Profit Sharing Agreement on Forex by qjo20368

VIEWS: 36 PAGES: 40

More Info
									No. COA04-422                                         TENTH DISTRICT



                    NORTH CAROLINA COURT OF APPEALS


                       *************************


STATE OF NORTH CAROLINA            )
                                   )
-vs-                               )        From WAKE COUNTY
                                   )
ROBERT HENRY BURR                  )


                       *************************
                      DEFENDANT APPELLANT'S BRIEF
                       *************************
                      - i -

                      INDEX

AUTHORITIES CITED............................. iv

QUESTIONS PRESENTED...........................   1

PROCEDURAL HISTORY............................   2

GROUNDS FOR APPELLATE REVIEW..................   3

   A. Right to appeal insufficiency of the
      evidence to support the sentence........   3

   B. Right to appeal lack of jurisdiction
      to sentence in the aggravated range.....   4

   C. Petition for a writ of certiorari to
      review the factual basis for the
      guilty pleas to security fraud and the
      lack of notice of the aggravating
      factor found............................   5

FACTS.........................................   7

   A. Indictments.............................   7

   B. Plea agreement.......................... 10

   C. Factual basis........................... 10

   D. Sentencing.............................. 16

ARGUMENTS

I. The Superior Court erred in imposing
   consecutive sentences for two counts of
obtaining property by false pretense without
sufficient evidence to support a finding of
more than a single offense.................... 18

   A. Preservation for review by law.......... 18

   B. Applicable law.......................... 18

   C. Application to the facts................ 20
                      - ii -

II. The Superior Court erred in accepting
    guilty pleas to security fraud without
any factual basis to determine that there
was an offer, sale, or purchase of any
security...................................... 21

   A. Preservation for review by law.......... 21

   B. Applicable law.......................... 22

   C. Application to the facts................ 23

III. The Superior Court erred in accepting
     guilty pleas to security fraud without
any factual basis to determine that the
statements of facts alleged to have been
omitted were necessary in order to make the
statements made, in light of the
circumstances in which they were made, not
misleading.................................... 23

   A. Preservation for review by law.......... 23

   B. Applicable law.......................... 24

   C. Application to the facts................ 24

IV. The Superior Court lacked jurisdiction
    to sentence the Defendant-Appellant in
the aggravated range absent allegation of the
aggravating factor in the indictment and
submission of the aggravating factor to a
jury.......................................... 25

   A. Preservation for review by law.......... 25

   B. Applicable law.......................... 26

   C. Application to the facts................ 28

V. The Superior Court erred in finding an
   aggravating factor not alleged in any
pleading or otherwise prior to the finding.... 28

   A. Preservation for review by law.......... 29
                     - iii -

   B. Applicable law.......................... 29

   C. Application to the facts................ 30

CONCLUSION.................................... 31

CERTIFICATE OF SERVICE........................ 33
                      - iv -

                AUTHORITIES CITED

Apprendi v. New Jersey, 530 U.S. 466,
120 S.Ct. 2348, 147 L.Ed.2d 435 (2000)........ 26

Jones v. United States, 526 U.S. 227,
119 S.Ct. 1215, 143 L.Ed.2d 311 (1999)........ 26

State v. Bailey, 157 N.C.App. 80, 577 S.E.2d
683 (2003).................................... 18

State v. Bivens, 155 N.C.App. 645,
573 S.E.2d 259 (2002).........................   6

State v. Fernandez, 346 N.C. 1, 484 S.E.2d
350 (1997).................................... 19

State v. Grady, 136 N.C.App. 394, 524 S.E.2d
75 (2000)..................................... 19

State v. Hines, 36 N.C.App. 33, 243 S.E.2d
782 (1978).................................... 21

State v. Hunt, 357 N.C. 257, 582 S.E.2d 593
(2003)........................................ 27

State v. Johnson, 212 N.C. 566, 194 S.E.2d
319 (1937).................................... 19

State v. Lucas, 353 N.C. 568, 548 S.E.2d 712
(2001)........................................ 26

State v. Shoff, 118 N.C.App. 724, 456 S.E.2d
875 (1995)....................................   7

State v. Wallace, 351 N.C. 481, 528 S.E.2d
326 (2000)....................................   4

United States Constitution, Sixth Amendment...   6

United States Constitution, Fourteenth
Amendment.....................................   6

North Carolina Constitution, Art. I, §19......   7
                      - v -

North Carolina Constitution, Art. I, §22...... 28

North Carolina Constitution, Art. I, §23......   6

North Carolina Constitution, Art. I, §24...... 28

N.C.G.S. §14-100..............................   2

N.C.G.S. §15A-1022(c).........................   6

N.C.G.S. §15A-1340.14......................... 27

N.C.G.S. §15A-1340.16(b)...................... 27

N.C.G.S. §15A-1340.16(d)...................... 27

N.C.G.S. §15A-1340.16(d)(14).................. 30

N.C.G.S. §15A-1340.16(d)(20).................. 28

N.C.G.S. §15A-1340.16A........................ 27

N.C.G.S. §15A-1340.17(c)......................   4

N.C.G.S. §15A-1340.17(c)(4)................... 27

N.C.G.S. §15A-1340.17(d,e).................... 27

N.C.G.S. §15A-1444(a1)........................   3

N.C.G.S. §15A-1444(e).........................   5

N.C.G.S. §15A-1446(d)(16)..................... 21

N.C.G.S. §15A-1446(d)(18)..................... 18

N.C.G.S. §15A-2000(e)......................... 27

N.C.G.S. §78A-2(11)........................... 22

N.C.G.S. §78A-8(2)............................   2

N.C.R.App.P. 13(a)(1).........................   3

N.C.R.App.P. 21(a)(1).........................   5
                      - vi -

N.C.R.App.P. 27(c)............................   3
No. COA04-422                                         TENTH DISTRICT



                    NORTH CAROLINA COURT OF APPEALS


                       *************************


STATE OF NORTH CAROLINA            )
                                   )
-vs-                               )        From WAKE COUNTY
                                   )
ROBERT HENRY BURR                  )


                       *************************
                      DEFENDANT APPELLANT'S BRIEF
                       *************************

                          QUESTIONS PRESENTED

1) Is the evidence presented in the guilty plea and sentencing
   proceedings sufficient to support consecutive sentences for
two counts of obtaining property by false pretense?

2) Do the statements made to the Superior Court in the guilty
   plea proceedings provide a factual basis for conviction of
fraud in the offer, sale, or purchase of any security?

3) Do the statements made to the Superior Court in the guilty
   plea proceedings provide a factual basis for conviction of
security fraud by omission to state material facts?

4) Does the Superior Court have jurisdiction to sentence in the
   aggravated range absent allegation of the aggravating factor
in the indictment and submission of the aggravating factor to a
jury?

5) Is the Superior Court correct to find an aggravating factor
   without any allegation of that aggravating factor prior to
the finding?
                                - 2 -

                         PROCEDURAL HISTORY

       On 22 July 2003, a grand jury in Wake County indicted the

Defendant-Appellant Robert Burr for six counts of security fraud

in violation of N.C.G.S. §78A-8(2) (Rpp. 20-25) and two counts

of obtaining property by false pretense in violation of N.C.G.S.

§14-100 for obtaining $5 million from a Billy B. Britt in 2001

(Rpp. 26-27).

       On 9 October 2003, the Defendant-Appellant appeared before

the Superior Court (Hon. Wade Barber, presiding), and guilty

pleas as charged were entered to all of the indictments (Tpp. 1-

22).    The Superior Court found as an aggravating factor that the

crimes were committed while the Defendant-Appellant was on

pretrial release regarding similar crimes in Arizona (Rpp. 57,

59) and imposed consecutive sentences of 84-110 months

imprisonment in the aggravated range at Class C, Level I, for

the two counts of obtaining property by false pretense,

consolidating the six security fraud convictions for judgment

with one of the obtaining property by false pretense convictions

(Rpp. 61-64).    The Defendant-Appellant gave notice of appeal

(Rpp. 62, 64; Tp. 46).

       The court reporter certified delivery of the transcript on

14 January 2004 (Rp. 68).    The Defendant-Appellant served a

proposed record on appeal on 18 February 2004 (Rp. 71), which
                               - 3 -

became the Record on Appeal in the absence of any objection,

amendment, or proposed alternative record (Rp. 72).

    The Defendant-Appellant filed the Record on Appeal on 23

March 2004 (Rp. 1), and the Clerk of the Court of Appeals mailed

the printed record to the parties on 5 April 2004.

    This Defendant Appellant's Brief is mailed to the Court of

Appeals with a copy to the assigned associate attorney general

on 6 May 2004, one day after the initial deadline allowed by

N.C.R.App.P. 13(a)(1), so is filed subject to the Court of

Appeals allowing the motion filed herewith to extend the filing

deadline by one day as permitted by N.C.R.App.P. 27(c).

                   GROUNDS FOR APPELLATE REVIEW

    The Defendant-Appellant assigns five errors on appeal (Rpp.

69-70).   Regarding two of the assignments of error, the

Defendant-Appellant appeals as a matter of right.    Regarding the

other three assignments of error, the Defendant-Appellant asks

the Court of Appeals to deem this Defendant Appellant's Brief to

be a petition for a writ of certiorari and to review the

assignments as a matter of discretion.

   A. Right to appeal insufficiency of the evidence to support

     the sentence.

    N.C.G.S. §15A-1444(a1) states:     "A defendant who has...

entered a plea of guilty...to a felony, is entitled to appeal as
                               - 4 -

a matter of right the issue of whether his sentence is supported

by evidence introduced...if the minimum sentence...does not fall

within the presumptive range for the defendant's prior record...

level and class of offense".

    Here, the Superior Court sentenced the Defendant-Appellant

to two consecutive terms of 84-110 months imprisonment in the

aggravated range at Class C, Level I (Rpp. 57-64).     The

presumptive range of minimum sentences at Class C, Level I, is

58-73 months, see chart at N.C.G.S. §15A-1340.17(c).

    Accordingly, the Defendant-Appellant appeals as a matter of

right regarding the issue of whether the evidence presented to

the Superior Court is sufficient to support a finding of more

than a single offense of obtaining property by false pretense in

order to impose consecutive sentences (assignment of error 3 at

Rp. 70; argument I below).

   B. Right to appeal lack of jurisdiction to sentence in the

     aggravated range.

    "(W)here an indictment is alleged to be invalid on its

face, thereby depriving the trial court of its jurisdiction, a

challenge to that indictment may be made at any time, even if it

was not contested in the trial court", State v. Wallace, 351

N.C. 481, 503, 528 S.E.2d 326, 341 (2000).

    Accordingly, the Defendant-Appellant appeals as a matter of
                              - 5 -

right regarding the issue of whether the indictments are

facially sufficient to give the Superior Court jurisdiction to

sentence in the aggravated range absent allegation of the

aggravating factor in the indictments (assignment of error 4 at

Rp. 70; argument IV below).

   C. Petition for a writ of certiorari to review the factual

     basis for the guilty pleas to security fraud and the lack

     of notice of the aggravating factor found.

    N.C.G.S. §15A-1444(e) states:     "Except as provided in

subsections (a1) and (a2) of this section and G.S. 15A-979, and

except when a motion to withdraw a plea of guilty...has been

denied, the defendant is not entitled to appellate review as a

matter of right when he has entered a plea of guilty...but he

may petition the appellate division for review by writ of

certiorari".

    N.C.R.App.P. 21(a)(1) states:     "The writ of certiorari may

be issued in appropriate circumstances by either appellate court

to permit review of the...orders of trial tribunals when...no

right of appeal from an interlocutory order exists".

    The Defendant-Appellant asks the Court of Appeals to deem

this Defendant Appellant's Brief to be a petition for a writ of

certiorari to review the issues of the factual basis for the

guilty pleas to security fraud (assignments of error 1 and 2 at
                                - 6 -

Rpp. 69-70; arguments II and III below).    Compare State v.

Bivens, 155 N.C.App. 645, 647-648, 573 S.E.2d 259, 261 (2002)

(review by writ of certiorari of issue whether the Superior

Court can sentence in the presumptive range after finding that

mitigating factors outweigh the aggravating factors).

    Review by writ of certiorari is warranted because

determination that there is a factual basis for a guilty plea is

a statutory mandate, see N.C.G.S. §15A-1022(c), and in this

case, the Superior Court accepted guilty pleas to six counts of

security fraud without any showing that a "security" was

involved in the alleged criminal transaction or that the

statements of facts alleged to have been omitted would have made

the statements made not misleading, both essential elements of

the security fraud charged in each count.

    The Defendant-Appellant also asks the Court of Appeals to

deem this Defendant Appellant's Brief to be a petition for a

writ of certiorari to review the issue of whether the Superior

Court can find an aggravating factor not alleged in any pleading

or otherwise alleged prior to the finding (assignment of error 5

at Rp. 70; argument V below).   Review by writ of certiorari is

warranted because notice of a criminal accusation is a

fundamental right guaranteed by Article I, Section 23 of the

North Carolina Constitution and by the Sixth and Fourteenth
                              - 7 -

Amendments to the United States Constitution and is a

fundamental component of the right to due process of law

guaranteed by Article I, Section 19 of the North Carolina

Constitution and by the Fourteenth Amendment to the United

States Constitution.

    Review of all three issues is permitted by N.C.R.App.P.

21(a)(1) because the determination by the Superior Court to

accept the guilty pleas (Rp. 47; Tp. 22) and the finding by the

Superior Court of an aggravating factor (Rpp. 57-60; Tp. 39) are

"orders of [the] trial tribunal[] when...no right of appeal from

an interlocutory order exists".   Compare State v. Shoff, 118

N.C.App. 724, 456 S.E.2d 875 (1995)(denial of motion to dismiss

DWI charge on grounds of double jeopardy is an interlocutory

order from which no right to appeal exists), affirmed, 342 N.C.

638, 466 S.E.2d 277 (1996).

                              FACTS

   A. Indictments

    Two indictments charge the Defendant-Appellant with

obtaining property by false pretense in violation of N.C.G.S.

§14-100, the false pretense consisting of "statements made by

the defendant to Billy B. Britt that funds given to the

defendant would be invested, by the defendant, into a private

placement investment program that would generate profits of ten
                                - 8 -

percent (10%) per month, when in fact the defendant converted

the [funds] to his personal use and benefit", one of the

indictments alleging the obtaining of $3 million on or about 5

July 2001 (03CRS 53008; Rp. 26) and the other indictment

alleging the obtaining of $2 million on or about 26 July 2001

(03CRS 53009; Rp. 27).

       Six indictments charge the Defendant-Appellant with

security fraud in violation of N.C.G.S. §78A-8(2).

       The first two of those six indictments allege that the

Defendant-Appellant "did, in connection with the offer, sale, or

purchase of a security...omit to state a material fact necessary

in order to make the statements made, in light of the

circumstances under which they were made, not misleading in that

the defendant omitted to state to Billy B. Britt that on May 18,

2001...the defendant pled guilty to two counts of Fraudulent

Schemes and Artifices (felonies) in the State of Arizona,

pursuant to the defendants participation in an investment scheme

that defrauded investors of over $44 million", one of the

indictments alleging the investment of $3 million on or about 5

July 2001 and the other indictment alleging the investment of $2

million on or about 26 July 2001 (03CRS 53002-53003; Rpp. 20-

21).

       The next two of those six indictments allege that the
                              - 9 -

Defendant-Appellant "did, in connection with the offer, sale, or

purchase of a security...omit to state a material fact necessary

in order to make the statements made, in light of the

circumstances under which they were made, not misleading in that

the defendant omitted to state to Billy B. Britt that, pursuant

to a plea agreement with the State of Arizona on May 18, 2001...

the defendant agreed to make restitution in the amount of

$4,980,060.48", one of the indictments alleging the investment

of $3 million on or about 5 July 2001 and the other indictment

alleging the investment of $2 million on or about 26 July 2001

(03CRS 53004-53005; Rpp. 22-23).

    The last two of those six indictments allege that the

Defendant-Appellant "did, in connection with the offer, sale, or

purchase of a security...omit to state a material fact necessary

in order to make the statements made, in light of the

circumstances under which they were made, not misleading in that

the defendant omitted to state to Billy B. Britt that, on

December 20, 2000 the defendant signed an Agreed Order of

Contempt, whereby, the defendant was found to be in contempt of

a federal court's Order Appointing Temporary Receiver, Temporary

Restraining Order, and Preliminary Injunction", one of the

indictments alleging the omission on or about 5 July 2001 and

the other indictment alleging the omission on or about 26 July
                                - 10 -

2001 (03CRS 53006-53007; Rpp. 24-25).

   B. Plea agreement

    On 9 October 2003, the Defendant-Appellant appeared with

appointed counsel (see Rp. 19) before the Superior Court in Wake

County (Hon. Wade Barber, presiding), and guilty pleas were

entered to each of the indictments as charged (Rpp. 29, 31-32;

Tpp. 1-21).   The plea agreement specified only that the security

fraud charges and one of the obtaining property by false

pretense charges be consolidated for one judgment, other terms

and conditions to be in the discretion of the Superior Court

(Rpp. 31-32; Tp. 7).

    In the plea colloquy with the Superior Court (Tpp. 3-8),

the Defendant-Appellant answered, "Yes, sir", when asked whether

he understood that he was pleading guilty to counts of

securities fraud with a maximum punishment of 10 months and to

two counts of obtaining property by false pretense with a

maximum punishment of 120 months each for a total maximum

punishment of 300 months and a mandatory mimimum sentence of 44

months (Tpp. 6-7).     The Defendant-Appellant answered, "Yes,

sir", when asked if he is in fact guilty of the crimes (Rp. 7).

   C. Factual basis

    Asked for a factual basis for each of the charges, the

prosecutor stated in relevant part:
                     - 11 -

"The victim in this case, Mr. Bill Britt, who is
a resident of Orange County received a phone call
from an individual named Don Miller in March of
2001. He indicated that he was not necessarily
acquainted with Mr. Miller, but in any event, Mr.
Miller told him that there was an individual who
had assisted in some of his -- in some
investments and some business matters that Mr.
Britt might be interested in, and thereafter
introduced Mr. Britt to Mr. Burr.
     April the 12th of 2001 at the Cardinal Club
here in Raleigh, Mr. Burr and Mr. Britt met. Mr.
Britt never met him prior to that time...at that
meeting, the defendant...indicated to Mr. Britt
that he was a lawyer by training, but his
business was assisting people by making large
investments and private placements. He indicated
that he had an office in the First Union
building, and both of those representations were
not true.
     They later had a meeting, several other
meetings and ended up on July the 5th of 2001, as
a result of their meeting, the victim transferred
three million dollars based on their agreement to
a escrow agent in California. And then on the
26th day of July 2001, the victim transferred two
million dollars to this escrow agent in
California.
     The representations made to Mr. Britt by Mr.
Burr was that this five million dollars would be
placed in an investment opportunity that would
guarantee a return of up to ten percent per
month, and that it was virtually guaranteed that
it was a no brainer, and that there were no risks
involved in it.
     The other things that Mr. Burr did not tell
Mr. Britt, which make up part of the failure to
disclose on the solicitation for the securities
violations, Mr. Burr did not tell Mr. Britt that
Mr. Burr had been charged in Arizona, and was
under indictment and had pled guilty to a
fraudulent scheme out there and was awaiting
sentencing, and that part of his plea arrangement
out there was that he was going to be required to
pay a -- a fine of 4.9 million dollars, and that
                      - 12 -

plea arrangment had been entered into just
several months prior to the time that the victim
and the defendant met.
      So it was just prior, several months prior
to their meeting and the solicitation of Mr.
Britt by Mr. Burr, that Mr. Burr had found
himself in state court in Arizona under those
charges and with that sort of possible sentence
hanging over his head out there.
      He also failed to disclose to Mr. Britt that
he was a named party in a case in federal court
in Texas entitled Securities Exchange Commission
versus Cook, which is a receivership wherein
actually Mr. Burr, I believe, signed a consent
agreement to be a respondent in that, and was
required by orders of that court to report his
various financial activities and so forth.
      Those are the -- the securities fraud cases
involve separate misrepresentations for failure
to disclose material facts that are required when
there is a securities solicitation. It is
different than merely telling a lie. You're
under an obligation to disclose things, so on
each one of the occasions when he got the money
from Mr. Britt, he had failed to disclose three
different material things, that makes up the six
counts, but they're nevertheless being
consolidated.
      The escrow agent in California is an
attorney. The money was wired to his trust
account in those two different groups, one three
million and one two million, and after he got the
money he disbursed it based instructions from Mr.
Burr.
      During the next six to nine months, there
were times when the victim was wondering what was
going on with his investment where his funds
were, why he wasn't getting any return on it and
there was fully money disbursed from the original
principal back to the victim to make it look as
if there was an investment.
      Out of the five million that the lawyer in
California took into his trust accout, 1.5
million of it was put into an investment that
I'll just call Forex, F-O-R-E-X which is a
                      - 13 -

foreign exchange investment scheme, for lack of a
better word, as a result of part of that money a
man named whose last name is Bradley was
prosecuted in federal court for actually scamming
those people, but he got that money from.
     About 200 thousand dollars was kept by the
lawyer in California as his attorney's fees, and
I don't quite have the figure in front of me, but
perhaps several hundred thousand dollars was sent
back to Mr. Britt, supposedly as return on his
investment, but it was actually from the original
principal...
this is before the money went to Forex.
     Four and a half million went to McDonald
Investments, which is an investment group. That
went to an account that Mr. Burr, the defendant
had control over. And so after that four and a
half million went to McDonald Investments,
thereafter a million and a half...of that was put
in the foreign exchange investment, the other
three million was thereafter in this account
under the control of Mr. Burr...At McDonnell
Investments. Based on the information that we
have, all of this money was transferred to
various LLC's and other legal entities which Mr.
Burr and his brother had control over or which
were their own little companies.
     Mr. Burr and his brother, and I believe this
Mr. Burr's wife and child...I believe all moved
to Wilmington and for the two years that would
have gone from July 2001 until the arrest of the
Burrs, which was in June of this year, two homes
were bought in Wilmington, initial value per home
was about four hundred thousand dollars.
     Substantial improvements were made to those
homes, including one of the homes had a forty
thousand dollar plus stereo and TV system put
into it.
     They leased cars...he and his brother and
his wife apparently lived mostly off of credit
cards that were paid each month out of funds that
orignally came from Mr. Britt.
     They spent about 20 thousand dollars a month
and paid so before that would have been close to
a half million dollars, I suppose.
                      - 14 -

...my information...when Mr. Burr gets back to
Arizona to be sentenced in that case...his
Arizona time will run concurrent with this time
...The minimum is three and a maximum is ten on
the Arizona case...The cofefendant got twelve and
a half. This defendant...had pled, but had not
been sentenced, and was supposed to be
cooperating with law enforcement officials...But
during the time that he was supposed to be
cooperating...this is what he did.
   ...how Mr. Burr...was living off of credit
cards and so forth and that it was Mr. Britt's
money. In the several months prior to the time
that he got the money from Mr. Britt, the bank
account balances in Mr. Burr's checking accounts
or other bank accounts...show a minimal balance,
that is no other income and no other available
funds which leads us to the conclusion that once
he solicited and obtained the money from Mr.
Britt and it went to California and then it went
to McDonnell's Investment group and 1.5 million
goes to Forex and the remainder ends up back in
Mr. Burr's hands, so that he's able to live that
lifestyle. They had leased several vehicles.

THE COURT: What's the status of the money that
went to Forex, do you understand?

[prosecutor] The short answer is it's gone...a
man named Michael Bradley was prosecuted for his
activities in that investment scheme for
obtaining money from people with the idea that it
would be invested in this scheme, and I'm not
real sure what happened, whether it never did
invest it in him or did divulge really what the
thing was about, but in any event he lost a large
amount of money...I'm not sure that the money
that Mr. Bradley was prosecuted for included this
1.5 million...It was a day trade foreign currency
idea, which is sort of the newest version of the
commodities market or actually a not a new
version...
     ...after the money had been transferred,
there was supposed to be a meeting or something
with Mr. Burr through the escrow agent and the
                             - 15 -

       victim, the victim was told by the escrow agent
       that Mr. Burr was not available on that
       particular day for the meeting...He had actually
       been found in contempt and was incarcerated in
       Texas in that federal receivership...
            ...The victim feels like that if he were to
       testify in this case or in some other forum, that
       he would be received by the jury as perhaps fool
       hardy in delivering this much money to a person
       that he barely knew. And although he will
       testify, he has some hesitancy so he may have
       some hesitancy about going to California or going
       to -- the federal authorities are not interested
       in this, so which would have made dealing with
       the California lawyer a whole lot easier...The
       victim in this case is an extremely wealthy man"

(Rpp. 33-46; Tpp. 8-21).

    Asked by the Superior Court, "do you stipulate there's a

factual basis to support each of these charges?", appointed

counsel answered, "Yes, sir, I do" (Rp. 46; Tp. 21).   Appointed

counsel went on to say, "as far as the money from Forex, my

client tells me that Forex raised four billion dollars and out

of that money 2.3 to 2.5 million is still left, and it's in the

Bank of Saipan and apparently the authorities are...trying to

get some of it back...He also tells me...they actually spent

money on attorneys, private investigators trying to locate where

that money was and Mr. Britt's behalf, but aside from that

addition, we would stipulate" (Rpp. 46-47; Tpp. 21-22).

    The Superior Court then found "that there's a factual basis

for the entry of the plea, Mr. Burr is satisified with his
                              - 16 -

lawyer, Mr. Burr is competent to stand trial and enters this

plea freely, voluntarily and understandingly.   It is accepted by

the Court and is ordered recorded" (Rp. 47; Tp. 22).

   D. Sentencing

    After inquiries regarding the Defendant-Appellant's prior

record, the Superior Court found no prior convictions,

establishing prior record level I (Tpp. 23-26; see Rpp. 48-49).

    The Defendant-Appellant addressed the Superior Court,

stating that he is an "honorably discharged veteran from the US

Navy" and that he spoke "to acknowledge and accept

responsibility for the crimes which I am pleading guilty to

today" (Tp. 33).   Asked by the Superior Court the business of

his company, the Defendant-Appellant answered, "To act as a

broker for a private placements and to manage those placements

for the benefit of itself and third parties on a joint venture

basis" (Tp. 36).

    The prosecutor asked the Superior Court "to find as an

aggravating factor...that...the offense involved the actual

taking of property of great monetary value or damage causing

great monetary loss" (Tp. 37).   The prosecutor provided the

Superior Court with an unsigned plea agreement faxed from

Arizona (Rpp. 50-56; Tpp. 37-38).

    After determining that the Defendant-Appellant had nothing
                               - 17 -

else to say (Tp. 38), the Superior Court found as an aggravating

factor:    "The defendant at the time he committed...these crimes

had, in that State of Arizona, entered pleas of guilty pursuant

to a plea agreement to:    Count one, fraudulently obtaining over

$900,000 in 1997 by promising an extraordinary rate of return;

Count two, that he fraudulently obtained in excess of $7 million

between December 1997 and June 1998.    Although final judgment

has not been entered in those cases, those pleas of guilty and

his conduct, knowledge there significantly aggravate the

defendant's culpability in these cases" (Tp. 39).   On the forms,

the Superior Court entered the aggravating factor under #20,

"Additional written findings of factors in aggravation" (Rpp.

57, 59).

    The Superior Court found mitigating factors that the

Defendant-Appellant had been honorably discharged from the

United States Armed Services and had accepted responsibility for

his conduct (Rpp. 58, 60; Tpp. 39-40).

    Finding that the factors in aggravation outweigh the

factors in mitigation, justifying an aggravated sentence (Rpp.

58, 60; Tp. 40), the Superior Court sentenced the Defendant-

Appellant to two consecutive terms of 84-110 months imprisonment

with restitution and attorney's fees totalling $4,894,925 (Rpp.

61-64; Tpp. 40-44).
                              - 18 -

    The Defendant-Appellant gave notice of appeal to the Court

of Appeals, and the Superior Court denied bail pending appeal

(Tp. 46).

                             ARGUMENTS

I. The Superior Court erred in imposing consecutive sentences

   for two counts of obtaining property by false pretense

without sufficient evidence to support a finding of more than a

single offense.   (Assignment of Error #3, Rp. 70)

   A. Preservation for review by law

    N.C.G.S. §15A-1446(d) states:      "Errors based upon any of

the following grounds, which are asserted to have occurred, may

be the subject of appellate review even though no objection,

exception or motion has been made in the trial division...(18)

The sentence imposed was unauthorized at the time imposed...was

illegally imposed, or is otherwise invalid as a matter of law".

    Here, the Defendant-Appellant asserts that the consecutive

sentences imposed are invalid as a matter of law.

   B. Applicable law

    "The Double Jeopardy Clauses of '[b]oth the Fifth Amendment

to the United States Constitution and Article I, Section 19 of

the North Carolina Constitution protect against multiple

punishments for the same offense'", State v. Bailey, 157

N.C.App. 80, 86, 577 S.E.2d 683, 687 (2003)(quoting State v.
                              - 19 -

Fernandez, 346 N.C. 1, 18, 484 S.E.2d 350, 361 (1997)).

    Whether consecutive sentences are valid or invalid depends

on whether the evidence establishes distinct offenses or one

continuing offense.   See State v. Grady, 136 N.C.App. 394, 524

S.E.2d 75 (2000)(double jeopardy to impose consecutive sentences

for two counts of maintaining a dwelling for use of a controlled

substance where the evidence established one continuing

offense).

    In State v. Grady, "Both counts involved undercover

purchases made by the same officer at the same dwelling.    One

offense occurred on 22 July 1997 and the other on 22 August

1997", 136 N.C.App. at 399, 524 S.E.2d at 78.   The Court of

Appeals notes, "Use of the words, 'keep or maintain any...

dwelling house...or any place whatever,' implies a process of

indefinite duration, indicating that the General Assembly

intended that a violation of this statute be a continuing

offense", Id.   The Court of Appeals also notes, "Our Supreme

Court has defined a continuing offense as 'a breach of the

criminal law not terminated by a single act or fact, but which

subsists for a definite period and is intended to cover or apply

to successive similar obligations or occurrences'", 136 N.C.App.

at 399, 524 S.E.2d at 79 (quoting State v. Johnson, 212 N.C.

566, 570, 194 S.E.2d 319, 322 (1937)).
                              - 20 -

    Regarding the crime of obtaining property by false

pretense, the Court of Appeals has held, "(T)he essence of the

crime is the intentional false pretense not the resulting

economic harm to the victim...The gravamen of the criminal

offense...is making the false pretense and, thereby, obtaining

another person's property of services.   The simple purpose of

G.S. 14-100 is to prevent persons from using false pretenses to

obtain property.   The ultimate loss to the victim...is an issue

which is irrelevent to the purpose of the criminal statute and

is an issue properly within the province of the civil courts",

State v. Hines, 36 N.C.App. 33, 42, 243 S.E.2d 782, 787 (1978).

    N.C.G.S. §14-100(a) prohibits obtaining property "by means

of any kind of false pretense whatsover", so encompasses both

discrete and continuing offenses.

   C. Application to the facts

    Here, the facts as recited by the prosecutor establish a

single offense continuing over a period of time rather than two

discrete offenses.   The prosecutor speaks of "a meeting, several

other meetings" which "ended up on July the 5th of 2001...the

victim transferred three million dollars...to a escrow agent in

California.   And then on the 26th day of July 2001, the victim

transferred two million dollars to this escrow agent" (Rp. 35).

The prosecutor does not speak of distinct false pretenses
                               - 21 -

obtaining first the $3 million and then the $2 million but

instead puts the false pretenses and the two payments together,

stating:   "The representations made to Mr. Britt by Mr. Burr was

that this five million dollars would be placed in an investment

opportunity that would guarantee a return of up to ten percent

per month, and that it was virtually guaranteed that it was a no

brainer, and that there were no risks involved" (Rp. 35).

    There is no evidence that the crime is other than as

described by the prosecutor:   False pretenses in a series of

meetings ending with the victim transferring $5 million to the

Defendant-Appellant's agent, a single, continuing offense for

which the United States Constitution and North Carolina

Constitution prohibit double punishment.

II. The Superior Court erred in accepting guilty pleas to

   security fraud without any factual basis to determine that

there was an offer, sale, or purchase of any security.

(Assignment of Error #1 at Rp. 69)

   A. Preservation for review by law

    N.C.G.S. §15A-1446(d) states:       "Errors based upon any of

the following grounds, which are asserted to have occurred, may

be the subject of appellate review even though no objection,

exception or motion has been made in the trial division...(16)

Error occurred in the entry of the plea".
                               - 22 -

    Here, the Defendant-Appellant asserts that error occurred

in the entry of the six guilty pleas to security fraud because

of the absence of any factual basis to support an essential

element of the crime of security fraud.

   B. Applicable law

    N.C.G.S. §15A-1022(c) states:       "The judge may not accept a

plea of guilty...without first determining that there is a

factual basis for the plea".

    N.C.G.S. §78A-8 states:    "It is unlawful for any person, in

connection with the offer, sale or purchase of any security...

(2)...to omit to state a material fact necessary in order to

make the statements made...not misleading" (emphasis added).

    By N.C.G.S. §78A-2(11):

       "'Security' means any note; stock; treasury
       stock; bond; debenture; evidence of indebtedness;
       certificate of interest or participation in any
       profit-sharing agreement; collateral-trust
       certificate; preorganization certificate or
       subscription; transferable share; investment
       contract including without limitation any
       investment contract taking the form of a whiskey
       warehouse receipt or other investment of money in
       whiskey or malt beverages; voting-trust
       certificate; certificate of deposit for a
       security; certificate of interest or
       participation in an oil, gas, or mining title or
       lease or in payments out of production under a
       title or lease; viatical settlement contract or
       any fractional or pooled interest in a viatical
       settlement contract; or, in general, any interest
       or instrument commonly known as a 'security,' or
       any certificate of interest or participation in,
                             - 23 -

       temporary or interim certificate for, receipt for
       guarantee of, or warrant or right to subscribe to
       or purchase, any of the foregoing."

While the statutory definition of "security" is broad, in all

cases it contemplates some writing evidencing a party's

interest.

   C. Application to the facts

    Here, the factual basis recited by the prosecutor contains

no mention of any writing whatsoever.    The prosecutor describes

what the victim was promised as "an investment opportunity" (Rp.

35) and states that $1.5 million was "put into...a foreign

exchange investment scheme" (Rp. 37), but nowhere is there any

information that any "security" was involved in the dealings

between the Defendant-Appellant and the victim.

III. The Superior Court erred in accepting guilty pleas to

    security fraud without any factual basis to determine that

the statements of facts alleged to have been omitted were

necessary in order to make the statements made, in light of the

circumstances in which they were made, not misleading.

(Assignment of Error #2 at Rpp. 69-70)

   A. Preservation for review by law

    N.C.G.S. §15A-1446(d) states:      "Errors based upon any of

the following grounds, which are asserted to have occurred, may

be the subject of appellate review even though no objection,
                               - 24 -

exception or motion has been made in the trial division...(16)

Error occurred in the entry of the plea".

    Here, the Defendant-Appellant asserts that error occurred

in the entry of the six guilty pleas to security fraud because

of the absence of any factual basis to support an essential

element of the crime of security fraud.

   B. Applicable law

    N.C.G.S. §15A-1022(c) states:       "The judge may not accept a

plea of guilty...without first determining that there is a

factual basis for the plea".

    N.C.G.S. §78A-8 states:      "It is unlawful for any person, in

connection with the offer, sale or purchase of any security...

(2)...to omit to state a material fact necessary in order to

make the statements made, in light of the circumstances under

which they are made, not misleading" (emphasis added).

   C. Application to the facts

    Here, the security fraud indictments charge omission to

inform the victim of the Defendant-Appellant's guilty plea to

fraudulent schemes in Arizona (Rpp. 20-21), of the requirement

for the Defendant-Appellant to pay nearly $5 million in

restitution (Rpp. 22-23), and of the Defendant-Appellant having

been found in contempt of a federal court (Rpp. 24-25).

    However, N.C.G.S. §78A-8(2) does not criminalize a person's
                             - 25 -

omission to disclose his every prior bad act, but only omission

to disclose information that would "make the statements made...

not misleading".

    Here, according to the prosecutor, the "statements made"

were that "Mr. Burr indicated to Mr. Britt that he was a lawyer

by training, but his business was assisting people in making

large investments and private placements.   He indicated that he

had an office in the First Union Building, and both of those

representations were not true" (Rp. 34), and that "The

representation made to Mr. Britt by Mr. Burr was that this five

million dollars would be placed in an investment opportunity

that would guarantee a return of up to ten percent per month,

and that it was virtually guaranteed that it was a no brainer,

and that there were no risks involved in it" (Rp. 35).

Disclosure of the plea in Arizona, the restitution obligation,

and the contempt adjudication would not have made those

statements not misleading.

IV. The Superior Court lacked jurisdiction to sentence the

   Defendant-Appellant in the aggravated range absent

allegation of the aggravating factor in the indictment and

submission of the aggravating factor to a jury.   (Assignment of

Error #4 at Rp.70)

   A. Preservation for review by law
                             - 26 -

    "(W)here an indictment is alleged to be invalid on its

face, thereby depriving the trial court of its jurisdiction, a

challenge to that indictment may be made at any time, even if it

was not contested in the trial court", State v. Wallace, above,

351 N.C. 481, 503, 528 S.E.2d 326, 341.

    Here, the Defendant-Appellant alleges that the indictments

are facially invalid to confer jurisdiction on the Superior

Court to sentence in the aggravated range.

   B. Applicable law

    "(I)n Jones v. United States, 526 U.S. 227, 119 S.Ct. 1215,

143 L.Ed.2d 311 (1999)...We there noted that 'under the Due

Process Clause of the Fifth Amendment and the notice and jury

trial guarantees of the Sixth Amendment, any fact (other than

prior conviction) that increases the maximum penalty for a crime

must be charged in an indictment, submitted to a jury, and

proven beyond a reasonable doubt...The Fourteenth Amendment

commands the same answer in this case involving a state

statute", Apprendi v. New Jersey, 530 U.S. 466, 476, 120 S.Ct.

2348, 2355, 147 L.E.2d 435, 446 (2000).

    In State v. Lucas, 353 N.C. 568, 597-598, 548 S.E.2d 712,

731 (2001), the Supreme Court cites Jones and Apprendi in

holding that firearm enhancement factors must be alleged in an

indictment and submitted to a jury before the firearm
                                - 27 -

enhancement required by N.C.G.S. §15A-1340.16A can be added to a

sentence.

    Like the firearm enhancement factors, the aggravating

factors listed in N.C.G.S. §15A-1340.16(d) are "fact[s] (other

than prior conviction) that increase[] the maximum penalty for a

crime".   Prior convictions are already taken into account in

determining the defendant's prior conviction level under

N.C.G.S. §15A-1340.14.    The prior record level established by a

defendant's prior convictions along with the class of the felony

committed limits the Superior Court's sentencing options to the

ranges of minimums specified in N.C.G.S. §15A-1340.17(c) with

the corresponding maximum specified in N.C.G.S. §15A-

1340.17(d,e).   Absent an aggravating factor, the "maximum

penalty for a crime" is the highest number in the presumptive

range at the applicable prior record level and felony class.

See N.C.G.S. §§15A-1340.16(b), 1340.17(c)(4).

    Although in State v. Hunt, 357 N.C. 257, 582 S.E.2d 593

(2003), the Supreme Court holds that Jones and Apprendi do not

require allegation in a short-form indictment of aggravating

circumstances in a capital case, that holding is based in part

on consideration that "N.C.G.S. §15A-2000(e) limits to eleven

the list of possible aggravators" in capital cases, 357 N.C. at

276, 582 S.E.2d 593.     In non-capital cases, N.C.G.S. §15A-
                             - 28 -

1340.16(d)(20) allows the Superior Court to find "(a)ny other

aggravating factor reasonably related to the purpose of

sentencing", effectively allowing an unlimited number of

aggravating factors in a non-capital case.

    Moreover, the Supreme Court in Lucas specifies that its

holding applies as of the date of its Lucas decision, not as of

the the date of Apprendi, see 353 N.C. at 598, 548 S.E.2d at

732, implying that the Lucas requirment to allege sentencing

enhancement factors in an indictment is compelled not by the

Fourteenth Amendment to the United States Constitution and Jones

and Apprendi, but by the indictment, notice, and jury trial

guarantees of North Carolina Constitution, Art. I, Sections 22,

23, and 24.

   C. Application to the facts

    Here, none of the indictments alleges any aggravating

factor (Rpp. 21-27), and the Defendant-Appellant did not waive

submission of any alleged aggravating factor to a jury.

Instead, the Superior Court found an aggravating factor under

the "catch-all" provision of N.C.G.S. §15A-1340.16(d)(20) and

imposed sentence in the aggravated range (Rpp. 57, 59, 61, 63;

Tpp. 39-41).

V. The Superior Court erred in finding an aggravating factor not

   alleged in any pleading or otherwise prior to the finding.
                               - 29 -

(Assignment of Error #5 at Rp. 70)

   A. Preservation for review by law

    N.C.G.S. §15A-1446(d) states:       "Errors based upon any of

the following grounds, which are asserted to have occurred, may

be the subject of appellate review even though no objection,

exception or motion has been made in the trial division...(18)

The sentence imposed...was illegally imposed, or is otherwise

invalid as a matter of law".

    Here, the Defendant-Appellant asserts that a sentence

resulting from finding an aggravating factor not alleged in any

pleading or otherwise prior to the finding is invalid as a

matter of law.

   B. Applicable law

    The Sixth Amendment to the United States Constitution

requires:   "In all criminal prosecutions, the accused shall

enjoy the right...to be informed of the nature and cause of the

accusation."   Similarly, the North Carolina Constitution,

Article I, Section 23, guarantees:      "(E)very person charged with

crime has the right to be informed of the accusation."

    In State v. Hunt, above, the Supreme Court notes, "(T)he

United States Supreme Court has unequivocally applied the Sixth

Amendment's edict that the accused be informed of criminal

accusations against him...In defining the parameters of state
                             - 30 -

criminal defendants' rights to notice under the Sixth Amendment,

the Supreme Court has concluded that such defendants have a

right to 'reasonable notice' sufficient to ensure that they are

afforded an opportunity to defendant against the charges", 357

N.C. at 271, 582 S.E.2d at 602.

   C. Application to the facts

    Here, the Defendant-Appellant had no notice of the

aggravating factor found by the Superior Court to warrant

sentence in the aggravated range.   That aggravating factor was

not alleged in any indictment or other pleading.   The

aggravating factor proposed by the prosecutor was the taking of

property of great monetary value with great monetary loss

specified by N.C.G.S. §15A-1340.16(d)(14) (Tp. 37).

    The first disclosure of the Superior Court's consideration

of the Arizona plea agreement as a possible aggravating factor

came only after the Superior Court had determined that the

Defendant-Appellant had nothing more to say (Tp. 38) and was

made not with any opportunity for the Defendant-Appellant to

respond, but in the Superior Court's finding of the aggravating

factor in pronouncing sentence (Tpp. 39-40).

    Finding the aggravating factor without any notice or

opportunity for the Defendant-Appellant to be heard violates the

notice and due process guarantees of the Sixth and Fourteenth
                                - 31 -

Amendments to the United States Constitution and Article I,

Sections 19 and 23 of the North Carolina Constitution.

                              CONCLUSION

    If the Court of Appeals finds error in the imposition of

consecutive sentences argued at I above, one of the judgments of

the Superior Court in Wake County in 03CRS 53008 or 03CRS 53009

must be vacated and judgment arrested on that count of obtaining

property by false pretense.

    If the Court of Appeals finds error in the acceptance of

guilty pleas to six counts of security fraud argued at II or III

above, the judgment of the Superior Court in 03CRS 53008 and the

guilty pleas to six counts of security fraud must be vacated and

the case remanded to the Superior Court for further proceedings.

    If the Court of Appeals finds error in sentencing in the

aggravated range argued at IV above, the judgments of the

Superior Court in both 03CRS 53008 and 03CRS 53009 must be

vacated and the case remanded to the Superior Court for

sentencing in either the presumptive range or mitigated range.

    If the Court of Appeals finds error in sentencing in the

aggravated range argued at V above, the judgments of the

Superior Court in both 03CRS 53008 and 03CRS 53009 must be

vacated and the case remanded to the Superior Court for

sentencing.
             - 32 -

6 May 2004      Defendant-Appellant ROBERT BURR
                By appointed counsel



                _______________________________
                KEVIN P. BRADLEY
                P.O. Box 303
                Durham NC 27702-0303
                (919) 680-2062
                                - 33 -

                        CERTIFICATE OF SERVICE

KEVIN P. BRADLEY certifies:

1) I am a lawyer licensed in North Carolina, State Bar 22798.       I

   am appointed to represent the Defendant-Appellant Robert Burr

on appeal to the Court of Appeals from the judgments of the

Superior Court in Wake County 9 October 2003 convicting the

Defendant-Appellant on guilty pleas of two counts of obtaining

property by false pretense and six counts of security fraud and

sentencing the Defendant-Appellant to two consecutive terms of

84-110 months imprisonment.

2) On Thursday 6 May 2004, I served a copy of the above

   Defendant Appellant's Brief on the respondent State of North

Carolina by first class mail addressed:    Attorney General, Tort

Claims Section, ATTN:    Iain M. Stauffer, Associate Attorney

General, 9001 Mail Service Center, Raleigh NC 27699-9001.


                                   Certified on 6 May 2004.



                                   ______________________________
                                   KEVIN P. BRADLEY

								
To top