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United States v. Lunn

United States Court of Appeals, Seventh Circuit

June 20, 2017

United States of America, Plaintiff-Appellee,
v.
Robert J. Lunn, Defendant-Appellant.

          Argued February 15, 2017

         Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 12 CR 00402 - Charles R. Norgle, Judge.

          Before BAUER, EASTERBROOK, and HAMILTON, Circuit Judges.

          BAUER, Circuit Judge.

         On May 30, 2012, Defendant-appellant Robert Lunn was charged with five counts of bank fraud, in violation of 18 U.S.C. § 1344. A jury convicted Lunn on all five counts on October 17, 2014. Lunn now challenges his conviction, arguing that the district court improperly interfered with his testimony and failed to provide his requested jury instruction.

         I. BACKGROUND

         Lunn owned and operated Lunn Partners, L.L.C., an investment advisory firm in Chicago, Illinois, that advised mostly high-net worth clients. In 1999, Lunn invested in Leaders Bank, a small commercial bank in Oak Brook, Illinois. The charges in this case stem from Lunn's conduct surrounding three extensions of credit by Leaders Bank: a line of credit he obtained for himself; a loan that Lunn arranged for former Chicago Bulls player Scottie Pippen; and a loan that Lunn arranged for Robert Geras, a Lunn Partners client.

         A. Personal Line of Credit

         In May 2001, Lunn contacted James Lynch, CEO of Leaders Bank, seeking to obtain a $480, 000 line of credit. Lunn provided the bank with a December 31, 2000, personal financial statement attesting that he owned shares of Morgan Stanley common stock with a market value of $11.5 million. The statement further attested that he owned shares of Lehman Brothers common stock with a market value of $5.5 million. Based on Lunn's purported ownership of a combined $15 million worth of common stocks, the bank provided Lunn the line of credit. However, the fact was that Lunn no longer owned the stocks; he had sold them in the 1990s to fund the launch of Lunn Partners. His brokerage account statements did not include the stocks, nor did his tax returns report any dividends earned from the stocks.

         In January 2004, Lunn sought to increase his line of credit by $720, 000, bringing the total line of credit to $1.2 million.

          Lunn submitted a personal financial statement dated December 31, 2003, in support of his request. The statement falsely stated that Lunn still owned both the Morgan Stanley and Lehman Brothers stock, but that the market value for the stocks had fallen to $5.8 million and $1 million, respectively, for a total of $6.8 million. Lunn's purported ownership of the stock persuaded Leaders Bank to increase Lunn's credit line.

         In April 2004, Lunn sought a $120, 000 increase in his credit line. Based upon Lunn's purported ownership of $6.8 million in common stock from Morgan Stanley and Lehman Brothers, bank officials granted Lunn's request; Lunn's total credit line was then $1.32 million.

         B. Pippen Loan

         In September 2002, Lunn contacted Leaders Bank to arrange for a short-term loan of $1.4 million. The terms of the loan required that principal and interest be paid back in 45 days. Lunn told the bank that Pippen sought the loan to purchase an interest in an airplane, ...


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