and it's a pleasure to preview for the ninth circuit as opposed to often times eight circuits always nice to have a variety this case appears on the briefs and appears in the factual support to be exceedingly complex should never have gone to the jury the business involved was a third party administered by simply what they would do is administer a health care plan of an employer they would review the claims that would come in and compare them to the plan of benefits determine what should be paid and vies the client who would fund an account and checks were then cut to pay the claims submitted by the employees as long as you have the money coming in that's requested the checks going out are covered if there is a problem with the in process then the out process becomes distorted or erroneous in this case a million dollars did not arrive in the account although it was listed on the b sets of allegations one are the six six nine er and those morning allegations which really relate to what you're talking about there were mail fraud allegations connection with a client called clark county and but yes the answer to your question is that the accountant who should have been responsible for making sure that money to  is the the facial reaction there but the fact of the matter is the vast with the facts show here's a let me give you one example to show why there was no criminal intent and then i'll get to why the charges legally insufficient first the same situation that occurred in april and may are in maybe in june and july of ninety seven had heard in the end of ninety six in the ninety seven what is the problem we should not be short the man had no answer for what happens at the end of january one point six million dollars arrives in the bank account from outlying banks you see combing so unless you accounted for who put what in and what was going out for whom you had no idea whose money was being brought in who's money was going out and that he is the problem in this case now it's a problem not only from criminal intent point because after that one point six million dollars came in and the same thing occurred started layer immunized by the government and testifying had no explanation he was the one every morning call the bank determine where the funds were short and instead of doing what had to be argument is it is more subject i will acknowledge to theirs well let's view of most favorably toward the government and when you get that view insufficient evidence claims are seldom overturned i suggest you in this case that there is absolutely no evidence no reasonable jury could have found at could have found criminal intent you cannot in this case you fifteen minutes now of course as a lawyer i thought well what that i did wrong but there's no way this evidence could have been realistically evaluated and come back by the jury in an hour and fifteen minutes therefore the trier of fact deference to the trier of fact is not appropriate here and i think you have to start from that people but getting the mail fraud counselors even this is where we get away from just the sufficiency of the to employer a ok we have fifteen thousand dollars worth of claims fund your account for fifteen thousand dollars and we'll pay the claims according to the government never intending to do that obviously in order to solicit or obtain funds from somebody you have to make some type of representation some type an agreement some type of fossil in order to make a fraud case in clark county that wasn't even that else that was a false representation by doing that because you had an agreement with clark county that this money is in this count only for court claim two responses about your own party please don't get that one first is that their own auditor clark county zone auditor the terminal this was not a trust account which is what in visions isn't vision by you more importantly control of that account went to pay claims not one penny be that not one penny that they put in there while my client ran the business was not use every penny put in there i should say was used to pay the point wasn't the money that i'm sorry around a guy at play of money that was in there that is involved was in there before my client ever took over the predecessor never told clark county about this money hark how they never got the statement is not wire fraud because there was no representation i'm not talking about no specific representation which is what the government focuses on i'm talking about no no generalized misrepresentation account in las vegas controlled by alan h to an account in residency a bank in the central bank in the central bank in fresno in an interest bearing account the one in las vegas was not it that they started putting clark county money somewhere else in another county and did use some other purpose for that money well then what you just live that's not the way it sounded to me but let me make sure it's more important  how it sounded to you of course so let me reiterate if i may ok wow l n h controlled the account none of the money that went into the clark county employees l h account in las vegas was transferred and it stayed there in this particular instance the funds are were written off of their ok this was the exception all the forms that are county put in were paid and the money at issue business every single night the predecessor company swept all their accounts including their accounting of our county into harris bank in chicago overnight why th day the money was transferred back out and fund it and we proved the trial that there were mistakes made by course or in refunding the accounts so you say it's clark county money is not true back to the whole process he was thirty days thirty days but that's not the issue the issue was there fraud in particular in that money and there wasn't because that money was not part of the process of obtaining funds to pay accounts now on the other cases the he calls in clark county  when it is simply a matter of not whether or not there was money there but where the money was there wasn't anything no criminal intent to embezzle and the government cannot prove that the money in t since the briefing of this matter amma line three has come down and on the basis of that authority the government will concede that this is a matter that would need to be remanded for the limited purpose of the determination by judge strand as to whether or not the fact that the sentencing guidelines are now advisory would have changed his sentence in this matter having said that let me also add that this morning i provided your clerk a correction for the record of a citation on page forty nine that admirably was discovered by my i have a sorry and noted in his brief i'd direct your attention to page forty nine b era is citation to weissman it should have read walker and that's to be found at two thirty four fed third seven eighty it's first circuit taste from two thousand and walker does stand for the exact proposition that appears in the brief era unfortunately i have to take responsibility for that  was in scribbling down walker versus weissman and attributing the improper citation and name in the case but otherwise the authority is the same i think the issue to be determined today is are the substantive issues that were raised by the defendant on his appeal matters that need to be decided by you and i would urge you to do that or i should say and secondly are the sentencing issues matters that you wish to provide instruction to the sentencing court rather than have the matter returned to him and then have it returned here with the same arguments being presented at a later  trine i would urge you to provide strand with the benefit of your wisdom concerning the issues that are being presented today specifically the government in its cross appeal indicated that the judge  created had committed error in regard to failing to apply three enhancements those being more than minimal planning role in the offense and then a through point downward departure  brief explains the reasons on each one of those but let me first turn to the substantive issues that mr roller has presented to you first the issue of clark county and the million in that account the defense would have you believe that the million dollars was a static sum of money sitting there without any designation as to who put the money there and you would need only to examine the testimony of margaret steel who was the funding it count person for that when the discrepancy presented itself in a trial testified that she went back and did an analysis and was able to determine that in the course of the years clark county with thousands of employees millions of dollars being paid out of their health care program had while it was with the predecessor company that in course so it's had canceled checks stop payment from the claims paying account for employee health care benefits had been placed there for that purpose but was not expend it because the stop payments on the checks be on the fund was to be used exclusively to pay the health care claims of clark county so every dollar that was in that account where the funds clark county having been put there if you will in trust although the county didn't say trust they had been forwarded to the course of the us and subsequently the l n h administrators with the express understanding that this money would be used to pay the claims of the employees and the way the company knew that was that he the core source for l n h would send a register of accounts that need to be pay checks that need to be funded for employees who had had health care and once the company the county of course received that register it wrote a check in hundreds of thousands of dollars on almost a daily basis to be put in this account to cover the checks that as soon as the money hit the account the mail room with then mail out the checks the checks then would go to the providers the providers cash the checks the money comes out of the found and it's on the basis of that that they refer to these accounts as  they had all they had been an oversight on part of the corporation of the county to take back the monies that had been deposited there and through that oversight the money just sat there it was not refunded to them coun argument is that since the money was already there we could steal that money and when we stole the money there was no misrepresentation made and since there was no misrepresentation made it can't be a  me explain to you why that's mistaken number one if you read mr hilton's testimony and that's can change in our supplemental lexmark of record a rather lengthy explanation as to how the scheme came into existence there was a meeting he concocted a scheme to use the funds from these claims accounts to cover the corporate expenses albeit on a short term basis kind of bridge loans to help us stay afloat stay alive and when the money was to be taken out of the account of course it was to be put back as quickly as possible from other sources so it was the float that exists for a short period of time between the funding of the account and that's time the checks are issued  submitted that the corporation would use that money to pay salaries corporate expenses etc uses that were not for the intended purposes paying the claims every one of those withdrawals for a purpose of paying a corporate bartz sells to your money for some limited period of time and remember for embezzlement it's not a permanent deprivation a limited one short term basis will do the defendant was at that point misrepresenting to the defendants to the victims what is intention was with the money and so the defense would have you believe that because there's a million dollars there it's static but that's not the case every day thousands hundreds of thousands of dollars have been put in there the same dollars if you will by serial number do no longer exist in that account in march when they first start dipping into the account as existed in january operation here jeff first there needs to be a deposit of the money into the account from which the monies will now be withdrawn by wire so if you will the wire is being used to execute the fraudulent scheme accounts that have been received today or within a short period of time listing a party mr jones has a twenty five dollar bill mr smith has a fifty dollar bill mr x has a hundred dollar bill send us one hundred seventy five dollars and we'll pay these three bills for you and that's been sent by helen h to clark county for the purpose of receiving the funds from clark county to put into the clark county record the false representation is that they know when they send them that list they're going to use the money to cover corporate expenses and when the money is then received scheme and the execution of that scheme the backside of that is the investment of those funds every withdrawal from the clark county account and if you'll take a look in the  supplemental exhibit this is exhibit one ten a trial which lists the dates and the withdrawals of the money from the account going into the money market account mr hilton testified that was just a cover story putting it in interest bearing account and when it hit that account within two days out of the eight hundred thousand dollars that were placed into the interest very money market account six hundred thousand of that was withdrawn by hilton maintain corporate operations the something called the flex account all of those were investments when you take a look at not only the withdrawal of the monies what you will see is that hilton put money back into that account why would help him put money back into the account if every dollar that was received by them went to pay claims and the suggestion is that money was needed back in the the the account to pay after they withdrew the eight hundred thousand dollars to pay what mary claims so he had to get some money back in there and you'll see he put back three hundred thousand he put back one hundred thousand after he did that then he took another two hundred thousand and three hundred thousand there is now a net of eight hundred thousand still withdrawn from the clark county account when one of the l n h employees was in in doing the monthly reconciliation the withdrawal by wires something is wrong that employee says because you can't withdraw from a check pay account only by wire and inquires of clark county what's going on there why did you guys with this money from this account by wire and clark county says we didn't do that that starts an investigation about the twenty fourth of april and by the twenty eighth of twenty ninth this setting on the phone with mr russo saying we have to have a meeting on the thirtieth they have a meeting and on the first of may eight that they had stolen from the first account so it's this shell game of moving the money back and forth not intending that anybody should suffer a financial harm mr hilton mistakenly acqua app's his intent to just move the money to cover positions he says would try protect everybody's position sure they are they don't intend for anybody to suffer a loss we have all these balls up in the air and  going until we have a moment breather and then we can stop and all of the accounts will be funded the problem was that never happened and there came a day when there just wasn't enough money in the accounts to be moved around read mister hilton's testimony he will say number one i never would have moved the money but for the fact that russo told me to do it number two i had no background in the insurance business i didn't know the difference between claims money being trust account money until i was informed that other people and when i was informed that i realized the error i had made and i went to mr russo and i said i quit what we're doing is wrong and that's true so convinced me some time in may to stay help me turn around the company and so he stayed at this point mr hilton knowing that he's moving money in violation of a sacred trust notwithstanding that he is giving him monthly excuse me daily accountings to mr russo as to how i'm moving the money it's absolutely correct this counsel points out mr russo didn't know in advance but that's the ministerial execution of the general plan that's what voices do they tell people he has the overall plan you go in do it and report back to me when it's done if you have a trusted employee that's how he operates and that's exactly what hilton did until hilton couldn't do it anymore and qui say in the remaining time you're honest there is a point made that it wasn't kinko's money take a look if you will at the withdrawals as they exist in the exhibits that we provided to you in the supplemental exhibits and what you will see is all the withdrawals was more than the deposits of the other people into those accounts and in other words only fifteen thousand dollars was deposited by the company into the kinko's accounts kinko's had been originally a count soley for the purpose of taking care of kinko's the defendant coming the money but even with the commingling the amounts that was drawn from that account ceded the amount that was put in by all the other people that's investment kinko's money the same applied for the works account i see my time's up thank you very much the minute and a half i have left let me just say a couple things mr masters a as a very good attorney he's very good at doing the broad brushstrokes and saying this is the what the conclusion is and the problem is in this case you cannot do that and i think your honor pointed out where in this representation when mr mesh described them in the money put it into account and will pay your feet that was misrepresentation and the wire transfer and all the wire fraud is half to go i would ask i also would ask you to read mr hilton's testimony mr you can take mr hilton's testimony i can tell you he said we never intended to commit fraud frank never told me to make those transfers i didn't always tell frank lot of times he didn't know i assumed this is what he wanted me to do and then you can take the quotes that mr mash just told you about they're all the case of the government depends upon the conclusion beyond a reasonable doubt that mr are you so told hilton to do this on a daily basis because it was only by doing that when the funds were coming in that there were the shortages one last thing exhibits one fifty three and one fifty four in our appendix reflecting all the money going into these accounts both the general claims account and met this  goes out is compared in the thirty five fifty account the so called kinko's plow was one of forty thousand dollars difference in the memphis account there's only seventeen thousand dollars difference that's why the