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Several burns over a three-year period create wire fraud



Michael Thomas set fire to many properties in a motorhome park and then used the post office to collect insurance money. The government accused Thomas of mail fraud during 18 U.S.C. § 1341, which requires proof of a "system of deception." At the trial, Thomas argued that the fires were not part of a system because they were not a chain of continuous and overlapping events but rather discrete episodes of alleged crime, so evidence of the fires as "other acts" was wrongly acknowledged. In United States Of America v. Michael Thomas No. 19-2969, the United States Court of Appeals for the Seventh Circuit (January 22, 2021) dealt with the allegation that the jury convicted Thomas incorrectly, and further appealed that all the fires except one were impermissible signs. Thomas ignored the fact that he was accused of postal fraud, not arson.

BACKGROUND

The Born & # 39 ;s RV Park is a residential area of ​​one square mile with less than one hundred homes, located in North Judson, Indiana. The park does not experience many fires – apart from the ones in this case only three in the last 26 years. Thomas was connected to eight flames there.

Thomas confided in his friend Kyle Nissen that Thomas had a family member start the fire. Less than three weeks earlier, Thomas had taken out home insurance. He also secured a second policy with another company that came into force on September 17, 2004 – the day of the fire. When Thomas demanded payment, the insurance companies paid him $ 75,000.

The next fires occurred on four properties during the night of November 14, 2010. Thomas had recently purchased a new motorhome with a garage at 5081 South 275 West. He originally planned to rent the property to tenants. Thomas was also able to access the motorhome owned by his mother-in-law at 5326 South A Street. In the months leading up to the fires, Thomas pressured his ex-wife Jennifer to buy insurance on both properties, but she refused.

According to Nissen, he and Thomas had already planned to burn the two homes and later the same day Thomas contacted him as soon as possible with the news that Jennifer wanted to cancel the policy. Thomas and Nissen both burned down two properties. Authorities determined that all four fires were intentionally lit. Still, Thomas raised over $ 50,000 from the two insurance policies.

For a new fire, Thomas received four checks for a total of $ 426,227.31 in insurance money. These four checks served as the basis for four counts of postal fraud that Thomas was charged with in April 2018. A jury sentenced Thomas in all parts and he was sentenced to 90 months in prison.

DISCUSSION

Thomas was charged with postal fraud under 18 USC § 1341, which requires "(1) a schedule or item to be fraudulent, (2) the use of the transmission system to implement the schedule, and (3) the defendant's participation in the scheme with intent to deceive. " [ USA mot . Seidling 737 F.3d 1155, 1160 (7th Cir. 2013).]

The fires at Thomas' properties 2010 and January 2013

The district court ruled that these fires were evidence of "Schema or artifice to deceive ”is required under § 1341. Thomas claimed that these fires were distinct events, separated by several years and with unique participants. Thomas claims that only the fire in April 2013 can be part of the schedule because it is the discreet event to which the four charged mailings refer. He claims that evidence that another fire is illegally contaminated by a predisposition.

The government has the "right to prove the system as a whole" and a system is not limited to an isolated body of conduct. The seventh cycle concluded that the district court correctly concluded that the fires in November 2010 and January 2013 on Thomas' properties were part of the plan to deceive. They were similar events designed to deceive in a similar way and took place over a relatively short period of time. The fires took place in a time interval of less than three years (with three on the same day), each property was located in Born & # 39 ;s motorhome park, and each fire involved a property that Thomas owned or was interested in. Even more, less than thirty days before each fire, Thomas or his wife took out new insurance on the property, experts reported, testifying that each of the fires was burnt, and shortly after each fire, Thomas requested and received money from the insurance company. Given the overwhelming similarity between these events and their proximity in time, the Seventh Circuit found that the district court did not abuse its discretion when determining that these fires were part of the same system.

Because the fires in 2010 and January 2013 on Thomas 'real estate were direct evidence of Thomas' postal fraud. As part of the accused system, evidence of these fires was very likely to prove the accused crime, which is not substantially outweighed by the risk of unfair prejudice against Thomas.

Distinctivity is the key to whether something is correct modus operandi proof. Events that share singular methods, locations, participants and scope. The paradigmatic example is the robber holding up banks in the same geographical area, in a specific way, wearing the same type of mask or clothes. Because these events are more distinct, they are more likely and less likely to elicit a propensity lead.

As the district court aptly described, the prejudice against Thomas is due to evidence of the 2004 fire from its inclusion in the other fires. The fire is not very harmful. The evidence for Thomas' guilt was overwhelming. The fires of 2010 and 2013 were properly adopted as part of Thomas' plan. The testimony of Jennifer Thomas, Nissen, fire marshal and insurance experts about these fires was more than enough for a reasonable jury to convict Thomas of postal fraud.

Arson is a violent and dangerous crime. When it is only done to raise money from an insurance company, it adds danger of fraudulent act. I'm worried that it took the insurance industry and the local police agencies that enabled Thomas to successfully deceive a group of insurance companies several times before his greed came to him and he was finally prosecuted. Those of us who are involved in the investigation of insurance fraud need to do better. handling, insurance shortfall and insurance fraud almost equally for insurers and policyholders. He also acts as an arbitrator or mediator for insurance-related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims lawyer and more than 52 years in the insurance industry. He is available at http://www.zalma.com and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine / ACE Legend Award.

For the past 53 years, Barry Zalma has devoted his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to enable insurers and their claims staff to become insurance claims staff.

Go to the podcast Zalma On Insurance at https://anchor.fm/barry-zalma; Follow Zalma on Twitter at https://twitter.com/bzalma ; Go to Barry Zalma videos on Rumble.com at https://rumble.com/c/c-262921; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to the Insurance Claims Library – https://zalma.com/blog/insurance-claims-library/ Read posts from Barry Zalma at https://parler.com/profile/Zalma/ posts; Go to the library for insurance claims – https://zalma.com/blog/insurance-claims-library/


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