Monday, April 16, 2012

Computers, Counterfeiting and Unanimity

After being convicted of possessing counterfeiting apparatus in violation of California Penal Code § 480(a) and forgery in violation of California Penal Code § 476, and sentenced to five years in prison, Fred Howe appealed.  People v. Howe, 2012 WL 1113318 (California Court of Appeals 2012).

According to the Court of Appeals’ opinion, the case began on June 25, 2010, when Agatha Breslin, who would become Howe’s codefendant, “attempted to or did”  

pass counterfeit $100 bills at four stores in Valley Center, California. At around 2:00 p.m. . . ., [she] attempted to purchase light bulbs at A–1 Irrigation using a $100 bill. The employees . . . refused to accept the bill. . . . [She] then went to Armstrong Feed and attempted to purchase dog food and shampoo using a $100 bill. An employee told [her] the bill was counterfeit and returned it. . . . At about 5:00 p.m. . . ., Breslin attempted to purchase light bulbs at Wallace Hardware using a $100 bill. A deputy sheriff arrested [her] as she waited at the counter. The deputy found a bill on Breslin, which he believed to be counterfeit.

The following day, deputy sheriffs arrived at Howe's apartment to execute a search under a valid 4th Amendment waiver. . . . Howe and Breslin were together when Howe previously attempted to pass counterfeit bills. . . . The apartment had two bedrooms and was very cluttered. Howe shared the bedroom on the right-hand side with Susan Elaine Crow-Woods, the mother of [his] son. Howe's son had the other bedroom.

In Howe's bedroom, deputies found a computer with a document depicting a security thread with `USA100’ repeated several times. The computer operating system had been loaded on June 2, 2010, and the username on the computer was `Fred Howe, Jr.’ The file depicting the security thread had been copied from the Internet to the computer on June 7 and printed from a particular type of printer. The computer also contained e-mail correspondence by Howe. When asked about the document, Howe claimed it had `been there for a long time. That was there before I got arrested last time’ and [said] the document was `used for making fraudulent currency.’ A search of the son's bedroom revealed a counterfeit $100 bill that had not yet been cut to size (the uncut bill). Howe claimed that the uncut bill had been planted and that he had not made any fraudulent currency since he got out of prison the last time.

People v. Howe, supra. 

At Howe’s trial, U.S. Secret Service Special Agent Mark Haaser testified that to deter

counterfeiting, . . . genuine currency has a watermark, a unique serial number and an imbedded security thread. The security thread for a $100 bill shows the phrase `USA100’ followed by an inverted `USA100,’ with the pattern repeating along the length of the security thread. Because the security thread is embedded in the note, it is very difficult to counterfeit. One method used by counterfeiters to avoid this security measure is to type a security thread on their computer, scan a false bill into the computer, and then scan the counterfeit security thread on top of the bill that they want to print. Another method is to print the front and back side of a counterfeit bill, print a security strip, put the strip between the two sides of the bill, and glue them together.

Haaser analyzed the uncut bill recovered from Howe's apartment and the two counterfeit bills passed by Breslin. He stated that the three bills had a defective security thread because the phrase `USA100’ did not follow the inverted pattern. This was the first time he had seen a security thread without inversion. He thought the security threads on the bills matched the image on Howe's computer. Additionally, the $100 bill recovered from codefendant Breslin after her arrest and the uncut bill recovered from Howe's apartment had the same serial number.

People v. Howe, supra. 

At trial, the court allowed the prosecution to present evidence that in 2008 “ Howe was involved in four incidents of possessing or passing counterfeit money” and “was working with Breslin” in “two of those incidents”.  People v. Howe, supra.  On March 9, Howe

attempted to pass a counterfeit $20 bill at Harrah's Casino. . . . On August 9, [he] purchased an ink cartridge from a Target store with a counterfeit $100 bill. . . . On September 15, a Border Patrol agent pulled over a car occupied by Howe and Breslin [and found] thirteen $100 bills, six $50 bills, and thirteen $20 bills. The agent determined the bills were counterfeit because each denomination had the same serial number.  Finally, on October 28, a Riverside County deputy sheriff investigated the passing of two counterfeit $100 bills at a SuperTarget store.

People v. Howe, supra. 

The deputy searched Howe’s and Breslin’s car and found “receipts from other stores.”  People v. Howe, supra. He “recovered 12 counterfeit $100 bills” from those stores, all of which had the “same security thread defect, where the phrase “USA100” had not been inverted. People v. Howe, supra. The trial judge told the jury they could consider the evidence “for the limited purpose of deciding whether Howe had a plan or scheme to commit the charged offenses”, i.e., that he “created the fake bills and he or Breslin would pass them.”  People v. Howe, supra.  On appeal, Howe claimed the judge erred in admitting the evidence for this purpose, but the Court of Appeals found it was properly admitted under California Evidence Code§ 1101(b).  People v. Howe, supra.

Howe also argued that the trial judge erred in not giving a unanimity instruction to the jury.  People v. Howe, supra.  This argument went to comments the prosecutor made in arguing to the jury that Howe should be convicted on the possessing counterfeiting apparatus charge.  People v. Howe, supra.  In her argument to the jury, the prosecutor claimed “the crime was `super easy’” because it had two elements:

`[T]hat you're possessing something you can use to make counterfeit money. And apparatus is -- there's [a] whole bunch of choices on apparatus which defendant made or had. In some instances you might have to make something in order to make counterfeit money. For example, you might have to make a security strip. So he made or had an apparatus, paper, either the kind of paper that you need to make counterfeit money, or a machine, a computer, or a computer system. So it's very simply [a] general intent crime that you have this -- some kind of machine or computer system or some paper, some ingredient for making counterfeit money. And that he used it.’

The prosecutor then mentioned the uncut bill found in Howe's apartment and the computer file of a security strip and concluded: `So for both having the fake bill which has the paper and having the computer file on your computer, these are both satisfactory for 480.’ During rebuttal, the prosecutor contradicted herself, stating that Howe was `charged with 480(a) and 476. The 480(a) is for the computer.’ She later told the jurors that `[t]he evidence about the computer file is satisfactory for 480(a) as well as the paper used to make the fake bill.’

People v. Howe, supra. 

Howe argued that “the prosecutor's reference to the `fake bill’ and the `computer file’” required a unanimity instruction and the prosecution disagreed.  People v. Howe, supra.  The court began its analysis of the issue by noting that when the evidence shows more

than one unlawful act that could support a single charged offense, the prosecution must elect which act to rely upon, or the jurors must be given a unanimity instruction telling them they must agree which act constituted the crime. . . .  The unanimity instruction ensures that a defendant will not be convicted when there is no agreement among the jurors as to which single offense was committed. . . .

People v. Howe, supra. 

The Court of Appeals found that no unanimity instruction was required here because

there was evidence of only one possible unlawful act for each of the charged offenses. A person will be guilty of forgery if he or she `makes, passes, utters, or publishes, with intent to defraud any other person’ a false bill, note or check for the payment of money or property, knowing the document is false, but intending to pass or use the document as genuine. . . . Thus, . . . this crime can only be committed if an individual possesses a counterfeit bill, note or check. Accordingly, the only evidence Howe committed forgery is the uncut bill found in his apartment.

To be guilty of possessing counterfeiting apparatus, the People needed to prove Howe created or possessed `any die, plate, or any apparatus, paper, metal, machine, or other thing, made use of in counterfeiting’ bank notes or bills. (italics added.) Thus, . .  a person cannot violate § 480 by possessing a counterfeit bill; rather, the person must create or possess some material used in making a counterfeit bill. . . . Accordingly, the uncut bill is not relevant to this crime and the only evidence Howe possessed counterfeiting apparatus is the computer and computer file of the security thread.

People v. Howe, supra. 

The court noted that while the prosecutor “misspoke during closing argument when she argued that the `fake bill’ and the `computer file’ would satisfy § 480”, she “twice correctly told the jury that Howe violated § 480 with the computer or computer file and  this crime referred to `some ingredient [used] for making counterfeit money.’” People v. Howe, supra.  It also noted that the trial judge “correctly instructed the jury” that it could only find Howe guilty of possessing counterfeiting apparatus if “he created or possessed `an apparatus, paper, machine, computer, or computer system’” and used it to create counterfeit bills.  People v. Howe, supra.  Given this and the fact the judge also told the jury that they were to “follow the law” as given in the court’s instructions and “ignore conflicting comments on the law by the attorneys”, the Court of Appeals found that the erroneous comment by the prosecutor was harmless error. People v. Howe, supra. 

Finally, Howe claimed that while he was charged with two crimes -- possessing counterfeiting apparatus and forgery – the “two offenses constituted a single act, preventing the court from imposing double punishment under” California Penal Code § 654(a).  People v. Howe, supra.  Section 654(a) states, in part, that an “act or omission that is punishable in different ways by different provisions of law shall be punished under the provision that provides for the longest potential term of imprisonment, but in no case shall the act or omission be punished under more than one provision.”

The Court of Appeals did not buy Howe’s argument.  It explained that § 654 prohibits

the imposition of multiple sentences where a single act or course of conduct pursuant to a single objective violates more than one statute. In such a situation, a defendant may be punished only for the more serious offense. . . . However, if the evidence discloses that a defendant entertained multiple criminal objectives independent of . . . each other, the trial court may impose punishment for independent violations committed in pursuit of each objective even though the violations shared common acts or were part of an otherwise indivisible course of conduct. . . .

People v. Howe, supra. 

It found that in this case, § 654 did not bar punishment for both offenses because

each offense required a separate criminal objective. Namely, § 476 prohibited the possession of counterfeit bills for the purpose of fraud and § 480 prohibited creating or possessing materials used to make counterfeit bills. Accordingly, Howe necessarily harbored separate and different criminal objectives, which were independent and not merely incidental to each other.

People v. Howe, supra.  The Court of Appeals therefore affirmed Howe’s conviction and sentence.  People v. Howe, supra. 

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