## Facts

- John Melvan lived in the Southern District of California.
- The government alleged Melvan and 10 others participated in a scheme to obtain fraudulent real-estate loans by inflating property values through multiple escrows and the use of straw buyers.
- Melvan allegedly served as a straw buyer for a property located in the Central District of California.
- The allegedly victimized financial institution connected to Melvan’s conduct was located in the Central District, and many alleged coconspirators and other victimized institutions were also located there.
- Melvan allegedly received proceeds for allowing the use of his name in the transaction but did not report that income on his 1982 federal income tax return.
- Melvan mailed his 1982 tax return to an Internal Revenue Service office located in the Eastern District of California.
- A 40-count indictment was returned in the Central District of California charging, among other counts, (1) the loan-fraud conspiracy and related offenses and (2) Melvan’s personal income tax evasion based on the unreported proceeds.
- Relying on 18 U.S.C. § 3237(b), Melvan moved for a change of venue to the Southern District of California as a matter of right.

## Issues

1. Under 18 U.S.C. § 3237(b), as amended in 1984, is a defendant entitled as a matter of right to transfer venue to his district of residence when a tax-evasion charge is joined in the same indictment with a related loan-fraud conspiracy prosecuted in the charging district?

## Decision

- The court denied Melvan’s motion to transfer venue under 18 U.S.C. § 3237(b).
- The court held that, in light of the 1984 amendment and its legislative history, § 3237(b) did not give Melvan an automatic right to move this joined prosecution to his district of residence.
- The case, including the tax-evasion count, remained in the Central District of California.

## Legal Principles

- Section 3237(b) provides a statutory transfer right for certain tax offenses that can be prosecuted in more than one district due to mailing or similar conduct, but the statute must be applied as written after Congress’s 1984 amendment.
- The 1984 amendment narrowed the circumstances in which a defendant may demand transfer as of right, particularly where a tax charge is prosecuted together with related, properly venued non-tax charges arising from the same alleged scheme.
- Legislative history may be used to confirm Congress’s purpose in revising § 3237(b), including limiting mandatory transfers that would split multi-count prosecutions and interfere with trying related counts together in the district where the alleged scheme largely occurred.
- When the core alleged criminal conduct and most defendants, victims, and events are tied to the charging district, § 3237(b) (as amended) does not require moving the prosecution to the defendant’s home district merely because the tax return was mailed to or processed in another district.

## Conclusion

United States v. Melvan holds that, after Congress amended 18 U.S.C. § 3237(b) in 1984, a defendant charged in a multi-count indictment could not demand an automatic venue transfer to his district of residence where the tax-evasion count was joined with, and derived from, a broader loan-fraud conspiracy centered in the charging district.


United States v. Melvan, 676 F. Supp. 997 (1987)