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9th Circuit Upholds False Statements Conviction

SAN FRANCISCO (CN) - A convicted identity thief cannot void his convictions on related charges of lying to banks simply because they suffered no economic loss, the Ninth Circuit ruled Tuesday.

The decision, written by U.S. Circuit Judge Mary Schroeder, upheld the conviction of Lloyd Taylor, who was sentenced to nearly five years in prison in November 2014 after a jury found him guilty of six counts of aggravated identity theft and seven counts of making false statements to a bank.

Taylor was also ordered to pay over $2.2 million in restitution to the Internal Revenue Service.

On appeal, Taylor challenged his conviction on the false statements charges, arguing that since the banks suffered no direct losses as a result of his lies, those counts were null and void.

The conviction on these counts added two years to his incarceration.

According to court documents, Taylor began his scheme in the 1980s, when he used the identities of children who had died before receiving social security numbers, and who would have been approximately his age.

At trial, the government introduced evidence that Taylor, a resident of San Diego, obtained Florida driver's licenses, which he subsequently renewed, and voter registration cards, using the stolen identities.

According to the evidence presented, Taylor used these false documents to open various bank and brokerage accounts, including checking accounts at Wells Fargo and Wachovia. In 2009, Taylor, using one of his false identities, purchased four cashier's checks from Wells Fargo Bank, totaling $250,000.

Prosecutors said at about the same time, again using a false identity, Taylor purchased two cashier's checks from Wachovia Bank, in the total amount of $98,050.

On appeal, Taylor claimed that the federal statute governing false statements requires that the financial institution face a "risk of loss" by virtue of the falsehood uttered.

In this case, he argued, the banks faced no loss because he "was depositing and withdrawing money from accounts he had created."

On review, the three-judge Ninth Circuit panel found that it is undisputed that Taylor made false statements to open accounts, withdraw funds,

and obtain cashiers' checks from insured banks.

It also noted that the Fourth, Fifth, Seventh and Tenth Circuits have all previously held that actual loss is not an element of the federal statute.

"Our court has not previously addressed the issue, but we have no reason to disagree with our sister circuits, because the plain language of § 1014 imposes no risk of loss requirement," Judge Schroeder wrote.

"Congress could legitimately have been concerned about banks' ability to detect identity theft and ensure the correct identity of their customers, regardless of whether the banks were also exposed to potential liability," she continued. "We therefore hold that proof of a risk of loss to a financial institution is not required for conviction of making a false statement in violation of § 1014."

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