A deeper dive into the relevant New York law, case by case.
The fourth installment of my series on the Trump indictment is now live on the homepage. For readers who want a deeper dive into the relevant New York law, I’ll show my work here. Again, I’m responding in good part to this post at Just Security, as well as to other commentators taking a similar tack.
The Legal Backdrop
The New York Penal Law never defines “intent to defraud,” which appears in a number of places in the false-records laws and elsewhere in the criminal code. But “defraud” is a term with a lot of common-law baggage, so courts typically start with the assumption that, when it is used in a statute and not more specifically defined, it carries at least some of its traditional common-law meaning.
Fraud, at common law, had certain well-established elements: a false or misleading statement, made with intent to deceive and defraud, which was material, and was relied upon by another person, causing them a loss of money or property. Of course, statutes don’t always require proof of all of these elements. Criminal prohibitions such as the federal mail-fraud statute do not require a completed fraud with proof of reliance and loss. New York’s Martin Act, the state’s law governing investment frauds, pointedly does not require proof of fraudulent intent. But absent cues in the statutory language or clear definitions of the terms, state and federal courts tend to read the traditional rules into any statute that prohibits frauds. This is why the New York courts have required false entries to be material, even though the statute doesn’t use the word.
The materiality requirement has been a persistent stumbling block to efforts to pursue Trump legally, because he has often been found lying to people who knew perfectly well that he was lying.
No case I have seen states a hard-and-fast rule that says that an internal document cannot be the subject of a prosecution for falsifying business records. Many business records, both in the private sector and in government, are internal in the sense that they are not continually in view of the public, and many prosecutions for falsifying business records have been based upon internal records. But it is still nearly always clear from those cases why the internal document was expected by the defendant to be deceptive.
Indeed, in Section 175.00 of the Penal Law, which defines terms used in the false records laws, it defines a “business record” as “any writing or article, including computer data or a computer program, kept or maintained by an enterprise for the purpose of evidencing or reflecting its condition or activity.” Section 175.00 likewise defines “written instrument,” used in other parts of the false records laws, as a writing “used for the purpose of reciting, embodying, conveying or recording information, or constituting a symbol or evidence of value, right, privilege or identification, which is capable of being used to the advantage or disadvantage of some person.” Both provisions reflect the statutory focus on using false records to reflect information and obtain advantage, not simply on falsehood for its own sake.
The New York Case Law
Let’s go chronologically through the key cases. Bear in mind that New York state courts are divided geographically into four departments, analogous to federal circuits. Manhattan is under the First Department, so cases decided by the Appellate Division for the First Department are binding, although the state’s highest court (the New York Court of Appeals) can and does step in to resolve direct conflicts between the departments. But contrary to what you may read at Just Security or other pro-Bragg outlets, even the First Department’s case law is not broad enough to support this indictment.
People v. Altman, (Nassau Cty. 1975): A felony false-records prosecution under Section 170.10. A car dealer filled out a form for registration with the DMV that falsely represented a used car as new and understated its mileage. The form, however, was created after the sale was completed. Its sole purpose was to allow the buyer to register the car. The court ruled for the defendant.
The court noted that, when a statute uses the word “false” it “requires proof of something more than the untrue. Its use imports an intention to deceive. It implies an evil intent, a corrupt motive, or an intent to perpetrate some treachery or fraud.” That was simply missing in this case:
It seems clear . . . that the false statement or information must be material to the written instrument. . . . There must be a sufficient nexus between that which the complete instrument is intended to accomplish and those portions of it which are not accurate. . . . It must reasonably appear that the erroneous information will cause, influence or determine a result that would not otherwise occur.
In this case, there is no proof of nexus between the inaccurate information and the purpose of the MV-50 form. Nor is there proof that the Department of Motor Vehicles would not have allowed the Buyer to register the vehicle had the correct information been placed on the form. Where the Grand Jury proof demonstrates merely untrue statements, a citizen need not suffer trial of an accusation of offering a false instrument for filing.
People v. Kase, (1st Dep’t 1980): A prosecution under Section 175.35, a parallel statute that deals specifically with false records made “with intent to defraud the state” or state entities, where the defendant “offers or presents it to a public office, public servant, [or other public entity] with the knowledge or belief that it will be filed with, registered or recorded in or otherwise become a part of the records of such public office.” Just Security hinges a lot of its argument for the breadth of “intent to defraud” in the First Department on Kase and its progeny, but it was dealing with a statute that, by its terms, could only apply to documents filed with the government and intended to influence its decisions.
The defendants in Kase sold a bar (a suspected mob hangout) to undercover cops, and the contract filed with the application for the liquor license understated the sale price because it did not include cash paid “under the table” to bribe members of the Alcoholic Beverage Control Board. The defendant argued that “intent to defraud” meant only intent to obtain money or property. Quoting a 1924 U.S. Supreme Court opinion, the First Department said that it would follow the federal rule and read the phrase more broadly when dealing with frauds on the government:
It is not necessary that the Government shall be subjected to property or pecuniary loss by the fraud, but only that its legitimate official action and purpose shall be defeated by misrepresentation, chicane or the overreaching of those charged with carrying out the governmental intention…
There are few responsibilities of government more important than the obligation faithfully to carry out its own law. Whoever intentionally files a false statement with a public office or public servant for the purpose of frustrating the State’s power to fulfill this responsibility, violates the statute. (Quotation omitted).
The Court of Appeals affirmed the decision in a summary opinion, thus ratifying this analysis. Despite the breadth of the language in Kase, it involved a document filed with the government to obtain a specific benefit while deceiving it about the bribery of the people making the decisions. The intent to defraud and materiality are fairly obvious.
People v. Coe, (N.Y. Cty. 1986), affirmed by the Court of Appeals in 1988: A felony false-records prosecution under Section 170.10. A nurse at a nursing home went through the pockets of an 86-year-old patient trying to rob him of $10, and he died shortly after the forcible search. The nurse was charged with failing to mention the search in medical records she was required to maintain, so there was no issue of the records’ being private. She argued that she could only have been charged with defrauding the nursing home, which required her to maintain such records, but the trial court held that “this is not necessarily true, as it might just as well have been [the patient’s] relatives, defendant’s supervisors or others. Intent to defraud anyone is sufficient.” But there still had to be an intent to defraud someone.
People v. Saporita, Stevenson, (2d Dep’t 1987): A felony false-records prosecution under Section 170.10. Two cops were charged with falsifying NYPD records of a car accident in which one of them hit a girl on a bicycle with a squad car. In the jury charge, “the court defined the word ‘defraud’ as follows: ‘The term defraud means to cheat or deprive another person of property or a thing of value or a right.’” The court concluded that “there is no evidence that ‘another person’ was deprived of any property or right as a result of the defendants’ conduct regarding the public records.” Just Security notes that the court in Saporita, Stevenson did not actually adopt the jury charge as the law, but just concluded that the prosecutors were stuck with it because they didn’t object to it. It does, however, show that the courts take seriously the requirement to charge and prove a direct line between the documents and the intended fraud.
People v. Schrag, (Cty. Ct. Rockland Cty. 1990): The Schrag opinion is rather short on facts or exactly what was charged, but it followed Kase and Coe to uphold an indictment of a police officer over a report he was required to make regarding an assault: “Similarly [to Coe] in this case it may be that the target of the intent to defraud could have been the defendant’s supervisors, the defendant’s employer, or the victim of the assault himself.”
People v. Ramirez, (4th Dep’t 1990): A falsifying-business-records conviction, presumably a misdemeanor. The defendant engaged in a direct form of fraud:
Defendant intended to defraud various store owners by applying for and obtaining credit cards in the name of another person when she could not get credit in her own name and that she intended to deceive those stores and induce them to extend credit to her, which, but for her misrepresentation, they would not have done.
The only wrinkle is that she intended to pay her bills, so the court threw out a separate conviction for petty larceny. But this was another direct submission of a document to someone with intent to mislead the reader.
People v. Papatonis, (3d Dep’t 1997): A felony false-records prosecution under Section 170.10 and 170.35, the false-written-instruments law. An applicant for a security-guard job lied about having no criminal record, when he actually had a felony drug conviction. The court found that “clearly, the Grand Jury could determine that defendant falsely completed the registration application intending that the State issue a security guard license to him to which he otherwise was not entitled and that he therefore intended to defraud the State.” It did, however, throw out the Section 170.10 on two grounds: There was no evidence of trying to conceal another crime, and the job application wasn’t a business record that “was ‘kept or maintained’ for the purpose of evidencing or reflecting the condition or activity of” the security company.
People v. Hankin, (Kings Cty. 1997): Misdemeanor false-records prosecution under Section 170.05. In a sting operation, a lawyer paid an informant for referring a personal-injury case (a misdemeanor under ethical rules at the time), and told the informant to bill him and falsely describe the bill as for investigative services — a billing arrangement similar to how Trump disguised his payment to Cohen. The court threw out the underlying charge for the referral payment, noting the First Amendment implications of the legal ban on attorney solicitation, and then tossed the false-records charge:
There is not even a suggestion in the accusatory instrument that there was an intent on the part of the defendant to defraud any person, group or institution by the filing of the investigator’s bill with the records of his own law firm. Granted, [assuming] defendant deliberately required the investigator/informant to submit a false bill as a condition of payment . . . an intent to deceive could easily be inferred, as well as intent to cover up an illegal or unethical payment.
However, even an intent to deceive and conceal another crime does not eliminate the required element of intent to defraud, commonly understood to mean to cheat someone out of money, other property or something of value. [citing Saporita, Stevenson] It is apparent from the nature of this transaction…that while there may well have been an intent to deceive, there was absolutely no intent to defraud anyone by the filing of the investigator’s bill with his own law firm’s records. (Emphasis added).
Hankin is subject to criticism for following Saporita, Stevenson in its definition of what was defrauded, but that was not the basis for the court’s decision; it was the fact that there was no target at all who was intended to be deceived by records in the law firm’s own files.
People v. Keller, (Sup. Ct. N.Y. Cty. 1998): A felony false-records prosecution under Section 170.10. I’ve discussed this case before: A call-girl ring put deceptive entries on charges to American Express (e.g., listing the payment for a prostitute as a “limousine” charge), because the lies were not intended to deceive American Express, to whom the bills were addressed. Citing Altman, the court concluded:
The defendants did not intend for American Express to be deceived by the writing. They knew and expected that the particular falsity of this writing would be of no moment to American Express. It was only the spouse or other personal or business associates of the defendants’ customer who were apparently the intentional targets of the defendants’ deceit. . . .
[In cases where the statute has been applied,] the false form submitted was either intended to deprive the recipient of a benefit it was to receive from the form, imposed a detriment on the recipient which the truthful submission of the form was intended to prevent, or eviscerated the efficacy of the form itself. Here the only alleged detriment visited on American Express was compelling it to deal with escort services which it purportedly would otherwise vigorously avoid.
Again, we see the centrality of connecting the falsehood to someone at the other end who is expected to be deceived by it to his or her detriment.
People v Norman, (Kings Cty. 2004): A prosecution under 175.10 and 175.35 of Clarence Norman, a prominent Brooklyn Democrat in the state assembly, for accepting campaign contributions in a state election that exceeded the limits allowable by state law. In other words, not only was Norman covering up a straightforward violation of state election laws, if he complied with those laws, he would not have been able to keep the money. Moreover, he was required to report it, so this was an omission-to-make-required-reports case. The court found that “the defendant concealed these solicitations and contributions from the treasurer and thus prevented the making of a true entry, and caused the omission of a true entry in the records of both the Committee and the Board of Elections with intent to defraud. . . .”
People v Elliassen, (Richmond Cty. 2008): A felony and misdemeanor false-records prosecution under Section 170.10 and 170.05. Cops failed to fill out required reports, and the court found that “it is not necessary to show a property or pecuniary loss from the fraud, and, in this case, it is sufficient to show that the NYPD’s legitimate official actions and purposes were impeded.” Once again, these were specific forms mandated by police procedures for transporting a juvenile or reporting a stop-and-frisk. They were not the private files of the cops but were reports to their employer.
People v. Taylor, (2d Dep’t 2008): Prosecution under Section 170.35 for a false filing with the government. This was an insurance-fraud prosecution that fell apart for failure to prove that the insurance claims were bogus. In addition, on the charge of filing false retainer agreements that were required to be filed with the New York State Office of Court Administration (OCA), the court concluded:
There was no proof of the required intent to defraud. As a representative from [OCA] testified, the retainer statements are meant to be filed but are not to be acted upon in any way, not even checked for accuracy. While the OCA representative testified that the OCA might provide the retainer statements to other agencies, the fact that information therein may have been false in no way impeded the State since the OCA did not check, verify, or rely upon that information. Thus, there was no proof that the filing of retainer statements with false information was for the purpose of leading another into error or disadvantage, or to frustrate the State’s purpose in requiring the retainer statement to be filed in the first instance.
Even with a false filing, there needed to be a purpose to mislead someone who would be expected to review it.
People v. Reyes, (1st Dep’t 2010): A felony and misdemeanor false-records prosecution under Section 170.10 and 170.05. A prison guard falsified his logbook to give himself an alibi to cover up raping an inmate. The issue on the appeal was that the jury acquitted on the felony charge of intending to cover up the rape, and there was no evidence presented of any intent to defraud other than the coverup: “Under the facts, either defendant’s intent was to conceal the alleged rape, or he had no fraudulent intent at all.” Reyes might appear to support the theory that covering up a crime can be sufficient evidence by itself of intent to defraud, but the fact remains that the logbook was precisely the sort of official job record that the defendant would expect his employer to examine.
Morgenthau v. Khalil, (1st Dep’t 2010): A felony false-records prosecution under Section 170.10. The case involved an illegal check-cashing scheme in which
defendant, conspiring or acting in concert with two other individuals, . . . circumvented federal and state banking laws by structuring numerous check cashing transactions and falsifying business records to make it appear that the checks were cashed in several different locations when they were in fact all cashed in a single location that was owned and operated by defendant’s alleged coconspirators.
The elements of fraud and the role played by the false paper trail are pretty obvious here. The defendant argued that there was no proof “that he acted with intent to defraud a particular person or business entity — as opposed to the government or the public at large — out of money, property, or something of pecuniary value,” and the court responded that “we do not view the meaning of ‘intent to defraud’ . . . to be so limited.” But the only argument the defendant was making was that he didn’t care who his victims were, he just wanted the money. That’s a far cry from saying that the government didn’t have to prove any targets at all.
People v. Headley, (Kings Cty. 2012): A felony and misdemeanor false-records prosecution under Sections 170.10, 170.05, and 170.35, the false-written-instruments law. The court threw out the false-records charges on separate grounds (the documents weren’t business records, and there was no underlying crime), but found sufficient evidence of intent to defraud and upheld the Section 170.35 charge where the defendant filed papers with the New York City Transit Authority (“NYCTA”) under an assumed name, so that he could be paid to “procure independent medical examinations of plaintiffs who had sued the NYCTA” while also acting as a lawyer representing NYCTA. If he applied to perform both jobs, he would have been disqualified from the examination business. The court found that this showed his intent to defraud NYCTA in its decision to retain him:
Maintaining a fair vendor selection process free of any potential conflicts of interest is a legitimate function of the NYCTA. By concealing his true identity from the NYCTA, defendant created the potential for impeding the NYCTA’s ability adequately to defend itself in personal injury lawsuits. Even more fundamentally, identifying vendors accurately is a legitimate function of the NYCTA. The evidence presented to the grand jury was legally sufficient to establish that defendant submitted the business proposal and the IRS W–9 form to the NYCTA knowing the two documents contained false information, with the intent to frustrate legitimate state interests.
People v. Sosa-Campana, (1st Dep’t 2018): A felony and misdemeanor false-records prosecution under Sections 170.10 and 170.05. The defendant presented a false identity when stopped for a traffic violation while driving without a license:
Defendant intended to escape responsibility for the violation by causing the officer to issue a summons to the wrong person, and also intended to conceal his additional offense of unlicensed driving.
Once again, we have the direct presentation of the document to someone, the intent to mislead the known recipient, and a benefit to the defendant (as well as harm to innocent third parties).
Grinols v. State, (N.Y. Ct. Claims 2019): A claim for damages for false prosecution arising out of a “road rage” dispute between a motorcyclist and a guy driving with kids in his car. The motorcyclist was charged with a felony under Section 175.10 for allegedly telling a state trooper that he didn’t know there were children in the car, which was the basis for charging him with causing the trooper to record that in his police report. The Court of Claims found that there was no basis for a prosecution:
Intent to defraud is not defined in the Penal Law, but has been construed as deceiving, tricking, or inducing another to part with something of value, whether money, property, or a legal right, or to lead them into disadvantage. . . .
In the felony complaint, [the trooper] states that claimant caused him to enter false information into the record of an official State Police investigation in order to conceal the commission of the crime of endangering the welfare of a child. . . .
There is no evidence to establish that claimant had the intent to defraud as he did not gain anything of value, nor was defendant somehow lead into disadvantage. The Court finds that a reasonable person would not believe that there was a violation of the statute.
***
This case is, so far as I can tell, unprecedented. Alvin Bragg is on seriously untrod ground here in trying to bring a charge without anything in his indictment or Statement of Facts that resembles the kind of proof of intent to defraud or materiality that has survived judicial scrutiny in the past. As in so many aspects of this case, he will be asking the courts to make up new law just to get Donald Trump.