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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 16-16441
________________________
D.C. Docket No. 1:16-cr-00025-SCJ-LTW-1
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
versus
EDWARD TOWNSEND,
Defendant - Appellant.
________________________
Appeal from the United States District Court
for the Northern District of Georgia
________________________
(December 26, 2017)
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Before MARCUS and NEWSOM, Circuit Judges, and MOORE, * District Judge.
PER CURIAM:
A jury found Defendant Edward Townsend guilty of one count of conspiracy
to commit money laundering, in violation of 18 U.S.C. § 1956(h), and four counts
of money laundering, in violation of 18 U.S.C. § 1956(a)(1)(B)(i). The district
court sentenced Defendant to forty-eight months and eight days of imprisonment,
followed by a three-year term of supervised release. In addition, Defendant was
ordered to pay $5,679.75 in restitution.
Defendant appeals his conviction and sentence on four grounds. First,
Defendant argues that the Government failed to offer any evidence at trial that he
had any role in or knowledge of the underlying fraud scheme. Second, Defendant
contends that the Government presented insufficient evidence at trial for a
reasonable jury to conclude that he aided and abetted the substantive money
laundering counts. Third, Defendant maintains that the district court erroneously
applied the business-records exception to permit the introduction of certain
documents. Finally, Defendant reasons that the district court incorrectly calculated
his sentencing guidelines by including in the loss amount funds that were
unconnected to the underlying criminal conduct. For the following reasons,
Defendant’s conviction and sentence are affirmed.
*
Honorable William T. Moore, United States District Judge, for the Southern District of
Georgia, sitting by designation.
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I. BACKGROUND
This case starts with an all too common fraud scheme that involves
individuals phoning citizens and falsely informing them that a warrant had been
issued for their arrest for failing to appear for jury duty. 1 The fraudsters then
attempt to convince their victims that they can avoid being arrested by immediately
paying a fine. The victims are told that the fine can only be paid by using
GreenDot MoneyPaks—a cash substitute service that operates by loading funds
onto prepaid debit cards. Once loaded, the victim can then use the internet or
phone to transfer the funds on the MoneyPak. Transferring funds only requires a
fourteen-digit PIN number for the MoneyPak and the number of the receiving
account. Physical possession of the MoneyPak is not required so long as the
individual transferring the funds knows the fourteen-digit PIN. A MoneyPak is
intended and designed to operate as cash, meaning that the funds are unrecoverable
once transferred from the MoneyPak.
The indictment alleged that unknown inmates housed by the Georgia
Department of Corrections (“DOC”) executed this type of fraud scheme using
contraband cell phones smuggled into various prisons. After a victim was
1
Because a jury convicted Defendant of all charges, the facts are presented in the light
most favorable to the Government by resolving all reasonable inferences and credibility
determinations in favor of the jury’s verdict. United States v. Doe,
661 F.3d 550, 560 (11th Cir.
2011).
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defrauded, Defendant, co-Defendant Caeser Futch, co-Defendant Tangela Parks,2
and others known and unknown engaged in a conspiracy to launder the proceeds of
the scheme by immediately transferring the funds from the MoneyPaks to other
financial products. Both Defendant and co-Defendant Futch operated this scheme
while incarcerated with the DOC. At various times, Defendant and co-Defendant
Futch resided at the same prison and for a portion of that time resided in the same
cell block. Co-Defendant Parks is co-Defendant Futch’s spouse. A fourth,
unindicted co-conspirator—Tashandra Williams—is the mother of one of
Defendant’s children.
At trial, Ms. Williams testified that she assisted Defendant in laundering the
MoneyPaks. Defendant would transfer the MoneyPak to prepaid debit cards held
by Ms. Williams, who would then purchase new MoneyPaks using those funds.
Finally, Ms. Williams would text the PIN numbers for the new MoneyPaks to
Defendant. For her role, Ms. Williams would occasionally receive some of the
funds.
The Government also presented evidence related to the movement of
specific victim’s funds. On June 26, 2015, W.M. provided 4 MoneyPaks totaling
$2,000 to avoid a purported arrest warrant. At least two of these MoneyPaks were
transferred to two separate debit cards held by Ms. Williams. Both transfers
2
Both co-Defendants Futch and Parks pled guilty prior to Defendant’s trial.
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occurred within two hours of W.M. purchasing the MoneyPaks. On the same day,
Ms. Williams used the debit cards to make four separate transactions, all within
fifteen minutes of each other, at a Rite-Aid: two purchases for $504.95, one for
$459.90, and one for $469.90.
On June 30, 2014, T.M. purchased three MoneyPaks totaling $1,372.
Approximately forty minutes later, one MoneyPak was transferred to Ms.
William’s WalMart charge card. Within thirty minutes of their purchase, the other
two MoneyPaks were transferred to prepaid debit cards held by an individual
named Treion Johnson.
On January 5, 2015, J.G. purchased five MoneyPaks totaling $2,283.
Approximately fifty minutes after the purchase, two of the MoneyPaks were
transferred to an American Express debit card and a PayPal account, both in
Defendant’s name. Within thirty-five minutes, two other of the MoneyPaks were
transferred to co-Defendant Park’s debit card. That debit card was used eighteen
minutes later at a Kroger self-checkout kiosk to obtain cash-back. The fifth
MoneyPak was never transferred due to a problem with the fourteen-digit PIN.
At trial, the Government used a variety of business records to establish the
timing of the phone calls in relation to the transfer of the laundered funds.
Defendant objected to five of these exhibits. Two were business records of a
company named AccountNow, which had been acquired by GreenDot. The other
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three were records of Cricket Wireless, which had been acquired by AT&T. The
Government called record custodians for the new companies to authenticate both
sets of records. The GreenDot custodian testified that he was familiar with
AccountNow’s recordkeeping because it had been a financial partner of GreenDot
prior to its acquisition and he assumed that the records are accurate. Similarly, the
AT&T custodian testified that he never worked for Cricket Wireless and had no
knowledge of whether it kept good records, but believed the records to be accurate.
Defendant objected to the introduction of these exhibits under the business
record exception based on the custodians lacking any personal knowledge of the
acquired companies’ record-keeping practices. The district court admitted the
exhibits, stating that “[t]he foundation requirements that I have to find are
trustworthiness and under the circumstances I’ve heard so far I have not heard
anything that would not lead me to believe the trustworthiness of the testimony that
these records were prepared the way [the witness] indicated.”
At sentencing, the district court calculated the loss amount as $22,724.75.
This total included $17,545 that was transferred from various MoneyPaks to
Defendant’s PayPal account. Defendant argued that the Government failed to
establish by a preponderance of the evidence that these funds were from the fraud
scheme because it was entirely possible they were generated selling contraband
cellular phones in prison. Finding that the Government established by a
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preponderance of the evidence that these MoneyPaks came from the fraud scheme,
the district court overruled the objection and included those amounts in the total
loss, which resulted in a four-level enhancement.
II. ANALYSIS
Defendant argues that the Government did not present any evidence that
would permit a reasonable jury to conclude that he knew the funds being
transferred were the proceeds of the fraud scheme. As a result, Defendant contends
that his conviction must be vacated because the Government failed to establish an
element of money laundering—that while conducting or attempting to conduct the
financial transaction Defendant knew that the property involved in the transaction
represented the proceeds of some kind of unlawful activity. In response, the
Government primarily relies on the short time frame within which a MoneyPak
purchased by a fraud victim would be transferred to Ms. Williams, and then in
some cases transferred to Defendant.
When assessing an appellant’s challenge to the sufficiency of the evidence,
the Court reviews the evidence presented at trial in the light most favorable to the
government. United States v. Dulcio,
441 F.3d 1269, 1276 (11th Cir. 2006) (citing
United States v. Williams,
144 F.3d 1397, 1401 (11th Cir. 1998)). The Court must
draw all reasonable factual inferences in a manner consistent with the jury’s
verdict.
Id. A guilty verdict must stand where a “‘reasonable fact-finder could have
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determined that the evidence proved’ [d]efendants' guilt beyond a reasonable
doubt.” United States v. Westry,
524 F.3d 1198, 1210 (11th Cir. 2008) (quoting
United States v. Smith,
459 F.3d 1276, 1286 (11th Cir. 2006)).
To convict Defendant, the Government had to prove that “he knew [the]
involved funds [] were the proceeds of some form of unlawful activity.” United
States v. Tarkoff,
242 F.3d 991, 994 (11th Cir. 2001). Circumstantial evidence is
sufficient to establish that a defendant knew the proceeds were the result of an
unlawful activity. United States v. Frazier,
605 F.3d 1271, 1282 (11th Cir. 2010)
(citing United States v. Gallo,
927 F.2d 815, 822 (5th Cir. 1991)). In addition,
“[t]he government need not prove that the funds came from a specific illegal
action.”
Id.
Viewing the evidence in this case in the light most favorable to the guilty
verdict, the Government presented sufficient evidence that would permit a
reasonable jury to conclude that Defendant knew the funds were the proceeds of an
unlawful activity. The timing of the payments by the fraud victims and the transfer
of money is sufficient to permit the jury to infer that Defendant knew the funds
derived from the fraud scheme. While Defendant complains of the circumstantial
nature of the Government’s evidence, direct evidence that Defendant knew that the
laundered funds were from the fraud scheme is unnecessary. The jury is entitled to
infer such knowledge based upon inferences drawn from the unique circumstances
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of this case. See, e.g., United States v. Miller,
255 F.3d 1282, 1287 (11th Cir. 2001)
(finding circumstantial evidence sufficient to allow jury to reasonably infer the
defendant knew shotgun barrel shorter than eighteen inches); United States v.
Samuels, ___ F. App’x ___,
2017 WL 5186317, at *2 (11th Cir. 2017) (“[W]hether
the jury could reasonably infer knowledge depends, as common sense would
suggest, on the surrounding facts and circumstances.” (quoting United States v.
Ayala-Tapia,
520 F.3d 66, 68 (1st Cir. 2008)); United States v. Ministre, 565 F.
App’x 806, 809-10 (11th Cir. 2014) (finding circumstantial evidence sufficient to
allow jury to reasonably infer the defendant knew purses contained drugs).
Defendant also argues that the Government failed to present sufficient
evidence for a jury to find him guilty of the substantive money laundering counts,
which are based on four cash-back transactions at a Kroger self-checkout kiosk.
Defendant contends that there was no evidence he played any part in those
transactions, or aided and abetted the individual performing those transactions. In
response, the Government reasons that it presented more than enough
circumstantial evidence to permit the jury to reasonably conclude that Defendant
aided and abetted co-Defendant Parks in the money laundering transactions.
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To obtain a conviction for concealment money laundering, the Government
must prove beyond a reasonable doubt that the Defendant, “knowing that the
property involved in a financial transaction represent[ed] the proceeds of some
form of unlawful activity, conduct[ed] or attempt[ed] to conduct such a financial
transaction which in fact involve[d] the proceeds of specified unlawful activity–
knowing that the transaction [was] designed in whole or in part– to conceal or
disguise the nature, the location, the source, the ownership, or the control of the
proceeds of specified unlawful activity.” 18 U.S.C. § 1956(a)(1)(B)(i). A defendant
can be convicted of aiding and abetting where he “associate[s] himself with the
venture, participate[s] in it as something he wishes to bring about, and seek[s] by
his action to make it successful.” United States v. Carter,
721 F.2d 1514, 1533
(11th Cir. 1984). The Government bears the burden of establishing, by direct or
circumstantial evidence, “that the accused shared in the principal's criminal intent
as to all the necessary statutory elements of the offense.” United States v. Kriesser,
731 F.2d 1509, 1516 (11th Cir. 1984); accord United States v. Pantoja-Soto,
739
F.2d 1520, 1525 (11th Cir. 1984) (“Direct or circumstantial evidence may be used
to prove the essential elements of aiding and abetting.”). This Court has provided a
useful illustration in United States v. Brantley:
The aiding and abetting requirement of shared intent between the
aider and abettor and the principal, sometimes referred to as the
“community of unlawful intent,” see, e.g., United States v. Austin,
585
F.2d 1271, 1277 (5th Cir. 1978), is similar to the requirement in
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conspiracy cases that there be an “agreement.” However, shared intent
need not rise to the level of agreement. United States v. Cowart,
595
F.2d 1023, 1031 (5th Cir. 1979). The fact that here [the defendant]
and [the co-conspirator], although not charged with conspiracy, were
almost certainly conspirators in fact, emphasizes the strength of “the
community of unlawful intent” between [the defendants].
733 F.2d 1429, 1435 n.9 (11th Cir. 1984). A defendant’s participation in an
underlying conspiracy can support a jury’s conclusion that he “expected and
encouraged the individual [actions] which constitute the substantive offenses.”
United States v. Owens,
492 F.2d 1100, 1104 (5th Cir. 1974).3
Once again, the Government presented sufficient circumstantial evidence for
the jury to reasonably infer that Defendant aided and abetted in the commission of
the money laundering counts. First, the Government presented evidence that
Defendant recruited Ms. Williams to launder funds, making it likely that he also
recruited co-Defendant Parks. Second, the Government established that the
MoneyPak laundered as part of the Kroger transactions was one of five purchased
by J.G. One MoneyPak was deposited into Defendant’s American Express account,
one into Defendant’s PayPal account, and two onto co-Defendant Park’s prepaid
debit card. The four MoneyPaks were all transferred within one hour of being
purchased by J.G. Third, Defendant’s splitting of J.G.’s money into several
different accounts is evidence of Defendant’s involvement in the money
3
In Bonner v. City of Prichard,
661 F.2d 1206, 1209 (11th Cir.1981) (en banc), the
Eleventh Circuit adopted as binding precedent all Fifth Circuit decisions that were handed down
prior to the close of business on September 30, 1981.
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laundering. The common source of the funds, the timing of their distribution, and
the manner they were laundered is all evidence that would permit a reasonable jury
to conclude that Defendant likely assisted co-Defendant Parks in laundering the
funds.
Moreover, the illustration in Brantley is applicable to this case. Having
determined that the Government presented sufficient evidence to support
Defendant’s conviction for conspiracy to commit money laundering, that
conspiracy conviction only “emphasizes the strength of ‘the community of
unlawful intent’ ” shared by Defendant, co-Defendant Futch, co-Defendant Parks,
and Ms. Williams. See
Brantley, 722 F.2d at 1435 n.9. The jury could easily
conclude that Defendant aided and abetted co-Defendant Parks because he
“expected and encouraged” the conduct that formed the substantive money
laundering counts—the Kroger cash-back transactions.
Id.
Defendant also contends that the district court abused its discretion by
admitting business records that the Government failed to properly authenticate.
Those records were from companies that had been acquired by another entity
sometime after the original company created the records in question. Defendant’s
argument is that the records custodian for the new company is unqualified to
authenticate those records due to a lack of knowledge concerning the acquired
companies’ record-keeping practices. In response, the Government contends that
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hearsay is admissible under the business records exception if the district court
determined that it is reliable, a decision over which the district court enjoys broad
discretion. In addition, the Government maintains that any abuse of discretion in
admitting the business records is harmless.
The business records exception to the hearsay rules excludes
[a] record of an act, event, condition, opinion, or diagnosis if:
(A) the record was made at or near the time by—or from information
transmitted by—someone with knowledge;
(B) the record was kept in the course of a regularly conducted activity
of a business, organization, occupation, or calling, whether or not
for profit;
(C) making the record was a regular practice of that activity;
(D) all these conditions are shown by the testimony of the custodian
or another qualified witness, or by a certification that complies
with Rule 902(11) or (12) or with a statute permitting
certification; and
(E) the opponent does not show that the source of information or the
method or circumstances of preparation indicate a lack of
trustworthiness.
Fed. R. Evid. 803(6). “The touchstone of admissibility under Rule 803(6) is
reliability, and a trial judge has broad discretion to determine the admissibility of
such evidence.” United States v. Collado, 439 F. App’x 845, 848 (11th Cir. 2011)
(citing United States v. Arias–Izquierdo,
449 F.3d 1168, 1183 (11th Cir. 2006)).
“To be admitted under that exception the person who actually prepared the
documents need not have testified so long as other circumstantial evidence and
testimony suggest their trustworthiness. Nor is it required that the records be
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prepared by the business which has custody of them.”
Id. (quoting United States v.
Parker,
749 F.2d 628, 633 (11th Cir. 1984)).
Even assuming the Government failed to establish that the requisite
conditions for admissibility were “shown by the testimony of the custodian or
another qualified witness,” Fed. R. Evid. 803(6)(D), any such error in this case was
harmless. After reviewing the evidence presented at trial, this Court concludes that
there was sufficient evidence outside of these business records supporting the
jury’s finding of guilt. See United States v. Arbolaez,
450 F.3d 1283, 1290 (11th
Cir. 2006) (“Evidentiary and other nonconstitutional errors do not constitute
grounds for reversal unless there is a reasonable likelihood that they affected the
defendant's substantial rights.”). For example, the AccountNow documents were
not the only evidence of the movement and timing of the funds fraudulently
obtained from W.M. and T.M. Also, Ms. Williams testified how she assisted
Defendant in laundering funds using MoneyPaks. In short, the absence of these
records provides less corroborating evidence of Defendant’s guilt. However, the
wealth of other incriminating evidence presented at trial supporting the jury’s
verdict shows that the “error had no substantial influence on the outcome, []
sufficient evidence uninfected by error supports the verdict, [and] reversal is not
warranted.”
Id.
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Defendant appeals his 48-month and 8-day sentence, arguing that the district
court improperly calculated the guideline range because it included all funds
deposited into his PayPal account during the period of the conspiracy in its
calculation of the loss amount. This Court reviews the district court’s
determination of facts concerning the amount of money involved in a money
laundering scheme for clear error and the interpretation of the Sentencing
Guidelines de novo. United States v. Paley,
442 F.3d 1273, 1276 (11th Cir. 2006).
There is no clear error where the record supports the district court’s findings.
United States v. Petrie,
302 F.3d 1280, 1290 (11th Cir. 2002). The government
bears the burden of proving by a preponderance of the evidence actual loss
attributable to the defendant’s conduct. See United States v. Stein,
846 F.3d 1135,
1152 (11th Cir. 2017).
The base offense level for money laundering is “8 plus the number of
offense levels from the table in § 2B1.1 (Theft, Property Destruction, and Fraud)
corresponding to the value of the laundered funds.” U.S.S.G. § 2S1.1(a)(2). The
table in § 2B1.1(b)(1) does not increase the base offense level if the loss involved
$6,500 or less, but increases the base offense level by 4 if the loss was greater than
$15,000, but no more than $40,000.
Id. § 2B1.1(b)(1)(A), (C), (D). The
commentary defines loss as “the greater of actual loss or intended loss,” with
“actual loss” being “the reasonably foreseeable pecuniary harm that resulted from
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the offense” and “intended loss” being “the pecuniary harm that the defendant
purposely sought to inflict” even if “impossible or unlikely to occur.”
Id. § 2B1.1
cmt. n.3(A)(i)-(ii). The commentary explains that “the court’s loss determination is
entitled to appropriate deference” because the court “is in a unique position to
assess the evidence and estimate the loss based upon that evidence.”
Id. § 2B1.1
cmt. n.3(C). The court need only make a reasonable estimate of the loss.
Id. This is
because the amount of loss can be “difficult to determine accurately.” United
States v. Bradley,
644 F.3d 1213, 1290 (11th Cir. 2011) (quoting United States v.
Medina,
485 F.3d 1291, 1304 (11th Cir. 2007)).
The district court is permitted to base its loss determination on factual
findings derived from “among other things, evidence heard during trial, undisputed
statements in the PSI, or evidence presented during the sentencing hearing.”
Id.
(quoting United States v. Polar,
369 F.3d 1248, 1255 (11th Cir. 2004)). The court
can employ a variety of methods to derive a “reasonable estimate of the loss” to the
victims based on the information available to it.
Stein, 846 F.3d at 1152 (quoting
United States v. Snyder,
291 F.3d 1291, 1295 (11th Cir. 2002)). Although the court
may estimate the amount of loss, it cannot “speculate about the existence of facts
and must base its estimate on reliable and specific evidence.”
Id. (quoting United
States v. Ford,
784 F.3d 1386, 1396 (11th Cir. 2015)). It can, however, rely on
“specific circumstantial evidence” to estimate the amount of loss and it is not
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required to restrain itself to absolute figures.
Bradley, 644 F.3d at 1290 (quoting
United States v. Willis,
560 F.3d 1246, 1251 (11th Cir. 2009)).
The district court did not clearly err by including in the loss amount all of
the deposits made into Defendant’s PayPal account during the life of the
conspiracy, because that finding is supported by sufficient circumstantial evidence
from the record. See
Bradley, 644 F.3d at 1290; see also
Petrie, 302 F.3d at 1290.
Defendant conceded at sentencing that he should be attributed losses from W.M.,
T.M., and J.G. totaling $3,872. The record supports attributing Defendant with an
additional $1,807.75 loss from J.G. because at least some funds from that scheme
were transferred to Defendant’s PayPal account. The record also supports the
conclusion that the remaining $17,045 in deposits made to Defendant’s PayPal
account was related to the money laundering conspiracy. The amount and timing of
those deposits were consistent with Defendant’s laundering of the funds obtained
from W.M., T.M., and J.G. In addition, the funds in the PayPal account were often
withdrawn from ATMs in Columbus, Georgia, where Defendant previously lived
and where Ms. Williams resided at that time. After a thorough review, the district
court’s inclusion of the PayPal funds in the total $22,724.75 loss amount is a
reasonable estimate based on the available specific circumstantial evidence
presented at the sentencing hearing.
AFFIRMED.
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