U.S. v. Lawson

In prosecution on wire fraud charge stemming from scheme to induce churches to apply for loans under circumstances where defendant misappropriated loan application fees without issuing said loans, Dist. Ct. erred in allowing prosecutor’s request to introduce fact that defendant had not reported to IRS said loan application fees as income, where instruction given to jury about said evidence did not tell jury about proper use of said evidence, and where record failed to demonstrate that Dist. Ct. had actually weighed potential for unwarranted prejudice arising out of said evidence against potential for appropriate use on issues of knowledge and intent as required by Rule 403. However, any error was harmless given undisputed proof that defendant converted application fees for his personal use and did not spend fees for purposes he represented to loan applicants.