The opinion of the court was delivered by: Judge Virginia M. Kendall
MEMORANDUM OPINION AND ORDER
On February 5, 2010, a jury convicted Defendant Treyonda Towns ("Towns") of wire fraud in violation of 18 U.S.C. § 1343 and mail fraud in violation of 18 U.S.C. § 1341. Towns now moves for a judgment of acquittal and alternatively for a new trial. For the reasons explained below, the Court denies Towns's Motion for Judgment of Acquittal and her Motion for a New Trial.
I. Indictment and Pretrial Conference
In June 2008, a federal grand jury returned two indictments related to mortgage fraud schemes in Chicago and Las Vegas ("the Chicago scheme" and "the Las Vegas scheme"). The Chicago indictment charged 21 defendants in a scheme involving 150 properties and the Las Vegas indictment charged 13 defendants in a scheme involving 32 properties. The only individual named as a Defendant in both indictments was Towns's Co-Defendant Bobbie Brown Jr. ("Brown").
The Las Vegas scheme indictment named Towns in two Counts--in Count I for wire fraud in violation of 18 U.S.C. § 1343, and in Count IV for mail fraud in violation of 18 U.S.C. § 1341. The indictment charged that Towns worked for B&M Custom Homes, Inc., a business owned used in the Las Vegas scheme to facilitate the purchase and sale of real estate. Towns, according to the indictment, facilitated the scheme by recruiting Co-Defendant Carolyn Thompson ("Thompson") to knowingly provide false account letters for unqualified buyers in order to induce lenders to issue loans to those buyers. The indictment further charged that Towns received proceeds of mortgage loans issued by lenders and used those proceeds in furtherance of the scheme.
At the final pretrial conference on January 19, 2010, the Court granted the Government's Motion in Limine to Admit Evidence of Other Criminal Conduct, holding that evidence explaining how various witnesses came to know Towns, how their relationship of trust emerged, and how they came to be involved in the Las Vegas scheme, was admissible under the "intricately related" doctrine. (See R. 206.) The Court also ruled that certain evidence pertaining to the type and timing of conduct charged in the Chicago scheme would be admissible under Federal Rule of Evidence 404(b) ("Rule 404(b)"). Finally, the Court granted the Government's Santiago Proffer over Towns's objection. (See R. 206.)
During trial, testimony revealed that Towns claimed to work for B&M Custom Homes, a sham business used to facilitate the Las Vegas scheme. Testimony further demonstrated that Towns was a loan officer licensed in the state of Illinois who had knowledge about the loan process and mortgage industry. She executed false Verification of Employment letters ("VOEs") as part of the Las Vegas scheme and recruited into the scheme Thompson, who provided false accountant letters in connection with the properties at issue in the two-Count indictment against Towns. Towns's counsel vigorously cross-examined each of Towns's cooperating Co-Defendants as to the potential benefits they could receive from testifying in Towns's trial and regarding the substance of their trial testimony as compared to their statements to the Government in prior interviews. (See, e.g., Tr. Trans. Feb. 3, 2010, 9:38:46-10:10:20; 2:05:02-2:12:44; 4:11:05-4:28:01; Tr. Trans. Feb. 4, 2010, 11:55:23-12:10:25; 2:57:51-2:59:05; 3:03:02-3:12:23.) In her Motions for a New Trial and Judgment of Acquittal, Towns specifically focuses on the trial testimony of Co-Defendants Thompson, Brian Barss ("Barss"), Jennifer Lorenzen ("Lorenzen"), Wayne Harris ("Harris"), and Barry Adams ("Adams"). The Court summarizes their testimony below.
A. Testimony of Carolyn Thompson
Thompson testified that she is an accountant with Thompson Tax and Accounting Services. (See Tr. Trans. Feb. 2, 2010, 1:26:01-1:26:23.) She explained that she first met Towns when they attended Heartland Community College together. (See Tr. Trans. Feb. 2, 2010, 1:28:10-1:28:58.) According to Thompson, Towns studied to obtain her loan officer license while working for B&M Custom Homes out of her home, and obtained that licence around June or July of 2006. (See Tr. Trans. Feb. 2, 2010, 1:29:39-1:35:17; 1:37:46-1:38:05.) When Thompson later took courses to try to become a loan officer herself, Towns "helped [her] to understand the flow of what goes in the documents and how to get them" while also showing her some of her own loan processing paperwork. (See Tr. Trans. Feb. 2, 2010, 1:41:56-1:43:44.) Thompson testified that B&M Custom Homes owned the home where Towns lived with Brown, and that Towns explained to her that "she did not know how much the mortgage was, because it was being paid for through the business." (See Tr. Trans. Feb. 2, 2010, 1:50:01-1:50:28.)
With respect to Thompson's direct role in the Las Vegas scheme, she testified that in September 2006, Towns contacted her by phone and asked her to provide a Certified Public Accountant ("CPA") letter for Co-Defendant Kenneth Smith ("Smith") after verifying on the phone that she knew Thompson was not a CPA. (See Tr. Trans. Feb. 2, 2010, 1:52:51-1:53:21.) When Thompson asked to see Smith's actual tax returns in order to verify that she had reviewed them, Towns told her that Harris would contact her. (See Tr. Trans. Feb. 2, 2010, 1:53:59-1:55:14.) Thompson testified that Harris then called her and said that they did not have time to allow her to review Smith's tax returns. (See Tr. Trans. Feb. 2, 2010, 1:55:14-1:58:14.) After a follow up call from Brown, Thompson agreed to prepare a letter stating that she had reviewed Smith's tax returns for a number of years and "was verifying his company." (See Tr. Trans. Feb. 2, 2010, 1:58:14-1:59:27.) Thompson then went on to testify that Towns contacted her within a few days to say that the letter was insufficient--it needed to state that Thompson actually prepared Smith's taxes and to have more official letterhead. (See Tr. Trans. Feb. 2, 2010, 2:00:05-2:01:59.) In response to Thompson's expressions of discomfort, Towns "got a little bit high toned and stated, 'do you want the money or not.'" (See Tr. Trans. Feb. 2, 2010, 2:02:30-2:02:43.) After Thompson provided Towns with the first CPA letter, Thompson testified that she met with Towns and Brown at Leona's Restaurant in Hyde Park to discuss providing false CPA letters on an ongoing basis; Towns explained at this meeting that she and Brown were business partners and so anything that needed to be discussed could be discussed in front of her. (See Tr. Trans. Feb. 2, 2010, 2:21:06-2:29: 47.) Finally, Thompson testified that she provided false CPA letters for the two properties listed in Counts 1 and 4 of the Indictment (the Counts against Towns). (See Tr. Trans. Feb. 2, 2010, 2:38:00-2:41:26; 2:42:48-2:44:43.)
B. Testimony of Brian Barss
Barss, a loan officer for Best Equity Solutions, began his testimony explaining that a VOE is a document "provided by the employer substantiating the claims of the prospective buyer, in terms of their employment, their position, and their employment history with the company." (See Tr. Trans. Feb. 3, 2010, 10:39:56-10:40:14; 10:48:40-10:48:56.) He testified that he completed approximately 21 real estate transactions in connection with the Las Vegas scheme, sometimes using CPA letters prepared by Thompson. (See Tr. Trans. Feb. 3, 2010, 11:34:58-11:35:35, 11:42:27-11:43:30.) He identified a note on a VOE for Co-Defendant Steven Anderson's ("Anderson") loan application stating "Per Trey Smith, Mr. Anderson is a project manager with B&M Custom Homes and has been for seven years," as well as a note indicating that "Trey Towns" verified Anderson's employment at B&M Custom Homes. (See Tr. Trans. Feb. 3, 2010, 11:58:07-12:03:14; 12:08:04-12:09:12.) Barss went on to testify that Brown told him to contact Towns for any specific needs, and that he proceeded to call Towns approximately 50 to 100 times over the course of several months (speaking with her five to ten times) to provide written and verbal VOEs for Anderson, Smith, and others; he also testified that Towns in fact provided those VOEs. (See Tr. Trans. Feb. 3, 2010, 12:19:02-12:46:03; 1:53:11-1:53:32.)
C. Testimony of Jennifer Lorenzen
Lorenzen, a Las Vegas realtor,testified that she was first recruited into the scheme when she met Brown and he explained that his business was expanding to Las Vegas and he would like her help in finding properties where, based on the appraisal value, a loan would issue for more than the list price of the property and the additional money would be sent to B&M Custom Homes. (See Tr. Trans. Feb. 3, 2010, 2:51:52-2:54:43.) She testified that Brown instructed her to contact Towns to obtain invoices for work on properties to support payments to B&M Custom Homes, and Towns provided those invoices on approximately four occasions. (See Tr. Trans. Feb. 3, 2010, 2:58:31-3:03:26.) Lorenzen further explained that on approximately four occasions, Towns agreed to prepare VOEs to send to loan officers after she told Towns what the borrower's income level and job history should be to obtain a loan; Towns then provided VOEs to Lorenzen. (See Tr. Trans. Feb. 3, 2010, 3:22:03-3:24:33; 3:28:34-3:30:27.) Finally, Lorenzen identified a business card indicating two numbers for an individual by the name of "Tre" and confirmed that she called those numbers to reach Towns at home and at work. (See Tr. Trans. Feb. 3, 2010, 3:26:23-3:28:21.)
D. Testimony of Wayne Harris
During the Government's direct examination of Harris, he testified that he met Brown while working as a loan originator at Unique Mortgage Consultants, and Brown eventually began sending him buyers and paying him side bonuses for each of the loans that he closed based on false information. (See Tr. Trans. Feb. 4, 2010, 10:21:58-10:26:29.) Harris then testified that he had approximately seven to ten phone conversations with Towns during which he gave her information necessary to do VOEs for Anderson and other individuals. (See Tr. Trans. Feb. 4, 2010, 10:43:37-10:45:32.) Harris explained that "Trey Smith" was an alias adopted by Towns after hearing Brown use "Smith" as his alias last name. (See Tr. Trans. Feb. 4, 2010, 10:55:25-10:56:01.) He ...