In U.S. v. Maze (1974), the U.S. government relied on the mail fraud statute to prosecute Thomas Maze for stealing his roommate’s BankAmericard and using it to pay his bills for a cross-national road trip to California in his roommate’s car, which he also stole.
U.S. v. Maze 414 U.S. 395, 94 S.Ct. 645 (1974)
History
Thomas Maze, Defendant, was convicted in the United States District Court for the Western District of Kentucky at Louisville on four counts of mail fraud. The Court of Appeals reversed. The Supreme Court affirmed.
REHNQUIST, J.
Facts
Thomas E. Maze moved to Louisville, Kentucky, and there shared an apartment with Charles L. Meredith. In the spring of that year Maze’s fancy lightly turned to thoughts of the sunny Southland, and he thereupon took Meredith’s BankAmericard and his 1968 automobile and headed for Southern California. By presenting the BankAmericard and signing Meredith’s name, Maze obtained food and lodging at motels located in California, Florida, and Louisiana. Each of these establishments transmitted to the Citizens Fidelity Bank & Trust Co. in Louisville, which had issued the BankAmericard to Meredith, the invoices representing goods and services furnished to Maze. Meredith, meanwhile, on the day after Maze’s departure from Louisville, notified the Louisville bank that his credit card had been stolen.
Upon Maze’s return to Louisville he was indicted on four counts of violation of the federal mail fraud statute (18 U.S.C. § 1341).
The mail fraud counts of the indictment charged that Maze had devised a scheme to defraud the Louisville bank, Charles L. Meredith, and several merchants in different States by unlawfully obtaining possession of the BankAmericard issued by the Louisville bank to Meredith, and using the card to obtain goods and services. The indictment charged that Maze had obtained goods and services at four specified motels by presenting Meredith’s BankAmericard for payment and representing himself to be Meredith, and that Maze knew that each merchant would cause the sales slips of the purchases to be delivered by mail to the Louisville bank which would in turn mail them to Meredith for payment. The indictment also charged that the delay in this mailing would enable Maze to continue purchasing goods and services for an appreciable period of time.
Maze was tried by a jury in the United States District Court for the Western District of Kentucky. At trial, representatives of the four motels identified the sales invoices from the transactions on Meredith’s BankAmericard which were forwarded to the Louisville bank by their motels. An official of the Louisville bank testified that all of the sales invoices for those transactions were received by the bank in due course through the mail, and that this was the customary method by which invoices representing BankAmericard purchases were transmitted to the Louisville bank.
The jury found Maze guilty as charged on all counts, and he appealed the judgment of conviction to the Court of Appeals for the Sixth Circuit. That court reversed the judgment as to the mail fraud statute. Because of an apparent conflict among the courts of appeals as to the circumstances under which the fraudulent use of a credit card may violate the mail fraud statute, we granted the Government’s petition for certiorari. For the reasons stated below, we affirm the judgment of the Court of Appeals.
Opinion
The applicable parts of the mail fraud statute provide as follows:
Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises . . . for the purpose of executing such scheme or artifice or attempting so to do . . . knowingly causes to be delivered by mail according to the direction thereon, or at the place at which it is directed to be delivered by the person to whom it is addressed, any (matter or thing whatever to be sent or delivered by the Postal Service) shall be fined not more than $1,000 or imprisoned not more than five years, or both. 18 U.S.C. § 1341.
We assume, as did the Court of Appeals, that the evidence would support a finding by the jury that Maze “caused” the mailings of the invoices he signed from the out-of-state motels to the Louisville bank. But the more difficult question is whether these mailings were sufficiently closely related to Maze’s scheme to bring his conduct within the statute.
Under the statute, the mailing must be for the purpose of executing the scheme, as the statute requires, but it is not necessary that the scheme contemplate the use of the mails as an essential element. (Pereira v. United States). The Government relies on Pereira, supra, and United States v. Sampson, 371 U.S. 75, 83 S.Ct. 173, 9 L.Ed.2d 136 (1962), to support its position, while Maze relies on Kann v. United States, and Parr v. United States, 363 U.S. 370 (1960).
In Kann, corporate officers and directors were accused of having set up a dummy corporation through which to divert profits of their own corporation to their own use. As a part of the scheme, the defendants were accused of having fraudulently obtained checks payable to them which were cashed or deposited at a bank and then mailed for collection to the drawee bank. This Court held that the fraud was completed at the point at which defendants cashed the checks.
The Government, however, relying on United States v. Sampson, argues that essential to the success of any fraudulent credit-card scheme is the “delay” caused by use of the mails “which aids the perpetrator . . . in the continuation of a fraudulent credit card scheme and the postponement of its detection.” In Sampson, various employees of a nationwide corporation were charged with a scheme to defraud businessmen by obtaining advance fees on the promise that the defendants would either help the businessmen to obtain loans or to sell their businesses.
Even after the checks representing the fees had been deposited to the accounts of the defendants, however, the plan called for the mailing of the accepted application together with a form letter assuring the victims that the services for which they had contracted would be performed. The Court found that Kann did not preclude the application of the mail fraud statute to “a deliberate, planned use of the mails after the victims’ money had been obtained.”
We do not believe that Sampson sustains the Government’s position. The subsequent mailings there were designed to lull the victims into a false sense of security, postpone their ultimate complaint to the authorities, and therefore make the apprehension of the defendants less likely than if no mailings had taken place. But the successful completion of the mailings from the motel owners here to the Louisville bank increased the probability that Maze would be detected and apprehended. There was undoubtedly delay in transmitting invoices to the Louisville bank, as there is in the physical transmission of any business correspondence between cities separated by large distances.
Mail service as a means of transmitting such correspondence from one city to another is designed to overcome the effect of the distance which separates the places. But it is the distance, and not the mail service, which causes the time lag in the physical transmission of such correspondence. (Since we are admonished that we may not as judges ignore what we know as men, we do not wish to be understood as suggesting that delays in mail service are solely attributable to the distance involved. If the Postal Service appears on occasion to be something less than a 20th century version of the wingfooted Mercury, the fact remains that the invoices were mailed to and were ultimately received by the Louisville bank.)
Congress could have drafted the mail fraud statute so as to require only that the mails be in fact used as a result of the fraudulent scheme. But it did not do this; instead, it required that the use of the mails be “for the purpose of executing such scheme or artifice. . . . ” Since the mailings in this case were not for that purpose, the judgment of the Court of Appeals is
Affirmed.
Dissent
WHITE, J. , joined by BURGER CJ , and BRENNAN and BLACKMUN JJ.
Until today the acts charged in the indictment in this case—knowingly causing four separate sales invoices to be mailed by merchants to the bank that had issued the stolen BankAmericard in furtherance of a scheme to defraud the bank by using the credit card without authorization and by falsely securing credit—would have been a criminal offense punishable as mail fraud under 18 U.S.C. § 1341. But no more. By misreading this Court’s prior decisions and giving an unambiguous federal criminal statute an unrealistic reading, the majority places beyond the reach of the statute a fraudulent scheme that by law is not consummated until after the mails have been used, that utilizes the mails as a central, necessary instrumentality in its perpetration, and that demands federal investigatory and prosecutorial resources if it is to be effectively checked. Because I cannot subscribe to the majority’s reasoning or the result it reaches, I dissent.
The majority’s decision has ramifications far beyond the mere reversal of a lone criminal conviction. In this era of the “cashless” society, Americans are increasingly resorting to the use of credit cards in their day-to-day consumer purchases. Today well over 300 million credit cards are in circulation, and annual charges exceed $60 billion. In 1969 alone, 1.5 million credit cards were lost or stolen, resulting in fraud losses exceeding $100 million. Current estimates of annual credit card fraud losses are put as high as $200 million. Under the result reached by the majority, only those credit card frauds exceeding $5,000 covered by 15 U.S.C. 1644 will be subject to federal criminal jurisdiction.
Yet this burgeoning criminal activity, as evidenced by the very facts of this case, does not recognize artificial state boundaries. In the future, nationwide credit card fraud schemes will have to be prosecuted in each individual State in which a fraudulent transaction transpired. Here, for example, Maze must now be charged and tried in California, Louisiana, and Florida. This result, never intended by Congress, may precipitate a widespread inability to apprehend and/or prosecute those who would hijack the credit card system.