The return of "Honest Services Fraud"

Neither Congress nor the president ever seem to learn anything. The U.S. Supreme Court recently struck down the "Honest Services Fraud" statute because it was too vague. So what do the clowns in Washington do? They look to create an even MORE expansive and vague law.

Apparently, the government is set to imprison thousands of business owners and managers for having the effrontery of being unsuccessful during the government-caused depression. And I guarantee that the return of this horrible law will create even more uncertainty, which in turn will help lengthen the depression.

Here is my recent commentary on the subject on Lew Rockwell's page.

Victoria Sprouse's conviction is overturned!

Two years ago, a Charlotte federal jury convicted Victoria Sprouse of "mortgage fraud," and I had a strong comment on that verdict in this column on Lew Rockwell's page. I have not changed my mind in the interim.

This past Friday, U.S. District Judge Martin Reidinger overturned her conviction and ordered a new trial, basing his decision upon the fact that the prosecution wove a highly-expansive view of "honest services fraud" into all of the charges, even though she was not actually charged with "honest services fraud." (I have this commentary on "honest services fraud" on the LRC page.)

The U.S. Supreme Court recently overturned most of that open-ended federal law and it was abundantly clear from Judge Reidinger's decision that the feds had no case at all without using the part of the statute that was overturned. I have my doubts as to whether or not the feds even can refile charges, and her counsel, Pete Anderson, will be a highly-effective force against anything that the U.S. attorney's office there throws against him.

Because the former assistant U.S. attorney, Matt Martens, now is the Chief Litigation Counsel of the Division of Enforcement of the Securities and Exchange Commission, he will no longer be leading the new prosecution team in that case. Let us just say that I have nothing good to say about Martens, and his appointment by the Obama administrations speaks volumes about the respect that administration has for the law. However, because Martens is extremely vindictive and unethical, I will not say much about him.

I will note, however, that in the Sprouse trial, he had her property seized so that she could not defend herself. The judge declared Sprouse indigent and then allocated $25,000 for her defense. Pete Anderson, at the time, was her attorney and he agreed to stay on as counsel.

Martens, however, told the court that it would take "4-6 weeks" to present the material to the jury, and Anderson had to back out, and Sprouse's court-appointed counsel turned out to be less-than-enthusiastic in defending her. During the trial, Martens presented his material in about three days.

That is correct; About three days. One can draw his or her own conclusion as to whether or not the government was skillfully able to consolidate its supposedly massive amounts of evidence and narrow its focus, or Martens did not tell the judge the truth about the evidence, especially given that Anderson is well-known as a criminal lawyer and had represented Rick Graves, who was acquitted of charges that Martens brought against him. The reader is left to decide what the truth might be in this situation.

There will be a hearing Tuesday to set the current terms of bond. Sprouse, since the conviction, has been under house arrest.