictment.
6.3 Counsel was ineffective for failing to
argue the insufficiency of the evidence on
Counts 3 and 4 in his Rule 29.
Ground Four:
Appellate counsel raised the
lack of federal jurisdiction, but ignored the
lack of a jurisdictional nexus with regard to
Counts 1 and 2, and addressed only Counts 3
and 4, which charged violations of 18 U.S.C.
§ 1014. Appellate counsel declined to argue
prosecutorial misconduct on the basis of the
Napue violation.
(2255 Mot., ECF No. 1 at 4-8.)
II.
DISCUSSION
A.
Shin’s Motion to Disqualify
Shin moves to disqualify this Court pursuant to 28 U.S.C. §
455(a). (Mot. to Disqual., ECF No. 25). Shin contends the Court
should recuse from deciding the instant § 2255 motion because this
Court lacked subject matter jurisdiction over the criminal matter
3
The Petition contained two subheadings labeled “5.”
renumbered the last point as “6.”
8
The Court
under 18 U.S.C. §§ 3231 and 1014. (Mot. to Disqualify, ECF No. 25
at 1.) The basis for Shin’s motion is that this Court “falsely
claimed to the jury that Jong Shin was charged with making a false
statement
on
loan
and
credit
applications
to
Chase
Bank
in
Violation of Title 18 U.S. Code Section 1014 and 2.” (Am. Mem. of
Facts in Supp. of Disqual. Mot., ECF No. 26 at 2.) According to
Shin, Counts Three and Four of the Superseding Indictment charge
her with making false statements to SMB, but Shin was convicted of
making a false statement to Chase Bank, which was not charged in
the indictment, and there was no evidence of a
Chase Bank loan
application. (Id.)
Further, Shin accuses this Court of accepting six innocent
persons’ guilty pleas for non-federal charges of signing SMB loan
applications in 2006. (Id. at 2-3.) Finally, Shin contends this
Court made a false statement via the Internet on April 18, 2012,
by denying Shin’s judgment of acquittal on the basis that Shin
made false statements in connection with mortgage applications to
Chase. (Id. at 4.)
28 U.S.C. § 455(a) requires a United States District Judge to
disqualify herself in any proceeding where her impartiality might
reasonably be questioned. “[J]udicial rulings alone almost never
constitute a valid basis for a bias or partiality motion.” Liteky
v. U.S., 510 U.S. 540, 555 (1994)(citing United States v. Grinnell
Corp., 384 U.S. 563, 583 (1966). Because Shin’s allegations against
9
this Court are based on this Court’s rulings, and further are
without basis, as revealed in the discussion of her claims below,
the Court denies Shin’s motion to disqualify pursuant to 28 U.S.C.
§ 455(a).
B.
Legal Standard
1.
28 U.S.C. § 2255
Section 2255 provides, in pertinent part:
A prisoner in custody under sentence of a
court . . . claiming the right to be released
upon the ground that the sentence was imposed
in violation of the Constitution or laws of
the United States or that the court was
without jurisdiction to impose such sentence,
or that the sentence was in excess of the
maximum authorized by law, or is otherwise
subject to collateral attack, may move the
court which imposed the sentence to vacate,
set aside or correct the sentence. . . .
28 U.S.C. § 2255.
The grounds that may be raised pursuant to § 2255 are limited.
United States v. Addonizio, 442 U.S. 178, 184 (1979). Section 2255
generally “may not be employed to relitigate questions which were
raised and considered on direct appeal,” unless there was an
intervening change in the governing substantive law or other
exceptional circumstances. United States v. DeRewal, 10 F.3d 100,
105 n. 4 (3d Cir. 1993)(citations omitted).
Additionally,
a
defendant
cannot
raise
a
procedurally
defaulted claim in a § 2255 motion unless she makes a showing of
cause and prejudice or actual innocence. Massaro v. United States,
10
538 U.S. 500, 504 (2003); Hodge v. United States, 554 F.3d 372,
379 (3d Cir. 2009). A claim is procedurally defaulted if the
petitioner could have but failed to raise the claim on direct
appeal. Id. The “cause” that is necessary to excuse a procedural
default must be something beyond a defendant's control that cannot
be fairly attributed to her. McCleskey v. Zant, 499 U.S. 467, 493
(1991). The “prejudice” necessary to excuse a procedural default
means that the alleged error worked to a defendant's “actual and
substantial disadvantage.” United States v. Frady, 456 U.S. 152,
170 (1982)(emphasis omitted).
The petitioner bears the burden of proof in a motion under §
2255. Gov't of Virgin Islands v. Nicholas, 759 F.2d 1073, 1081 (3d
Cir. 1985). A motion under § 2255 will be granted only if the
sentence results “in a fundamental defect which inherently results
in a complete miscarriage of justice” or “an omission inconsistent
with the rudimentary demands of fair procedure.” Hill v. United
States, 368 U.S. 424, 428 (1962); United States v. Cleary, 46 F.3d
307, 311 (3d Cir. 1995).
2.
Ineffective Assistance of Counsel
There are two parts to an ineffective assistance of counsel
claim:
First, the defendant must show that counsel’s
performance was deficient. This requires
showing that counsel made errors so serious
that counsel was not functioning as the
“counsel” guaranteed the defendant by the
11
Sixth Amendment. Second, the defendant must
show that the deficient performance prejudiced
the defense.
This requires showing that
counsel’s errors were so serious as to deprive
the defendant of a fair trial, a trial whose
result is reliable.
Strickland v. Washington, 466 U.S. 668, 687 (1984).
The first part of the test “requires a defendant to show ‘that
counsel’s
representation
fell
below
an
objective
standard
of
reasonableness.’” Lafler v. Cooper, 132 S. Ct. 1376, 1384 (2012)
(quoting
Hill
v.
Lockhart,
474
U.S.
52,
57
(1985)(quoting
Strickland, 466 U.S. at 688)). There is “a strong presumption that
counsel's
conduct
falls
within
the
wide
range
of
reasonable
professional assistance; that is, the defendant must overcome the
presumption that, under the circumstances, the challenged action
‘might be considered sound trial strategy.’” Id., 466 U.S. at 689
(quoting Michel v. Louisiana, 350 U.S. 91, 101 (1955)). “The Sixth
Amendment guarantees reasonable competence, not perfect advocacy
judged with the benefit of hindsight.” Yarborough v. Gentry, 540
U.S. 1, 8 (2003)(citing Bell v. Cone, 535 U.S. 685, 702 (2002);
Kimmelman v. Morrison, 477 U.S. 365, 382 (1986); Strickland, 466
U.S. at 689; United States v. Cronic, 466 U.S. 648, 656 (1984)).
Prejudice, the second part of the Strickland test, requires
a defendant to “show that there is a reasonable probability that,
but
for
counsel's
unprofessional
errors,
the
result
of
the
proceeding would have been different.” Strickland, 466 U.S. at
12
694. “A reasonable probability is one ‘sufficient to undermine
confidence in the outcome.’” Collins v. Sec. of Pennsylvania Dept.
of Corr., 742 F.3d 528, 547 (3d Cir. 2014)(quoting Strickland, 466
U.S. at 694).
“Prejudice is viewed in light of the totality of the evidence
at trial ….” Collins, 742 F.3d at 547 (citing Rolan v. Vaughn, 445
F.3d 671, 682 (3d. Cir. 2006)). A court is not required to address
both components of the ineffective assistance inquiry; “[i]f it is
easier to dispose of an ineffectiveness claim on the ground of
lack of sufficient prejudice … that course should be followed.”
Strickland, 466 U.S. at 697.
The
Strickland
test
applies
to
claims
of
ineffective
assistance of appellate counsel. Smith v. Robbins, 528 U.S. 259
(2000). An attorney's decision about which issues to raise on
appeal are strategic, and an attorney is not required to raise
every possible non-frivolous issue on appeal. Albrecht v. Horn,
485 F.3d 103, 138 (3d Cir. 2007); Robbins, 528 U.S. at 272; Jones
v. Barnes, 463 U.S. 745 (1983).
C.
Procedurally Defaulted Claims in the § 2255 Motion
The Government contends the following claims raised by Shin
are procedurally defaulted: (1) the claims embedded in Ground One
objecting to the jury instructions and the sufficiency of the
evidence in Counts One and Two, relating to interstate wire
communications; (2) Ground One, the sufficiency of the evidence on
13
Counts 3 and 4; and (3) Ground Three, perjured testimony and
prosecutorial misconduct. (Answer, ECF No. 9 at 10-15.)
Shin responded that she can meet the fundamental miscarriage
of
justice
exception
to
procedural
default
because
newly
discovered evidence shows she is actually innocent. (Petr’s Reply
Brief at 23.) The newly discovered evidence is an April 2016 email
from AUSA Carrig to Attorney, Ruth M. Liebesman (Id., Exh. Q.)
Shin contends the email proved the prosecution introduced at trial
non-existing evidence, Government Exhibit 321A, and fraudulent
evidence, Exhibit 321B. (Id.) Referring to trial transcript pages
160-61, Shin concludes Exhibit 321A does not exist because Chase
employee Darrell Adkins testified Exhibits 321A and 321B for the
property at 148 S. Bellevue Ave were neither requested nor supplied
to the U.S. Attorney's office by Chase on August 8, 2011. (Id. at
24.)
Shin offers three additional bases for her factual innocence:
(1) the facts charged in the indictment in Counts 1, 3 and 4 did
not constitute a violation of 18 U.S.C. § 1014 at the time of the
alleged violation: (2) the Superseding Indictment failed to allege
a federal offense; and (3) Government Exhibits 321A and 321B were
fabricated by a source other than Chase Bank. (Id. at 23-25.) Shin
also asserts her appellate attorney was ineffective for failing to
argue on appeal the issues raised in the § 2255 motion. (Id. at
25.)
14
Here, the actual innocence and ineffective assistance of
counsel claims Shin asserts to excuse her procedural default
require analysis of the same claims she raises in her § 2255
motion.
Because
the
underlying
claims
are
without
merit,
as
discussed below, Shin has not shown cause and prejudice resulting
from ineffective assistance of her appellate counsel or actual
innocence to excuse her procedural default.
D.
Merits of the Grounds for Relief in the § 2255 Motion
1.
In
Ground
Ground One (a)(1)
One
(a)(1),
Shin
contends
this
Court
lacked
jurisdiction over Counts One and Two in the Superseding Indictment
because there was no showing that she agreed that funds should be
transferred interstate, as required by the plain language of the
statute which addresses only wire communications “in interstate or
foreign commerce. (2255 Mot., ECF No. 1 at 4.) Shin asserts that
a jurisdictional element of the offense of conspiracy to commit
wire fraud is an agreement to transmit signals by wire, and the
court did not require the jury to find that that an agreement to
transmit signals by wire was part of the conspiracy. (Petr’s Mem.,
ECF No. 1-2 at 16.) Shin then strays to a challenge of the jury
instructions. She notes the court instructed the jury on the
commerce element of Count One, wire fraud conspiracy:
It is sufficient if the government proves
beyond a reasonable doubt that Jong Shin knew
the use of the wire … in interstate commerce
15
would follow in the ordinary course of
business or events, or that Jong Shin should
reasonably have anticipated that wire …
communication in interstate commerce would be
used.
(Petr’s Mem., ECF No. 1-2 at 16.) Then Shin raises a sufficiency
of the evidence claim, concluding there was no showing at trial
that she agreed funds should be transferred interstate, as required
by the plain meaning of 18 U.S.C. § 1343. (Id. at 17.) Shin further
contends that the Government was required to prove an interstate
nexus, and an ordinary negligence standard is insufficient. (Id.)
In response, the Government notes that what Shin labeled as
a jurisdictional challenge is really an objection to the jury
instructions and the sufficiency of the evidence as to interstate
wire communications. (Answer, ECF No. 9 at 13.) The Government
argues the essence of the wire fraud statute is not a specific
agreement to transmit signals by wire. (Id. at 11.) “[T]he use of
wires need not be an essential element of the scheme.” (Id.,
quoting United States v. Keller, 395 F. App’x 912, 915 (3d Cir.
2010)(quoting Schmuck v. United States, 489 U.S. 705, 710-11
(1989)).
Regarding Shin’s attack on the jury instructions for failing
to require a specific agreement to transmit signals, the Government
notes this Court’s jury instructions on conspiracy and wire fraud
track
the
Third
Circuit
Model
Jury
Instructions,
which
are
supported by Third Circuit case law. (Answer at 12, citing Keller,
16
395 F App’x at 914-916; United States v. Andrews, 681 F.3d 509,
528-29 (3d Cir. 2012)).
Further,
the
Government
submits
that
the
Court’s
jury
instructions required more than negligence to convict Shin of
conspiracy to commit fraud. (Petr’s Mem., ECF No. 1-2 at 14.) The
jury was instructed that it had to find Shin joined the conspiracy
knowing of its objective to commit wire fraud, and intending to
join a conspirator to achieve the objective. (Id.) Thus, the jury
was required to find intent to defraud, defined for them as
“knowingly and with the intention or purpose to deceive or cheat.”
(Id.)
The Government also responded to Shin’s argument that the
evidence at trial was insufficient to prove her awareness that the
transactions
would
involve
interstate
commerce.
(Id.)
The
Government argues the evidence that Shin orchestrated fraudulent
property transactions that involved wire transfers of funds from
New Jersey to New York banks was sufficient to prove conspiracy to
commit wire fraud. (Id. at 15-16.)
In
her
Reply
Brief,
Shin’s
argument
focuses
on
the
jurisdictional challenge to the allegations in the Superseding
Indictment. (Petr’s Reply Brief, ECF No. 15 at 11.) Shin contends
the facts alleged in support of violation of 18 U.S.C. § 1349,
conspiracy to commit an offense, fall beyond the scope of the
underlying wire fraud offense, 18 U.S.C. § 1343, as a matter of
17
statutory interpretation. (Id.) Count Two, money laundering, is
deficient she argues because it relies on the predicate act of
wire fraud. (Id. at 13.)
Specifically,
Shin
contends
the
facts
alleged
in
the
Superseding Indictment were insufficient because the Government
alleged only that Shin and Zhu prepared and submitted false loan
applications and other documents to SMB. (Id. at 12-13.) Shin also
notes that the prosecutor requested a special verdict at trial on
whether the Count One offense "affected a financial institution."
(Id. at 13.) She argues SMB is a mortgage lender, not a financial
institution. (Id.)
Beginning with the argument Shin presented in her Reply
Brief,4 the Court looks to the Superseding Indictment to establish
jurisdiction. See e.g. U.S. v. Huet, 665 F.3d 588, 595 (3d Cir.
2012). “Although the Government is not required to set forth its
entire case in the indictment, ‘if the specific facts’ that are
alleged ‘fall beyond the scope of the relevant criminal statute,
as a matter of statutory interpretation,’ the indictment fails to
state an offense.” Huet, 665 F.3d at 595 (3d Cir. 2012)(quoting
United States v. Panarella, 277 F.3d 678, 685 (3d Cir. 2002)).
“[A]
district
court's
review
of
4
the
facts
set
forth
in
the
The Court notes Shin was represented by counsel for the initial
submission of her § 2255 motion and memorandum in support thereof.
Counsel later withdrew, and Petitioner submitted her reply brief
pro se, raising some new claims not contained in her § 2255 motion.
18
indictment is limited to determining whether, assuming all of those
facts as true, a jury could find that the defendant committed the
offense for which he was charged.” Huet, 665 F.3d at 595-96 (citing
Panarella, 277 F.3d at 685; United States v. DeLaurentis, 230 F.3d
659, 660 (3d Cir. 2000)).
Here,
Shin
challenges
whether
SMB
is
a
“financial
institution” as the phrase is used in the wire fraud statute, 18
U.S.C. § 1343. The version of the wire fraud statute in effect in
2006, when the alleged violations occurred, states:
Whoever, having devised or intending to devise
any scheme or artifice to defraud, or for
obtaining money or property by means of false
or fraudulent pretenses, representations, or
promises,
transmits
or
causes
to
be
transmitted by means of wire, radio, or
television communication in interstate or
foreign
commerce,
any
writings,
signs,
signals, pictures, or sounds for the purpose
of executing such scheme or artifice, shall be
fined under this title or imprisoned not more
than 20 years, or both. If the violation
affects a financial institution, such person
shall be fined not more than $1,000,000 or
imprisoned not more than 30 years, or both.
By the plain terms of the statute, a person can violate the law
whether or not the scheme to defraud by means of wire in interstate
commerce affects a financial institution.
The penalty, however,
is enhanced if it is a financial institution that is harmed.
Moreover, the wire fraud statute requires only that means of
wire are used in interstate commerce to transmit a scheme or
artifice to defraud. Count One of the Superseding Indictment
19
charges Shin and her co-conspirators of conspiracy to commit wire
fraud in violation of 18 U.S.C. § 1349, by devising and executing
a scheme to defraud by purchasing seven residential properties in
Atlantic City, New Jersey and recruiting Straw Purchasers to buy
the properties at an inflated value. (United States v. Shin,
10cr208(RMB)-1 (D.N.J.) Superseding Indictment, ECF No. 23, §1a.)
Esther Zhu, a co-conspirator, was employed by a mortgage
brokerage
firm,
Summit
Mortgage
Bankers
“SMB.”
(Id.,
§1b).
“Based upon false and fraudulent information provided by Jong Shin
and mortgage broker Esther Zhu, SMB made and/originated several
mortgage loans to Jong Shin and the various Straw Purchasers.”
(Id.) Financial institutions, including Chase, which purchased
certain loans from SMB at the real estate closings, were affected
by false statements made to induce them to lend funds for the
purchase of the properties at inflated prices. (Id. at 12-15.)
Proceeds from the sales of certain properties at fraudulently
inflated prices were wired from New Jersey Bank accounts to Shin’s
personal bank account in New York. (Trial Tr., ECF No. 89 at 119139, 180-182.)
These allegations in the Superseding Indictment establish
jurisdiction over Count One, conspiracy to commit wire fraud.
Shin’s
challenge
to
Count
Two,
conspiracy
to
commit
money
laundering in violation of 18 U.S.C. 1956(h), relies on the same
faulty argument about the sufficiency of allegations of conspiracy
20
to commit wire fraud. (Petr’s Reply Brief, ECF No. 15 at 15.) Thus,
Count Two of the Superseding Indictment also establishes federal
jurisdiction.
Turning now to the arguments presented in support of Ground
One(a)(1) in Shin’s initial brief in support of her § 2255 motion,
Shin asserts that this Court did not require the jury to find that
that an agreement to transmit signals by wire was part of the
conspiracy, a jurisdictional element. Shin is wrong.
This Court’s instruction that it was sufficient for the
Government to prove, beyond a reasonable doubt, that Jong Shin
knew
or
reasonably
anticipated
that
the
use
of
the
wire
in
interstate commerce would follow in the ordinary course of business
or events, and that Shin joined the conspiracy knowing of its
objective to commit wire fraud, and intending to join a conspirator
to achieve the objective was supported by law. (United States v.
Shin, 10cr208(RMB)-1 (D.N.J.)(Jury Instructions, ECF No. 70 at 2747.) Wire fraud has three essential elements: (1) the defendant's
knowing and willful participation in a scheme or artifice to
defraud, (2) with the specific intent to defraud, and (3) the use,
or cause of use, of interstate wire communications in furtherance
of the scheme. United States v. Keller, 395 F. App'x 912, 914 (3d
Cir. 2010).
The first element can be met “‘[w]here one does an act with
knowledge that the use of the mails will follow in the ordinary
21
course of business, or where such use can reasonably be foreseen,
even though not actually intended, then he ‘causes' the mails to
be used.’” Keller, 395 F. App'x at 914 (quoting United States v.
Bentz, 21 F.3d 37, 40 (3d Cir. 1994)(internal citations omitted in
original). This Court’s instruction was correct as to the first
element.
The instruction on conspiracy was also proper. Guilt may be
found where “the person ‘ha[d] knowledge of the illicit objectives
of the fraudulent scheme and willfully intend[ed] that those larger
objectives be achieved.’” United States v. Weaver, 220 F. App'x
88, 94 (3d Cir. 2007)(quoting Genty v. Resolution Trust Corp., 937
F.2d 899, 908–09 (3d Cir. 1991)). Thus, it is sufficient if the
defendant “knew that he was participating in the fraudulent scheme
alleged in the indictment.” Id. at 95.
Shin’s final argument in Ground One (a)(1), is that the
evidence at trial was insufficient to prove her awareness that the
transactions would involve interstate commerce. The trial record
contains evidence that Shin received loan proceeds, from loans
made based on the fraudulent representations she orchestrated, by
wire transfer from a New Jersey bank to her personal account in a
New York bank. (United States v. Shin, 10cr208(RMB)-1, (D.N.J.)
(Trial Tr., ECF 89 at 119-140.) Shin knew that New Jersey and New
York residents and entities were involved in her overall mortgage
fraud scheme, and thus had reason to anticipate the transactions
22
would require use of interstate wire communications. The evidence
was sufficient to convict Shin of conspiracy to commit wire fraud.
Ground One (a)(1) of the § 2255 motion is denied.
2.
Ground One (a)(2)
In Ground One (a)(2), Shin argued this Court convicted her
under the Post-2009 version of 18 U.S.C. § 1014, but the alleged
illegal conduct occurred under the 2006 version of the statute.
(Petr’s Mem. ECF No. 1-2 at 18-20.) She contends that in 2006 the
statute did not make it illegal to submit false information to a
mortgage broker, even if the false information was used to obtain
an FDIC-insured mortgage. (Id. at 20.) Shin asserts that in the
2006 version of the statute mortgage brokers and originators were
not in the “list of covered institutions” in the statute, they
were only added by amendment in 2009. (Id.)
Shin
established
concedes
that
a
that,
under
defendant
did
the
not
2006
need
statute,
to
know
case
law
that
the
institution she was trying to influence with false statements was
federally insured, as long as the proof showed the defendant knew
it was a bank that she intended to influence. (Id. at 21, citing
United States v. Thompson, 811 F.2d 841, 844 (5th Cir. 1987);
United States v. McDow, 27 F.3d at 135-36)). Thus, Shin concluded
that because the Government produced no direct evidence that she
knew SMB would acquire funds from another entity to make her loan,
her conviction could not stand. (Petr’s Mem., ECF No. 1-2 at 22,
23
citing McDow.) Shin also noted, however, that case law in 2006
provided:
If [the defendant] had intended by making
false statements to [a] leasing corporation to
influence the bank as well, the fact that the
statements were not made to the bank would not
prevent his conviction…. It would be enough if
[the defendant] had known that the loan he was
getting from [a] leasing corporation would be
assigned to the bank.
(Id. at 22 n.2, quoting United States v. White, 882 F.2d 250, 254
(7th Cir. 1989)).
In addition to violating the Ex Post Facto Clause, Shin argued
that Counts 3 and 4 of the Superseding Indictment charged conduct
that was not in violation of 18 U.S.C. § 1014; therefore, the
indictment should be dismissed and the conviction vacated. (Petr’s
Mem., ECF No. 1-2 at 23; Petr’s Reply Brief, ECF No. 15 at 14.)
The Government maintains that Counts Three and Four each
allege that Chase Bank is a federally insured bank, and that Esther
Zhu sent a false URLA and false appraisal to Chase. (Answer, ECF
No. 9 at 16.) Counts 3 and 4 charge that Zhu and Shin knowingly
made false statements for the purpose of influencing Chase in
issuing mortgage loans, in violation of 18 U.S.C. § 1014, as in
effect in 2006. (Id.)
In her Reply Brief, Shin asserts Counts Three and Four, as a
matter of law, do not properly allege offenses under 18 U.S.C. §
1014, which criminalizes making a false statement in a loan
24
application to an FDIC lender. (Petr’s Reply Brief, ECF No. 15 at
15.)
She
contends
the
District
Court
lacked
subject
matter
jurisdiction over Counts Three and Four, mandating that Shin's
conviction and sentence be vacated, and that Counts Three and Four
be dismissed with prejudice. (Id.)
The Court begins with Shin’s Ex Post Facto argument. “The ex
post facto prohibition [in the Constitution] forbids the Congress
and the States to enact any law ‘which imposes a punishment for an
act which was not punishable at the time it was committed; or
imposes additional punishment to that then prescribed.’” Weaver v.
Graham, 450 U.S. 24, 28 (1981). For a penal law to be ex post
facto, “it must be retrospective, that is, it must apply to events
occurring before its enactment, and it must disadvantage the
offender affected by it.” Id. at 29 (citations omitted).
The 2006 version of 18 U.S.C. § 1014 provided, in pertinent
part:
Whoever knowingly makes any false statement or
report, or willfully overvalues any land,
property or security, for the purpose of
influencing in any way the action of … any
institution the accounts of which are insured
by the Federal Deposit Insurance Corporation
… shall be fined not more than $1,000,000 or
imprisoned not more than 30 years, or both….
In 2009, the statute was amended, and it read, in pertinent part:
Whoever knowingly makes any false statement or
report, or willfully overvalues any land,
property or security, for the purpose of
influencing in any way the action of the
25
Federal
Housing
Administration,
…
any
institution the accounts of which are insured
by the Federal Deposit Insurance Corporation,
… or a mortgage lending business, or any
person or entity that makes in whole or in
part a federally related mortgage loan as
defined in section 3 of the Real Estate
Settlement Procedures Act of 1974 … shall be
fined not more than $1,000,000 or imprisoned
not more than 30 years, or both….
18 U.S.C. § 1014 (effective May 2009)(amendments in bold).
In statutory interpretation, courts “assume that ‘Congress
expresses its intent through the ordinary meaning of its language’
and therefore begin ‘with an examination of the plain language of
the
statute.’”
Pennsylvania
Disabled
Transp.
in
Auth.,
Action
539
of
F.3d
Pennsylvania
199,
210
v.
(3d
Se.
Cir.
2008)(quoting Rosenberg v. XM Ventures, 274 F.3d 137, 141 (3d Cir.
2001)). If the language of the statute is unambiguous, no further
inquiry is necessary. Id.
In 2006, the plain language of § 1014 unambiguously made it
illegal to make a false statement “for the purpose of influencing
… any institution the accounts of which are insured by the Federal
Deposit Insurance Corporation.” The statute did not require that
a false statement be made directly to an FDIC-insured bank; it is
enough if the false statements were to be presented to a bank.
Shin, 560 F. App’x at 141. Counts Three and Four of the Superseding
Indictment alleged such a scheme by Shin. This Court had subject-
26
matter jurisdiction, and Shin’s conviction did not violate the Ex
Post Facto Clause. Ground One (a)(2) is denied.
3.
In
Ground
Ground Two
Two
of
her
§
2255
motion,
Shin
claimed
the
Government violated her right to due process by introducing and
failing to correct perjured testimony that it knew to be untrue.
(Petr’s Mem., ECF No. 1-2 at 23-26, citing Napue v. Illinois, 360
U.S. 264, 269 (1959)). Shin contends that Trial Exhibit 523, a
HUD1 form for the property at 133 South Wilson Avenue, shows the
property was funded by SMB. (Id. at 24.)
Shin asserts that the identity of the entity that funded the
purchase of 133 South Wilson Avenue is not an element of the crime,
rather the issue is to whom the false statements were made, and
SMB was the only “recipient of false information.” (Id.) Thus,
Shin contends it was perjury when Mr. Adkins, an employee of Chase
Bank, testified that a loan application (URLA) for 133 South Wilson
Avenue was in Chase’s files, and Chase funded the purchase. (Id.)
Shin also asserts Special Agent Altieri’s testimony about the
property at 133 South Wilson Avenue was perjury. (Petr’s Mem., ECF
No. 1-2 at 24-26.) Altieri testified that the wire transfer record,
Trial Exhibit 528B, showed Chase purchased the mortgage for 133
South Wilson Avenue. (Id. at 24.) The wire was sent on November
20, 2006, but Ms. Rampersaud [the straw purchaser] closed on the
mortgage with SMB on November 10, 2006. (Id. at 25.) According to
27
Shin, the prosecution did not attempt to correct this misstatement.
(Petr’s Mem., ECF No. 1-2 at 25.)
Additionally, Altieri testified that Shin or one of the straw
buyers made mortgage applications directly to Chase Bank. (Id. at
25.) Shin argues Altieri was speculating, and this was false
because not a single Chase URLA was ever signed, and all mortgages
started
with
a
URLA
to
SMB.
(Id.)
Shin
contends
this
false
testimony was the only evidence that she or a straw purchaser had
signed a Chase loan application or that the scheme to submit false
applications to SMB in any way anticipated or included forwarding
a
false
SMB
loan
application
to
Chase,
and
resulted
in
her
erroneous conviction. This was compounded, she alleges, when the
Government argued in closing that the loan applications were
submitted to Chase Bank. (Id. at 26.)
The Government submits that there was no perjury, and Shin
misinterpreted the testimony. (Answer, ECF No. 9 at 17.)
As to
Darrell Adkins’ testimony, Shin stated Adkins testified Chase Bank
funded the purchase of 133 South Wilson Avenue because the loan
application (URLA) was in Chase’s files. (Id. at 21.) In fact,
Adkins testified that the URLA for 133 South Wilson Avenue was in
Chase’s files, but the application came to them from Summit
Mortgage [SMB]. (Id. at 22.) He further testified that this was a
document
that
a
Chase
underwriter
would
have
received
considered in deciding whether to fund the mortgage. (Id.)
28
and
The Government also explained the context of Special Agent
Altieri’s testimony. (Answer, ECF No. 9 at 17-20.) He testified
that SMB both originated mortgage applications and funded some of
the mortgages until the loans could be resold. (Id. at 19.) The
trial exhibits and testimony established that Chase, a federally
insured bank, directly funded mortgages in three of the fraudulent
real estate transactions5 that were part of the Count 1 conspiracy,
and subsequently purchased mortgages which had originally been
funded by SMB for four of the fraudulent real estate transactions
that were part of the Count 1 conspiracy.6 (Id. at 17-18.)
For the mortgages directly funded by Chase Bank, many of the
documents signed at the closings, including the HUD1 Settlement
Statements, Mortgages and Notes, indicated that Chase bank was the
lender at the time of sale. (Id. at 18-19, referring to Trial
Exhibits 153, 154A, 155A, 155B, 156, 158, 158B, 162 and 166.)
There was testimony that Shin orchestrated each of the deals, was
present at each of the closings, and signed some of the documents
in which Chase was the direct lender. (Id. at 18-19.) For example,
the Government notes Chase directly funded the sale of 136 South
5
This included the August 29, 2006 sale of 136 South Bellevue;
the August 1, 2006 sale of 148 South Bellevue; and the November
17, 2006 sale of 1929 Blaine Avenue.
6
This included the September 26, 2006 sale of 150 South Bellevue;
the June 30, 2006 sale of 138 South Bellevue; the November 10,
2006 sale of 133 South Wilson; and the December 6, 2006 sale of
512 Magellan.
29
Bellevue on August 29, 2006, and Shin signed all of the closing
documents on behalf of her ex-husband, Steven Boswell. (Answer,
ECF No. 9 at 18-19.)
Special Agent Altieri also testified that there were often
multiple copies of the same document that he obtained from the
different entities involved in the transaction, including SMB,
Chase, Equity Title and others. (Id. at 19.) He could tell by the
Bates stamps on the bottom of each exhibit which entity it had
come from. (Id.) He also explained that the “typical procedure is
at the time of settlement [for] the lending institutions [to] have
the borrower sign the application again as like a failsafe to make
sure everything is true and accurate. So, for one mortgage loan,
we may have three loan applications.” (Id.)
Altieri
further
testified
that
it
is
the
role
of
an
originator, like SMB, to obtain the information from the borrower,
the borrower’s income, place of employment, and to complete the
loan application. (Answer, ECF No. 9 at 19-20.) In instances when
the loan made by SMB was sold to Chase prior to closing, Shin had
to sign “as a final application at the closing table.” (Id. at
20.) Therefore, the Government maintains Altieri’s testimony was
true. (Id. at 21.)
In reply, Shin argues Altieri’s and Adkin’s testimony that
Shin or an alleged straw buyer made loan applications directly to
Chase was proved false by Trial Exhibits 160B, 151, 621A, and 621B,
30
all of which were SMB loan applications (Petr’s Reply, ECF No. 15
at 17). Shin concludes that she was convicted despite the fact
that the Government presented no real evidence of loan applications
to Chase at trial. (Id. at 19.)
First, as to Shin’s claim that Altieri and Adkins lied in
their testimony by stating that Chase funded the mortgage for the
property at 133 South Wilson, Shin misconstrues the testimony.
Altieri testified that SMB was the originator of the November 10,
2006 purchase of 133 South Wilson, and SMB sold the loan to Chase
on November 20, 2006. (ECF 89 at 176-77, ECF No. 90 at 9, 15, 1819, 25, 31-34.) Adkins testified that the loan application for
this mortgage was in Chase’s files, but his testimony indicated
that the loan application came from SMB, the originator. (Trial
Tr., ECF No. 90 at 99-100, 111, 117.) There was no perjury.
Second, the testimony of Altieri and Adkins was not perjury
because evidence was introduced of loan applications made to and
received by Chase on behalf of the straw purchasers recruited by
Shin,
including
Government
Exhibits
151,
162,
621B,
631B.
Therefore, Ground Two of the § 2255 motion is denied.
4.
Ground Three (a)(1)
In Ground Three (a)(1), Shin maintains her trial counsel was
ineffective for failing to seek to call Esther Zhu to the witness
stand or, if Zhu was unavailable, to seek a missing witness
instruction. (2255 Mot., ECF No. 1 at 6-7.) In support of this
31
claim, Shin quotes the FBI notes from its May 29, 2008 interview
of Esther Zhu. (Petr’s Mem., ECF No. 1-2 at 27.) Zhu told the FBI
that after she received “the aforementioned” loan applications,
she sent them to Chase Bank in Florida, whom SMB used to underwrite
the loans. (Id., Ex. C.) Zhu said she knew SMB would sell the loans
to FDIC insured financial institutions immediately after closing.
(Id.) Zhu also stated she was in possession of faxes from Shin to
herself,
outlining
all
the
information
to
put
in
the
loan
applications. (Id.) Zhu knew the financial institutions would rely
on the truth and accuracy of the loan applications. (Id.)
Shin contends there was no evidence in the record that Shin
knew or cared what Zhu or SMB would do with the loan applications
they received, and counsel should have interviewed Zhu to confirm
Shin
had
nothing
to
do
with
what
SMB
did
with
the
loan
applications. (Id. at 28.) Further, because Zhu was permitted to
repatriate to the People’s Republic of China and was unavailable
for trial, Shin contends her counsel should have requested a
missing witness instruction. (Petr’s Mem., ECF No. 1-2 at 29-30.)
Shin notes that at the time of her trial, Zhu had plead guilty to
conspiracy to commit wire fraud and was awaiting sentencing, and
Zhu was on the Government’s witness list for Shin’s trial. (Id. at
30.) Defense counsel, however, agreed to a jury instruction that
the jury could not draw any inferences from the fact that Zhu was
not named in the indictment as a defendant. (Id.)
32
Shin asserts she was prejudiced by counsel’s failure to call
Zhu because Zhu could have testified that her agreement with Shin
ended with the submissions of false applications to SMB. (Id. at
31.) Shin claims Zhu was within the control of the Government
because she pled guilty to violation 18 U.S.C. § 1014 but had not
yet been sentenced; therefore she had good reason to invoke the
Fifth Amendment prohibition on self-incrimination. (Id.) Under
such circumstances, Shin argues her trial counsel should have
requested a jury instruction that the defense was entitled to an
inference that the Government’s failure to call Zhu as a witness
suggested her testimony would have been adverse to the Government.
(Id. at 32.)
The Government responded that Shin’s ineffective assistance
claim fails because Zhu’s testimony would not have helped Shin,
but in any event, Shin could not establish prejudice based on
failure to interview or call Zhu to testify. (Answer, ECF No. 9 at
24.) The Government relies on the Third Circuit’s holding that the
evidence was sufficient to convict Shin despite the fact that she
did not personally submit a false URLA to a federally insured bank.
(Id. at 25.)
Furthermore,
the
Government
contends
counsel
was
not
ineffective in failing to request a missing witness instruction
because such an instruction is appropriate only when a witness is
in control of one party. (Id. at 26.) The Government submits that
33
Zhu did not agree to cooperate with the Government and was not
within its control. (Answer, ECF No. 9 at 26.) Moreover, the fact
that Zhu pled guilty and might have invoked the Fifth Amendment if
called to testify rendered her unavailable to both parties and did
not support the missing witness instruction. (Id. at 26-27, citing
United States v. Adigun, 998 F.Supp.2d 356, 367 (M.D. Pa. 2014)).
Failure to interview Shin or call her to testify did not
prejudice Shin. First, if Zhu had testified that Shin had no
knowledge that the false information in the SMB loan applications
would be forwarded to other banks, the Government could have
impeached Zhu with testimony that Shin appeared at the closings
and
signed
documents
containing
false
information
for
loans
originated by SMB but ultimately funded by an FDIC-insured bank.
Second, counsel was not ineffective for failing to request a
missing
witness
instruction
because
such
an
instruction
was
inappropriate. “[A] missing witness instruction is not appropriate
when a witness is equally available (or equally unavailable) to
both parties.” United States v. Henries, 98 F. App'x 164, 166 (3d
Cir. 2004)(citing e.g., United States v. Vastola, 899 F.2d 211,
235 (3d Cir.), vacated on other grounds, 497 U.S. 1001 (1990).
Zhu’s unavailability was premised on the assumption she would
invoke her Fifth Amendment right not to incriminate herself because
she
had
pled
guilty
and
was
awaiting
sentencing.
Zhu
was
unavailable to both parties, and if the missing witness instruction
34
had been requested, it would have been denied. Therefore, Ground
Three (a)(1) is denied.
5.
Ground Three (a)(2)
In Ground Three (a)(2) of her § 2255 motion, Shin claims that
her counsel was ineffective for failing to move to dismiss the
Superseding Indictment for the reasons alleged in Ground One of
the motion. The Court has considered Ground One and determined the
jurisdictional and related claims are without merit.
“Many cases have held that Section 2255 generally ‘may not be
employed to relitigate questions which were raised and considered
on direct appeal.’” United States v. DeRewal, 10 F.3d 100, 105 n.4
(3d Cir. 1993)(quoting Barton v. United States, 791 F.2d 265, 267
(2d Cir. 1986)(collecting cases). The Third Circuit Court of
Appeals determined the evidence was sufficient to convict on Counts
Three and Four for violation of 18 U.S.C. § 1014. Shin, 560 F.
App’x
137,
141-42
(3d
Cir.
2014)(finding
“more
than
enough
evidence” to convict Shin under § 1014, and affirming the District
Court’s denial of Shin’s Rule 29(c) motion for acquittal). Counsel
was not ineffective for failing to raise the meritless claims
concerning
the
sufficiency
of
the
indictment,
the
jury
instructions and the sufficiency of the evidence. See Werts v.
Vaughn, 228 F.3d 178, 205 (3d Cir. 2000)(where underlying claim
failed, defense counsel was not ineffective for failing to raise
it). Ground Three (a)(2) is denied.
35
6.
Ground Three (a)(3)
Shin’s third claim of ineffective assistance of trial counsel
is that counsel failed to object to the jury instructions on
conspiracy to commit wire fraud. (Petr’s Mem., ECF No. 1-2 at 33.)
Shin incorporated her arguments from Ground One (a)(1). Shin
further asserts that where criminal statutes require activity in
interstate
commerce,
the
government
must
prove
an
interstate
nexus. (Id. at 35.) Thus, she states “[i]n a conspiracy charge, an
agreement
to
cause
interstate
wire
communications
should
be
required. (Id.) She contends the ordinary negligence standard,
what a person “should reasonably have anticipated,” cannot suffice
to support a criminal conspiracy conviction for wire fraud.” (Id.)
The Government opposes Ground Three (a)(3), arguing that this
Court properly used the Third Circuit model jury instructions, and
the jury instructions correctly instructed the jury on the mens
rea required to convict. (Answer, ECF No. 9 at 27.)
As discussed in Ground One (a)(1) above, this Court’s jury
instructions on conspiracy and wire fraud are supported by the
law. An agreement “to cause interstate wire communications” is not
required for conspiracy to commit wire fraud. U.S. v. Veras de los
Santos, 184 F. App’x 245, 253 (3d Cir. 2006)(the interstate element
of wire fraud is a jurisdictional fact, and the presumption of a
scienter requirement does not apply.)
36
The mens rea is required for the scheme to defraud rather
than the use of wires. See Keller, 395 F. App’x 912, 915 (3d Cir.
2010)(the
second
element
of
the
wire
fraud
statute
is
the
defendant’s knowing and willful participation in a scheme or
artifice to defraud). It is only necessary for a person to have
reasonably anticipated that the fraud would involve communication
by wire. See Andrews, 681 F.3d 509, 529 (3d Cir. 2012)(evidence
was sufficient for conviction on wire fraud where use of interstate
wire
communications
in
the
scheme
to
defraud
was
reasonably
foreseeable.) Neither trial nor appellate counsel was ineffective
for failing to challenge proper jury instructions. See e.g. Senk
v. Zimmerman, 886 F.2d 611, 617 (3d Cir. 1989)(counsel could
reasonably have concluded there was no basis to challenge the jury
instructions). Therefore, Ground Three (a)(3) is denied.
7.
Ground Three (a)(4)
Shin asserts in Ground Three (a)(4) that her trial counsel
was ineffective for failing to object to the jury instructions on
the three ways in which the jury could find her guilty on Counts
Three and Four, violation of 18 U.S.C. § 1014. (Petr’s Mem., ECF
No. 1-2 at 27.) Shin contends the instructions violated the Ex
Post Facto Clause and lacked a mens rea requirement. (Id. at 2933.) Shin’s second argument, that the jury instructions lacked a
mens rea requirement, is based on her premise that “it appears
from the statutory language [of § 1014] that the purpose of
37
Congress was to protect a long list of particularly identified
federally-insured or federally-chartered financial institutions,
not to protect the mortgage lending business as an industry
important to interstate commerce.” (Petr’s Mem., ECF No. 1-2 at
42.)
The Government argues counsel was not ineffective for failing
to raise meritless claims because the jury instructions on Counts
3 and 4 properly described the mens rea requirement. (Answer, ECF
No. 9 at 27-29.) The jury was instructed it had to find knowledge
that the statements were false when made, and find intent to
influence a bank to issue the mortgage loans which were identified
in the indictment. (Id.) The instructions under Pinkerton7 and
aiding and abetting theories also properly instructed the jury on
the mens rea required. (Answer, ECF No. 9 at 29.) The Government
7
In Pinkerton v. United States, 328 U.S. 640, 647 (1946), the
Supreme Court held:
The criminal intent to do the act is
established
by
the
formation
of
the
conspiracy. Each conspirator instigated the
commission
of
the
crime.
The
unlawful
agreement contemplated precisely what was
done. It was formed for the purpose. The act
done was in execution of the enterprise. The
rule which holds responsible one who counsels,
procures, or commands another to commit a
crime is founded on the same principle. That
principle is recognized in the law of
conspiracy when the overt act of one partner
in crime is attributable to all.
38
contends § 1014 does not require proof that the defendant knew the
bank was federally insured. (Answer, ECF No. 9 at 29, citing e.g.,
United States v. Key, 76 F.3d 350, 353 (11th Cir. 1996); United
States v. Thompson, 811 F.2d 841, 844 (5th Cir. 1987); United
States v. Lentz, 524 F.2d 69, 71 (5th Cir. 1975); United States v.
Sabatino, 485 F.2d 540, 544 (2d Cir. 1973)).
This Court has considered and rejected Shin’s claim that her
conviction violated the Ex Post Facto Clause because the 2006
version of § 1014 did not include mortgage lending businesses in
the list of covered institutions. The 2006 version of the statute
plainly stated that a person is guilty of violating § 1014 if she
makes a false statement for the purpose of influencing in any way
the action of any institution, the accounts of which are insured
by
the
Federal
Deposit
Insurance
Corporation.
This
Court
instructed the jury accordingly.8
Shin’s objections to the mens rea requirement in the jury
instructions for conviction under § 1014 are premised on the faulty
conclusion that the Government was required to prove Shin knew the
false statements would be presented to an FDIC-insured bank. This
Court’s instructions, including the conspiracy and aiding and
8
The jury was instructed that “[t]he law makes it a crime to
knowingly make a false statement to a federally insured bank for
the purpose of influencing the bank to make a loan.” (United States
v. Shin, 10cr208(RMB)-1 (D.N.J.)(Trial Tr., ECF No. 93 at 48.)
39
abetting instructions, properly required the jury to find that
Shin intended to influence the lending decision of a bank with a
false statement.9 For these reasons, Ground Three (a)(4) is denied.
8.
9
Ground Three (a)(5)
This Court instructed:
To find a person guilty of the crime of making
false statements on loan and credit and
applications you must be convinced that the
government has proved each of the following
four elements beyond a reasonable doubt.
First, that J.P.
federally insured;
Morgan
Chase
Bank
was
Second, that a person made a false statement
to J.P. Morgan Chase Bank;
Third, that the person knew the statement was
false when it was made;
and Fourth, that the person intended to
influence the bank to issue the mortgage loans
identified in the indictment.
It is not necessary, however, to prove that
the
institution
involved
was
in
fact
influenced or misled. What must be proven is
that the person intended to influence the
lending decision of the bank with a false
statement. To make a false statement to a
federally insured bank, the person need not
directly submit the false statement to the
institution, it is sufficient that the person
submitted the statement to a third party
knowing that the third party will submit the
false statement to the federally insured bank.
(United States v. Shin, 10cr208(RMB)-1 (D.N.J.)(Trial Tr., ECF No.
93 at 48-49.)
40
Shin contends in Ground Three (a)(5) that her counsel was
ineffective for failing to object to the constructive amendment of
the indictment by virtue of the jury charge. (Petr’s Mem., ECF No.
1-2 at 42.) Shin asserts that the Fifth Amendment requires the
charges upon which a person is convicted be contained in the
indictment against her. (Id. at 43.) Thus, “a[n] indictment is
constructively amended when evidence, arguments, or the district
court’s jury instructions effectively ‘amend[s] the indictment by
broadening the possible bases for conviction from that which
appeared in the indictment.” (Id., quoting United States v. Lee,
359 F.3d 1984, 208 (3d Cir. 2004)). Shin asserts a constructive
amendment to the indictment constitutes “‘a per se violation of
the fifth amendment’s grand jury clause.” (Id., quoting United
States v. Castro, 776 F.2d 1118, 1121-22 (3d Cir. 1985)).
Shin
contends
that
Counts
charged
that
Shin
Indictment
3
and
and
Zhu
4
of
the
knowingly
Superseding
made
false
statements for the purpose of influencing Chase. (Id.) However,
Counts Three and Four did not state to whom the false statements
were made for the purpose of influencing JPM Chase. (Id.) Shin
acknowledges
that
the
factual
allegations
of
Count
1
are
incorporated into Counts 3 and 4, and include allegations that
false statements were made to SMB, which sold the mortgages to JPM
Chase. (Id. at 44.) Shin argues, however, that this Court did not
instruct the jury that Shin was charged with submitting false loan
41
applications to SMB for the purpose of influencing JPM Chase, but
rather
that
Shin
was
charged
with
submitting
false
loan
applications to JPM Chase, and this constructively amended the
indictment. (Petr’s Mem., ECF No. 1-2 at 44-45.) Shin contends she
had no notice that she was charged with submitting applications to
Chase. (Id. at 45.)
The Government counters that Counts 3 and 4 by themselves
clearly allege that Shin’s co-conspirator Esther Zhu sent the false
statements
to
Chase.
(Answer,
ECF
No.
9
at
29.)
And,
the
instructions properly instructed the jury on the three theories
approved by this Court and by the Third Circuit, and did not
constructively amend the indictment. (Id. at 29.) The Government
points to its closing argument, where it told the jury:
Now, at this point you might ask one question,
which is I understand all that, but Jong Shin
herself did not personally submit these
applications
to
Chase.
As
Judge
Bumb
instructed you, there are three different ways
that Jong Shin can be found guilty of this
charge even though she did not herself
personally submit the applications to Chase.
(Id. at 20.)
Shin replied that this Court instructed the jury that 18
U.S.C. § 1014 makes it a crime to knowingly make false statements
to a Federally Insured Bank, which SMB was not. (Petr’s Reply
Brief, ECF No. 15 at 21.)10
10
In her reply brief, Shin raised the new claim that:
42
This Court properly instructed the jury that “[t]he law makes
it a crime to knowingly make a false statement to a federally
insured bank for the purpose of influencing the bank to make a
loan.” (United States v. Shin, 10cr208(RMB)-1 (D.N.J.)(Trial Tr.,
ECF No. 93 at 48.) As discussed above, § 1014 does not require
that the false statement be made directly to an FDIC-insured bank,
only
that
the
false
statement
be
made
for
the
purpose
of
influencing such a bank to make a loan.
The jury instructions, consist with the allegations in the
Superseding Indictment, charged that Shin could be found guilty of
violating § 1014 if she herself submitted the false statement in
a loan application to a bank, or if she aided and abetted another
The Superseding Indictment Count One charged
under object of the conspiracy, “which caused
more than one million dollars to various
mortgage lenders...” (Superseding Indictment
¶8) Mortgage lenders such as SMB are not
financial institutions. Judge Bumb, however,
instructed the jury a financial institution is
any bank insured by FDIC (Tr. at 965). At
trial, however, the jury instruction and a
special verdict submitted by the Government,
and given by the Court, constructively amended
Count One of the Indictment, as the Special
Verdict asked whether the offense charged in
Count One "affected a financial institution"
(Tr. at 918).
(ECF No. 15 at
claim based on
Section II.D.2
same reasons,
constructively
20-21.) The Court addressed Shin’s jurisdictional
the phrase “affected a financial institution” in
above, and found it to be without merit. For the
the Court finds the jury instructions did not
amend the indictment as to Count One.
43
in submitting the false statement to a bank, or if she conspired
with others [such as Esther Zhu] to submit a false statement to a
bank [by forwarding the SMB loan applications to Chase Bank].
Therefore, the jury instruction did not constructively amend the
Superseding Indictment, and trial counsel was ineffective for
failing to make this claim. Ground Three (a)(5) is denied.
9.
Ground Three (a)(6)
Shins asserts in Ground Three (a)(6) that her counsel was
ineffective by failing to argue the insufficiency of the evidence
on Counts 3 and 4 in the Rule 29 motion for judgment of acquittal.
(Petr’s Mem., ECF No. 1-2 at 45-46.) This claim is factually
incorrect. Defense counsel moved for judgment of acquittal on
Counts 3 and 4 based on insufficiency of the evidence. (Brief in
Supp. of Mot. for Judgment of Acquittal, ECF No. 73-1 at 10.) This
Court denied the motion, and the Third Circuit Court of Appeals
affirmed. See Shin, 560 F. App’x at 141-42 (“[t]he District Court
denied Shin’s Rule 29(c) motion for a judgment of acquittal on the
grounds that a jury could have found Shin guilty based on any of
three alternate theories …. We agree.”) Ground Three (a)(6) is
denied.
10.
In
Ground
Ground Four
Four,
Shin
asserts
her
appellate
counsel
was
ineffective for failing to raise the issues Shin raised in her §
2255 motion because the issues raised by appellate counsel on
44
direct appeal were weaker than the arguments raised herein. (Petr’s
Mem., ECF No. 1-2 at 53.) This Court has reviewed Shin’s 2255
claims and finds they have no merit. Therefore, appellate counsel
was not ineffective for failing to raise these claims on direct
appeal.
E.
New Claims Raised in the Shin’s Reply Brief
Shin raised new claims of ineffective assistance of counsel
in her reply brief. First, she alleges her counsel was ineffective
for failing to interview and subpoena employees of Chase and all
Chase Bank Underwriters who were involved in processing the loans
at issue. (Petr’s Reply Brief, ECF No. 15 at 22.) Shin argues
defense counsel should have shown that Chase Bank’s underwriters
did not rely on Shin’s false information on loan applications from
SMB, and that the false information was not material. (Id.)
Although moving parties are not typically permitted to raise
new issues and present new factual materials in a reply brief
because the opposing party is entitled to notice and an opportunity
to respond, Shin’s new claims are without merit, and a response
from the opposing party is not required. For this new claim, Shin
relies on Deborah Davis’s testimony that, as a Chase underwriter,
she reviewed and cleared paystubs. (Petr’s Reply Brief, ECF No. 15
at 22.) Shin asserts that neither she nor Zhu provided any paystubs
to Chase with respect to the purchase of the property at 512
Magellan, which SMB funded on December 6, 2006. (Id. at 23.)
45
Therefore,
Shin
concludes
false
statements
on
SMB
loan
applications were not material to Chase approving the loan. (Id.)
Shin also contends Chase Bank Underwriter Ann Keaugh and
someone from SMB altered Shin’s original SMB loan application for
the property at 138 S. Bellevue to change the purchaser’s monthly
income and the total monthly payment. (Id. at 23, citing Gov’t
Exhibits 402, 409 and D2.) Shin asserts she did not sign the new,
altered
SMB
loan
application;
therefore,
the
fraudulent
information Shin gave SMB did not impact the ultimate issuance of
the loan. (Id.)
These claims fail on the prejudice prong of Strickland.
Darrell Adkins testified that he was a quality assurance analyst
at Chase in 2006, and he reviewed underwriting of Chase loans.
(United States v. Shin, 10cr208(RMB)-1 (D.N.J)(Trial Tr., ECF No.
90 at 84.) Although he did not do the underwriting for the loans
at issue, at trial he reviewed the documents submitted in support
of the loans and described what information was important to
underwriters. For example, he testified length of employment,
income, and combined housing expenses of the borrower are very
significant to the ability to pay the mortgage. (United States v.
Shin, 10cr208(RMB)-1 (D.N.J)(Trial Tr., ECF No. 90 at 89-90.)
Primary residence of the borrower is important because someone
living in home is more likely to make the payments (Id. at 93-94.)
Knowing where the cash for closing comes from is important because
46
someone who puts down money is more likely to make payments. (Id.
at 95.)
Special Agent Altieri submitted the evidence he had obtained
by subpoena into the record. (Id., ECF No. 89 at 70-116). He
testified concerning the false representations that were made as
to each property purchase at issue. (Id. at 149-194; ECF No. 90 at
3-41.)
The
false
representations
included
the
borrower’s
employment, monthly income, primary residence and where the cash
for closing came from, as well as the fraudulent appraisals for
the real estate flips. Id. The evidence fully supported the
conclusion that the false statements were material to the issuance
of each loan at issue here.
Contrary
Underwriter
to
Ann
Shin’s
Keaugh
contention
changing
that
evidence
information
on
of
Shin’s
Chase
loan
application for his initial purchase of the property at 138 South
Bellevue, Avenue, the record indicates that Shin was complicit in
the false representations made with respect to the flip of the
property at 138 South Bellevue Avenue on June 28, 2006, when Shin
sold the property to Tula Rampersaud. (See testimony of Tula
Rampersaud, Trial Tr., ECF No. 92 at 73-100.)
For
these
underwriters
who
reasons,
reviewed
if
counsel
the
had
relevant
called
loan
the
Chase
applications
to
testify, there was little chance the outcome of the trial would
47
have been different. Therefore, Shin cannot show the prejudice
required by Strickland.
Shin’s next set of new ineffective assistance of counsel
claims
are
based
on
the
failure
to
object
to
prosecutorial
misconduct. (Petr’s Reply Brief, ECF No. 15 at 26-28.) Shin asserts
the
Government
committed
prosecutorial
misconduct
by
(1)
introducing evidence that did not exist [Gov’t Exhibit 321A];
introducing false evidence that Gov’t Exhibit 321B was supplied by
Chase Bank [citing Exhibit O to Petitioner’s Reply Brief]; (3)
introducing Gov’t Exhibit 151, which appears to be inauthentic
because it is missing a Bates stamp from Chase; (4) submitting
Gov’t Exhibit 621A, stamped with the date of November 9, 2016, a
date that was in the future; and (5) that Gov’t Exhibits 251A and
251B
are
both
for
the
first
loan
on
the
property,
and
the
Government represented that it used the letter “A” for first loans
and the letter “B” for second loans, and further Exhibit 251B is
not a complete or true and correct document. (Id. at 27-29.)
“To constitute a due process violation, the prosecutorial
misconduct must be of sufficient significance to result in the
denial of the defendant's right to a fair trial.” United States v.
Liburd, 607 F.3d 339, 344 (3d Cir. 2010)(citing Greer v. Miller,
483 U.S. 756, 765 (internal quotations omitted)). Courts must
determine whether the misconduct “so infected the trial with
unfairness as to make the resulting conviction a denial of due
48
process in light of the entire proceeding.” Id. (quoting United
States v. Morena, 547 F.3d 191, 194 (3d Cir. 2008)(internal
quotations omitted).
The parties stipulated to the authenticity of all of the
Government Exhibits complained of by Shin, and Special Agent
Altieri explained how he obtained and numbered the exhibits.
(United States v. Shin, 10cr208(RMB)-1 (D.N.J.) Trial Tr., ECF No.
89 at 70-116.) While it appears that the Government moved to submit
Government Exhibit 321A into evidence, which may have been a
misstatement of the exhibit number,11 this “nonexistent” exhibit
did not prejudice Shin because it was not presented to the jury as
evidence. The record were properly authenticated, and none of these
new
issues
raising
questions
about
the
authenticity
of
the
Government’s exhibits so infected the trial with unfairness as to
deny Shin her right to a fair trial.
F.
No Evidentiary Hearing is Required
A district court may summarily dismiss a motion brought under
Section 2255 without a hearing where the “motion, files, and
records, ‘show conclusively that the movant is not entitled to
relief.’” United States v. Nahodil, 36 F.3d 323, 326 (3d Cir. 1994)
(quoting United States v. Day, 969 F.2d 39, 41–42 (3d Cir. 1992)).
Here, where most of Shin’s claims are an attempt to relitigate
11
See United States v. Shin, 10cr208(RMB)-1 (D.N.J.) Trial Tr.,
ECF No. 89 at 97.)
49
issues decided on direct appeal “dressed in different legal garb,”
the record conclusively shows Shin is not entitled to relief, and
an evidentiary hearing is unnecessary. See De Welles v. United
States, 372 F.2d 67, 69–70 (7th Cir.) (litigation “of trial issues
under different labels or on expanded allegations that could have
been made in the first instance is not contemplated by section
2255”), cert. denied, 388 U.S. 919 (1967)).
IV.
CERTIFICATE OF APPEALABILITY
The Court must assess whether a certificate of appealability
should issue. A litigant may not appeal from a final order in a
proceeding
under
appealability.
28
28
U.S.C.
U.S.C.
§
§
2255
without
a
of
A
2253(c)(1)(B).
certificate
certificate
of
appealability shall not issue unless there is a “substantial
showing of the denial of a constitutional right.” 28 U.S.C. §
2253(c)(2).
“Where
a
district
court
has
rejected
the
constitutional claims on the merits, the showing required to
satisfy
§
demonstrate
court's
2253(c)
that
assessment
is
straightforward:
reasonable
of
the
jurists
The
would
constitutional
petitioner
find
claims
the
must
district
debatable
or
wrong.” Slack v. McDaniel, 529 U.S. 473, 484 (2000)). Based on the
discussion above, reasonable jurists would not find it debatable
that any of the constitutional claims raised have merit.
50
V.
CONCLUSION
For the reasons discussed above, Shin’s motion to disqualify
and the § 2255 motion are denied; and the motions for release on
bail
and
to
dismiss
the
Superseding
Indictment
for
lack
jurisdiction are dismissed as moot.
An appropriate order follows.
Date:
April 11, 2018
s/Renée Marie Bumb
RENÉE MARIE BUMB
United States District Judge
51
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