United States v. Fred Joseph Suttles , 297 F. App'x 887 ( 2008 )

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
FILED
------------------------------------------- U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 07-12340 October 24, 2008
Non-Argument Calendar THOMAS K. KAHN
-------------------------------------------- CLERK
D.C. Docket No. 06-00107-CR-3-MCR
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
FRED JOSEPH SUTTLES,
a.k.a. Sport,
MARY R. HAM,
Defendants-Appellants.
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Appeal from the United States District Court
for the Northern District of Florida
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(October 24, 2008)
Before EDMONDSON, Chief Judge, ANDERSON and HULL, Circuit Judges.
PER CURIAM:
Defendants-Appellants Fred Joseph Suttles and Mary R. Ham appeal their
convictions for conspiracy to defraud the Internal Revenue Service (“IRS”) by
impeding the collection of tax revenues, in violation of 18 U.S.C. § 371.1 No
reversible error has been shown; we affirm.
The conspiracy charge alleged that Suttles and Ham conspired to evade
payment of employment taxes, individual income taxes, and corporate income
taxes. To that end, the indictment alleged Defendants created entities to defeat
IRS collection of taxes owed, engaged in the transfer of businesses and assets into
the name of Ham and others, created false documentation to disguise transfers of
business income to Defendants for their personal use and to conceal taxable
income, failed to withhold and to pay over employment taxes, and made
statements and committed acts to hide and conceal the conspiracy. The charged
conspiracy lasted from around August 1990 to 2006.
Defendants challenge the sufficiency of the evidence to support their
convictions. Defendants maintain that the evidence fails to show that they
knowingly and willfully agreed to defraud the IRS. Suttles argues that (1) the
evidence shows that he acted alone; and (2) fails to demonstrate that the United
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Suttles also was convicted on ten substantive income tax related counts. Only the conspiracy
convictions of Suttles and Ham are at issue in this appeal.
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States was the target of a conspiracy. Ham argues that she was a naive woman,
dependent on Suttles for financial support; she claims to have been only a passive
recipient of the fruits of Suttle’s tax schemes. According to Ham, the government
failed to prove her subjective knowledge of Suttles’s illegal acts and failed to
prove that she intended to conspire with him to defraud the IRS.
We review the sufficiency of the evidence to support a guilty verdict de
novo, viewing the evidence in the light most favorable to the government. United
States v. Klopf, 423 F.3d 1228, 1236 (11th Cir. 2005). We accept all reasonable
inferences and credibility choices in favor of the jury’s verdict. United States v.
Tinoco, 304 F.3d 1088, 1122 (11th Cir. 2002). When the government relies on
circumstantial evidence, reasonable inferences rather than mere speculation, must
support conviction. Klopf, 423 F.3d at 1236. If a reasonable jury could conclude
that the evidence establishes guilt beyond a reasonable doubt, we will affirm the
verdict. See Jackson v. Virginia, 99 S.Ct. 2781, 2789 (1979). No requirement
exists that the evidence “exclude every reasonable hypothesis of innocence or be
wholly inconsistent with every conclusion except that of guilt,” United States v.
Calderon, 127 F.3d 1314, 1324 (11th Cir. 1997), modified on other grounds by
United States v. Toler, 144 F.3d 1423, 1427 (11th Cir. 1998) (quotation and
citation omitted); the evidence is sufficient unless no reasonable trier of fact could
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find guilt established beyond a reasonable doubt even if the evidence might also
support a defendant’s theory of innocence. Tinoco, 304 F.3d at 1122; Calderon,
127 F.3d at 1324.
Under 18 U.S.C. § 371, it is a crime to “conspire either to commit any
offense against the United States, or to defraud the United States, or any agency
thereof in any manner of for any purpose ....” A conspiracy to defraud the United
States2 has three elements: (1) an agreement to achieve an unlawful objective; (2)
defendant’s knowing and voluntary participation in the conspiracy; and (3) the
commission of an overt act in furtherance of the conspiracy. United States v.
Cure, 804 F.2d 625, 628 (11th Cir. 1986). The agreement may be proved by
circumstantial evidence, see United States v. Silvestri, 409 F.3d 1311, 1328 (11th
Cir. 2005); and inferences based on defendant’s conduct may demonstrate
agreement and intent. See id. (agreement); United States v. LaSpesa, 956 F.2d
1027, 1035 (11th Cir. 1992) (participation and intent). “The government need not
prove that a defendant had knowledge of all details of the phases of the
2
The proof required to support a conviction under section 371 differs depending on whether the
conspiracy charged falls under the “any offense” clause or the “defraud” clause of section 371.
United States v. Mendez, 528 F.3d 811, 815 (11th Cir. 2008) petition for cert. filed, 77 USLW 3087(Aug. 1, 2008). Where, as here, the “defraud” clause applies, “the government must prove that the
United States was the ultimate target of the conspiracy.” Id. (quoting United States v. Harmas, 974
F.2d 1262, 1268 (11th Cir. 1992)).
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conspiracy. They need only demonstrate that the defendant knew the essential
nature of the conspiracy.” United States v. Lluesma, 45 F.3d 408, 410 (11th Cir.
1995).
Ample evidence in the record supports the jury’s verdict that Ham and
Suttles conspired to defraud the IRS. Evidence showed that Suttles owed the IRS
around $250,000 in 1998 and that Ham was aware of that debt. At Suttle’s behest,
Ham bought a business -- Diamond Brokers -- from Suttle’s ex-wife; evidence
showed that Ham was aware that Suttles did not buy Diamond Brokers himself
because assets held in Suttles’s name would be subject to IRS collection for
Suttles’s outstanding debt. Ham obtained financing to purchase real estate several
times based on her and Diamond Broker’s representations that she worked for
Diamond Brokers; the evidence showed Ham performed little or no work for
Diamond Brokers. Ham used false documentation to support mortgage
applications; Suttles’s controlled Diamond Broker’s assets and used them to pay
Ham’s mortgage obligation and other personal expenses. Records of Diamond
Brokers showed that Suttles listed payment to Ham improperly as loan
repayments; this listing disguised the taxable nature of some payments made to
Ham. Ham allowed Suttles to use her credit cards to obtain cash; Diamond
Brokers paid Ham’s credit card bills. False representations were made to the IRS
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by Ham about the amount of time she worked at Diamond Brokers and about
amounts she received from Suttles for child support. Both Suttles and Ham
engaged in tax protestor-related activity; and Ham fled when an IRS agent
attempted to serve her with a grand jury subpoena related to the instant
prosecution. The jury reasonably could infer from Ham’s flight consciousness of
guilt. See United States v. Borders, 693 F.2d 1318, 1324-25 (11th Cir. 1982).
Sufficient evidence demonstrated that Suttles and Ham knowingly and
voluntarily agreed to impede the collection by the IRS of taxes owed by them and
Diamond Brokers. The evidence showed that they acted jointly to prevent the IRS
from collecting taxes owed; they were aware that the purpose of their acts was to
impede IRS tax collection. The IRS, an agency of the United States government,
was the direct target of the conspiracy. We cannot say that no reasonable jury
could find beyond a reasonable doubt that Suttles and Ham conspired to defraud
the IRS in violation of 18 U.S.C. § 371.
AFFIRMED.
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