By: Derek Hawkins//January 24, 2017//
7th Circuit Court of Appeals
Case Name: United States of America v. Eric A. Bloom
Case No.: 15-1445
Officials: BAUER, KANNE, and HAMILTON, Circuit Judges
Focus: Sufficiency of Evidence – Jury Instructions
In August 2007 Sentinel Management Group collapsed. Sentinel managed short-term cash investments for futures commission merchants, individuals, hedge funds, and other entities. Its bankruptcy left customers and creditors in the lurch: over $600 million was lost. In the wake of the collapse, Sentinel president and CEO Eric Bloom was convicted of wire fraud and investment adviser fraud The government’s case rested on three theories. First, the government presented evidence that Bloom, despite assuring customers otherwise, put their funds at significant risk by using them as collateral for Sentinel’s risky proprietary trading. Second, the government contended that Bloom fraudulently manipulated the rates of return paid to clients on their investments. Third, the government claimed that Bloom continued to accept new customer funds even after he knew that Sentinel was about to collapse. The jury found Bloom guilty on all counts, eighteen of wire fraud and one of investment adviser fraud. On appeal, Bloom offers five arguments, which we address in turn. First, Bloom challenges the sufficiency of the evidence supporting his convictions. Second, he argues that his convictions were tainted by prosecutorial misconduct. Third, Bloom argues that the court erred by refusing to instruct the jury properly on the meaning of a federal regulation governing futures commission merchants. Fourth, he challenges several of the district court’s evidentiary rulings. Fifth, he argues that in sentencing the district court used too high a loss amount to calculate the sentencing guideline range. We find no reversible error.
Affirmed