Shaw v. U.S.

Summarized by:

  • Court: United States Supreme Court
  • Area(s) of Law: Criminal Law
  • Date Filed: December 12, 2016
  • Case #: 15-5991
  • Judge(s)/Court Below: BREYER, J., delivered the opinion for a unanimous Court.
  • Full Text Opinion

Convictions for “knowingly execut[ing] a scheme … to defraud a financial institution,” pursuant to 18 U.S.C. §1344(1), are valid if the scheme defrauds bank customer accounts, because financial institutions have property rights in customer accounts.

Petitioner appealed his conviction for “knowingly execut[ing] a scheme … to defraud a financial institution” pursuant to 18 U.S.C. §1344(1), after transferring and using funds from a personal bank account belonging to a bank customer. The Ninth Circuit affirmed. On appeal to the U.S. Supreme Court, it upheld the Ninth Circuit’s holding that the statute’s “financial institution” language applies to Petitioner’s fraudulent transfer of customer funds, because the banks have the property right to use the customer’s funds for their own profit. Moreover, the Court held that an actual loss suffered by the financial institution, or Petitioner’s intent to cause the loss, was not required; ignorance of relevant law is not a defense; knowledge of a harm cause was not required; other statutory provisions did not apply, and; the law was clear enough under the rule of lenity. Finally, the Court determined that Petitioner’s challenge to a jury instruction should be reviewed by the Ninth Circuit. VACATED and REMANDED.

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