Prosecutors: Fraud is fraud

Government calls Sawyer appeal that they could cover investor loss moot

By Sheila G. Miller / The Bulletin

Published Nov 12, 2013 at 04:00AM

The U.S. government has responded to an appeal filed by a Bend couple serving time in federal prison for fraud, stating whether they had the money to repay their investors is moot when the money they solicited was used for purposes other than promised.

Former Bend Police Capt. Kevin Sawyer and his wife, former Bend real estate broker Tami Sawyer, went to prison in April after pleading guilty to crimes that defrauded more than 20 people of more than $4 million between 2004 and 2009. They filed an appeal in September, alleging Chief U.S. District Judge Ann Aiken was wrong to exclude evidence that would have shown they didn’t intentionally seek to defraud the investors, and that the net fair market value of the couple’s properties and companies exceeded the amount of money they owed their investors.

In the answering brief, filed Friday by Assistant U.S. Attorney Amy Potter in U.S. District Court in Eugene, Potter writes that the government had two ways of demonstrating the Sawyers’ fraud against their investors. At trial the government would have shown how the Sawyers lied to investors and banks and demonstrated how they used the money, with both documents and victim testimony.

“The government argued that evidence of intent or ability to repay was irrelevant because ‘the fraud in this case was completed when she made those misrepresentations and (the investors) loaned or invested money based on those misrepresentations,’” the brief states.

Potter argues the court was right to refuse to allow the Sawyers to include evidence that showed their ability to repay the victims.

“As this Court has made clear in several published opinions, evidence of defendants’ intent or ability to repay the victims of their fraud is not a defense to fraud charges,” Potter wrote. “Such evidence would have only served to confuse the jury. The district court’s ruling did not prevent defendants from offering a defense; the court’s ruling was narrowly tailored to prevent only irrelevant evidence offered to excuse their behavior and confuse the jury about what constitutes fraud.”

Kevin Sawyer pleaded guilty to one count of providing false statements to a financial institution and is serving 27 months at a federal penitentiary in Littleton, Colo., expecting to be released in April 2015. Tami Sawyer pleaded guilty to all 21 counts against her, including fraud, conspiracy and money laundering, and is serving nine years in prison in Dublin, Calif., expecting to be released in February 2021. They were also ordered to pay more than $5.8 million in restitution.

The Sawyers now have 14 days, if they want, to respond to the government’s answering brief.

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