Insurance Fraud is Not a Victimless Crime: Life Insurance Motive for Murder

Life insurance is usually purchased to protect his or her spouse and children in the event of an untimely death. Sometimes life insurance is purchased for a malicious purpose. Insurers have paid benefits to a spouse after a murder only to find later that the beneficiary committed the murder to profit from the life insurance. Insurers must pay claims presented quickly while criminal investigators have many years to prosecute a crime. A belated prosecution may punish the criminal only to cost the insurer the benefits to which the criminal was not entitled.

Two defendants, tempted to commit murder by large life insurance policies, were convicted in the United States District Court for the Eastern District of Missouri of conspiracy to commit murder-for-hire and murder-for-hire, resulting in death. In U.S. v. Young, — F.3d —-, 2014 U.S. App. LEXIS 9595 (C.A.8 (Mo.)), [enhanced version available to lexis.com subscribers], the Third Circuit Court of Appeal was asked to reverse their conviction.

To prove conspiracy to commit murder for hire, the government must prove that the defendant (1) used or caused another to use the mail or a facility in interstate commerce, (2) with the intent that murder is committed, (3) for hire. [18 U.S.C.A. § 1958(a), [enhanced version available to lexis.com subscribers].]

After a six-day trial, a jury convicted Elain “Kay” Young and Katherine “Kathy” Mock of conspiracy to commit murder-for-hire, resulting in death, in violation of 18 U.S.C. § 1958 and murder-for-hire, resulting in death, in violation of 18 U.S.C. §§ 1958 and based on the death of Young’s husband. Young argues that the district court erroneously admitted into evidence coconspirator statements despite the lack of corroborating evidence as to the conspiracy’s existence; and admitted Mock’s out-of-court statements in violation of Young’s confrontation rights. Mock raises one issue unique to her, contending that the district court erroneously prohibited Mock from introducing Young’s subsequent inconsistent statement involving Mock’s whereabouts following the murder.

BACKGROUND

Young married Melvin Griesbauer in 2004. They lived together on a farm in northern Missouri. The farm had been in Young’s family for several years. Young bred dogs on the farm and befriended Mock through their common interest in the avocation.

Shortly after Young and Griesbauer married, the Missouri Army National Guard deployed Griesbauer to Iraq for nearly one year, beginning in October 2004. Immediately before and during his deployment, Young purchased multiple life insurance policies on Griesbauer that listed Young as the primary beneficiary. Under the policies, Young stood to receive over $1.1 million in the event of Griesbauer’s death.

Rita overheard Young tell Mock that Young was afraid of Griesbauer and intended on leaving him because he threatened to kill her. Mock agreed to help Young get away from Griesbauer. Two days later, Mock asked her son Thomas Ponder (“Thomas”) if he knew anyone that could kill somebody. Mock told him that Young wanted someone killed and was willing to pay $10,000. Mock told Thomas that Griesbauer was abusing Young, causing Mock to fear for Young’s safety. Thomas declined. Shortly thereafter Griesbauer was shot to death.

Approximately two years after Griesbauer’s death, Missouri authorities arrested Young and charged her in state court with first-degree murder.

While in custody, Young allegedly spoke with a jailhouse informant named Amanda Bax. The government called Bax to testify against Young. Bax testified that Young told her that she killed Griesbauer for insurance money because she was about to lose her farm. She also stated that Young told her she would “rather lose her husband than lose that farm.” Additionally, one of Young’s paramours, Kris Robbins, testified that Young proclaimed many times in relation to Griesbauer, “I would like to kill the son-of-a-bitch” and “I wish he was dead.”

A joint, six-day jury trial found Young and Mock guilty of both counts. The district court sentenced them both to two concurrent life sentences.

DISCUSSION

The court admitted Mock’s out-of-court statements in violation of Young’s confrontation rights. Mock raises one issue unique to her, contending that the district court erroneously prohibited Mock from introducing Young’s subsequent inconsistent statement involving Mock’s whereabouts following the murder.

The testimony of a witness who had been solicited to kill a previous husband demonstrated Young’s intent, motive, knowledge, and plan for Griesbauer’s death, the district court’s instruction was proper where the district court instructed that Young was “on trial only for the crimes charged, and you may consider the evidence of prior acts only on the issue of motive, intent, knowledge, or plan.”

Federal Rule of Evidence 801(d)(2)(E), [enhanced version available to lexis.com subscribers], provides that a coconspirator’s out-of-court statement is not hearsay if the statement was made “during and in furtherance of the conspiracy.” A party may admit evidence pursuant to this Rule only if the party demonstrates a conspiracy between the declarant and the defendant.

The government provided substantial evidence of Young and Mock’s conspiracy outside of the statements themselves. This evidence includes their joint 911 call, their common alibi, their presence at the murder scene at the exclusion of all others, the clear lack of suicide or accident, the ski mask that Mock purchased that was found at the murder scene, Young’s disdain for Griesbauer, the note found in Young’s vehicle at her arrest, the life insurance policies, their financial distress, the additional $10,000 Young requested when she refinanced the farm, Mock’s belief that she would receive money soon, and Bax’s testimony relating to Young’s jailhouse statements. Furthermore, although some of the government’s evidence related to events that occurred after the events comprising Keri’s and Thomas’s testimonies, they nonetheless indicate the presence of a conspiracy at the time Mock solicited their help to kill Griesbauer. The government provided ample evidence of a conspiracy.

Young and Mock both contend that the district court erred by refusing to sever their trial pursuant to Federal Rule of Criminal Procedure 14(a), [enhanced version available to lexis.com subscribers], which provides, “If the joinder of … defendants … for trial appears to prejudice a defendant or the government, the court may order separate trials of counts, sever the defendants’ trials, or provide any other relief that justice requires.” This is especially true when the district court, like here, provides limiting instructions to the jury on the use of evidence against only one defendant. Generally, persons charged in a conspiracy should be tried together, especially when proof of the charges against the defendants is based upon the same evidence and acts A joint trial is preferable because it gives the jury the best perspective on all of the evidence and, therefore, increases the likelihood of a correct outcome.

Finally, Young and Mock both contend that the district court erred by denying their motion for judgment as a matter of law because, according to them, the evidence failed to establish that either party received valuable consideration for commission of the offense.

The government must prove three elements to convict a defendant for violating the substantive portion of 18 U.S.C. § 1958(a). These include that the defendant: “(1) used or caused another to use the mail or a facility in interstate commerce, (2) with the intent that murder is committed, (3) for hire.” The “for hire” element typically requires consideration or some form of bargained-for exchange. A quid pro quo contractual arrangement can satisfy the “for hire” element. Thus, the payment for the murder could consist, theoretically, of a promise to give a peppercorn.

Here, the government provided significant circumstantial evidence to support a jury verdict that Young promised to pay Mock money in consideration for Griesbauer’s murder. First, Keri’s and Thomas’s testimony reveal that Mock solicited others to murder Griesbauer for money on Young’s behalf. Second, Young insisted on receiving an extra $10,000 from her lender above that needed to pay off her debts on the farm mere hours before Griesbauer’s death. Third, Young had previously solicited Newlin to murder an ex-husband for exactly $10,000. Fourth, despite Mock’s financial hardships, she informed Ballard that she would soon be able to settle her debts with interest. Fifth, the defendants’ presence at the crime scene and overlapping alibis demonstrate the presence of a scheme to murder Griesbauer. Consequently, when one considers the evidence in a light most favorable to the jury verdict, this evidence leads to the reasonable inference that Young promised to pay Mock $10,000 to murder Griesbauer. Thus, the defendants’ argument must fail.

ZALMA OPINION

Ms. Young must have been disappointed, after buying $1.1 million insurance on his life that he returned home safely from combat in Iraq. She had borrowed money in his name and probably still had the life insurance policies and a hatred for her husband that was tempered by the love for her farm. The evidence was damning and the motive was no less than $1.1 million. The only question remaining was whether the insurers who paid Young after the death of Griesbauer ever recovered their money. Obviously, with life sentences, the chances of recovering from Young or Mock was slim.

    By Barry Zalma, Attorney and Consultant

Reprinted with Permission from Zalma on Insurance, (c) 2013, Barry Zalma.

Barry Zalma, Esq., CFE, is a California attorney who limits his practice to consultation regarding insurance coverage, insurance claims handling, insurance bad faith and fraud and acting as a mediator or arbitrator on insurance disputes. Mr. Zalma serves as a consultant and expert almost equally for insurers and policyholders. He founded Zalma Insurance Consultants in 2001 and serves as its only consultant. He recently published the e-books, "Zalma on Rescission in California - 2013"; "Random Thoughts on Insurance" containing posts from this blog; "Zalma on Insurance;" "Murder and Insurance Don't Mix;" “Heads I Win, Tails You Lose — 2011,” “Zalma on Diminution in Value Damages,” “Arson for Profit” and “Zalma on California Claims Regulations,” and others that are available at Zalma Books.

Mr. Zalma can be contacted at Barry Zalma or zalma@zalma.com, and you can access his free "Zalma on Insurance Fraud" newsletter at Zalma’s Insurance Fraud Letter.

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