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Court Holds Hobbs Act Extends to Robberies Involving Forced ATM Withdrawals

In United States v. Rose, the Court (Katzmann, Walker, and Bolden, sitting by designation) rejected a jurisdictional challenge to a guilty plea to violating the Hobbs Act, potentially giving rise to a Circuit split.  The defendant, Floyd Rose, was charged with robbing his victim by forcing them to withdraw money from their bank’s ATM and then hand it over to Rose.  After pleading guilty to Hobbs Act robbery, Rose argued that his plea should be set aside because the robbery lacked any connection to interstate commerce.

Writing for the Court, Chief Judge Katzmann observed that the Hobbs Act prohibits robberies that affect interstate commerce “in any way or degree,” a de minimis requirement.  The Court has specifically found in the past that the jurisdictional element is satisfied where the defendant targeted the assets of a business engaged in interstate commerce, even if the impact is slight or potential.  Rose argued that his robbery lacked even a de minimis connection to interstate commerce because his target was the owner of the money—the victim, not Citibank—and thus no assets of a firm engaged in interstate commerce had been depleted.  The Court disagreed.  It reasoned that Rose had targeted funds held in the victim’s account, which were the property of Citibank at the time:  the bank had the right to use the funds as a source of loans and otherwise as it saw fit.  Although the victim had withdrawn the funds and handed them to Rose, the target of the robbery remained Citibank.

The Court expressly declined to follow the Fifth Circuit’s decision in United States v. Burton, 425 F.3d 1008 (5th Cir. 2005), a case that found a lack of jurisdiction under materially similar facts.  There, the court held that the defendant’s separate bank fraud conviction could not stand because the bank no longer had custody over the money at the time of the robbery, and summarily added that the Hobbs Act conviction could not stand for the same reason.  The Second Circuit found Burton “unpersuasive” because, even if the bank did not have custody over the funds at the time of the theft (the key question under the bank fraud statute, according to Burton) that did not mean that the crime lacked a de minimis effect on interstate commerce (the key question under the Hobbs Act).

The panel’s conclusion that the bank was the owner of the stolen money, and thus the true “target” of the crime, seems in tension with the notion that the money becomes the property of the bank’s customer upon withdrawal, even if this is only for a moment before the money is taken away by the defendant.  To be sure, the money belonged to the bank before it was withdrawn.  Indeed, the Court acknowledged that when a customer deposits funds, the bank “ordinarily becomes the owner of the funds . . . though the customer retains the right, for example, to withdraw funds.”  Rose’s argument was, in effect, that the money was no longer the bank’s property once it was withdrawn by the victim, even though it was taken out at his behest and was soon in his possession.  The Court’s response to this argument was to focus primarily on the temporal connection between the withdrawal and the robbery, holding that the fact that the bank did not have custody “at the precise moment that the robber stole the victim’s money” does not deprive the robbery of a de minimis effect on interstate commerce.  Another potential response to that argument was offered by Judge Posner in United States v. McCarter, 406 F.3d 460, 463 (7th Cir. 2005), which held that when the bank customer is forced to withdraw funds, “the customer becomes the unwilling agent of the robber, and the bank is robbed.”  In Judge Posner’s view, the facts here are different from those in which someone withdraws money from a bank on their own, walks away, and then is robbed.  Id.  Both situations are the same from the perspective of the victim and from the perpetrator of the crime, but one is a federal crime and the other may not be.  This type of hairsplitting analysis is sometimes necessary to find federal jurisdiction, a reminder that the federal criminal law is narrow compared to state criminal law, where there are a host of possible charges that could be brought on the facts presented in this case.

-By Brandon Trice and Harry Sandick