United States District Court, N.D. Iowa, Cedar Rapids Division
R. READER JUDGE
matter before the court is the pretrial detention of
Defendant Darrell Smith in the above-captioned matter.
RELEVANT PROCEDURAL HISTORY
March 31, 2017, a criminal complaint (docket no. 2) was filed
against Defendant alleging: (1) mail fraud in violation of 18
U.S.C. § 1341; (2) wire fraud in violation of 18 U.S.C.
§ 1343; (3) aggravated identity theft in violation of 18
U.S.C. § 1028A; and (4) money laundering in violation of
18 U.S.C. §§ 1956(a)(1) and 1957. See
Complaint at 1. On April 26, 2017, Defendant appeared before
the undersigned for an initial appearance, following which
Defendant was temporarily detained pending a detention
hearing. See April 26, 2017 Minute Entry (docket no.
9); Order of Temporary Detention (docket no. 8). On May 1,
2017, the United States Probation Office filed the Pretrial
Services Report (docket no. 11). On that same date, the court
held a preliminary hearing and detention hearing.
See May 1, 2017 Minute Entry (docket no. 12). At the
hearing, the government was represented by Assistant United
States Attorney Timothy Vavricek. Defendant appeared
personally with his attorney, Michael Lahammer. At the
conclusion of the hearing, Defendant conceded that the
government had met its burden for purposes of the preliminary
hearing. No further written order from the court shall issue
on that matter.
III. RELEVANT FACTUAL BACKGROUND
detention hearing, the government introduced Exhibits 1-8,
which are materials associated with Defendant's prior
criminal case in United States v. Darrell Smith,
16-CR-2002-LTS (“2016 proceedings”). The
government also offered the previously filed Pretrial
Services Report and the Affidavit of Special Agent Scott
Irwin of the Federal Bureau of Investigation in Support of
the Complaint (“Irwin Affidavit”) (docket no. 2).
The government also introduced the testimony of Special Agent
Scott Irwin. The court took judicial notice of the underlying
criminal file in the 2016 proceedings. See United States
v. Morris, 451 F.2d 969, 972 (8th Cir. 1971)
(“[T]he district court may take judicial notice of its
own records.”) (citing Chandler v. United
States, 378 F.2d 906, 909 (9th Cir. 1967)). The evidence
supports the following facts regarding the instant matter.
“was a broker and investment adviser for several
investment firms.” Irwin Affidavit at 4. “On a
number of occasions, [Defendant] . . . caused money to be
transferred or checks to be issued via wire and/or mail from
his clients' investment accounts without their knowledge
or authorization.” Id. at 5. Defendant
subsequently “deposited the funds in accounts he
controlled . . . and then used those funds for the operation
of Permeate, ” a biofuel company owned by Defendant,
“and for other purposes.” Id. Defendant
“effectuate[d] the unauthorized transfer of funds via
wire or issuance of checks via mail from his clients'
investment accounts by providing the company with an
authorization purportedly signed by the client authorizing
the withdrawal of funds from the investment account.”
Id. He “either used pre-signed, blank
authorization forms or forged his clients' signatures
without their authority.” Id.
hearing, Special Agent Irwin testified extensively about
misrepresentations Defendant made to the court when seeking
pretrial release in the 2016 proceedings. He also testified
that Defendant attempted to contact individuals whom he was
prohibited from contacting, in violation of the court's
order. He also testified that Defendant contributed to a
report for prospective investors, which contained several
misrepresentations. The report was distributed to prospective
investors while Defendant was on pretrial release in the 2016
B. Pretrial Services Report
for Defendant's recent period of incarceration, he has
resided with his wife in Forest City, Iowa for twenty-three
years. If released, Defendant intends to reside with his wife
at their home in Forest City. Defendant reports that he is in
“poor” health, evidenced by significant weight
loss, back pain and dental problems. Defendant has no history
of alcohol abuse and denied the illegal use of controlled
substances. Defendant has significant financial resources.
criminal history consists of a 2016 conviction for failure to
account for and pay over employment tax. See 2016
Proceedings. While that charge was pending, Defendant was
initially released on pretrial supervision. The government
filed a motion to revoke pretrial release, which the court
denied. The government then filed a second motion ...