Organization Receiving Benefits Under a Federal
Title 18 U.S.C. § 666(b) requires that the organization receive
benefits in excess of $10,000 under a Federal program involving a grant,
contract, subsidy, loan, guarantee, insurance, or other form of Federal
assistance. This provision covers a wide variety of state and local
agencies, such as city police departments, county governments and private
organizations such as hospitals. See United States v.
Westmoreland, 841 F.2d 572 (5th Cir.), cert. denied, 488 U.S. 82
(1988); United States v. Smith, 659 F. Supp. 833 (S.D. Miss. 1987);
United States v. Hart, 70 F.3d 854 (6th Cir. 1995), aff'd, 70
854 (1995), cert. denied, 116 S. Ct. 1368 (1996); United States v.
Sadlier, 649 F. Supp. 1560 (D. Mass. 1986).|
Courts have interpreted this clause to require that the
receive and administer the $10,000 in benefits, rather than merely be an
beneficiary. Thus the Ninth Circuit held that a college that receives no
funds directly, but merely receives indirect benefits in the form of its
students' Federally funded tuition loans, is not covered by the statute.
United States v. Wyncoop, 11 F.3d 119 (9th Cir. 1993). Similarly, an
accounting firm hired to administer Federal housing funds by paying
from a Federal account was not an "organization receiving benefits."
States v. Webb, 691 F. Supp. 1164 (N.D. Ill. 1988).
Furthermore, 18 U.S.C § 666(c) specifically exempts benefits
are bona fide salary, wages, fees, or other compensation paid, or expenses
or reimbursed in the usual course of business. Federal government money
purchase goods in a commercial transaction are not "benefits" under the
United States v. Stewart, 727 F. Supp. 1068 (N.D. Tex. 1989).
[cited in USAM 9-46.100]