decided before mcrae was even tried was under proceeds equal profit argument available to him on direct appeal notwithstanding the number of circuits that had rejected such an argument i don't think there was a regional basis stories that are there waters always hurt is because the government asked for a jury instruction that said that the wires had to be essential to the fraud ok but are essential and central the same yes i think so well i mean that yes yes i guess my question would be if i understand your argument i'm not sure what would happen in a hearing because it seems to me if you're claiming and sufficiency of the abbot and spaced on santos that that you can't automate the record that's sort of the record because that would seem like that that's the trial so it's not you know that the prosecutor doesn't get a second by you don't get it another you know and it's double jeopardy you know if we say something to insufficiency of the evidence didn't do that it's my understanding under nineteen sixty five a one the promotional money laundering the government has to prove juanita gagetown a financial transaction which involved proceeds from specified illegal activity to be the proceeds were from illegal activity and three intended the transaction to promote promote illegal activity so he's your clients arguing that the price to be defined as profits in this case based on santos and that there was insufficient evidence of the wire transfers involved profits right but you never did challenge the sufficiency of the evidence of proceeds on direct appeal but rather a challenge to other elements of the money laundering so just so have i understand all this correctly because it is a little bit not it's not confusing because of how you're presenting it but it's a different if a defendant is charged with both wire fraud and money laundering based on the same transaction the government has to prove that the transaction involved the profits of be undermined scheme that the props of the n o i scheme where the where the transaction involved but where the transaction was central to the scheme and the money laundering count radically increases the defendant's maximum statutory sentence is that right  there was a search warrant skewed and that point that the fraud sort of fall apart so if i identify say following that through if the transfers were not essential to the schemes continued operation in contrast to the payment of so if this is mr santa mr santos it's not mr santos and mr mccrae if if we were to accept your arguments he doesn't he doesn't go free he could the court could come back and sentence seventy and a half year sentence presumably his guy lighter angel beats will be much less than that but of course it's always possible that for post booker can do what it wants to do so he can certainly impose the same so i i can't remember how much time you said you wanted to  you know he same why his arguments why he didn't make certain arguments but why isn't your argument here that the wires were not central to this scheme and consistent with your position at trial and on direct appeal that they were essential because they allowed mr mccray to promote this scheme to investors as a potential tax free investment yes you are you're on the time of the trial in this case the government argued that these were essential because that was the element that was necessary that the instructions at the time and that's of the underlying docket number two forty three so are essential and central to saying no you're i would i would submit that there are not that is that it that we have seen in the case law that courts can find that certain things can be essential for example danielle steel in that third transaction they found that was sufficient but didn't present the merger problem regarding the whether that was a promotional money laundering as well as it did not merge with the the wire fraud because it could be promotional could be essential but not necessarily essential component of the scheme to defend the appellant wants to conflate the wire fraud element here essential part with central component which is a rose which is the stronger word essential or central i would submit that essential component sort of core or inherent these are some of the other words of this court is used to describe what kind of a transaction would trigger a merger problem that central component now the essential part the language really stems from the sort of jurisdictional fictional aspect of money and the wire fraud that is that there has to be some kind of interstate transaction the wire transmission in that  has to be interstate but i would note that this kid this court is quite clear that even a perfectly legitimate law whole wire transfer can be a part of a money laundering sorry wire fraud scheme that the  the question is whether or not the transaction can be that that there is a merger issue or whether there is not and i think the united states versus grasso this court also articulated that sort of  individuals as part of that illegal scheme but i think sort of trying to separate the wheat from the chaff here as i come to this case sort of muley or question to the court is what was this money for what was done with this money and i think the record is now complete thanks to the court's request for that particular defense exhibit that outlines what was done with this money and what was done was while there was some trading there were some expenses paid but a bulk of it over four point three million dollars i believe as articulated as set forth in that trial exhibit was went back to the client find to pay refunds and that as the court noted invent all steam makes it would like one of that third category of paying back refunds is not a central component of the ponzi scheme because it makes money unavailable to continue to low investors to keep this team go in and mr mccrae himself explained why he did that he did that so that he would avoid litigation and sort of generate goodwill when things were falling apart and so it's not a matter of looking at the subsequent transactions to it's because of for their own sakes but because they shed light on what that original transaction was for and else it was no different in that case the actual charge transaction was between one of mr out danielle scenes partnership accounts to another of his partnership accounts and then the testimony revealed that some of those transactions went to then pay investors sort of distribution and others went to pay a full refund and so the subsequent transaction sheds light on what the charge transaction was about and the appellant's example of well what does it matter why should we look at what happens afterwards you go and buy a pair of shoes for example well the fact that there was money available from that transaction to buy a pair of shoes i would submit suggest that there was enough money at least among that transaction that that was a non expense of the scheme and or profits and i would submit that santos and other case law of this search this court that santos left undisturbed provides of the government just needs to show that a portion of some of the transaction involves proceeds fact that they're mean maybe some proceeds some criminally derive proceeds in this transaction even if they're some not criminally derived proceeds would satisfy this transaction here because as the court noted the statute provides that this because they weren't meant for the essential component of the scheme so your honor as i think that there is enough here presented in the records setting aside what may be problematic missions by behalf of the government i would i'm not choosing to rely on those and i but as for the facts of these transactions what occurred here i would submit that there's enough here that there were proceeds of can we derive activity at the time of these this transaction to pla and i think that the one the government's has submitted as far as those charts at the end of the f d r demonstrate that there was money available and i would contest the notion that well the only profits were generated here by after they were fraud that the false statements the misrepresentations are the reason that money came in and that was established at trial by the jury verdict of guilty on the underlying wire fraud and mail fraud and the testimony in the evidence  argument grounds for what you can and cannot bring up after having failed to bring it up before is inappropriate in this context because he is a supposed to be an extraordinary rebbie so i would submit that we should look at very carefully what he did raise and what he did included judge reinhart and this court determined what we've all saying mr mcrae i think we figured out on two different days there are two different direct appeals and i think they had those and i had to reset the scene so we haven't seen him but we've all t right so what authority would allow us to hold that there is no prejudice based on a prediction that mr mcrae would receive the overall sentence summary mand if we were first his promotional money laundering convictions i think it would be i think i saw you shaking your head when he was saying something i asked the question of pellets council i don't really usually like to look in the peanut gallery but sometimes i do see people's head shaking i would submit that at the time the judge jones and against mr mcrae did not at all drive the sense here they were so that's the amount of time but what about he made the comment about what credit he would get for money that he sort of bootstrap himself into a benefit on sentencing that wasn't actually available to him at the time that he was and in one thousand nine hundred eight at that time the calculated guidelines properly and found that the wire recommended one a year for the court selected the middle of that range and the guidelines at that time had mandatory language that if the guidelines and this was greater than the statutory maximum it shall run consecutive to produce the combined sends to equal the total punishment transactions were actually returned as convictions they had no bearing on and no increase to the guidelines whatsoever there was no plus to that that we see down the current guidelines is a wholly separate guideline that was lower so they used to be the money laundering money articulated it was whether or not proces should be defined as profits or gross receipts and so it was out there at the time that was the first circuit as well as the third circuit interestingly the sixth circuit had also even much earlier had considered that same question even prior to schiavo and courts of the circuit lower courts to be sure have determined that because of that the available authority out there that this claim was in fact available findings down below it's essentially invite certain successive twenty fifty five's in those circumstances as well as work work a sort of expansion of the availability of this extraordinary ripped and i think that that's the framework to keep fraud but the promotion one of the honor analysis is very different again given the nature of mr mccray scheme he didn't make any money off this scheme until he made trades in those trades generated commissions that's why the government's case at trial is that he made about a million dollars because that's the money he he was trading it which was again the the very essence of is for all two quick points about procedural default first on the calls and prejudice issues i think it's important to remember that the hopes that perhaps one day letting will strike in the supreme court will grant cert and agree with the flood of decisions to the contrary finally that the government has never cited any authority for the idea that u v s candido is somehow limited to the direct appeal