United States v. Al Kabouni , 641 F. App'x 6 ( 2016 )

Not for Publication in West's Federal Reporter
United States Court of Appeals
For the First Circuit
No. 14-1985
UNITED STATES OF AMERICA,
Appellee,
v.
MUSTAFA AL KABOUNI,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND
[Hon. Mary M. Lisi, U.S. District Judge]
Before
Thompson, Lipez, and Kayatta,
Circuit Judges.
B. Alan Seidler on brief for appellant.
Peter F. Neronha, United States Attorney, and Donald C.
Lockhart, Assistant United States Attorney, on brief for appellee.
April 25, 2016
LIPEZ, Circuit Judge. Appellant Mustafa Al Kabouni pled
guilty to 18 counts in connection with a conspiracy to defraud the
Supplemental Nutrition Assistance Program (SNAP) by accepting SNAP
benefits in exchange for cash. He admitted to conspiracy to
unlawfully acquire SNAP benefits, wire fraud, and money
laundering. The district court determined that his total offense
level was 25, including a four-level upward adjustment for
"organiz[ing] or lead[ing]" the fraud. U.S.S.G. § 3B1.1(a).
Factoring in appellant's criminal history category of I, his
Guidelines range was 57 to 71 months' imprisonment. He was
sentenced to a below-Guidelines sentence of 36 months. On appeal,
he argues that the district court erroneously increased his offense
level under § 3B1.1(a). Appellant also argues that he received
ineffective assistance of counsel at sentencing.
We find no clear error in the district court's conclusion
that appellant was a leader or organizer for purposes of the four-
level upward adjustment. We also decline to consider appellant's
ineffective assistance of counsel claim in this direct appeal.
Accordingly, we affirm.
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I. BACKGROUND1
Appellant owned one store (Regency Mart), and was at
least part owner of a second store (Corner Store), in the
Providence, Rhode Island area. Both stores were authorized by the
federal government to accept SNAP credits -- a form of federal
benefits commonly known as "food stamps" -- from individual
recipients in exchange for approved food items. Clerks at both
stores participated in a scheme to defraud the SNAP program along
the following lines. Ordinarily, SNAP beneficiaries use
electronic benefit transfer (EBT) cards to purchase goods from a
retailer. The retailer then represents to the government that it
obtained those credits by selling approved items, and the
government deposits cash -- equivalent to the face value of the
credits -- into the retailer's account. At Regency Mart and Corner
Store, however, clerks fabricated sales to justify accepting SNAP
benefits. Customers with SNAP EBT cards paid a certain amount of
credits to the store, and the clerks gave them cash -- roughly
half the cash value of the credits. The stores then represented
to the government that they had accumulated the SNAP credits in
legitimate transactions, and received cash from the government in
1
Because appellant pled guilty, the relevant facts are taken
from the unchallenged portions of the Presentence Investigation
Report ("PSR"), and the change of plea and sentencing hearings.
See United States v. Dávila-González, 595 F.3d 42, 45 (1st Cir.
2010).
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exchange for those credits. In the end, the stores received about
half of the proceeds of the scheme, the other half going to the
SNAP beneficiaries themselves. Appellant admits to overseeing
operation of the scheme at Regency Mart, though he claims his role
was more limited at Corner Store.
II. DISCUSSION
A. The Offense Level Adjustment
Appellant claims that the record does not support the
district court's conclusion that he was "an organizer or leader of
a criminal activity that involved five or more participants or was
otherwise extensive," § 3B1.1(a), and that therefore the four-
level adjustment was applied in error.
We review the district court's factfinding for clear
error. See United States v. Delgado, 288 F.3d 49, 52 (1st Cir.
2002). We also review role-in-the-offense determinations, which
are innately fact-specific, for clear error. See United States v.
Colón-Muñoz, 318 F.3d 348, 364 (1st Cir. 2003).
The district court made two necessary findings before
applying § 3B1.1(a): that appellant was an "organizer or leader,"
and that the criminal activity was sufficiently extensive.2 Those
2 Criminal activity is sufficiently extensive under § 3B1.1(a)
if it either involved five or more participants, or was otherwise
extensive. See United States v. Dietz, 950 F.2d 50, 53 (1st Cir.
1991). Here, the district court found the conspiracy to be
otherwise extensive.
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findings had to be supported by a preponderance of the evidence.
See Delgado, 288 F.3d at 52. In making those findings, the court
was permitted to rely on undisputed facts from the PSR. See United
States v. Prochner, 417 F.3d 54, 65-66 (1st Cir. 2005). We see no
clear error in either finding.
The district court based its conclusion that appellant
was a leader or organizer on his direction of the scheme at Regency
Mart, and his control over the finances of both stores. The
undisputed facts adequately support this finding. Appellant
admitted that he was the sole owner of Regency Mart, authorized
his employees to conduct fraudulent transactions there, and
claimed substantially all of the $293,000 in illicit proceeds from
that location. See United States v. Aguasvivas-Castillo, 668 F.3d
7, 15 (1st Cir. 2012) (identifying factors to be considered in
determining the role-in-the-offense to include "authority
exercised over others," and "the claimed right to a larger share
of the fruits of the crime" (quoting U.S.S.G. § 3B1.1 cmt. n.4)).
With regard to Corner Store, appellant did not dispute the PSR's
statement that SNAP credits flowed from both stores into bank
accounts he controlled, including all proceeds of the illicit
transactions at Corner Store. Further, the money laundering counts
to which he pled guilty were based on transactions he personally
conducted using Corner Store's SNAP account. See id. (emphasizing
the significance of defendant's control over the bank accounts of
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stores engaged in SNAP fraud, and concluding that he exercised a
leadership role in the fraud); see also U.S.S.G. § 3B1.1 cmt. n.2
(authorizing a role-in-the-offense adjustment for defendants who
"exercise[] management responsibility over the property[] [or]
assets . . . of a criminal organization").
Additionally, it is undisputed that the criminal
activity here involved store employees and numerous SNAP
beneficiaries, and the illicit transfer of over $1.9 million in
SNAP credits over roughly three years. The district court's
finding that this activity was sufficiently extensive under
§ 3B1.1(a) was not clear error. See Dietz, 950 F.2d at 53-54(finding criminal activity otherwise extensive under § 3B1.1(a)
based on the "number of participants" -- including minor
participants -- and the "width, breadth, scope, complexity, and
duration" of the scheme); U.S.S.G. § 3B1.1 cmt. n.3 ("In assessing
whether an organization is 'otherwise extensive,' all persons
involved during the course of the entire offense are to be
considered.").
B. The Ineffective Assistance of Counsel Claim
Appellant also claims that his attorney's failure to
properly challenge the application of § 3B1.1(a) amounted to
ineffective assistance of counsel.3 Claims of ineffective
3
Counsel's purported failures are, first, not moving for an
evidentiary hearing on appellant's role in the offense, and second,
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assistance of counsel generally may not be raised for the first
time on direct appeal. United States v. Jones, 778 F.3d 375, 389
(1st Cir. 2015); United States v. Grace, 367 F.3d 29, 37 (1st Cir.
2004) (applying the rule to a claim of ineffective assistance at
sentencing). This is because appellate courts typically lack a
sufficient record to make the necessary fact-specific
determinations as to what happened, and why counsel took the
challenged actions. United States v. LaPlante, 714 F.3d 641, 648
(1st Cir. 2013). An exception to the general rule allows
ineffective assistance claims to be considered on direct appeal in
"those rare instances in which the record is sufficiently
developed." Jones, 778 F.3d at 389-90.
Appellant offers no plausible argument that the general
rule should not apply.4 We note, in particular, the lack of record
evidence on "why counsel acted as he did," LaPlante, 714 F.3d at
648, and decline to consider the ineffective assistance claim. We
dismiss this claim of error without prejudice to the defendant's
right to seek relief pursuant to 28 U.S.C. § 2255.
not arguing in the alternative that the court should enhance his
offense level by two levels under U.S.S.G. § 3B1.1(c) or three
levels under U.S.S.G. § 3B1.1(b), rather than four levels under
§ 3B1.1(a).
4
Indeed, appellant's brief fails to even acknowledge the
general rule as it exists in this circuit. In an apparent
oversight, the brief cites only Second Circuit cases on this issue.
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III. CONCLUSION
Finding no merit in appellant's arguments, we affirm the
judgment below.
So ordered.
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