United States v. Lawrence Shaw

Congress enacted the Bank Fraud Act in 1984, and ever since, the federal courts have grappled with whether its provisions require proof of an intent to cause harm to the bank itself. The Act contains two clauses: the first criminalizes schemes “to defraud a financial institution,” and the second schemes to obtain bank assets or property under its control “by means of false or fraudulent pretenses, representations, or promises.” 18 U.S.C. § 1344 . Last year, the Supreme Court held that the second clause does not require proof that the defendant intended to defraud the bank. Loughrin v. United States, — U.S. -, 134 S.Ct. 2384, 2387 , 189 L.Ed.2d 411 (2014). In this case, we deal with the first clause, which by its terms does require such proof. The question here is whether that means the government must prove the defendant intended the bank to be the principal financial victim of the fraud.

The principal intended victim in this case, at least according to the defendant, was a bank customer, Stanley Hsu. The defendant, Lawrence Shaw, had access to the victim’s bank statements. The gist of Shaw’s scheme was to use PayPal, an online payment and money transfer service, to…