United States v. Bryan Noel , 502 F. App'x 284 ( 2012 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 11-4283
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
BRYAN KEITH NOEL,
Defendant - Appellant.
Appeal from the United States District Court for the Western
District of North Carolina, at Asheville. Richard L. Voorhees,
District Judge. (1:09-cr-00057-RLV-1)
Argued: October 24, 2012 Decided: December 28, 2012
Before DAVIS and FLOYD, Circuit Judges, and Catherine C. EAGLES,
United States District Judge for the Middle District of North
Carolina, sitting by designation.
Affirmed by unpublished opinion. Judge Eagles wrote the
opinion, in which Judge Davis and Judge Floyd joined.
ARGUED: Ann Loraine Hester, FEDERAL DEFENDERS OF WESTERN NORTH
CAROLINA, INC., Charlotte, North Carolina, for Appellant.
Melissa Louise Rikard, OFFICE OF THE UNITED STATES ATTORNEY,
Charlotte, North Carolina, for Appellee. ON BRIEF: Henderson
Hill, Executive Director, FEDERAL DEFENDERS OF WESTERN NORTH
CAROLINA, INC., Charlotte, North Carolina, Matthew Segal,
Allison Wexler, FEDERAL DEFENDERS OF WESTERN NORTH CAROLINA,
INC., Asheville, North Carolina, for Appellant. Anne M.
Tompkins, United States Attorney, Charlotte, North Carolina, for
Appellee.
Unpublished opinions are not binding precedent in this circuit.
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EAGLES, District Judge:
A jury convicted Bryan Keith Noel of conspiracy to commit
mail fraud, multiple counts of mail fraud, conspiracy to commit
money laundering, money laundering, multiple counts of bank
fraud, multiple counts of making false statements to a bank, and
making a false oath in a bankruptcy proceeding. J.A. 2192-93,
2460. Noel was sentenced to 300 months’ imprisonment. J.A.
2453, 2461. On appeal, Noel challenges two evidentiary rulings,
the propriety of the prosecutor’s remarks during closing
arguments, and a sentencing enhancement. Finding no reversible
error, we affirm.
I.
A.
Noel’s convictions in large part stem from an investment
fraud scheme. The government alleged that, between 2003 and
2006, Noel recruited retirees to invest more than $10 million
with his estate planning company, Certified Estate Planners
(“CEP”), by assuring them that their funds would be invested in
small-cap stocks and that the investments were low-risk. J.A.
252-54, 372.
Although Noel consistently provided the investors with
quarterly statements indicating favorable returns, J.A. 281-82,
333-40, 376-77, 420-23, 650-52, 654-58, 744-45, 751, their
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investments were generally unsuccessful. J.A. 985. In early
2002, Noel agreed to offer a stock trading program developed by
Alexander Klosek, who was employed by CEP as an independent
trustee and accountant. J.A. 817, 820, 828-30. The program
went well for several months, but it began sustaining
substantial losses by June 2002. J.A. 842. Klosek did not tell
Noel about the losses. J.A. 842-44, 853-60.
In 2003, Noel began borrowing money from CEP’s investor
funds to pay for his start-up mining business, including $2
million to purchase a factory in Tennessee. J.A. 861-65, 872.
Noel and Klosek agreed to conceal the loan from the investors.
J.A. 875, 879-80, 915-16, 934, 1168. Noel continued to borrow
money from CEP to fund his start-up companies until 2006,
totaling an additional $2 million. J.A. 467, 474, 889, 903-04,
906-07, 912-13, 1360-63, 2270-74. In 2005, Klosek told Noel
about the losses sustained as a result of the stock trading
program. J.A. 985-91. Noel continued to issue positive
quarterly statements. J.A. 333, 337, 423, 893-96, 1718-19,
2223.
Of the over $10 million invested by CEP clients,
approximately $2 million were lost in stock market trades and
more than $4 million were diverted to Noel’s start-ups before
CEP’s collapse in August 2006. J.A. 1348, 1369, 1406, 1979,
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2267, 2275, 2359. When the government seized CEP’s accounts in
August 2006, only $997,630.20 remained. J.A. 1375.
B.
Noel’s bank fraud convictions arose from Noel’s fraudulent
statements on two loan applications. In late 2005, one of
Noel’s start-up companies applied for and received a $1.25
million loan from Carolina First Bank. J.A. 1001, 1474-75,
1479, 1504, 1805, 1826. The stated purposes of the loan were to
repay an earlier loan from Carolina First and to purchase
equipment. J.A. 1475, 1479, 1504, 1805, 1826. Noel signed the
loan on behalf of his start-up. J.A. 1504. Noel and Klosek
actually invested the money in the stock market, hoping to make
enough to repay CEP for the funds Noel had routed to his start-
ups. J.A. 1001-15, 1453. The investments were unsuccessful,
and Noel again sustained substantial losses. J.A. 1006-07,
1018-20, 1196, 1970-74, 2368.
In August 2006, Noel sought to refinance his home. J.A.
1511-12. In his loan application, Noel falsely stated that he
was not a defendant to any lawsuit. J.A. 1322, 1381-82. Noel
also certified that his income was $23,000 per month. J.A.
1517, 1530, 1538, 1993-97. However, on his later-filed
bankruptcy petition, Noel reported his 2006 income as $150,000;
on his 2006 tax return, he reported $154,783. J.A. 1447, 1993-
97.
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C.
Noel’s bankruptcy fraud convictions stemmed from false
statements he made on his August 2007 bankruptcy petition.
Despite owning a 2007 BMW with a purchase price of $72,890 and a
$1000 assault rifle, Noel listed only a 1997 Ford truck valued
at $3500 and only $100 in sporting goods. J.A. 1631-34, 1654,
1683, 1685-86, 1688.
II.
On appeal, Noel first contends that the district court
erred in admitting testimony from four CEP investors about the
effects of their financial losses, rendering his trial
fundamentally unfair under the Due Process Clause of the Fifth
Amendment. The victims testified over defense objections that
after losing the money they invested with CEP, they could not
pay off their mortgages, had to sell their homes, and had to
work despite having saved for retirement. J.A. 283-84, 388-89,
638-39. The government’s final witness, Carol Odegaard,
testified in tears that she almost lost her home, became
depressed, had thoughts of suicide, and could not afford her
medication. J.A. 1720-21.
We review preserved evidentiary rulings for abuse of
discretion and will only reverse a ruling that is “arbitrary and
irrational.” United States v. Cloud, 680 F.3d 396, 401 (4th
6
Cir. 2012) (internal quotation marks omitted). Under Rule 52(a)
of the Federal Rules of Criminal Procedure, evidentiary rulings
are subject to harmless error review, “such that ‘in order to
find a district court’s error harmless, we need only be able to
say with fair assurance, after pondering all that happened
without stripping the erroneous action from the whole, that the
judgment was not substantially swayed by the error.’” United
States v. Johnson, 617 F.3d 286, 292 (4th Cir. 2010) (quoting
United States v. Brooks, 111 F.3d 365, 371 (4th Cir. 1997)).
The testimony about the victims’ financial losses was
relevant to prove intent to defraud. Cloud, 680 F.3d at 402;
see also United States v. Copple, 24 F.3d 535, 545 (3d Cir.
1994) (“Proving specific intent in mail fraud cases is
difficult, and, as a result, a liberal policy has developed to
allow the government to introduce evidence that even
peripherally bears on the question of intent. Proof that
someone was victimized by the fraud is thus treated as some
evidence of the schemer’s intent.” (internal citations
omitted)). Even Odegaard’s testimony about her mental health
was offered in the context of explaining the financial
consequences of the fraud and her inability to pay for her
prescription medicine. This testimony was extremely brief and
was followed by a cautionary instruction not to be swayed by
sympathy or pity.
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Even assuming that the district court erred in admitting
Odegaard’s testimony, the error was harmless and did not rise to
the level of a due process violation. The jury heard extensive
testimony from Klosek that Noel planned and executed a scheme to
defraud the investors. Several victims testified as to what
Noel said would be done with their money and what actually
happened to it. The government presented documentary evidence
of the losses contrasted with letters in which Noel assured CEP
clients that their investments were thriving. The brief victim-
impact testimony “was therefore cumulative and did not have a
substantial or injurious effect on the jury’s verdict.” United
States v. DeLeon, 678 F.3d 317, 328 (4th Cir. 2012).
Additionally, Noel was acquitted on one charge, indicating the
jury was not unfairly influenced by passion or sympathy. Thus,
we are confident that the jury’s guilty verdicts were not
attributable to any error in admitting the victim-impact
testimony. See Sullivan v. Louisiana, 508 U.S. 275, 279 (1993).
III.
Noel also argues that the district court erred in admitting
Klosek’s testimony because Klosek was taking anti-anxiety
medication. Noel contends that the testimony violated the Sixth
Amendment’s Confrontation Clause because the medication acted as
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a “screen” that deprived Noel of a meaningful opportunity for
confrontation and cross-examination.
Because defense counsel did not object at trial with a
reasonable degree of specificity as to the Confrontation Clause
violation, objecting instead on competency grounds, this claim
is subject to plain error review. See Fed. R. Evid. 103(a);
United States v. Parodi, 703 F.2d 768, 783 (4th Cir. 1983) (“The
mandate for specificity in the Rule imposes upon the objecting
party the obligation to object with that reasonable degree of
specificity which would have adequately apprised the trial court
of the true basis for his objection; and would have clearly
stated the specific ground now asserted on appeal.” (internal
quotation marks, citations, and alteration omitted)).
Accordingly, we will reverse only if Noel demonstrates error
that was plain and affected his substantial rights. United
States v. Mackins, 315 F.3d 399, 408 (4th Cir. 2003).
The Confrontation Clause protects a defendant’s right to
face witnesses who testify against him and his right to conduct
cross-examination. See Pennsylvania v. Ritchie, 480 U.S. 39, 51
(1987); United States v. Jinwright, 683 F.3d 471, 482-83 (4th
Cir. 2012). There is nothing in the record to indicate that
Klosek’s medication had the effect of “screening” Klosek from
Noel. See Coy v. Iowa, 487 U.S. 1012, 1020-21 (1988) (holding
that a witness’s testimony, given from behind a screen designed
9
to block the witness’s view of the defendant, violated the
defendant’s right to a face-to-face encounter). Further, Noel
was given a full and complete opportunity to cross-examine
Klosek in front of the jury, including questions about his
mental health and the effects of his medication. Accordingly,
we hold that the district court did not err in permitting Klosek
to testify.
IV.
Noel next challenges the government’s closing argument.
Specifically, Noel objects to what he characterizes as the
prosecutor’s (1) call for justice; (2) comparison of Noel to the
victims; and (3) call for the jury to “do the right thing.”
In the government’s closing argument, after summarizing the
fraud schemes, counsel closed with the following:
While John Thomas worked for years as a lineman
in the Wisconsin winters and the hot Midwest summers
saving up so he and his wife could hike and travel in
the final years of their retirement, it took Mr. Noel
one seminar, one meeting, one wire transfer, and one
big lie to take half of it away and to buy himself a
factory . . . .
While Ms. O’Ryan worked hard as a single mom and
as a teacher saving up so her daughter could go to
medical school Mr. Noel had other ideas for her money.
She never even heard of [Noel’s start-up companies]
until it was too late.
While Mr. Emme and his wife lived under their
means for 30 plus years saving up for retirement Mr.
Noel was using their money to buy a factory . . . , to
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fund [one of his start-ups], buying five BMWs in five
years, refinancing his million-dollar home, and hiding
his $73,000 BMW, his expensive firearm, and $200,000
in income from the federal bankruptcy court.
It’s been an endless stream of lies, members of
the jury. But now it is time for the truth. It is
time for you to hold Mr. Noel accountable. It is time
for you to give these people justice. It is time to
find the truth. It is time to find him guilty.
J.A. 2093-94. During the government’s rebuttal, counsel stated
We’re asking for it to finish right. These people
were wronged. They were lied to repeatedly. They
were defrauded. They were subjected to a scheme to
defraud, as was the bankruptcy court, as was JP Morgan
Bank, as was Carolina First Bank, and what we are
asking you to do is to end it right, to finish it
right, to do the right thing.
J.A. 2134.
Because Noel did not object to the prosecutor’s remarks, we
review this claim for plain error. See United States v. Loayza,
107 F.3d 257, 262 (4th Cir. 1997).
“[P]rosecutors enjoy considerable latitude in presenting
arguments to a jury because the adversary system permits the
prosecutor to prosecute with earnestness and vigor.” Bates v.
Lee, 308 F.3d 411, 422 (4th Cir. 2002) (internal quotation marks
and citations omitted). A prosecutor’s remarks may violate a
defendant’s due process rights, however, if the remarks were (1)
improper; and (2) so prejudiced the defendant’s substantial
rights that he was denied a fair trial. United States v.
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Wilson, 624 F.3d 640, 656 (4th Cir. 2010). In assessing
prejudice, we consider:
(1) the degree to which the prosecutor’s remarks have
a tendency to mislead the jury and to prejudice the
accused; (2) whether the remarks were isolated or
extensive; (3) absent the remarks, the strength of
competent proof introduced to establish the guilt of
the accused; (4) whether the comments were
deliberately placed before the jury to divert
attention to extraneous matters; (5) whether the
prosecutor’s remarks were invited by improper conduct
of defense counsel; and (6) whether curative
instructions were given to the jury.
Id. at 656-57.
The prosecutor’s comments were not improper and did not
deny Noel a fair trial. When a crime has a victim, it is not
improper to point that out to the jury. The argument accurately
summarized the evidence presented at trial and placed Noel’s
conduct in context. Moreover, the government presented strong
evidence of Noel’s guilt, and the court had already instructed
the jury to resist being swayed by sympathy for the victims.
Having found no reversible error in the admission of
evidence or the government’s closing argument, we also reject
Noel’s proposition that, combined, the victim-impact testimony
and the government’s closing argument warrant reversal pursuant
to the cumulative error doctrine. Faced with strong evidence
against Noel and a fundamentally fair trial, we conclude that
cumulatively there is no error.
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V.
Finally, Noel claims that the district court committed
procedural sentencing error by imposing a two-level
sophisticated means enhancement pursuant to U.S. Sentencing
Guidelines Manual (“USSG”) § 2B1.1(b)(9)(C) (2009), and a two-
level sophisticated laundering enhancement, pursuant to USSG §
2S1.1(b)(3). In reviewing a district court’s guidelines
calculation, “including its application of any sentencing
enhancements, this Court reviews the district court’s legal
conclusions de novo and its factual findings for clear error.”
United States v. Horton, 693 F.3d 463, 474 (4th Cir. 2012). We
thus review for clear error the district court’s finding that
Noel used sophisticated means.
Section 2B1.1(b)(9)(C) of the 2009 guidelines provides for
a two-level sentencing enhancement if the offense “involved
sophisticated means,” which is defined as “especially complex or
especially intricate offense conduct pertaining to the execution
or concealment of an offense.” USSG § 2B1.1 cmt. n.8(B).
Likewise, USSG § 2S1.1(b)(3) applies a two-level enhancement
where a money laundering offense “involved sophisticated
laundering,” similarly defined as “complex or intricate offense
conduct pertaining to the execution or concealment of the 18
U.S.C. § 1956 offense.” USSG § 2S1.1 cmt. n.5(A).
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Noel essentially argues that his conduct was not intricate
or complex enough to warrant sophistication enhancements because
he did not use fictitious entities, shell corporations, or
offshore accounts. However, each of a defendant’s individual
actions need not be sophisticated to warrant a sophisticated
means enhancement. See Jinwright, 683 F.3d at 486 (applying
USSG § 2T1.1(b)(2) tax fraud sophisticated means enhancement);
United States v. Snow, 663 F.3d 1156, 1163-64 (10th Cir. 2011)
(applying USSG § 2B1.1(b)(9)(C)); United States v. Ghertler, 605
F.3d 1256, 1267-68 (11th Cir. 2010) (same); United States v.
Wayland, 549 F.3d 526, 529 (7th Cir. 2008) (same).
The district court found application of § 2B1.1(b)(9)(C)
and § 2S1.1(b)(3) was appropriate in light of the “intricate web
of representations and manipulations and maneuverings” Noel
created to hide the scheme from his investors. J.A. 2398. This
finding was supported by substantial evidence. Over a three-
year period, Noel attracted CEP clients by assuring them that he
would invest their money safely and took money from those
investors to fund his own start-up companies. Meanwhile, Noel
intentionally informed the investors through quarterly
statements and letters, as well as in person, that their money
was producing well, and Noel instructed Klosek to do the same.
Noel also lied to two financial institutions in order to
perpetuate and obscure the scheme. Noel’s three-year period of
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extensive, intentional concealment is the kind of scheme
anticipated by the enhancements. See, e.g., United States v.
Sheneman, 682 F.3d 623, 631-32 (7th Cir. 2012); Snow, 663 F.3d
at 1164; United States v. Fiorito, 640 F.3d 338, 351 (8th Cir.
2011). Thus, we conclude that the district court did not err in
applying sophisticated means and laundering enhancements.
VI.
For the reasons stated, we affirm Noel’s conviction and
sentence.
AFFIRMED
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