U.S. v. Green ( 1992 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
____________________________________
No. 91-3573
------------------------------------
United States of America,
Plaintiff-Appellee,
versus
Douglas D. Green,
a/k/a/ Doug Green,
Defendant-Appellant.
--------------------------------------------------
Appeal from the United States District Court
for the Eastern District of Louisiana
--------------------------------------------------
(June 15, 1992 )
Before WISDOM, REYNALDO G. GARZA and JONES, Circuit Judges
GARZA, REYNALDO G., Circuit Judge:
Appellant Douglas D. Green (Green) challenges his
convictions for mail fraud, conspiracy to commit mail fraud
and money laundering and the sentences imposed. For the
following reasons, we AFFIRM Green's convictions and
sentences.
The Facts
"They say the gods themselves/ Are moved by gifts, and
gold does more with men than words."1
Appellant Green was elected to the position of
Commissioner of Insurance for the State of Louisiana in
October of 1987. He took office in March of 1988. The
facts of his election campaign and his conduct while in
office bear witness to the unfortunately continuing truth of
the words spoken by Euripides almost 2,500 years ago.
In the fall of 1986, John and Naaman Eicher (the
Eichers), principals of Champion Insurance Company
(Champion), became dissatisfied with the performance of the
then Commissioner of Insurance of the State of Louisiana,
Sherman Bernard (Bernard). In an effort to unseat Bernard
and find favor in the office of the Commissioner, the
Eichers handpicked Green, a former employee of John Eicher
at Key Underwriters, to run for the post.2 The Eichers
offered to match Green's then current income and to provide
substantial funding for Green's campaign.3
1
Euripides, Medea (431 B.C.) (Tr. Rex Warner), as
appearing in The International Thesaurus of Quotations at 63
(compiled by Rhoda Thomas Tripp) (Softcover ed. 1987).
2
Green had previously worked for the Eichers' at
Key Underwriters, an insurance agency. Testimony at trial
revealed Green regularly falsified state driving records for
the Eichers' clients in order to get reduced rates for
clients with bad driving records.
3
Much of the incriminating evidence adduced at
trial came in the form of testimony provided by Naaman
Eicher, Patricia Eicher and Gary O'Neill (the Eichers'
attorney) pursuant to plea agreements with the government.
2
Funding for Green's campaign arrived in the form of
"loans" from William Hall (Hall) ($100,000), Harry Mey (Mey)
($25,000) and M.L.C. Services Inc. (MLC) ($25,000), a
company owned by Carey Guidry.4 Testimony revealed each of
the "loans" corresponded exactly to amounts "loaned" to
Hall, Mey and M.L.C. (collectively the "intermediaries") by
United Financial Services (United), a company owned by the
Eichers. Notes for the "loans" were simultaneously created
between the intermediaries and the Green campaign and the
intermediaries and United. United informed the
intermediaries that it would not seek repayment of the notes
unless the Green campaign repaid the intermediaries.
Although fundraisers were held on behalf of Green following
his election, no payments of principal or interest were ever
made to the intermediaries. At the same time, however, some
of the money raised was used to hire private investigators
utilized in an attempt to gather information for the purpose
of firing Max Mosley, the Chief Insurance Examiner and a
target of the Eichers. Green was entirely aware of these
financing arrangements; he had been present at meetings
during which these financing arrangements were planned.
In addition to the financing provided by the Eichers,
Green was paid $2,000 per month to "run for office" and was
4
Although charged with money laundering the three
"loans", which totalled $150,000, testimony revealed that
the Eichers channelled $2.1 million into Green's campaign.
3
provided with a fashion consultant. The Eichers also
arranged for Green's brother to be his driver, the Eichers
paying the salary, and arranged for Green's brother to live
in an apartment paid for by the Eichers.
Upon Green's assumption of duties as Commissioner of
Insurance, a backlog of unpaid claims began to build up at
Champion and complaints at the Insurance Commission mounted.
James Fernandez (Fernandez), a supervisor in the Department
of Insurance, repeatedly raised the issue of Champion's
problems with Green, asking Green to take action against
Champion. Green's response to Fernandez' overtures was to
remove Fernandez from the investigation of the claims
involving Champion. Green personally assumed control and
responsibility for the investigation together with his close
friend Tom Bentley.5 Although intense pleas from Fernandez
continued,6 Green did nothing about Champion's mounting
problems. In spite of Green's nonaction, official inquiry
forms ("lulling letters") were sent by the Department of
Insurance to each of Champion's complainants indicating that
the Department of Insurance was investigating their
complaints. Champion claimants testified the lulling
5
Bently is currently appealing his conviction for
making false statements to a federal grand jury during the
investigation of Champion and Green. United States v.
Bently, appeal docketed, No. 91-3768.
6
Fernandez' testimony was corroborated by at least
two other witnesses from the Department of Insurance.
4
letters contributed to their decisions not to seek legal
action against Champion.
In addition to the lulling letters, Green assisted the
Eichers and Champion by interfering with an audit of
Champion designed to remove the watchlisting of Champion by
A.M. Best (Best), a national insurance rating company.
Green appointed Malcolm Ward (Ward) to conduct the
examination of Champion. When Ward attempted to expand the
audit of Champion, Green intervened and limited it. Green
guided the Department of Insurance in its urging of Best to
withdraw the watchlisting of Champion. This action occurred
via correspondence from the Department of Insurance drafted
by Patti Eicher, John Eicher's wife.
Green's actions on behalf of the Eichers extended into
other areas as well. He misled the Insurance Commissioner
of Alabama, at the time conducting its own investigation of
Champion, by indicating that Champion was in good condition
despite knowledge of innumerable complaints against it.
When Alabama insurance auditors sought to audit other
companies controlled by the Eichers, Green, upon being
informed by Naaman Eicher that one particular Eicher
company, United Southern Underwriters, could not withstand
auditing, prevented the auditing of that company.7 When
7
Green, overcoming the resistance of the Alabama
auditors, succeeded in appointing Owen Guidry to control the
Alabama audit of the Eicher companies. In regards to the
audit of United Southern Underwriters, testimony revealed
Green allayed Naaman Eicher's fears by stating "Don't worry,
5
Alabama eventually announced it would issue its own report
of the examination as opposed to a joint report with
Louisiana. The differences between the two reports was
staggering, Louisiana reporting Champion to be solvent by
$15 million and Alabama reporting it insolvent by $25
million.
Green personally licensed the Capital Insurance Company
(Capital), a Communion company owned by the Eichers. The
licensing permitted Capital to write multiple lines of
insurance in Louisiana despite the fact that Capital could
not sell insurance where it was originally licensed and thus
failed to fulfill the requirements of Louisiana law. The
$15 million solvency of Champion shown by the Louisiana
report was due in part to a reinsurance contract Champion
had with Capital. Under this contract, Capital supposedly
accepted retroactive responsibility for certain claims
against Champion. Testimony revealed, however, that if
actually effectuated, this contract would require Capital to
pay out $1.21 for every dollar of premium it received.
Appellant was aware of the Eichers' plan to permit Champion
to fail and to begin to write insurance in Louisiana through
Capital.
The Law
In his first point of error, Green contends the
I'll talk to Guidry. Quit getting so upset, so worked up."
As indicated, United Southern Underwriters was not audited.
6
evidence was insufficient to permit the jury to convict him.
In a challenge to the sufficiency of the evidence, this
court must view the evidence, and all reasonable inferences
to be drawn therefrom, in the light most favorable to the
verdict. United States v. Triplet, 922 F.d 1174, 1177 (5th
Cir.), cert. denied, 111 S. Ct. 2245 (1991). The question on
appeal is whether a rational jury could have found the
defendant guilty beyond a reasonable doubt and not every
reasonable hypothesis of innocence need be excluded. Id.
All credibility choices should be made in favor of the
verdict. United States v. Montemayor, 703 F.2d 109, 115 (5th
Cir.), cert. denied, 464 U.S. 822 (1983).
1. Mail Fraud
Green's argument regarding his conviction on the mail
fraud counts is two-fold. First, he contends that because
the lulling letters, sent to induce complaining Champion
claimants into inaction, were sent by staff at the
Department of Insurance and not by Green himself, there can
be no reasonable conclusion other than Green did not have
the specific intent to defraud required for conviction.
Related to this, he points to evidence that the letters were
sent as a matter of course and had similarly been sent by
the previous Insurance Commissioner's administration.
Secondly, Green contends the letters tended to expose the
fraudulent scheme to keep Champion in business despite its
troubled times and that thus the letters cannot, as a matter
of law, constitute mail fraud.
7
To prove a case of mail fraud, the government must show
that Green engaged in a scheme to defraud and used the mails
to further this scheme. United States v. Church, 888 F.2d
20, 23 (5th Cir. 1989). A defendant need not actually be
involved in the mailings directly; it is sufficient to show
that "an individual does an act with the knowledge that the
use of the mails will follow in the ordinary course of
business. United States v. Shaid, 730 F.2d 225, 229 (5th
Cir.), cert. denied, 469 U.S. 844 (1984). Nothing more is
needed to show the defendant "caused" the mails to be used.
Id. The evidence clearly established that Green knew the
lulling letters would be sent out by his office. Thus,
Green's argument that others did the actual mailing of the
lulling letters and that he therefore does not have the
requisite intent is without merit.
As to the evidence that the same types of letters had
been sent by the previous administration, the Supreme Court
has held that even routine letters, innocent in themselves,
may form the basis of a mail fraud conviction. Schmuck v.
United States, 109 S. Ct. 1443, 1448-49 (1989). The Court in
Schmuck specifically rejected an argument virtually
identical to the one put forth by Green. We need look no
further in rejecting this aspect of Green's appeal.
As to the argument that the letters tended to expose
Green's wrongdoing and thus cannot form the basis of mail
fraud, Schmuck is again directly on point. As the Court
observed:
8
We also reject Schmuck's contention that mailings that
someday may contribute to the uncovering of a
fraudulent scheme cannot supply the mailing element of
the mail fraud offense. The relevant question at all
times is whether the mailing is part of the execution
of the scheme as conceived by the perpetrator at the
time, regardless of whether the mailing later, through
hindsight, may prove to have been counterproductive and
return to haunt the perpetrator of the fraud.
Schmuck, 109 S. Ct. at 1449-50.
There was testimony at trial that Green 1)participated
in the scheme, 2) knew of its existence, 3) knew of the
troubles Champion was experiencing and, 4) knew that his
actions would lead to the mailing of the "routine" lulling
letters. Viewing the evidence in the light most favorable
to the prosecution, a rational jury could have found Green
engaged in an illegal scheme and used the mails to further
that scheme.
2. Money Laundering
The indictment upon which Green went to trial charged
him with violation of 18 U.S.C. §1956(a)(1)(B)(i). This
section reads in relevant part:
(a)(1) Whoever, knowing that the property involved in
a financial transaction represents the proceeds of some
form of unlawful activity, conducts or attempts to
conduct such a financial transaction which in fact
involves the proceeds of specified unlawful activity-
(B) knowing that the transaction is involved in
whole or in part-
(i) to conceal or disguise the nature, the
location, the source, the ownership, or the control of
the proceeds of specified unlawful activity...
The proceeds involved in Green's case are allegedly
9
proceeds of an illegal campaign bribery scheme. Louisiana
law provides:
Bribery of a candidate is the giving, promising or
offering to give, directly or indirectly, a campaign
contribution to a candidate, political committee, or
other person, or the accepting, soliciting, offering to
accept, directly or indirectly, a campaign
contribution, by a candidate, political committee or
other person with the intention that the candidate will
provide or influence another to provide the contributor
or another person...anything of apparent present or
prospective value.
La.Rev.Stat.Ann. §1469(A) (West Supp. 1992). Loans are
specifically excluded from the definition of "contribution"
in the Louisiana Election Code. Id. at §1483(6)(c)(iv).
Green contends the fact that the $150,000 "loaned" by
Hall, Mey and MLC came in the form of a loan excludes the
transactions involved from the Louisiana campaign bribery
statute. Because no bribery occurred as a matter of law,
there could have been no unlawful proceeds necessary for the
money laundering counts.
In State v. Brand, 520 So. 2d 114 (La. 1988), the
defendant turned over confidential public records in a sting
operation and she was charged with violating Louisiana's
public bribery statute. 520 So. 2d at 114-15. The defendant
alleged that the $100 she received for the records was a
loan. Id. at 116. In rejecting the defendant's defense of
a "loan", the Louisiana Supreme Court noted that the jury
was free to disregard the defendant's version of the events
based upon evidence of, inter alia, a damning recording of
the defendant at the time of the delivery of the money and
10
the fact that no indication of repayment existed between the
time of the loan and the defendant's arrest. Id.
If Brand reasonably stands for any proposition, it is
that when the making of a loan is asserted as a defense to
bribery, the defense can be shown to be false. There is
ample evidence upon which the jury could have concluded, as
it apparently did, that the "loans" involved in this case
were sham loans intended to be bribes.
The testimony of Naaman Eicher revealed that, long
before any loans were contemplated, Eicher had indicated he
would do "whatever it took to fund [Green's] campaign." The
Eichers were the principals of United, the financial
institution making the loans to the intermediaries.
Moreover, there was testimony that the loans from United
would not have to be paid back unless the campaign paid back
the contributors first. Indeed, Green himself testified
that despite the fact that money had been gained by the
campaign subsequent to the loans, no attempt was ever made
to repay the loans. Plainly, the jury could reasonably have
determined that the loans were sham loans and thus that the
campaign bribery statute had been violated. Thus violated,
the jury could have determined the proceeds were illegal and
that the making of the loans through the intermediaries,
third parties, was done knowing that the transaction was
designed in whole or in part to conceal the source,
ownership, or control of the proceeds. Green's argument
regarding his conviction for money laundering is without
11
merit.
Green's contention that the transfer of the proceeds by
the Eichers through United to the intermediaries somehow
caused the proceeds to loose their illegal character. He
cites to the case of United States v. Dove, 629 F.2d 325
(4th Cir. 1980) for the proposition that the transfer of
illegal money to an innocent person renders the funds legal.
Dove involved the transfer of a stolen automobile to
undercover police agents. Id. at 326. The defendants took
possession from the agents and were charged with
transportation of stolen goods in interstate commerce. Id.
The court reversed on the ground that the agents held the
automobile for the true owner. Id. at 329. The principle in
Dove, that stolen goods recaptured by the police loose their
status as stolen, is inapplicable to the present facts.
There simply are no law enforcement agents involved in the
transactions through which the Eichers channelled money to
Green in order to buy his influence. Moreover, our
reasoning regarding the ability of the jury to consider the
entire transactions as sham loans casts doubt on whether the
proceeds were, in fact, ever validly "transferred" into the
possession of the intermediaries. The more applicable
principle of law is that cited by the government, namely
that one who has the requisite mental state to defraud but
who uses another to commit his acts is nevertheless guilty
of the offense. See 18 U.S.C.A. §2 (West 1969) (statutory
basis of law of principals). Green's contentions as to this
12
point must be rejected.
Green finally contends there is insufficient evidence
he "conducted" the transactions as alleged in the
indictment. As the government points out, Green was tried
as a direct principal and also under a theory that he aided
and abetted the money laundering scheme. Green participated
in negotiations of the financing of the his campaign.
Moreover, there was testimony from one of the
intermediaries, Hall, that Green personally dealt with him
when Hall made the transactions involved. A reasonable jury
could have found beyond a reasonable doubt that Green
conducted the transactions involved.
3. Conspiracy to Commit Mail Fraud
Count 40 of the indictment charged Green with
conspiracy to commit mail fraud. Green, in his brief on
appeal, refers to his conspiracy conviction in one sentence
and fails to provide any analysis whatsoever on the issue.
Failure to prosecute an issue on appeal constitutes waiver
of the issue. United States v. Fagan, 821 F.2d 1002, 1015
n.9 (5th Cir. 1987), cert. denied, 484 U.S. 1005 (1988);
United States v. Johnson, 718 F.2d 1317, 1325 n.23 (5th Cir.
1983) (en banc). Green has waived any error as to his
conviction for conspiracy. Even were we to conclude Green
had properly raised the issue, our analysis of the
sufficiency of the evidence as to Green's participation in
the object offense requires affirmance. As indicated,
evidence demonstrated Green's agreement with the Eichers to
13
assist them with their efforts to gain control of the
Louisiana insurance industry. Moreover, even were Green not
a direct participant in the object offense, we would affirm
because there is sufficient evidence to find him a
coconspirator. See Pinkerton v. United States, 328 U.S. 640,
647-48 (1946). Greens contention, if it can be deemed such,
that the evidence is insufficient to find him guilty of
conspiracy, is totally unavailing.
4. Denial of Motions for Acquittal and New Trial
As with Green's conviction for conspiracy, he has
failed to brief the issue of the district court's refusal to
grant his motions to acquit and for new trial. He has thus
waived these matters for appellate review. See Fagan, supra;
Johnson, supra; see also, United States v. Lindell, 881 F.2d
1313, 1325 (5th Cir. 1989), cert. denied, 110 S. Ct. 2621
(1990) (citing F.R.App.P. 28(a)(4)). Even assuming,
arguendo, he had briefed these issues, our analysis of the
sufficiency of the evidence sustaining the jury's verdict as
to his convictions would preclude us from ruling in his
favor on these matters. See United States v. Gorel, 622 F.2d
100, 106 (5th Cir. 1979), cert. denied, 445 U.S. 943 (1980)
(court reviewing denial of motion for new trial views
evidence in light most favorable to verdict and verdict
entitled to all reasonable inferences drawn therefrom);
United States v. Varkonyi, 611 F.2d 84, 85 (5th Cir.), cert.
denied, 446 U.S. 945 (1980) (district court must determine,
in ruling on motion for judgment of acquittal, whether
14
evidence is sufficient to find defendant guilty beyond
reasonable doubt).
5. Sufficiency of Indictment
Green alleges the district court erred by admitting
evidence that certain financial institutions were involved
in interstate commerce. His argument is essentially that
the indictment was jurisdictionally deficient because it
failed to allege that the financial transactions upon which
the money laundering counts were based affected interstate
commerce. 18 U.S.C. §1956(c)(4) requires that the
government show that the financial transaction upon which
the money laundering count is based involved a financial
institution engaged in interstate commerce. Green objected
to the admission of testimony by two government witnesses to
the effect that the two banks named in the indictment were
involved in interstate commerce. He now contends the
testimony constituted a material variance from the
allegations contained in the indictment.
In a superseding indictment, the grand jury charged:
C. On or about the dates listed below, in the
Eastern District of Louisiana, DOUG GREEN, with the
intent to promote the carrying on of the bribery of a
candidate in violation of LSA-RS 18:1469, did conduct
and attempt to conduct financial transactions, that is
the receipt of funds from checks of intermediaries
drawn on accounts at banks located in the Eastern
District of Louisiana, knowing the funds he was to
receive were the proceeds of an act of bribery of a
candidate and that the transactions were designed to
conceal that the source of the proceeds of these
bribery funds were the Eichers and their companies:
15
COUNT DATE AMOUNT CHECK #
37 8/24/87 $100,000 No. 346
Hibernia National Bank
Jefferson Parish
38 10/6/87 $25,000 No. 1425
South Louisiana Bank
39 10/7/87 $25,000 No. 1730
South Louisiana Bank
Houma, La.
All in violation of Title 18, United States Code,
Sections 1956 and 2.
"An indictment must allege every element of the crime
charged." United States v. Merritt, 882 F.2d 916, 918 (5th
Cir. 1989), cert. denied, 110 S. Ct. 2592 (1990). "An
indictment is sufficient if (1) it contains the elements of
the offense charged, (2) it `fairly informs' the defendant
of the charge he must meet, and (3) there is no risk of
future prosecutions for the same offense." United States v.
Arlen, 947 F.2d 139, 144 (5th Cir. 1991) (citing United
States v. Gordon, 780 F.2d 1165, 1169 (5th Cir. 1986)).8 A
conviction "will not be reversed for minor deficiencies that
do not prejudice the accused." Merritt, 882 F.2d at 918.
Thus, the validity of an indictment will be determined by
reference to practical, not technical, considerations.
United States v. Mouton, 657 F.2d 736, 739 (5th Cir. Unit A
Sept. 1981) (citing Varkonyi, 645 F.2d at 456). This
8
Here, as in Arlen, the appellant does not claim
he is subject to double jeopardy and thus only the first two
prongs are relevant. See Arlen, 947 F.2d at 144.
16
court's standard of review as to the sufficiency of the
indictment is de novo. United States v. Shelton, 937 F.2d
140, 142 (5th Cir.), cert. denied, 112 S. Ct. 607 (1991).
Green relies on Stirone v. United States, 361 U.S. 212
(1960). Stirone involved an indictment alleging
interference with interstate commerce by obstruction of
transportation of sand to a steel mill. 361 U.S. at 213-14.
At trial, the prosecutor sought to prove the defendant had
also attempted to obstruct the exportation of steel from the
mill. Id. at 214. Justice Black, writing for a unanimous
court, reasoned:
Ever since Ex parte Bain, 121 U.S. 1, was decided
in 1887 it has been the rule that after an indictment
has been returned, its charges may not be broadened
through amendment except by the grand jury itself....
...
The Bain case, which has never been disproved, stands
for the rule that a court cannot permit a defendant to
be tried on charges that are not made in the indictment
against him. [citations omitted]. Yet the court did
that in this case....
...
Here, as in the Bain case, we cannot know whether the
grand jury would have included in its indictment a
charge that commerce in steel from a nonexistent steel
mill had been interfered with. Yet because of the
court's admission of evidence and under its charge this
might have been the basis upon which the trial jury
convicted petitioner. If so, he was convicted on a
charge the grand jury never made against him.
Stirone, 361 U.S. at 215-19.
Stirone is inapplicable to the facts of Green's case.
As we explained in United States v. Young, 730 F.2d 221, 223
(5th Cir. 1984),
17
Stirone requires that courts distinguish between
constructive amendments of the indictment, which are
reversible per se, and variances between indictment and
proof, which are evaluated under the harmless error
doctrine. The accepted test is that a constructive
amendment of the indictment occurs when the jury is
permitted to convict the defendant upon a factual basis
that effectively modifies an essential element of the
offense charged. [citations omitted]. In such cases
reversal is automatic, because the defendant may have
been convicted on a ground not charged in the
indictment. See Stirone, 361 U.S. at 217, 219, 80 S. Ct.
at 273, 274; [remaining citations omitted]. If, on the
other hand, the variation between proof and indictment
does not effectively modify an essential element of the
offense charged, "the trial court's refusal to restrict
the jury charge to the words of the indictment is
merely another of the flaws in trial that mar its
perfection but do not prejudice the defendant." [United
States v.] Ylda, 653 F.2d [912,][]914 [(5th Cir.
1981)](footnote omitted).
.....
Unlike [Stirone and other cases omitted herein],
the case before us involves a single set of facts. Mr.
Young was not indicted for receiving one particular
firearm and then convicted for receiving another. The
factual basis for the indictment is identical to that
for the conviction. Hence it is not possible that the
defendant has been convicted for an offense not charged
in the indictment. Stirone and Salinas II9 are not
applicable.
Young, 730 F.2d at 223-24. Here, as in Young, Green's
conviction is based upon the same set of money laundering
facts as those alleged in the indictment; he has not been
convicted of a different offense nor could the introduction
of the testimony regarding interstate commerce have created
9
United States v. Salinas, 654 F.2d 319 (5th Cir.
Unit A Aug. 1981), affirmed in part, reversed in part sub
nom, United States v. Adamson, 700 F.2d 953 (Former 5th Cir.
Unit B), cert. denied, 464 U.S. 833 (1983).
18
a new offense. Thus, Stirone is inapplicable.
Green's challenge is more akin to an allegation that
the indictment fails to state an offense because an
essential element thereof has not been alleged. See Mouton,
657 F.2d at 739 (indictment sufficient if it contains
essential elements of offense). His position is that an
allegation of an affect upon interstate commerce is
jurisdictional and, as such, is an essential element of the
offense of money laundering. If an allegation of interstate
commerce is jurisdictional, then it is essential. See Young,
730 F.2d at 224 ("The particular predicate for jurisdiction
is an essential element of any offense.") (citing McRary,
665 F.2d at 678-79).
18 U.S.C.A. § 1956(a)(1) requires that a defendant
participate or attempt to participate in a financial
transaction; this is clearly an essential element of the
offense. Subsection (c)(4) provides the definition of the
term "financial transaction":
(4) the term "financial transaction" means (A) a
transaction (i) involving the movement of funds by wire
or other means or (ii) involving one or more monetary
instruments, which in any way or degree affects
interstate or foreign commerce, or (B) a transaction
involving the use of a financial institution which is
engaged in, or the activities of which affect,
interstate or foreign commerce in any way or degree;
The Eighth Circuit has addressed a situation similar to
that we face here. In United States v. Lucas, 932 F.2d 1210
(8th Cir.), cert. denied, 112 S. Ct. 199, 349, 399, 609
19
(1991) the defendants were charged with, inter alia,
violating the federal money laundering statute. 932 F.2d at
1213. Following conviction, the defendants appealed,
arguing the money laundering counts failed to state an
offense because they failed to allege any nexus between the
defendants' conduct and interstate commerce. Id. at 1218.
The panel observed the defendants had not made their
challenge to the indictment until after the close of the
government's case-in-chief. Although it noted that
defendants are permitted to raise arguments as to the
validity of an indictment at any time, Id. (citing United
States v. Clark, 646 F.2d 1259, 1262 (8th Cir. 1981)), the
court quoted Ninth Circuit precedent for the proposition
that indictments are liberally construed in favor of
validity where they are tardily challenged. Id. (quoting
United States v. Pheaster, 544 F.2d 353, 361 (9th Cir.
1976), cert. denied, 429 U.S. 1099 (1977)).
Applying its standards of review, the Eighth Circuit
observed:
We find that counts XVII, XIX, and XXI, reasonably
construed, do allege a nexus with interstate commerce.
We therefore do not reach the question of whether an
allegation of a "nexus with interstate commerce" is an
essential element in a charge under 18 U.S.C. § 1956
for laundering money. All three counts refer to
specific acts of money laundering that gave rise to the
charges in each of those counts. Counts XIX and XXI
refer to conduct that is related expressly to the
construction of a shopping mall....Likewise, count XVII
refers to the purchase of real estate...and although it
does not expressly state that it is to be used in the
construction of the mall, the inference that it is to
20
be put to such a use is, in the circumstances of this
case, quite reasonable.
Furthermore, although counts XVII, XIX, and XXI do
not expressly mention the words "interstate commerce,"
it seems apparent that an effect upon interstate
commence is an inevitable incident of the construction
of a shopping mall. Consequently, we believe that
allegations that reasonably implicate the construction
of such an establishment are sufficient to constitute
allegations of an effect upon interstate commerce.
Lucas, 932 F.2d at 1219.
Based upon the standards of review of the sufficiency
of an indictment discussed above, see supra at p.16-17, we
find Greens' case indistinguishable from that in Lucas. We
therefore conclude that we need not reach the question of
whether an allegation of an affect upon interstate commerce
is jurisdictional and, thus, an essential element of the
offense. Green's indictment plainly alleges that banks were
involved in the transactions at issue. It further
delineates the specific banks involved. At oral argument,
Green's counsel admitted he had never heard of a bank that
did not affect interstate commerce in some way; nor have we.
We hold, as in Lucas, that the allegations of the
involvement of banks contained in this indictment are
sufficient to reasonably appraise Green of an affect upon
interstate commerce. Green's contentions are meritless.
6. Obstruction of Justice
At sentencing, the district court imposed a two point
enhancement for obstruction of justice as to the conspiracy
to commit mail fraud and mail fraud convictions. The court
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stated its actions were premised on the evidence of Green's
interference with the Alabama investigation of the Eicher
companies. The court included a well written statement of
reasons and supplemental statement of reasons for its
actions. It reasoned Green's crimes had done significant
damage to the electoral process and irreparably damaged many
families and individuals who would never be able to be
compensated for personal and property losses.
Green alleges the court erred by accepting paragraph 53
of the presentence report, obstruction of justice, and
paragraph 54 of the presentence report, failure to produce
documents. As to paragraph 54, the district court agreed
with Green's objections thereto and plainly stated it would
not consider the allegations contained therein. Thus,
Green's complaint to this paragraph has no merit. As to
paragraph 53, Green argues the conduct alleged to have been
the basis for the obstruction of justice is part of the
object offense. He suggests an enhancement for obstruction
of justice may be based only upon acts obstructing the
investigation of the object offense, not upon acts forming
the basis of the object offense itself. He points to the
fact that the behavior alleged to form the basis of the
enhancement was behavior disputed at trial and upon which he
was convicted. The district court, in its supplemental
statement, concluded that Green had indeed obstructed
justice and referred to the proof of this obstruction
adduced at trial. The district court did not err.
22
Section 3C1.1 of the Sentencing Guidelines provides
that "[i]f the defendant willfully impeded or obstructed, or
attempted to impede or obstruct the administration of
justice during the investigation or prosecution of the
instant offense, increase the offense level...." (emphasis
added). In United States v. Cain, 881 F.2d 980, 982 (11th
Cir. 1989), the appellant argued obstruction of justice
applied only to post-offense conduct. The Eleventh Circuit
rejected the contention, citing Fifth Circuit precedent. 881
F.2d at 982 (citing United States v. Galvan-Garcia, 872 F.2d
638, 641 (5th Cir.), cert. denied, 493 U.S. 857 (1989). In
Galvan-Garcia, this court upheld an enhancement for
obstruction of justice based of the defendant's attempted
concealment of marijuana by throwing bags of the contraband
out of his automobile while being chased by the police.
Here, Green does not challenge the district court's factual
finding that the obstruction occurred. Because this was
obstruction of an investigation which would have led to the
prosecution of Green for the offense of mail fraud, the
district court did not err.
7. Reasonableness of Sentence
There has never been any dispute that the offense of
money laundering as charged in Green's indictment occurred
pre-guidelines.10 Green argues the district court's
10
The effective date of the Sentencing Guidelines
was November 1, 1987. United States v. Garcia, 903 F.2d
1022, 1025 (5th Cir.), cert. denied, 111 S. Ct. 364 (1990).
23
sentence of twenty years on each of three counts is "plainly
unreasonable". He cites to no authority whatsoever to
support his assertion that a sentence of twenty years for
the offenses charged is "plainly unreasonable".
A district court has great discretion in imposing a
sentence for pre-guideline offenses. United States v. Helms,
897 F.2d 1293, 1299 (5th Cir.), cert. denied, 111 S. Ct. 257
(1990) (citing United States v. Nichols, 695 F.2d 86 (5th
Cir. 1982)). There is simply no basis for us to conclude
the sentence imposed here constitutes an abuse of that
discretion. We note the sentences were ordered to run
concurrently, not consecutively, and thus the district court
actually gave Green only one third of the time he could have
received. See United States v. Garcia, 903 F.2d 1022, 1025
(5th Cir.), cert. denied, 111 S. Ct. 364 (1990) ("[T]he
sentencing court has unfettered discretion to impose
sentences on pre-guideline counts consecutively or
concurrently.") (quoting United States v. Watford, 894 F.2d
665, 669 (4th Cir. 1990) (opinion by Judge Wilkins,
Chairman, United States Sentencing Commission)). Moreover,
we reiterate the findings of the district court that Green's
crimes were particularly egregious, injuring countless
persons by depriving them of their rightful compensation for
personal injury and property loss. Finally, we note that
the sentence of twenty years is not greater than the
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statutory maximum for the offense of money laundering. 18
U.S.C.A. §1956(a)(1). The sentence imposed is not "plainly
unreasonable" and we reject any suggestions to the contrary.
CONCLUSION
We have examined all of Green's remaining issues and
conclude they are so lacking in merit as to not warrant
discussion. Because we find no error in the trial below,
Green's convictions and sentences are in all respects
AFFIRMED.
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