Valansi v. Atty Gen USA

Opinions of the United

2002 Decisions States Court of Appeals

for the Third Circuit

1-23-2002

Valansi v. Atty Gen USA

Precedential or Non-Precedential:

Docket 0-2293

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Filed January 23, 2002

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No: 00-2293

ELANITH VALANSI,

Petitioner

v.

JOHN ASHCROFT,* Attorney General

of the United States,

Respondent

On Petition For Review of an Order of the

Board of Immigration Appeals

United States Immigration and Naturalization Service

Argued: April 6, 2001

Before: SCIRICA, AMBRO, and GIBSON,**

Circuit Judges

(Opinion Filed January 23, 2002)

Thomas E. Moseley (Argued)

Suite 2600

One Gateway Center

Newark, NJ 07102

Counsel for Appellant

_________________________________________________________________

* Substituted pursuant to Rule 43(c) of the F.R.A.P.

** The Honorable John R. Gibson, Circuit Judge, United States Court of

Appeals for the Eighth Circuit, sitting by designation.

Michael P. Lindemann

Alison M. Igoe (Argued)

Matthew R. Hall

United States Department of Justice

Office of Immigration Litigation

P.O. Box 878

Ben Franklin Station

Washington, DC 20044

Counsel for Appellee

OPINION OF THE COURT

AMBRO, Circuit Judge

Petitioner Elanith Valansi seeks judicial review of a final

order of removal entered by the Board of Immigration

Appeals (the "BIA" or "Board") for the United States

Immigration and Naturalization Service (the "INS" or

"Government"). The Board ruled that the petitioner's

conviction for embezzling, in violation of 18 U.S.C.S 656, in

excess of $400,000 in cash and checks from her employer

(the First Union National Bank) was an aggravated felony

as defined in section 101(a)(43)(M)(i) of the Immigration and

Nationality Act of 1952 (the "INA" or "Act") (codified as

amended at 8 U.S.C. S 1101(a)(43)(M)(i)). It therefore

ordered her removed to Israel pursuant to 8 U.S.C.

S 1227(a)(2)(A)(iii). Valansi's petition asks us to vacate the

Board's final order of removal because her conviction under

18 U.S.C. S 656 does not qualify as an aggravated felony

authorizing her removal from the United States. For the

reasons explained below, we grant the petition for review

and vacate the Board's order.

I. Background Facts and Procedural History

Valansi was born in Israel in 1974. She first came to the

United States with her parents and older sister only a

month and a half after her birth, and has been a lawful

permanent resident in this country since 1990. Valansi's

family settled in Monmouth County, New Jersey, where she

attended elementary and high school and received her high

2

school diploma. She later attended a local community

college. Her father, mother, and sister are all lawful

permanent residents. Her sister's son is a United States

citizen, and she has two siblings from her father's prior

marriage who are both United States citizens.

From 1992 to 1995, Valansi was employed as a bank

teller in Tinton Falls, New Jersey. From 1995 to 1997, she

was a bank teller with First Union National Bank ("First

Union") in Eatontown, New Jersey. Prior to 1997, she had

never been arrested and had no criminal record. However,

on six separate occasions spanning four months in 1997,

Valansi embezzled in the aggregate more than $400,000 in

cash and checks entrusted to First Union. A federal grand

jury returned an indictment charging that, "with intent to

injure and defraud the Bank, [Valansi] knowingly and

willfully embezzle[d] and purloine[d] . . . moneys, funds,

credits, and assets belonging to the Bank and intrusted

[sic] to her custody and care," in violation of 18 U.S.C.

S 656.

On October 30, 1998, Valansi pled guilty to the six-count

indictment in exchange for the Government's agreement not

to prosecute her further for any charges that might arise

from her embezzlement, and in exchange for a stipulation

regarding the federal sentencing guidelines that would

apply to her case. During the plea colloquy during which

Valansi's plea was accepted by the Court, the Government

set forth the following essential elements of the crime to

which she agreed to plead guilty:

First, that at the time of the offense charged, Valansi

was an employee of First Union National Bank, which

is a national bank.

Second, that she wilfully embezzled money or credits of

First Union, or money, funds or assets entrusted to the

custody or care of First Union.

Third, that the value of those moneys or assets was in

excess of $1,000.

And, lastly, that Valansi acted with the intent to"injure

or defraud" the bank.

3

The Court asked Valansi a series of questions designed to

determine whether her criminal conduct conformed to the

elements of the offense. It confirmed that she was an

employee of First Union and that she "deliberately" removed

funds in the amounts charged within the indictment with

the intent to "deprive" the bank of those funds. The Court

concluded that her conduct violated the elements of the

offense under 18 U.S.C. S 656 and accepted Valansi's guilty

plea. On January 22, 1999, Valansi was sentenced under

United States Sentencing Guideline S 2B1.1, the Sentencing

Guideline for theft offenses, to six months imprisonment

followed by five years supervised release, the first six

months of which to be served at home under electronic

monitoring. She was ordered to pay restitution in the

amount of $32,260.22 for the cash amounts embezzled. 3

Valansi served her prison term. She sought employment

in the prison education department and was hired to teach

basic literacy and American Sign Language. In January

1999, Valansi became engaged to marry a United States

citizen, and the couple planned a May 1999 wedding. On

April 24, 1999, the INS served Valansi with a notice to

appear for a removal proceeding charging her with removal

for committing an aggravated felony as defined in 8 U.S.C.

S 1101(a)(43)(M)(i). Valansi was taken into INS custody

almost immediately after being released from prison. 4 She

was later released in May 2000 to complete the house

arrest portion of her sentence.

On December 7, 1999, an Immigration Judge held that

Valansi was removable under 8 U.S.C. S 1227(a)(2)(A)(iii) as

an alien who had been convicted of an aggravated felony.

On July 20, 2000, the BIA affirmed. In doing so it rejected

_________________________________________________________________

3. The restitution amount does not reflect the amounts embezzled

through checks because the checks could not be negotiated without

proper endorsements and were recovered when the thefts were

discovered.

4. Valansi's brief describes inconsiderate treatment from INS agents

when attending her father's funeral while in their custody. Although we

believe that conduct was serious, and that it may have caused

unnecessary emotional distress to Valansi, we do not repeat it at length

here because it does not bear on our analysis of whether her conviction

qualifies as an aggravated felony.

4

Valansi's argument that her conviction under 18 U.S.C.

S 656 was not an aggravated felony because it was a theft

offense with a term of imprisonment of less than one year.

It concluded that Valansi's conviction under S 656 was

properly considered an aggravated felony because it was an

offense involving fraud or deceit (and not theft) that

resulted in loss to the victim greater than $10,000.

Valansi filed this petition for review on August 7, 2000.

The Government moved to dismiss her petition on

September 11, 2000, for lack of subject matter jurisdiction,

and Valansi filed an opposition to this motion on October 2,

2000. By order dated November 1, 2000, our Court referred

this motion to a merits panel.5 By letter dated October 20,

2000, Valansi's attorney notified this Court that she would

become eligible for removal on November 7, 2000, but that

he had not received notice from the INS expressing an

intent to execute the removal order at that time. To

preserve the status quo and allow us to make a decision on

this case, we granted Valansi's motion for stay of removal.

II. Discussion

Valansi's petition for review is governed by 8 U.S.C.

S 1252(a)(2)(C), which provides that "no court shall have

jurisdiction to review any final order of removal against an

alien who is removable by reason of having committed a

criminal offense covered in section . . . 1227(a)(2)(A)(iii)." We

have recently explained that this jurisdiction-stripping

provision comes into play only when two facts exist:"(1) the

petitioner is an alien (2) who is deportable by reason of

having been convicted of one of the enumerated offenses."

Drakes v. Zimski, 240 F.3d 246, 247 (3d Cir. 2001). In

keeping with the views of several other circuit courts, we

held that we have jurisdiction "to determine whether these

jurisdictional facts are present." Id.; Tapia Garcia v. INS,

237 F.3d 1216, 1220-21 (10th Cir. 2001); Mahadeo v. Reno,

_________________________________________________________________

5. On October 12, 2000, Valansi moved for summary reversal of the

BIA's decision and for a stay of removal. The Government filed a

response on November 13, 2000, and Valansi submitted a reply on

November 29, 2000. This motion was also referred to the merits panel on

January 3, 2001.

5

226 F.3d 3, 9 (1st Cir. 2000), cert. denied, 121 S. Ct. 2590

(2001); Bell v. Reno, 218 F.3d 86, 89-90 (2d Cir. 2000), cert.

denied, 121 S. Ct. 784 (2001); Santos v. Reno, 228 F.3d

591, 597 n.11 (5th Cir. 2000); Flores-Miramontes v. INS,

212 F.3d 1133, 1135 (9th Cir. 2000); Lewis v. INS, 194

F.3d 539, 542 (4th Cir. 1999); Diakite v. INS , 179 F.3d 553,

554 (7th Cir. 1999) (per curiam).

In this case, Valansi does not dispute that she is an

alien. Instead she argues that her conviction for

embezzlement of bank funds under 18 U.S.C. S 656 does

not qualify as an aggravated felony as defined in 8 U.S.C.

S 1101(a)(43)(M)(i), and that she therefore cannot be

deported pursuant to 8 U.S.C. S 1227(a)(2)(A)(iii). If she is

right, judicial review is not precluded, and the removal

order will be vacated for failing to allege a removable

offense. If she is wrong, 8 U.S.C. S 1252(a)(2)(C) deprives us

of jurisdiction to inquire any further into the merits, and

the removal order will stand. Because we are determining a

purely legal question, and one that governs our own

jurisdiction, we review de novo whether the petitioner's

conviction qualifies as an aggravated felony. See, e.g.,

Lopez-Elias v. Reno, 209 F.3d 788, 791 (5th Cir. 2000), cert.

denied, 121 S. Ct. 757 (2001) ("Reviewing the matter de

novo, we nevertheless conclude that we have no jurisdiction

under IIRIRA [Illegal Immigration Reform and Immigrant

Responsibility Act of 1996], because Lopez-Elias was

convicted of a crime of violence . . . ."); Solorzano-Patlan v.

INS, 207 F.3d 869, 872 (7th Cir. 2000) ("[B]oth our

jurisdiction to hear this case and the merits of the appeal

turn on the question of whether Solorzano-Patlan is an

aggravated felon, a decision we review de novo."); Ye v. INS,

214 F.3d 1128, 1131 (9th Cir. 2000) ("This court reviews de

novo the question of whether a particular offense

constitutes an aggravated felony for which an alien is

subject to removal.").

Despite our exercise of de novo review, we will give

deference to the agency's interpretation of the aggravated

felony definition if Congress's intent is unclear."We do not

doubt that the principles of Chevron v. Natural Resources

Defense Council, 467 U.S. 837 (1984) . . . apply in general

to the statutory scheme set out in the INA." Drakes, 240

6

F.3d at 250 (citing INS v. Aguirre-Aguirre, 526 U.S. 415,

424-25 (1999)). The Aguirre-Aguirre Court explained that

"the BIA should be accorded Chevron deference as it gives

ambiguous statutory terms `concrete meaning through a

process of case-by-case adjudication.' " 526 U.S. at 425.

The courts of appeals have likewise employed Chevron

when interpreting immigration statutes that ultimately

determined their jurisdiction. See, e.g., Bell, 218 F.3d at 90

(analyzing under Chevron standard whether the

Immigration Act of 1990 superseded the Anti-Drug Abuse

Act of 1988 date restriction with regard to aggravated

felonies); Lettman v. Reno, 207 F.3d 1368, 1370 (11th Cir.

2000) (same); Lewis, 194 F.3d at 544 (same); Maghsoudi v.

INS, 181 F.3d 8, 14 (1st Cir. 1999) (according"due

deference" to the BIA's interpretation of whether a crime

involved "moral turpitude" within the meaning of 8 U.S.C.

S 1227(a)(2)(A)(i)); Coronado-Durazo v. INS, 123 F.3d 1322,

1323-24 (9th Cir. 1997) (applying Chevron when deciding

whether a conviction for solicitation under Ariz. Rev. Stat.

S 13-1002 is a deportable offense within the meaning of 8

U.S.C. S 1251(a)(2)). But see Lopez-Elias , 209 F.3d at 791

("Even assuming the ambiguity of the statutory terms of

IIRIRA, however, the fact that courts defer to the INS's

construction of its statutory powers of deportation does not

mean that similar deference is warranted with respect to

the enforcement of this court's jurisdictional limitations.").

Under Chevron, "[w]e only defer . . . to agency

interpretations of statutes that, applying the normal `tools

of statutory construction,' are ambiguous." INS v. St. Cyr,

121 S. Ct. 2271, 2290 n.45 (2001) (quoting INS v. Cardoza-

Fonseca, 480 U.S. 421, 447-48 (1987)). In St. Cyr, the

Supreme Court refused to defer to the BIA's interpretation

of whether certain provisions of IIRIRA should be applied

retroactively because "there is, for Chevron purposes, no

ambiguity in such a statute for an agency to resolve." Id.

Prior to St. Cyr, courts of appeals agreed that deference to

the BIA's interpretation of the Act is only appropriate when

Congress's intent is unclear. See, e.g., Sandoval v. Reno,

166 F.3d 225, 240 (3d Cir. 1999) ("Assuming arguendo that

Chevron does apply, it directs us to ascertain, by `employing

traditional tools of statutory construction,' whether

Congress has expressed `an intention on the precise

7

question at issue.' ") (quoting Chevron , 467 U.S. at 843 n.9);

Bell, 218 F.3d at 90 ("If, by employing traditional tools of

statutory construction, we determine that Congress's intent

is clear, that is the end of the matter. However, if the

statute is silent or ambiguous with respect to the specific

issue, we then ask whether the agency's answer is based on

a permissible construction of the statute.") (internal

citations and quotation marks omitted); Lewis , 194 F.3d at

544 ("If we conclude that Congress has not directly

addressed the question at issue in a statute or its intent is

ambiguous, we must defer to the Board's interpretation of

the statute provided it is not an unreasonable one.")

(internal citations and quotation marks omitted). Thus, our

task is to determine, using ordinary tools of statutory

construction, whether Congress intended the definition of

aggravated felony provided in 8 U.S.C. S 1101(a)(43)(M)(i) to

include embezzlement of bank funds under 18 U.S.C.

S 656.

"The first step in interpreting a statute is to determine

`whether the language at issue has a plain and

unambiguous meaning with regard to the particular dispute

in the case.' " Marshak v. Treadwell, 240 F.3d 184, 192 (3d

Cir. 2001) (quoting Robinson v. Shell Oil Co. , 519 U.S. 337,

340 (1997)). When the statutory language has a clear

meaning, we need not look further. Id.; see also In re

Crammond, 23 I&N Dec. 9 (BIA 2001) (examining first the

"terms of the statute itself " before turning to "traditional

tools of statutory construction, such as the legislative

history" to determine Congressional intent).

"The plainness or ambiguity of statutory language is

determined by reference to the language itself, the specific

context in which that language is used, and the broader

context of the statute as a whole." Marshak , 240 F.3d at

192 (internal quotation marks omitted). In this case, the

specific provision providing a definition of aggravated

felony, 8 U.S.C. S 1101(a)(43)(M)(i), does not mention

embezzlement. It provides that an aggravated felony

includes "an offense that -- involves fraud or deceit in

which the loss to the victim or victims exceeds $10,000." Id.

Valansi does not dispute that her conviction satisfies the

$10,000 monetary requirement. Instead, she argues that

8

her conviction for embezzlement is not an offense that

"involves fraud or deceit."

The BIA argues to the contrary. It has acknowledged that,

because the term "fraud" is not defined in the INA, "it

should be used in the commonly accepted legal sense, that

is, as consisting of false representations of a material fact

made with knowledge of [their] falsity and with intent to

deceive the other party. The representation must be

believed and acted upon by the party deceived to his

disadvantage." Matter of GG, 7 I&N Dec. 161, 164 (BIA

1956); see also Agathos v. Starlite Motel, 977 F.2d 1500,

1508 (3d Cir. 1992) ("Under general principles of tort law,

the elements of fraud are: (1) a material factual

misrepresentation; (2) made with knowledge or belief of its

falsity; (3) with the intention that the other party rely

thereon; (4) resulting in justifiable reliance to that party to

his detriment.") (citing Restatement (Second) of Torts

SS 525-526 (1977)); Black's Law Dictionary 670 (7th ed.

1999) (defining fraud as "a knowing misrepresentation of

the truth or concealment of a material fact to induce

another to act to his or her detriment" and explaining that

"[f]raud is usu. a tort, but in some cases (esp. when the

conduct is willful) it may be a crime.").

The term "deceit" also is not defined in the INA. However,

it is commonly perceived as "[t]he act of intentionally giving

a false impression," Black's Law Dictionary 413 (7th ed.

1999), or "the act or process of deceiving," which is in turn

defined as "to cause to believe the false." Webster's Third

New International Dictionary of the English Language

Unabridged 584 (3d ed. 1993).

Turning back to 8 U.S.C. S 1101(a)(43)(M)(i), we

determine whether the phrase "offense that -- involves

fraud or deceit" has a plain meaning. The word"involves"

means "to have within or as part of itself " or "to require as

a necessary accompaniment." Webster's Third New

International Dictionary at 1191. Thus, an offense that

"involves fraud or deceit" is most naturally interpreted as

an offense that includes fraud or deceit as a necessary

component or element. It does not require, however, that

the elements of the offense be coextensive with the crime of

fraud.

9

An examination of the surrounding sections providing

further examples of aggravated felonies supports this

reading of the phrase "involves fraud or deceit." In

S 1101(a)(43)(A) Congress defined the term aggravated

felony to mean "murder, rape, or sexual abuse of a minor."

In that case, it may have intended only those specific

crimes, and not other offenses "involving" those crimes, to

qualify as aggravated felonies. In S 1101(a)(43)(F) Congress

defined an aggravated felony to mean "a crime of violence

(as defined in section 16 of Title 18, but not including a

purely political offense) for which the term of imprisonment

[is] at least one year." It thus limited the scope of the

provision to apply only to crimes specified in a certain

section within the United States Code. By analogy, had

Congress intended S 1101(a)(43)(M)(i) to cover only

convictions for the crime of fraud, it could have stated that

an aggravated felony includes "the offense of fraud" or "the

offense of fraud as defined in [a specific provision for the

crime of fraud]." Thus, the use of the word"involves"

expands the scope of S 1101(a)(43)(M)(i) to include offenses

that have, at least as one element, fraud or deceit.

Using this framework, we examine whether a conviction

under 18 U.S.C. S 656 qualifies as a crime"involving fraud

or deceit." The statute provides that

[w]hoever, being an officer, director, agent or employee

of, or connected in any capacity with any . . . national

bank . . . embezzles, abstracts, purloins or willfully

misapplies any of the moneys, funds or credits of such

bank . . . shall be [subject to fines provided in the

statute . . .].

Id. The Government is required to establish five elements to

obtain a conviction under this provision: (1) the defendant

was an employee, (2) of a federally connected bank, (3) who

took cash or other assets, (4) in the custody or care of the

bank, (5) with the intent to injure or defraud the bank. See,

e.g., United States v. Schoenhut, 576 F.2d 1010, 1024 (3d

Cir. 1978) (citing United States v. Schmidt, 471 F.2d 385

(3d Cir. 1972)).

The predecessor of 18 U.S.C. S 656 explicitly enunciated

the last element, the intention to injure or defraud the

10

bank, but the 1948 revision omitted this language.

Nevertheless, Golden v. United States, 318 F.2d 357 (1st

Cir. 1963), and Seals v. United States, 221 F.2d 243 (8th

Cir. 1955), held that this revision did not change the

meaning or substance of the existing law. In Schmidt we

cited Golden and Seals for the proposition that an intent to

injure or defraud, "while no longer explicitly required by the

statute, is still considered an essential element of the

crime." 471 F.2d at 386. Because the element is stated in

the disjunctive, it may be shown either by intent to injure

or intent to defraud. As Judge Posner wrote in United

States v. Angelos, "Moreover, it is important to distinguish

between intent to injure and intent to defraud; either will

do, and they are not the same." 763 F.2d 859, 861 (7th Cir.

1985).

No doubt the crime of "embezzlement with intent to

defraud" would qualify as an offense "involving fraud or

deceit." The common meaning of the term "defraud" is "to

take or withhold from (one) some possession, right, or

interest by calculated misstatement or perversion of truth,

trickery, or other deception." Webster's Third New

International Dictionary at 593.

However, the mens rea element under S 656 may also be

established by proof of an "intent to injure." The plain

meaning of the term "injure" is "to do an injustice to," "to

harm, impair or tarnish the standing of," or"to inflict

material damage or loss on." Webster's Third New

International Dictionary at 1164. Acting with the intent to

injure does not require "false representations of a material

fact made with knowledge of [their] falsity and with intent

to deceive the other party," Matter of GG, 7 I&N Dec. at

164, or "a knowing misrepresentation of the truth or

concealment of a material fact to induce another to act to

his or her detriment." Black's Law Dictionary 670 (7th ed.

1999). Nor does it require deception, which is defined as

causing another to believe what is false. Thus, a conviction

under S 656 establishing only that the defendant acted with

an intent to injure his or her employer is not an offense

that "involves fraud or deceit" under 8 U.S.C.

S 1101(a)(43)(M)(i).

11

The INS maintains that a conviction for embezzlement

under S 656 includes as a necessary element a finding that

Valansi had the specific intent to defraud or deceive her

employer. In its view, Valansi necessarily admitted that she

committed a crime with intent to defraud her employer

when she pled guilty.6

We disagree. The cases establish that a conviction may

be established under 18 U.S.C. S 656 by proving that the

defendant acted with either an intent to injure or an intent

to defraud. See United States v. Krepps, 605 F.2d 101, 104

(3d Cir. 1979); Schoenhut, 576 F.2d at 1024; Schmidt, 471

F.2d at 386; United States v. Moraites, 456 F.2d 435, 441

n.9 (3d Cir. 1972)). The Government's isolated citation to

United States v. Thomas, 610 F.2d 1166, 1174 (3d Cir.

1979), does not persuade us that a conviction under the

statute necessarily requires an intent to defraud. Although

Thomas listed as a basic element of the crime that "the

defendant must have acted with intent to defraud the

bank," it cited to Schoenhut, which, as noted above, held

that a conviction may be obtained by proving either an

intent to injure or an intent to defraud. We do not believe

that Thomas intended to change the landscape of the law.

Consequently, some but not all convictions under 18

U.S.C. S 656 qualify as aggravated felonies under 8 U.S.C.

S 1101(a)(43)(M)(i). A conviction establishing that the

defendant acted with the intent to defraud his or her

employer qualifies as an offense that involves fraud or

deceit, and therefore as an aggravated felony. A conviction

_________________________________________________________________

6. Our dissenting colleague agrees, citing Gov't of the V.I. v. Moolenaar,

133 F.3d 246, 250 (3d Cir. 1998), for the proposition that embezzlement

"necessarily" involves deception. In that case we held an information to

be sufficient even though it used the term "theft" rather than the

statutory term "larceny." The thrust of our analysis was that the word

"theft" may be taken to mean "breaking and entering," in contrast with

"[f]raud and embezzlement," which "necessarily involve securing

possession of another's property by deception." Id. This brief

characterization of the crimes of "fraud and embezzlement" does not

outweigh case law establishing that intent to injure alone may suffice for

guilt under 18 U.S.C. S 656, particularly when linking "embezzlement

and fraud" renders ambiguous whether "embezzlement" taken alone

necessarily involves deception.

12

establishing that the defendant acted only with an intent to

injure his or her employer does not.7

Taking a position directly opposite the Government's,

Valansi argues that Congress intended convictions under

18 U.S.C. S 656 to qualify as aggravated felonies only when

they meet the requirements of S 1101(a)(43)(G) rather than

S 1101(a)(43)(M)(i). Section 1101(a)(43)(G) defines an

aggravated felony as "a theft offense (including receipt of

stolen property) or burglary offense for which the term of

imprisonment [is] at least one year." Because Valansi's

conviction resulted in a term of imprisonment of less than

one year, she maintains that it should not be considered an

aggravated felony.

Valansi's argument relies upon background law with

which Congress may be presumed to be familiar. See

Cannon v. Univ. of Chicago, 441 U.S. 677, 699 (1979);

Matter of Gomez-Giraldo, 20 I&N Dec. 957, 964 n.3 (BIA

1995) (Congress is "presumed to be cognizant of existing

law pertinent to the legislation it enacts."). She directs our

attention principally to three sources of law to assist in

determining Congress's intent -- the federal criminal

statutes, the Sentencing Guidelines, and the Model Penal

Code.

_________________________________________________________________

7. In this respect, our conclusion is different from that of the Eleventh

Circuit. In Moore v. Ashcroft, 251 F.3d 919 (11th Cir. 2001), that Court

acknowledged that "to establish the offense of misapplication of bank

funds under 18 U.S.C. S 656, the government must prove as an element

of the offense that the accused `acted with intent to injure or defraud

the

bank.' " Id. at 923. It then observed that "the `intent to injure or

defraud'

element of the offense is established by proof that the defendant

knowingly participated in a deceptive or fraudulent transaction." Id. It

therefore concluded that "the crime of misapplication of bank funds

under 18 U.S.C. S 656 necessarily involves fraud or deceit and is

appropriately considered an aggravated felony under INA

S 101(a)(43)(M)(i), 8 U.S.C. S 1101(a)(43)(M)(i)." Id. We agree that the

Government may establish that the accused acted with"intent to injure

or defraud" by offering proof that he or she"knowingly participated in a

deceptive or fraudulent transaction." However, we also believe that

element could be satisfied by proof that the defendant acted with merely

an intent to injure his or her employer. Under the latter circumstance,

a conviction under 18 U.S.C. S 656 does not, in our view, necessarily

involve fraud. That depends on how the conviction under S 656 unfolds.

13

Valansi points out that, under federal criminal statutes,

embezzlement of bank funds is an offense under 18 U.S.C.

S 656, whereas bank fraud is a separate offense under 18

U.S.C. S 1344. Moreover, embezzlement underS 656 is

grouped together with theft offenses in Chapter 31 of Title

18, whereas fraud offenses are grouped in Chapters 47 and

63 of that Title. She also directs our attention to precedent

stating that the term "theft" was intended to encompass all

forms of stealing, including embezzlement, under the

federal criminal statutes. See United States v. Turley, 352

U.S. 407, 412-13 & n.8, 415 n.14 (1957); United States v.

Schneider, 14 F.3d 876, 880-81 (3d Cir. 1994); United

States v. Maloney, 607 F.2d 222, 230-31 (9th Cir. 1979);

United States v. Henry, 447 F.2d 283, 285 (3d Cir. 1971).

She argues that we may presume that Congress was aware

of these classifications and likewise intended that

embezzlement be treated as a theft offense for purposes of

the aggravated felony definition rather than an offense

involving fraud or deceit.

Valansi also urges us to take notice of the distinction

between theft offenses and fraud offenses in the U.S.

Sentencing Guidelines Manual. U.S.S.G. S 2B1.1 creates a

distinct Guideline for theft offenses, including

embezzlement under 18 U.S.C. S 656, whereas U.S.S.G.

S 2F1.1 creates a separate Sentencing Guideline for fraud

and deceit offenses that does not include embezzlement

under S 656. She urges us to compare the commentary to

U.S.S.G. S 2B1.1, identifying that Guideline's applicability

to convictions under 18 U.S.C. S 656, with the commentary

to U.S.S.G. S 2F1.1, which does not list 18 U.S.C. S 656

among the convictions to which that Guideline applies.

Consistent with this distinction, Valansi was sentenced

under U.S.S.G. S 2B1.1, the Guideline for theft offenses, not

fraud offenses. She argues that because the definition of

aggravated felony under S 1101(a)(43) adopted the same

categories of offenses that are found in the Guidelines, a

conviction for embezzlement under 18 U.S.C. S 656 should

be treated as a theft offense under S 1101(a)(43)(G) rather

than an offense involving fraud and deceit under

S 1101(a)(43)(M)(i).

Finally, Valansi argues that the treatment of

embezzlement as a theft rather than fraud offense in the

14

Model Penal Code constitutes background law that we can

presume Congress intended to parallel. She directs our

attention to the fact that the Model Penal Code consolidates

all stealing offenses, including embezzlement, under"theft,"

and places theft offenses in a section separate from fraud

offenses. Compare Model Penal Code S 223 with S 224.

We do not dispute that courts may look to these sources

when attempting to divine Congress's intent when passing

the INA. Indeed, the BIA appears to have done so on several

occasions when interpreting whether various criminal

convictions may be classified as aggravated felonies in

S 1101(a)(43). See, e.g., In re Espinoza, Int. Dec. 3402, 1999

WL 378088 (BIA 1999) (en banc) (examining classifications

under federal statutes and Sentencing Guidelines when

determining whether misprision of felony constitutes an

offense relating to the obstruction of justice under

S 1101(a)(43)(S)); In re Perez, Int. Dec. 3432, 2000 WL

726849 (BIA 2000) (en banc) (relying on Model Penal Code

definition of burglary when determining whether breaking

into a vehicle qualifies as an aggravated felony under the

INA); In re VZS, Int. Dec. 3434, 2000 WL 1058931 (BIA

2000) (holding that a conviction under Model Penal Code

S 223.2, which includes embezzlement, constitutes a theft

offense under S 1101(a)(43)(G));8 In re Bahta, Int. Dec. 3437,

2000 WL 1470462 (BIA 2000) (relying on Model Penal Code

definition of theft offense when determining whether

conviction for attempted possession of stolen property was

an attempted theft offense under S 1101(a)(43)(G)).

However, Valansi's argument suffers from a defect similar

to that of the INS: it classifies convictions under 18 U.S.C.

S 656 in an all-or-nothing manner. Valansi urges us to

conclude that every conviction under 18 U.S.C. S 656

_________________________________________________________________

8. Valansi maintains that In re VZS is binding precedent that required

the BIA to classify her conviction as a theft offense rather than an

offense involving fraud or deceit. We disagree. The fact that the BIA

classified embezzlement as defined in the Model Penal Code as a theft

offense under S 1101(a)(43)(G) does not mean that it could not also

classify it as an offense involving fraud or deceit under

S 1101(a)(43)(M)(i). Moreover, a conviction under 18 U.S.C. S 656 may be

different from embezzlement under the Model Penal Code if the former

includes an element of fraud or deceit that the latter does not.

15

should be treated as a theft offense for purposes of the

aggravated felony definition because in other areas of the

law Congress has chosen to align embezzlement offenses

more closely with the crime of theft than with the crime of

fraud. However, as we have explained above, the scope of

the aggravated felony definition in S 1101(a)(43)(M)(i) is not

coextensive with the crime of fraud. Congress's placement

of the crime of embezzlement in the same Title of the

United States Code as theft offenses, and treatment of

sentencing for embezzlement offenses like sentencing for

theft offenses, does not compel us to conclude that

Congress intended to exclude the possibility of fraud within

a conviction for embezzlement under 18 U.S.C. S 656. An

analysis of the plain meaning of the statute suggests that

embezzlement with intent to defraud would qualify as an

offense that "involves fraud or deceit." When the statutory

language has a clear meaning, we need not look further.

Marshak, 240 F.3d at 192.9

Having determined the plain meaning of 8 U.S.C.

S 1101(a)(43)(M)(i), we turn our attention to Valansi's

specific case. We have cautioned that where "a criminal

statute on its face fits the INA's deportability classification

. . .[,] [t]o go beyond the offense as charged and scrutinize

_________________________________________________________________

9. We pause to address Valansi's argument that the "longstanding

principle of construing any lingering ambiguities in deportation statutes

in favor of the alien," Cardoza-Fonseca, 480 U.S. at 449, requires that

her conviction under 18 U.S.C. S 656 be treated as a theft offense rather

than an offense involving fraud or deceit. This rule of construction

(which Valansi refers to as the "rule of lenity," a term traditionally

reserved for the criminal, not immigration, context) may be applied as a

canon of last resort to determine the intent of Congress on an

ambiguous issue. See id.; Marincas v. Lewis, 92 F.3d 195, 200 & n.6 (3d

Cir. 1996); In re Crammond, 23 I&N Dec. 9 (BIA 2001). However, it need

not be applied when the intent of Congress is already clear based on an

analysis of the plain meaning of the statute. See Cardoza-Fonseca, 480

U.S. at 449; Marincas, 92 F.3d at 200. After analyzing the text of

S 1101(a)(43)(M)(i), we believe there is no ambiguity to resolve because

the plain meaning of the section is evident: it includes offenses that

have

fraud or deceit as an element. A conviction under 18 U.S.C. S 656

qualifies as an offense that has fraud or deceit as an element if there

was a finding that the embezzlement was committed with an intent to

defraud.

16

the underlying facts would change our inquiry from a

jurisdictional one into a full consideration of the merits.

Such an approach would fly in the face of the jurisdiction

limiting language of IIRIRA." Drakes, 240 F.3d at 247-48.

However, in this case we have determined that the criminal

statute does not fit squarely within the INA's deportability

classification because some, but not all, of the convictions

under 18 U.S.C. S 656 qualify as offenses involving fraud or

deceit. Because we are unable to determine from the face of

the statute whether Valansi's conviction is among those

that qualify as an aggravated felony, we must take the

additional step of examining the underlying facts to

determine whether Valansi pled guilty to an offense

involving fraud or deceit.

A federal grand jury issued an indictment against Valansi

charging that, "with intent to injure and defraud the Bank,

[she] knowingly and willfully embezzle[d] and purloine[d]

. . . moneys, funds, credits, and assets belong to the Bank

and intrusted [sic] to her custody and care," in violation of

18 U.S.C. S 656. Although the Government urges us to

conclude based upon the indictment that Valansi pled

guilty to the intent to injure and defraud the bank, we

hesitate to do so. While Valansi pled guilty to the

indictment, her specific statements during the colloquy

clarified what that plea entailed. "To comport with the Fifth

Amendment, a defendant's plea of guilty must be voluntary

and intelligent." Parry v. Rosemeyer, 64 F.3d 110, 113 (3d

Cir. 1995); accord United States v. Salmon, 944 F.2d 1106,

1130 (3d Cir. 1991). The court is required to ensure that

the defendant understands the nature of the charge before

accepting his or her guilty plea as voluntary and intelligent.

See Fed. R. Crim. P. 11(c). We therefore decline to limit our

inquiry to the charge as stated in the indictment. We

instead examine the entire context of Valansi's conviction,

including not only the offense as charged in the indictment,

but also as explained to her and confirmed by the District

Court during the plea colloquy.

When the District Court asked the Government to read

the elements of Valansi's crime into the record during the

plea colloquy, the Government included as a necessary

element that Valansi "acted with the intent to injure or

17

defraud the bank." The District Court then asked a series

of questions with the goal of confirming that Valansi's

conduct conformed to the elements charged. Valansi's

responses demonstrate the intent to injure her employer by

depriving it of its property. But never do they demonstrate

clearly that Valansi's specific intent was to defraud the

bank.

The Court first established that Valansi was an employee

of First Union, and that she was "responsible, along with

others, for processing night deposit bags which had been

left by customers in the night deposit drop at the bank."

Valansi agreed that this was correct. The Court then asked

whether she "removed each of the [night deposit] bags from

the bank deliberately," and whether she took the"batch of

checks from the bank deliberately and knowing that it was

wrong to do so." It asked Valansi whether she"intend[ed] in

each case to deprive the bank of the cash and checks

contain[ed] in the bags," and whether she"intend[ed] to

deprive the bank of the checks contained in that batch

knowing that they had not yet been fully processed."

Valansi answered yes to each of these questions.

The Court then asked the following question: "Ms.

Valansi, you have admitted here today that you did not

intend to return those checks back from your apartment to

the bank, that you intended to deprive the bank of that

property, is that correct?" Valansi answered"No, it's not."

The following dialogue between her counsel (Mr. Pascarella),

the prosecutor (Mr. Weissman), the Court, and Valansi then

ensued:

MR. PASCARELLA: There was discussion between

myself and Mr. Weissman with reference to the checks,

and the admission was that she in fact took the

checks, deprived the bank, sustaining a loss, they had

not been fully processed.

The question posed [is] whether or not she

deliberately took those checks in depriving the bank. I

don't know if Ms. Valansi is prepared to actually state

that up until the time she gave the statement to

Detective Cleary she did not intend to actually return

the checks, because, quite frankly, at the time of

18

sentence your Honor will hear certain remarks by

myself regarding the fact that the checks were

valueless to her. They only signified signatures on a

piece of paper and they were worth maybe the amount

of two cents per piece of paper.

THE COURT: Let's talk about what the plea today is

to and what the admission was, because Question 13

on Schedule A, and I will refer to it, it says "Did you

intend to deprive the bank of the checks contained in

that batch, knowing that they had not been fully

processed?"

MR. PASCARELLA: What I think the answer to the

question is, at the time she actually took the checks

she committed a crime because she intended to deprive

the bank of those checks knowing that they had not

been fully processed.

There came a point in time when Ms. Valansi

recognized two things: One, they were useless to her,

and two, they knew they were gone and that she had

intended to return them.

The crime had been complete. We are not talking

about a crime that had not been completed at this

time.

If the question were posed in that fashion to Miss

Valansi, she would acknowledge that number 13 is

accurate.

Is that correct Ms. Valansi?

MS. VALANSI: Yes.

MR. WEISSMAN: I agree with that analysis.

THE COURT: What everybody is telling me is . . .[t]he

taking meant an intent to deprive.

MR. PASCARALLA: That's correct.

THE COURT: That's what Miss Valansi is admitting

to?

MR. PASCARELLA: That's correct.

BY THE COURT:

19

Q Is that correct, Ms. Valansi?

A Yes.

Q You are saying it is, yes, I took it -- I took them, I

intended to deprive the bank of them, but I'm not

going to say that I also never intended to return

them. Is that fair to say?

A Correct.

Q Is there anything else that you wish to add in terms

of my understanding of what you're admitting to on

the issue of checks?

A No, ma'am.

After confirming Valansi's intent to deprive the bank of

its property, the Court abruptly switched to the general

charges in the indictment which, as noted above, listed as

an element of her crime the intent to "injure and defraud."

Q In terms of all of the charges in the indictment, and

if you wish to review them one more time before

you answer, or if you can answer directly, how do

you plead to all the charges in the indictment,

guilty or not guilty?

A Guilty.

THE COURT: I find that in this case that Ms. Valansi

is fully competent and capable of entering an informed

plea, that she's aware of the nature of the charges and

the consequences of the plea, and entering the plea of

guilty is knowingly and voluntarily done. I accept Ms.

Valansi's plea and she is now adjudged guilty of that

offense.

When reviewing this plea colloquy, we are faced with a

dilemma. On one hand, the plea colloquy viewed in a

general sense contains a plea of guilt to the charges of the

indictment, which contained the phrase "injure and

defraud." On the other hand, the District Court and the

Government failed to establish throughout the plea colloquy

whether Valansi was admitting that she had acted with the

intent to defraud her employer. The Court repeatedly asked

whether Valansi had the intent to "deprive" the bank of the

20

checks, to which she responded affirmatively. The meaning

of "deprive" is "to take something away from." Webster's

Third New International Dictionary at 606; accord Black's

Law Dictionary at 453 (defining deprivation as an"act of

taking away."). That word connotes an injury to the bank,

but nothing of an intent to defraud, which means"to cause

injury or loss to (a person) by deceit," Black's Law

Dictionary at 434, or "to take or withhold . . . by calculated

misstatement . . . or other deception." Webster's Third New

International Dictionary at 593. But the District Court and

the Government failed to establish that Valansi deceived

the bank (i.e., by causing it to believe what is false) or acted

fraudulently (i.e., by making a knowing misrepresentation

of the truth or concealment of a material fact to induce the

bank to act to its detriment).10

In this case, Valansi accepted guilt for theft and an intent

to injure, but did not clearly accept guilt as to any

fraudulent intent. Several times during the sentencing the

Judge referred to Valansi's act as a "theft." The Court also

stated that Valansi admitted to the specific acts that she

committed that made her criminally responsible. In

imposing sentence the Court referred to the money Valansi

had taken, rather than a fraud the Government now alleges

she had committed.

In this context, we cannot conclude, after scrutinizing the

_________________________________________________________________

10. We recognize that it is common practice for United States Attorneys'

Offices to pursue a strategy of "plead in the conjunctive, but instruct in

the disjunctive" in order to "avoid uncertainty." Dep't of Justice

Criminal

Resource Manual S 227. This tactic relies on the fact that

[w]hen a statute specifies several alternative ways in which an

offense may be committed, the indictment may allege the several

ways in the conjunctive, and this fact neither renders the

indictment

bad for duplicity nor precludes a conviction if only one of the

several

allegations linked in the conjunctive in the indictment is proven.

Id., citing United States v. McCann, 465 F.2d 147, 162 (5th Cir. 1972).

The use of the conjunctive in the indictment is"to avoid uncertainty"

only; just as the Government may obtain a conviction if "only one of the

several allegations linked in the conjunctive in the indictment is

proven,"

so may a defendant plead guilty to only one of the allegations required

to prove an element of her crime.

21

entire plea colloquy and record, that Valansi knowingly pled

guilty to embezzlement with the specific intent to defraud.

We simply do not know and may not speculate (though

indeed we are skeptical about) whether Valansi would have

accepted that her conduct amounted to an intent to

defraud rather than to injure her employer. This skepticism

is fed by what we do know: Valansi, advised by experienced

immigration counsel, wanted strongly to avoid subjecting

herself to deportation as a result of her plea. Not conceding

this alternative element of embezzlement allowed her both

a way to plead affirmatively to the crime and to offer an

argument to elude deportation.

The Supreme Court has recently explained that "[p]lea

agreements involve a quid pro quo between a criminal

defendant and the government, . . . There is little doubt

that . . . alien defendants considering whether to enter into

a plea agreement are acutely aware of the immigration

consequences of their convictions." St. Cyr , 121 S. Ct. at

2291. The plea colloquy in this case states explicitly that

"to the extent that there [was] any immigration or

deportation issue, [Valansi was] apprised of the

consequences of the plea as they may affect her status." In

fact she retained separate counsel to advise her on the

immigration consequences of the guilty plea. We believe

that Valansi would have avoided pleading guilty to

embezzlement with the specific intent to defraud and

therefore cannot conclude that she pled guilty to"an

offense that [ ] involves fraud or deceit." 8 U.S.C.

S 1101(a)(43)(M)(i).

III. Conclusion

The plain meaning of S 1101(a)(43)(M)(i) defines an

aggravated felony as an offense that has fraud or deceit as

at least one required element. Some but not all convictions

under 18 U.S.C. S 656 qualify as an aggravated felony

under that definition: a conviction for embezzlement with

specific intent to defraud qualifies as an offense involving

fraud or deceit, and thus an aggravated felony; a conviction

with only the specific intent to injure does not.

In Valansi's case, the specific intent to defraud was not

established. It appears that Valansi was counseled to avoid

22

admitting to that intent, and the plea colloquy fails to pin

down the mens rea element sufficiently for us to conclude

that Valansi acted with the intent to defraud rather than to

injure her employer. The Government had ample

opportunity during the plea colloquy to explore the fraud or

deceit element, but made no effort to do so. In light of this

failure to make its case, particularly in a situation where it

must have realized that little things mean a lot, we will

grant Valansi's petition for review and vacate the final order

of removal for failure to establish that she was convicted of

an aggravated felony.

23

SCIRICA, Circuit Judge, dissenting.

At her guilty plea to embezzlement (18 U.S.C S 656),

Valansi's counsel engaged in a clever bit of lawyering that

was not picked up on by the government or the District

Judge. As a consequence, the majority holds that although

pleading guilty to embezzlement, Valansi never pled guilty

to a crime involving fraud or deceit. Because I believe the

majority mistakenly defines the crime of embezzlement

under 18 U.S.C. S 656, I respectfully dissent.

I.

Valansi embezzled in the aggregate more than $400,000

in cash and checks entrusted to First Union National Bank

on six separate occasions spanning four months in 1997.1

She pled guilty to six counts of embezzlement under 18

U.S.C. S 656.2 As a lawful permanent resident, Valansi is

removable if her conviction qualifies as an aggravated

felony under 8 U.S.C. S 1101(a)(43)(M)(i). See 8 U.S.C.

S 1227(a)(2)(A)(iii).

The critical issue on appeal is whether a conviction for

embezzlement under 18 U.S.C. S 656 constitutes an

aggravated felony, defined in 8 U.S.C. S 1101(a)(43)(M)(i) as

"an offense that -- involves fraud or deceit in which the loss

to the victim or victims exceeds $10,000." Because Valansi

pled guilty to embezzling more than $10,000, the sole

_________________________________________________________________

1. Valansi's indictment was based on the following criminal conduct: On

April 30, 1997, Valansi embezzled $5,084.99 in cash and checks; on

May 27, 1997, Valansi embezzled $11,287.86 in cash and checks; on

June 7, 1997, Valansi embezzled $3,904.22 in cash and checks; on June

16, 1997, Valansi embezzled $8,239.05 in cash and checks; on August

4, 1997, Valansi embezzled $14,003.34 in cash and checks; on August

12, 1997, Valansi embezzled $370,674.69 in cash and checks entrusted

to the care of First Union National Bank.

2. Valansi was charged with six counts of embezzlement in the

indictment. Each count charged her with "knowingly and wilfully"

embezzling deposits "intrusted to her custody and care." Valansi pled

guilty to each count.

24

question is whether embezzlement is an offense that

"involves fraud or deceit."3

18 U.S.C. S 656 provides, in part:

Whoever, being an officer, director, agent or employee

of, or connected in any capacity with any . . . national

bank . . . embezzles, abstracts, purloins or willfully

misapplies any of the moneys, funds or credits of such

bank . . . shall be fined not more than $1,000,000 or

imprisoned not more than 30 years, or both; but if the

amount embezzled, abstracted, purloined or misapplied

does not exceed $1,000, he shall be fined under this

title or imprisoned not more than one year, or both.

The statute does not define "embezzle." Therefore, we

must resort to its settled meaning. In Morissette v. United

States, 342 U.S. 246 (1952), the Supreme Court held:

[W]here Congress borrows terms of art in which are

accumulated the legal tradition and meaning of

centuries of practice, it presumably knows and adopts

the cluster of ideas that were attached to each

borrowed word in the body of learning from which it

was taken and the meaning its use will convey to the

judicial mind unless otherwise instructed. In such

case, absence of contrary direction may be taken as

satisfaction with widely accepted definitions, not as a

departure from them.

Id. at 263; see also Standard Oil Co. of N.J. v. United

States, 221 U.S. 1, 59 (1911) ("[W]here words are employed

in a statute which had at the time a well-known meaning

at common law or in the law of this country, they are

presumed to have been used in that sense unless the

context compels to the contrary.").4

_________________________________________________________________

3. I agree with the majority that "the use of the word `involves' expands

the scope of S 1101(a)(43)(M)(i) to include offenses that have, at least

as

one element, fraud or deceit" and that the provision does not require

"that the elements of the offense involving `fraud or deceit' be

coextensive

with the crime of fraud." Supra at 9.

4. Similarly, "where Congress uses a common law term in a federal

criminal statute, absent a new instruction defining it, Congress is

presumed to adopt the term's widely accepted common law meaning."

United States v. Cicco, 10 F.3d 980, 984 (3d Cir. 1993) (citing

Morissette,

342 U.S. at 263); United States v. Nedley, 255 F.2d 350, 357 (3d Cir.

1958)).

25

The term "embezzlement" has been defined consistently

by the Supreme Court for more than 100 years. In 1887,

the Supreme Court said embezzlement had a "settled

technical meaning."5 United States v. Northway, 120 U.S.

327, 334 (1887). In 1895, the Supreme Court held

"[e]mbezzlement is the fraudulent appropriation of property

by a person to whom such property has been intrusted, or

into whose hands it has lawfully come." Moore v. United

States, 160 U.S. 268, 269 (1895); see also United States v.

Petti, 459 F.2d 294, 295 (3d Cir. 1972).6 In 1902, the

Supreme Court declared "the word `embezzled' itself implies

fraudulent conduct on the part of the person receiving the

money. . . . Indeed, it is impossible for a person to embezzle

the money of another without committing a fraud upon

him." Grin v. Shine, 187 U.S. 181, 189 (1902).

Later cases have articulated that the act of embezzlement

violates a relationship of trust and confidence."In

embezzlement, breach of fiduciary duty is an inherent

element of the crime." United States v. Maurello, 76 F.3d

1304, 1310 (3d Cir. 1996); see also United States v.

Sayklay, 542 F.2d 942, 944 (5th Cir. 1976) ("The essence

of embezzlement lies in breach of a fiduciary relationship

deriving from the entrustment of money."). In order to be

convicted of embezzlement, the accused must be entrusted

with another's money or property or have lawful possession

by virtue of some office, employment, or position of trust

_________________________________________________________________

5. "By the late 18th century, courts were less willing to expand common-

law definitions. Thus, when a bank clerk retained money given to him by

a customer rather than depositing it in the bank, he was not guilty of

larceny, for the bank had not been in possession of the money. Stautory

crimes such as embezzlement and obtaining property by false pretenses

. . . were created to fill this gap." Bell v. United States, 462 U.S. 356,

359

(1983) (citations omitted). See 2 W. LaFave & A. Scott, Substantive

Criminal Law S 8.6 at 369 (1986) ("[E]mbezzlement . . . [was a] crime

created by the legislature for the specific purpose of plugging loopholes

left by the narrowness of the crime of larceny.").

6. See Black's Law Dictionary 522 (6th ed. 1990) (Embezzlement is

defined as "the fraudulent appropriation of property by one lawfully

entrusted with its possession."); 2 W. LaFave & A. Scott, Substantive

Criminal Law S 8.6 at 368 (1986) (Embezzlement is defined as: "(1) the

fraudulent (2) conversion of (3) the property (4) of another (5) by one

who

is already in lawful possession of it.").

26

before converting it.7 The Court of Appeals for the First

Circuit notes:

The notion of "fraudulent conversion," at the heart of

embezzlement, may sound obscure, but, in fact, it is

not. It essentially refers to, say, a bank teller, trustee,

or guardian using money entrusted to him by another

person for his own purposes or benefit and in a way

that he knows the "entruster" did not intend or

authorize.

United States v. Young, 955 F.2d 99, 102 (1st Cir. 1992).

II.

Valansi pled guilty to "knowingly and willfully"

embezzling bank deposits. Despite the settled definition of

"embezzlement," the majority declines to apply that

definition to Valansi's conduct and guilty plea. Nor does it

address her position of trust as an employee,8 or the breach

of her fiduciary duties to the bank. As a result, I believe the

majority misinterprets the elements of embezzlement under

18 U.S.C. S 656.

A.

As a bank teller for First Union National Bank, Valansi

was in a fiduciary relationship.

_________________________________________________________________

7. "The crime of embezzlement builds on the concept of conversion, but

adds two further elements. First the embezzled property must have been

in the lawful possession of the defendant at the time of its

appropriation.

Second, embezzlement requires knowledge that the appropriation is

contrary to the wishes of the owner of the property." United States v.

Stockton, 788 F.2d 210, 216-17 (4th Cir. 1986) (citations omitted).

8. "Fraud inherently involves some exploitation of trust." United States

v.

Iannone, 184 F.3d 214, 231 (3d. Cir. 1999) (Becker, C.J., concurring)

(citing United States v. Koehn, 74 F.3d 199, 201 (10th Cir. 1996) ("In

every successful fraud the defendant will have created confidence and

trust in the victim . . . ."); United States v. Mullens, 65 F.3d 1560,

1567

(11th Cir. 1995) ("[T]here is a component of misplaced trust inherent in

the concept of fraud . . . ."); United States v. Hathcoat, 30 F.3d 913,

915

(7th Cir. 1994) ("By its definition, embezzlement requires a finding of a

breach of trust.")).

27

The essence of a fiduciary relationship is that the

fiduciary agrees to act as his principal's alter ego. . . .

Hence the principal is not armed with the usual

wariness that one has in dealing with strangers; he

trusts the fiduciary to deal with him as frankly as he

would deal with himself--he has bought candor.

United States v. Dial, 757 F.2d 163, 168 (7th Cir. 1985).

On six separate occasions spanning four months, Valansi

appropriated checks and cash entrusted to her for deposit.

Under any definition, this breach of her fiduciary duties

involved fraud and deceit.9 By pleading guilty to

"knowingly" embezzling the deposits "intrusted to her care,"

Valansi demonstrated the requisite intent for "fraudulent

conversion."10 These actions were paradigmatic examples of

embezzlement. As the Court of Appeals for the First Circuit

said:

An embezzler, like a thief or a swindler, may commit

the crime in any of a myriad of different ways. But, in

each instance, the embezzler will have acted for his

own purposes and contrary to authorization. He will

have "fraudulently converted" property entrusted to

him by another. (citations omitted).

Young, 955 F.2d at 103.

A crime involving fraud or deceit qualifies as an

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9. "Fraud in the common law sense of deceit is committed by deliberately

misleading another by words, by acts, or, in some instances -- notably

where there is a fiduciary relationship, which creates a duty to disclose

all material facts -- by silence." Dial, 757 F.2d 163.

10. One basic source says "the mental state required for embezzlement

generally appears in the statutes in the form of the adverb `fraudulently'

modifying the verb `converts.' (If the statute should instead punish one

who `embezzles,' it would not signify anything different, for `embezzles'

means `fraudulently converts.')" 2 W. LaFave & A. Scott, Substantive

Criminal Law S 8.6 at 379 (1986). Another source defines "fraudulent

conversion" as "[r]eceiving into possession money or property of another

and fraudulently withholding, converting, or applying the same to or for

one's own use and benefit, or to [the] use and benefit of any person other

than the one to whom the money or property belongs." Black's Law

Dictionary 662 (6th ed. 1990).

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aggravated felony.11 Independent of the fraud analysis,

Valansi's conduct also constituted a crime involving deceit.12

We have stated that "[f]raud and embezzlement necessarily

involve securing possession of another's property by

deception . . . ." Gov't of the V.I. v. Moolenaar, 133 F.3d

246, 250 (3d Cir. 1998).

As a result, a conviction for embezzlement under 18

U.S.C. S 656 constitutes an offense involving fraud and

deceit and qualifies as an aggravated felony under 8 U.S.C.

S 1101(a)(43)(M)(i). See Moore v. Ashcroft , 251 F.3d 919, 923

(11th Cir. 2001) (holding "[t]he `intent to injure or defraud'

element of the offense is established by proof that the

defendant knowingly participated in a deceptive or

fraudulent transaction") (citations omitted).

B.

The "dilemma" the majority wrestles with, whether

Valansi embezzled more than $400,000 with the "intent to

defraud" or the "intent to injure," is unnecessary to the

resolution of this appeal. Knowledge satisfies the required

mental state under S 656.13 Valansi pled guilty to

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11. Valansi's counsel ignores the fact that offenses that "involve deceit"

qualify as aggravated felonies.

12. "Deceit" is defined as the "act or process of deceiving (as by

falsification, concealment, or cheating)," which is in turn defined as "to

be false, to betray . . . to deprive especially by fraud or stealth."

Webster's Third New International Dictionary of the English Language

Unabridged 584 (3d ed. 1993).

13. The Third Circuit cases the majority cites (all of which involve the

"willful misapplication of funds" under S 656 rather than embezzlement)

favor the government's position. "It is well settled that `intent to

injure or

defraud a bank exists if a person acts knowingly and if the natural result

of his conduct would be to injure or defraud the bank even though this

may not have been his motive.' " United States v. Krepps, 605 F.2d 101,

104 (3d Cir. 1979) (quoting United States v. Schmidt, 471 F.2d 385, 386

(3d Cir. 1972)); see also United States v. Schoenhut, 576 F.2d 1010,

1024 (3d Cir. 1978) ("Intent to injure or defraud a bank exists whenever

the defendant acts knowingly and the result of his conduct would be to

injure or defraud the bank, regardless of his motive."). Furthermore,

"reckless disregard of the interests of the bank is equivalent to intent

to

29

"knowingly and willfully" embezzling deposits"intrusted to

her custody and care." (A-90, 104-110). Because

"embezzlement" means to convert by fraud and deception,

it makes no difference whether Valansi pled guilty to

embezzlement with the "intent to injure" or the "intent to

defraud."14 Embezzlement with the "intent to injure" still

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injure or defraud." Krepps, 605 F.2d at 104; Schoenhut, 576 F.2d at

1024. By pleading guilty to "knowingly and wilfully" embezzling the

money, which showed a reckless disregard of the interests of the bank

and had the natural result of injuring and defrauding the bank (to

defraud "means `to cause injury or loss to (a person) by deceit' or `to

take

or withhold . . . . by calculated misstatement . . . or other deception.'

"

Supra at 21), Valansi was guilty of embezzling $400,000.00 with the

intent to injure and defraud the bank.

In discussing the mens rea requirement under S 656, we stated in

Schoenhut,

Section 656 penalizes willful misapplication, but that term must

be placed in context with the other acts prohibited by the section.

It proscribes actions of one who "embezzles, abstracts," and

"purloins." When this is read together with willful misapplication,

it

is evident that the mens rea for the crime is not fulfilled by mere

indiscretion or even foolhardiness on the part of the bank officer.

His conduct must amount to reckless disregard of the bank's

interest or outright abstraction of funds.

576 F.2d at 1024.

14. The majority's citation to United States v. Angelos, 763 F.2d 859 (7th

Cir. 1985) is inapposite. That case involved the willful misapplication of

funds rather than embezzlement. In Angelos, a bank president arranged

a loan, without the approval of the bank's board of directors, to a

business in which he owned 80 percent of stock. Convicted under 18

U.S.C. S 656 for willful misapplication of funds, Angelos argued on

appeal that because he intended to repay the loan his conduct did not

violate S 656.

The court held Angelos' argument was irrelevant not only because one

can injure a bank "by taking its money even if you intend to return it,"

but because Angelos breached his fiduciary duty to the bank and as a

result intended to defraud it. Id. at 861.

By lending the bank's money in effect to himself in violation of

accepted banking procedures, Angelos breached his fiduciary

obligation to the bank, and it is irrelevant whether he thought,

and

30

constitutes an offense that involves fraud and deceit. Based

on her guilty plea, Valansi fraudulently converted $400,000

with the intent to injure the bank and committed an

aggravated felony.

III.

Valansi pled guilty to "knowingly and willingly"

embezzling more than $400,000 "intrusted to her care." As

a result, she committed a crime involving fraud and deceit;

a crime which constitutes an aggravated felony under 8

U.S.C. S 1101(a)(43)(M)(i). For the foregoing reasons, I would

affirm the judgment of the BIA.

Therefore, I respectfully dissent.

A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit

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thought correctly, that the bank would not be hurt. Intent to

defraud -- which means, to take financial advantage of a

confidential relationship . . . is all that is required to make out

a

violation of section 656; intent to injure the bank need not be

shown.

Id. at 861-862 (citations omitted).

Even under the Angelos analysis, Valansi intended to defraud First

Union as she breached her fiduciary obligation to the bank and took

financial advantage of her position of trust and confidence. The majority

does not discuss Valansi's breach of her fiduciary duties nor does it

define "embezzlement" or apply it to these circumstances.

Because "embezzlement," unlike "willful misapplication of funds," has

a precise definition ("the fraudulent appropriation of property. . . .")

it is

irrelevant whether Valansi fraudulently appropriated the deposits with

the intent to injure or the intent to defraud the bank. Either way, she

committed an offense involving "fraud."

31