Aggravated Felonies

(D)  An Offense “Involving” Fraud.   If the offense of conviction lacks an essential element requiring intent to defraud or deceive, the conviction is arguably not a conviction of an offense involving fraud or deceit.[426]  However, some courts have read the “involving fraud or deceit” more broadly to include offenses related to fraud or deceit.[427]

In Olmari v. Gonzalez,[428] the Fifth Circuit held that a federal conviction for interstate transportation of stolen, converted, and fraudulently obtained property, in violation of 18 U.S.C. § 2314, was not necessarily an aggravated felony fraud offense, as the statute included “stolen” and “converted” property, as well as property that had been “fraudulently obtained.”  Although noting that the “involves” language meant that the offense must “necessarily entail fraud or deceit,”[429] the court did not find that the transportation offense would never qualify as a fraud offense because the offense itself did not require proof of fraud.  The court instead analyzed the conviction similarly to a Second Circuit case finding that possession of a forged document was an offense “related to” forgery.[430]  The court, in fact, made this point explicit:

If the tickets had been fraudulently obtained, Omari’s conviction for knowingly transporting or transferring them might well have been a conviction for an offense involving fraud or deceit.  Whether an offense “involves” fraud is a broader question than whether it constitutes fraud.  Cf. United States v. Winbush, 407 F.3d 703, 707-08 (5th Cir. 2005) (attempted possession of controlled substance with intent to distribute is offense “involving ... manufacturing, distributing, or possessing with intent to manufacture or distribute, a controlled substance,” and therefore a “serious drug offense”);  Richards v. Ashcroft, 400 F.3d 125, 129-30 (2d Cir. 2005) (possession of forged instrument with intent to defraud or deceive is offense “relating to” forgery, though not actual forgery).[431]

The Third and Fifth circuits may be split on how broadly to read the “involves fraud or deceit” language.  Counsel should argue that the Third Circuit’s definition should be applied, and that the Fifth Circuit incorrectly applied the “relating to” analysis to the fraud category, where that language is not present. 

If the offense was in federal court, treatment under the U.S. Sentencing Guidelines may serve as evidence that, for example, an offense involving theft should not be charged as fraud.  For example, if there was no enhancement of the sentence for an offense involving fraud under U.S.S.G. § 2Fl.1(b), then the offense should be held not to have included fraud.[432]

[426] Valansi v. Ashcroft, 278 F.3d 203 (3d Cir. 2002).

[427] See also “related to” discussion at § 4.37, supra.

[428] Omari v. Gonzales, 419 F.3d 303 (5th Cir. July 25, 2005).

[429] Id. at 307.

[430] Richards v. Ashcroft, 400 F.3d 125 (2d Cir. Mar. 3, 2005).  See § 5.53, supra.

[431] Id. at 309 n.11.

[432] See ILRC § 9.20.