In the
United States Court of Appeals
For the Seventh Circuit
No. 17‐3642
UNITED STATES OF AMERICA,
Plaintiff‐Appellee,
v.
WILLIAM D. CORRIGAN,
Defendant‐Appellant.
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 13 CR 915 — Robert M. Dow, Jr., Judge.
ARGUED OCTOBER 24, 2018 — DECIDED JANUARY 3, 2019
Before BAUER, MANION, and BRENNAN, Circuit Judges.
BAUER, Circuit Judge. Following a bench trial, defendant
William D. Corrigan (“Corrigan”) was found guilty of four
counts of wire fraud in violation of 18 U.S.C. § 1343. Corrigan
appeals his conviction, arguing that the indictment failed to
properly set out a scheme for wire fraud, and the evidence at
trial was insufficient to sustain a conviction. Corrigan also
2 No. 17‐3642
contends that the district court erred when it ordered restitu‐
tion in the full amount of the investments. We disagree, and for
the following reasons, we affirm.
I. BACKGROUND
Corrigan served as the President and Chief Executive
Officer of Embedded Control Systems (“ECS”), a company that
developed a process for replacing copper wiring in airplanes
with fiber optics. Beginning in 2007, ECS began soliciting
capital from various investment groups. Among the investors
were Jason Neilitz who purchased $125,000 worth of ECS
stock, and Rawah Partners which purchased $350,000 worth of
stock.
By June 2008, Corrigan had negotiated a prospective sale of
ECS to a third party. However, due to the worldwide financial
downturn the sale fell through. Shortly thereafter, through a
Board resolution, ECS authorized Corrigan to manage ECS in
whatever capacity he saw fit. At the same time, Corrigan was
negotiating a sale to another third party when ECS began to
suffer from cash flow problems.
ECS had difficulty paying its expenses and its officers’
compensation. It closed its bank account with Chase Bank
because it was frequently overdrawn, and opened a new
account with LaSalle Bank. This account excluded the Vice
President of Business Development, A.J. Yarmine, from its
signatories. Through 2008, ECS employees received health
insurance from the company but ECS fell behind on the pay‐
ment for the insurance policy in 2008, making the last payment
to United Healthcare in November 2008. United Healthcare
cancelled the policy in January 2009, due to non‐payment.
No. 17‐3642 3
By March 2009, Corrigan had begun soliciting Jason Neilitz
and Rawah Partners for additional investments announcing
that ECS was close to closing a sale but needed additional
funds to cover ECS’s healthcare insurance premiums. On
March 22, 2009, and again on April 22, 2009, Corrigan emailed
Jason Neilitz stating that the company was close to being
dropped by its health insurance provider and that such a result
would be “catastrophic” to its employees and the pending sale.
Based on Corrigan’s representations, Neilitz agreed to pur‐
chase an additional $50,000 worth of ECS stock. Per Corrigan’s
instructions Neilitz wired $50,000 to the specified account
which, unbeknownst to Neilitz, was Corrigan’s personal
account.
At the same time that Corrigan was soliciting additional
capital from Neilitz, he was also communicating with Kevin
Duncan, a representative from Rawah Partners, to secure an
additional investment. After several conversations, in which
Corrigan represented that ECS needed an additional capital
infusion to cover its health insurance premiums, Duncan
agreed to invest. In March 2009, Rawah Partners purchased an
additional $50,000 worth of ECS stock. Per Corrigan’s instruc‐
tions, Rawah Partners wired $50,000 to the specified account,
which unbeknownst to Rawah Partners, was Corrigan’s
personal account. In April 2009, Rawah Partners purchased an
additional $10,000 worth of ECS stock.
After Corrigan received the funds at the end of March 2009,
he began to spend the money on myriad expenses, unrelated
to ECS’s legitimate expenses. For example, Corrigan: wired
money to his girlfriend and her translator; wired money to
Flight Test Labs, an associate’s company which did not do any
4 No. 17‐3642
work for ECS; retained an immigration attorney; took vaca‐
tions; subscribed to dating websites; and covered moving
expenses. Corrigan also withdrew $30,000 in cash.
Ultimately, Corrigan was terminated from ECS on July 2,
2011, after ECS’s Chief Financial Officer discovered Corrigan
had received investor money in his personal account and made
no record of the payments. Shortly thereafter, Corrigan
contacted Neilitz and Rawah Partners attempting to buy back
the fraudulently sold stock. When he was questioned about
what had been done with their investments he reaffirmed his
original lie, that the funds were used by ECS to pay health
insurance costs for employees.
A. Defendant’s Romantic Relationship
In March 2009, at about the advent of Corrigan’s scheme, he
began courting a Ukrainian woman, Natalia Vasilenko
(“Natalia”). Natalia lived in Ukraine and Corrigan spoke with
her through a translator, which Corrigan paid for. During their
courtship Corrigan spoke about his attempts to raise money for
a trip to visit her in Ukraine and that it appeared he would be
able to get funds from ECS’s investors.
Immediately following the receipt of funds from Neilitz on
April 24, 2009, Corrigan booked a flight to Brussels, Belgium,
with a return flight and hotel accommodations in Kiev,
Ukraine. Also, Corrigan communicated to Natalia that he was
speaking with an immigration attorney about bringing her to
the United States, and arranged for the transfer of funds to an
immigration attorney.
No. 17‐3642 5
B. Indictment and Trial
On November 20, 2013, Corrigan was indicted on four
counts of wire fraud, in violation of 18 U.S.C. § 1343. The
indictment alleged that Corrigan orchestrated a scheme to
defraud ECS’s investors by providing them false statements
and material misinformation. In December 2013, the govern‐
ment filed an unopposed motion to correct typographical
errors in Counts II, III, and IV of the indictment and correctly
identify the victim in Count I. The motion was granted without
objection.
On December 15, 2015, the case proceeded to a bench trial.
At trial the government proved that Corrigan solicited funds
from Neilitz and Rawah Partners based on false statements
about the status of the company and the need for the funds,
and that once he secured the funds, he used them for non‐
business related expenses and continued to provide the
investors with false and misleading information about the
usage of the funds.
The district court concluded that Corrigan “engaged in a
scheme to defraud Neilitz and Rawah Partners by making false
statements and material misrepresentations and by concealing
material facts. [Corrigan’s] scheme was to obtain additional
money from Neilitz and Rawah Partners by falsely represent‐
ing that the money was needed to pay for and would be used
to pay for health insurance premiums for ECS employees.”
United States v. Corrigan, No. 1:13‐cr‐915, 2016 WL 4945013, at
*13 (N.D. Ill. Sept. 15, 2016).
Following trial, the district court denied Corrigan’s post‐
trial motion for acquittal based on the insufficiency of the
6 No. 17‐3642
evidence. Corrigan was sentenced to a below Guidelines
sentence of 144 days (time served) and ordered to pay restitu‐
tion in the full amount of Neilitz’s and Rawah Partners’
investments—$110,000.
II. ANALYSIS
A. The Indictment Properly Set Out a Scheme to Defraud
Corrigan’s first argument, that the indictment failed to
allege a scheme to defraud, is without merit. In support of this
argument Corrigan suggests that the indictment was improp‐
erly amended, multiplicitous, and failed to allege fraudulent
intent.
Challenges to the sufficiency of the indictment must be
raised in a motion to dismiss prior to trial, Federal Rule of
Criminal Procedure 12(b)(3)(B), else they are waived, absent
good cause. Fed. R. Crim. P. 12(c)(3); see United States v. Nixon,
901 F.3d 918, 920–21 (7th Cir. 2018). If a defendant fails to
timely contest a constructive amendment, we review for plain
error. United States v. Cusimano, 148 F.3d 824, 828 (7th Cir.
1998); see also Puckett v. United States, 556 U.S. 129, 135 (2009)
(“A plain error that affects substantial rights may be consid‐
ered even though it was not brought to the court’s attention.”).
Under the plain error standard a defendant must demonstrate
that:
“(1) there is an error; (2) the error is clear or
obvious, rather than subject to reasonable dis‐
pute; (3) the error affected the appellant’s sub‐
stantial rights, which in the ordinary case means
it affected the outcome of the district court
No. 17‐3642 7
proceedings; and (4) the error seriously
affect[ed] the fairness, integrity or public reputa‐
tion of judicial proceedings.”
United States v. Anderson, 881 F.3d 568, 572 (7th Cir. 2018)
(quoting United States v. Marcus, 560 U.S. 258, 262 (2010)).
Here, Corrigan argues that the indictment was improperly
amended because the motion to amend was solely to correct a
typographical error and the amended indictment instead
changed the victim in Count I. He argues this is a significant
alteration in violation of the Fifth Amendment, an issue raised
for the first time after trial. The district court denied the motion
and concluded that the government did not constructively
amend the indictment because the Grand Jury transcript,
regarding Count I, clearly relates to the fraud perpetrated
against Neilitz as did the evidence presented at trial. The
district court also reiterated that the amendment to the
indictment corrected a misnomer—correctly identifying the
victim in Count I. We agree.
Because this challenge was levied for the first time follow‐
ing the trial, we evaluate it under the plain error standard, but
Corrigan makes no argument in furtherance of any of the four
operative elements. “The purpose of the rule against construc‐
tive amendments is to give the defendant reasonable notice so
that she can prepare a defense[.]” United States v. Penaloza, 648
F.3d 539, 546 (7th Cir. 2011). Here, he has not, and cannot argue
that he was unaware of the charges that were brought against
him. The grand jury transcript clearly refers to the fraud
against Neilitz in Count I and Corrigan was aware of the
proper victim during the pre‐trial proceedings, undercutting
8 No. 17‐3642
any suggestion that a substantive right was affected by the
scrivener’s error in the original indictment. Because Corrigan
cannot show that any error occurred, let alone one that affected
his substantive rights, we agree with the district court’s
determination that no constructive amendment occurred.
Next, Corrigan suggests that Counts II through IV are
multiplicitous because they stem from Rawah Partners’ $50,000
investment and wire fraud requires an additional risk of loss
for subsequent claims. He is mistaken.
“A multiplicitous indictment charges a single offense as
separate counts … . To determine whether a given indictment
contains multiplicitous counts, we look to the applicable
criminal statute to see what the allowable ‘unit’ of prosecution
is—the minimum amount of activity for which criminal
liability attaches.” United States v. Ajayi, 808 F.3d 1113, 1123
(7th Cir. 2015) (internal citations and quotations omitted).
To prove wire fraud the government must show
“[defendant’s] participation in a scheme to
defraud, his intent to defraud, and his use of the
wires in furtherance of the fraudulent scheme.
Wire communications that lull a victim into a
false sense of security after the victim’s money
had already been obtained, or that assist the
defendant in avoiding detection may be suffi‐
cient to further a scheme.”
United States v. McGowan, 590 F.3d 446, 457 (7th Cir. 2009)
(emphasis added) (internal citations and quotations omitted).
As the district court correctly pointed out, Count II was based
on Corrigan’s March 22, 2009, email to Rawah Partners,
No. 17‐3642 9
soliciting $50,000 to, allegedly, cover health insurance costs;
Count III was based on a November 7, 2011, email, assuring
Rawah partners that the funds went to ECS, not Corrigan
personally; and Count IV was predicated on a November 9,
2011, email, assuring Rawah Partners that its investment
covered health insurance costs in 2009. The Count II email
solicited the funds based on false statements and material
misrepresentations about the need for and prospective use of
the funds. The Counts III and IV emails lulled Rawah Partners
into a false sense of security that the funds went to ECS and
were used to cover health insurance costs. Because Corrigan
cannot show that any of the acts that abet Count II through IV
are duplicative, his argument that Counts II through IV are
multiplicitous must fail.
Next, Corrigan argues that the indictment failed to allege
intent to defraud, stating that “any misunderstanding of how
[the invested] funds were to be spent was not material to the
decision to invest.” Lead Brief and Required Short Appendix
for the Defendant‐Appellant at 37, USA v. Corrigan, 17‐3642
(July 5, 2018). We disagree.
This issue is raised for the first time on appeal, accordingly,
we review for plain error and liberally in favor of validity.
United States v. Harvey, 484 F.3d 453, 456 (7th Cir. 2007)
(“Generally speaking, ‘tardily challenged indictments should
be construed liberally in favor of validity.’”) (quoting United
States v. Smith, 230 F.3d 300, 306 n.3 (7th Cir. 2000)). “[F]raud
does not require that a defendant contemplate harm to the
victim or any loss. In fact, a defendant’s honest belief that his
actions will ultimately result in a profit and not a loss is legally
irrelevant.” United States v. Fard, 775 F.3d 939, 944 (7th Cir.
10 No. 17‐3642
2015) (internal citations and quotations omitted); see United
States v. Nayak, 769 F.3d 978, 980 (7th Cir. 2014) (liability results
from the benefit to the defendant, not the harm to the victim);
United States v. Fernandez, 282 F.3d 500, 507 (7th Cir. 2002)
(“[G]overnment [does] not have to prove a contemplated harm
to a victim.”).
Here, the indictment properly alleges the elements of wire
fraud. The indictment alleged Corrigan’s “participation in a
scheme to defraud, his intent to defraud, and his use of the
wires in furtherance of the fraudulent scheme[.]” McGowan,
590 F.3d at 457. His argument that the indictment needs to
explicitly allege an intent to defraud is based on a misunder‐
standing of the law. Accordingly, this argument fails.
B. The Evidence at Trial Amply Supported Corrigan’s
Conviction
Corrigan next argues that the evidence presented at trial is
insufficient to support a conviction for wire fraud. However,
ample evidence was presented at trial to prove that he was
engaged in a scheme to defraud Neilitz and Rawah Partners
and used interstate wire communication to do so.
This Court will only overturn a verdict for insufficiency of
the evidence where “after viewing the evidence in the light
most favorable to the government, the record is devoid of
evidence from which a reasonable jury could find guilt beyond
a reasonable doubt.” United States v. Campbell, 770 F.3d 556, 568
(7th Cir. 2014) (quoting United States v. Aslan, 644 F.3d 526, 540
(7th Cir. 2011)). In evaluating a challenge to the sufficiency of
the evidence, we do not “weigh the evidence or second‐guess
the [fact finder’s] credibility determinations.” United States v.
No. 17‐3642 11
Coscia, 866 F.3d 782, 795 (7th Cir. 2017), reh’g and suggestion for
reh’g en banc denied (Sept. 5, 2017), cert. denied, 138 S. Ct. 1989,
(2018). Because we “[r]ecogniz[e] that ‘it is usually difficult or
impossible to provide direct evidence of a defendant’s mental
state,’ we allow for criminal intent to be proven through
circumstantial evidence.” Id. (quoting United States v. Morris,
576 F.3d 661, 674 (7th Cir. 2009)).
At trial the government presented ample evidence to prove
the three elements of wire fraud: testimony from defrauded
investors; Corrigan’s email correspondence; evidence of receipt
of investor funds; spending records, et cetera. All of these
showed that Corrigan obtained the funds through fraudulent
misrepresentations, used the funds for personal expenses, and
concealed his bad acts for years.
At trial, Duncan and Neilitz testified that Corrigan solicited
the second round of investments by representing that it was
necessary to cover ECS’s health insurance costs; that if he was
unable to raise the required revenue before the end of March
2009, its health insurer would cancel its policy; and that if
Neilitz and Rawah Partners, respectively, were not interested
he would have to solicit funds from other investors. These
representations were false. By March 2009, United Healthcare
had terminated ECS’s policy for non‐payment and there were
no other looming deadlines that required a cash infusion. More
to the point, the funds were never used for health insurance
costs. Instead the funds were spent by Corrigan personally to,
inter alia, travel and support his girlfriend.
The government also presented myriad other evidence.
Documents showed Corrigan misled investors as to where
12 No. 17‐3642
the funds would be sent, the Stock Subscription Agreements
indicated that the funds would be sent to ECS, but Corrigan
provided his personal account number instead. Emails showed
that Corrigan repeatedly lied about how the funds had been
and were being used—he insisted that the money was used to
cover health insurance costs and other ECS expenses. In sum,
there was ample evidence to support the district judge’s
conclusion that Corrigan had perpetrated a scheme to defraud
investors. Corrigan told investors he would do one thing but
did another.
Corrigan argues, unsuccessfully, that these misrepresenta‐
tions were not material because he never misrepresented the
value of the stock purchased nor did he minimize the risks
inherent in the investment. But, “a false statement is material
if it has a natural tendency to influence or [is] capable of
influencing, the decision of the decisionmaking body to which
it was addressed.” United States v. Seidling, 737 F.3d 1155, 1160
(7th Cir. 2013) (quoting Neder v. United States, 527 U.S. 1, 16
(1999)). A scheme to defraud can exist “even when the scheme
was unsuccessful and ‘no one relied on any misrepresenta‐
tion.’” Id. (quoting Bridge v. Phoenix Bond & Indem. Co., 553 U.S.
639 (2008)).
Here, Corrigan explicitly told the investors that the funds
were necessary to cover the impending health insurance
premiums and that if ECS lost its insurance coverage it would
jeopardize the then‐pending sale. These statements were meant
to induce further investments from Neilitz and Rawah Partners
to both protect their initial investments and expedite their
return. Accordingly, we agree with the district court; the
evidence at trial supports the conclusion that Corrigan made
No. 17‐3642 13
material misrepresentations about the need for investor funds
and what those funds would be used for.
C. Restitution in the Full Amount of the Fraudulently
Solicited Funds is Proper
Corrigan’s final argument on appeal is that the district
court erred when it ordered $110,000 restitution—the total
amount received as a result of the fraud. In support of this
proposition he avers that up to half of the funds invested as a
result of the fraud were used for ECS purposes; and he should
have been credited for the value of ECS’s patents. We are not
persuaded by either argument.
Typically, the district court’s restitution determination is
reviewed for abuse of discretion and we will not disturb the
restitution order unless the district court relied on impermissi‐
ble factors or abused its discretion. United States v. Havens, 424
F.3d 535, 538 (7th Cir. 2005). However, because Corrigan failed
to appropriately raise the issue at sentencing, we review for
plain error. United States v. White, 883 F.3d 983, 992 (7th Cir.
2018). But, even under the lesser burden, the restitution
amount is proper.
Restitution under the Mandatory Victims Restitution Act is
mandatory when a defendant commits a property crime by
fraud. 18 U.S.C. § 3663A(a)(1), (c)(1)(A)(ii); United States v.
Wilkozek, 822 F.3d 364, 369 (7th Cir. 2016). “Section
3664(f)(1)(A) requires courts to ‘order restitution to each victim
in the full amount of each victim’s losses[.]’” United States v.
Moose, 893 F.3d 951, 959 (7th Cir. 2018) (quoting 18 U.S.C.
§ 3663(f)(1)(A)) (emphasis added).
14 No. 17‐3642
Here we agree with the district court’s conclusion that
Corrigan is responsible for taking the money out of the hands
of investors. According to Neilitz’s and Duncan’s testimony,
neither would have invested additional funds absent Corri‐
gan’s representation that the funds were necessary to secure
health insurance for ECS’s employees.
Moreover, Corrigan effectively conceded the government’s
loss calculations. Neither at sentencing nor now does he
present evidence to support some lesser amount of restitution.
Instead he argues that ECS’s patents have some intrinsic value
that should be credited against the restitution figure, but that
is not the test. The district court had to consider “the full
amount of each victim’s losses,” Moose, 893 F.3d at 959, and it
was Corrigan’s burden to show that the government’s calcula‐
tion was inaccurate or unreliable and produce evidence as to
the actual loss amount. United States v. Scalzo, 764 F.3d 739, 745
(7th Cir. 2014). Because the district court neither relied on
improper evidence nor did Corrigan present contrary evi‐
dence, we find that the district court did not err in ordering
restitution in the full amount of the fraud.
III. CONCLUSION
The district court found William Corrigan guilty of four
counts of wire fraud in violation of 18 U.S.C. § 1343. For the
reasons listed above, we find that the district court properly
found that Corrigan was guilty of the charged offenses and
that the determination of restitution in the amount of $110,000
is proper. Accordingly, we AFFIRM the judgment of the
district court.