Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-07-02555/USCOURTS-ca8-07-02555-0/pdf.json

Parties Involved:
Dan Thanh Nguyen
Appellant
United States
Appellee

Document Text:

1

 The Honorable Paul A. Magnuson, United States District Judge for the District

of Minnesota.

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 07-2555

 ___________

United States of America, *

*

Appellee, *

* Appeal from the United States

v. * District Court for the 

* District of Minnesota.

Dan Thanh Nguyen, *

*

Appellant. *

___________

Submitted: February 11, 2008

Filed: May 22, 2008

___________

Before WOLLMAN, JOHN R. GIBSON, and SHEPHERD, Circuit Judges.

___________

SHEPHERD, Circuit Judge.

A jury convicted Dan Nguyen of ten counts of mail fraud, 18 U.S.C. § 1341,

and two counts of wire fraud, 18 U.S.C. § 1343. On appeal, he challenges various

evidentiary and procedural rulings of the district court.1

 Finding no error, we affirm.

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 “Bust-out” is a term that has been broadly used to describe any fraudulent

scheme in which a person establishes an account, and then charges a large number of

transactions to the account with no intention of paying the balance. See, e.g., United

States v. Phuc Thien Tran, 285 F.3d 934, 936 (10th Cir. 2002); United States v.

Germosen, 139 F.3d 120, 123 (2d Cir. 1998); United States v. Schneider, 111 F.3d

197, 199 (1st Cir. 1997). The person then declares “bust” and disappears or files for

bankruptcy protection. If the scheme is done in the name of a business, the business

is declared insolvent, leaving “mulcted creditors . . . to pick over the meatless carcass

of an assetless enterprise.” United States v. Crockett, 534 F.2d 589, 592 (5th Cir.

1976); see also United States v. Mohammad, 53 F.3d 1426, 1430 & n.1 (7th Cir.

1995).

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I.

Dan Nguyen was convicted of mail and wire fraud arising out of a “bust-out”

scheme.2

 In December 2004 and January 2005, Nguyen charged the maximum

amount to several credit accounts and paid the balances with forged checks. Once the

checks were received, the balances on the accounts were temporarily increased. After

the increase, Nguyen would again charge the maximum authorized amount. He

charged $90,826 to the accounts before the credit issuers discovered that the checks

were fraudulent.

 Investigation of Nguyen began in January 2005, when loss prevention

investigators from Marshall Field’s noticed several large purchases and payments on

Nguyen’s account. Video surveillance showed Nguyen, accompanied by another

person, purchasing merchandise at a Marshall Field’s store. An investigator contacted

United States Postal Inspector Troy Sabby and presented him with three insufficient

checks that had been mailed as payments on Nguyen’s account. 

Inspector Sabby interviewed the holder of the accounts from which the checks

were to draw; the holder informed the Inspector that the accounts had been closed

three years earlier. The holder said that he did not write any of the checks to Marshall

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 The Honorable Susan Richard Nelson, United States Magistrate Judge for the

District of Minnesota.

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Field’s, that he did not give any checks to Nguyen, and that he did not know any

checks were missing. On further investigation, Inspector Sabby learned that Nguyen

had defrauded other credit issuers, including Wells Fargo Bank. He then provided the

information he had gathered to the Police Department of Brooklyn Park, Minnesota,

the city where Nguyen lived.

Relying on the information obtained from the Inspector, Marshall Field’s

investigators, and Wells Fargo Bank investigators, Detective John Blasingame

prepared a search warrant application. The application requested authority to search

Nguyen’s home, car, and person to find evidence relating to the defrauded credit

accounts and the merchandise he had purchased. A judge granted the warrant on

February 8, 2005. The next day, officers executed the warrant and seized

approximately 25 credit cards in Nguyen’s name, credit card statements and letters,

and merchandise that had been purchased with credit. 

Nguyen filed for bankruptcy on April 13, 2005. He reported $3,202 in assets

and $128,133 in liabilities. 

II.

On June 20, 2006, a grand jury indicted Nguyen on ten counts of mail fraud, 18

U.S.C. § 1341, and two counts of wire fraud, 18 U.S.C. § 1343. Nguyen moved to

suppress evidence obtained through the search warrant, on grounds that the warrant

was not supported by probable cause. Adopting the magistrate judge’s3

recommendation, the district court denied the motion. 

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Prior to trial, the Government moved to exclude evidence of other bust-out

schemes involving individuals associated with Nguyen. The Government did not

intend to introduce evidence of these other schemes. As a result, it reasoned,

statements from these individuals denying knowledge of the other schemes would be

irrelevant to whether Nguyen knowingly or intentionally participated in the particular

bust-out scheme of which he was accused. The court granted the Government’s

motion. 

On the morning of the trial, Nguyen moved for a continuance because he

wanted to replace his court-appointed attorney with a private lawyer. Although he

was indigent, he suggested that he could borrow money from his family to hire a

private lawyer. Nguyen did not challenge the competency of his appointed attorney

and said that he believed his attorney was adequately prepared for trial. The court

denied the continuance, and told Nguyen that he should have sought a “second

opinion” earlier in the proceedings.

For Nguyen’s defense, his counsel portrayed him as the unwitting victim of

connivers who preyed on his desperate financial situation. Nevertheless, the jury

returned a verdict of guilty on all 12 counts. Nguyen moved for a new trial, asserting

that the court should have appointed a Vietnamese interpreter, the Government failed

to disclose exculpatory evidence, and the court erred in excluding evidence of other

bust-out schemes. The court denied the motion. Nguyen received 30 months of

imprisonment on each of the 12 counts, to be served concurrently, in addition to a

$1,200 special assessment and mandatory restitution of $90,826.

III.

Nguyen appeals the district court’s rulings on his motion to suppress, motion

for a continuance, and motion for a new trial. For the reasons given below, we affirm

the decisions of the district court.

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A.

On appeal from the denial of a motion to suppress, we review the district

court’s legal determination of probable cause de novo and its underlying factual

conclusions for clear error. United States v. McAtee, 481 F.3d 1099, 1102 (8th Cir.

2007). For probable cause to be shown, the warrant application and affidavit must

describe circumstances showing that, based on practical experience and common

sense, there is a fair probability that contraband or similar evidence will be found in

the targeted place. Id. (citing Illinois v. Gates, 462 U.S. 213, 238 (1983)). Relevant

to a finding of probable cause are an informant’s reliability, veracity, and basis of

knowledge. Id. Our inquiry is whether the evidence, taken as a whole, provides a

substantial basis for the finding of probable cause. Id. (quoting United States v. Terry,

305 F.3d 818, 822 (8th Cir. 2002)). 

Nguyen attacks the warrant as improperly relying on information provided by

the United States Postal Inspector, Marshall Fields investigators, and Wells Fargo

Bank investigators. He asserts that the affidavit supporting the search warrant

application did not show why Detective Blasingame believed the informants to be

credible and reliable, or how the informants came to know the information in the

affidavit. He also claims that the information used in the affidavit was stale, because

the objects sought were mobile, easy to conceal, consumable, and very incriminating.

See United States v. Kennedy, 427 F.3d 1136, 1142 (8th Cir. 2005) (affirming the

suppression of narcotics and cash when the informant did not give a time frame). 

Contrary to Nguyen’s assertion, the magistrate found that Detective Blasingame

reasonably relied on the informants. The magistrate saw no reason to treat the Postal

Inspector differently from a police officer, and noted that police officers are entitled

to a presumption of credibility when they are the informants mentioned in a search

warrant affidavit. United States v. Apker, 705 F.2d 293, 304 (8th Cir. 1983).

Moreover, the Postal Inspector spoke to investigators for the victim corporations and

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the person whose checks were fraudulently used to pay the accounts. The magistrate

properly deemed these individuals to be reliable, with no apparent motive to deceive

the authorities. 

As for Nguyen’s staleness argument, the magistrate found that his pattern of

fraudulent behavior suggested a continuing criminal activity. We agree. Because a

bust-out scheme depends on writing new checks to keep up with the current account

balances, as a practical matter Nguyen would have needed to maintain accurate

records about how much he had purchased and the status of the account balances.

There was a fair probability that credit card documentation and durable merchandise

was in his possession within two months after the information was provided. The

magistrate did not clearly err in her factual conclusions, and those conclusions

supported the finding of probable cause. 

B.

District courts have broad discretion to decide a request for a continuance.

United States v. Wilcox, 487 F.3d 1163, 1172 (8th Cir. 2007). A “district court’s

discretion is at its zenith when the issue [of a continuance] is raised close to the trial

date.” United States v. Whitehead, 487 F.3d 1068, 1071 (8th Cir.), cert. denied, 128

S. Ct. 693 (2007). Continuances are disfavored and should only be granted if the

moving party has shown a compelling reason. Wilcox, 487 F.3d at 1172. We will

reverse only if the court abused its discretion and the moving party was prejudiced as

a result. Id. 

Nguyen paints the denial of his request for a continuance as the denial of his

right to counsel of his own choosing. See United States v. Gonzalez-Lopez, 126 S.

Ct. 2557, 2563 (2006). Last-minute requests to change counsel, however, are

disfavored. United States v. Armstrong, 112 F.3d 342, 345 (8th Cir. 1997). When

there is not a conflict of interest, irreconcilable conflict, or a complete breakdown in

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communication between the defendant and his counsel of record, denial of a lastminute request for a substitution is appropriate. Id. Considering the court’s interest

in efficiently administering its own docket, and Nguyen’s ample opportunity to retain

private counsel, the district court did not abuse its discretion in denying Nguyen’s

request for a continuance on the morning of trial. See Whitehead, 487 F.3d at 1071;

Armstrong, 112 F.3d at 345.

C.

We review the district court’s denial of a new trial for an abuse of discretion.

United States v. LeGrand, 468 F.3d 1077, 1080 (8th Cir. 2006), cert. denied, 127 S.

Ct. 2926 (2007). The district court’s discretion is broad, but we may reverse if it did

not consider all of the appropriate factors. Id. Nguyen offers three reasons why he

should have been granted a new trial. We hold that a new trial was not warranted.

First, Nguyen argues that the district court erred by not granting him a

Vietnamese interpreter. A defendant is entitled to an interpreter if the court

determines that he “speaks only or primarily a language other than the English

language . . . so as to inhibit [his] comprehension of the proceedings or

communication with counsel or the court, or so as to inhibit [his] comprehension of

questions and the presentation of . . . testimony.” 28 U.S.C. § 1827(d)(1). A trial

court has wide discretion in making that determination. Luna v. Black, 772 F.2d 448,

451 (8th Cir. 1985). Here, Nguyen’s counsel specifically informed the court that

Nguyen did not need an interpreter, the record shows that he had lived in the United

States for approximately 20 years, and he had held jobs that required English

proficiency. Under the circumstances, it was appropriate for the district court not to

insert an unwanted person into the proceedings. See United States v. Khehra, 396

F.3d 1027, 1030 (8th Cir. 2005) (per curiam) (finding no plain error when defendant

said he did not need an interpreter at trial).

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Second, Nguyen contends that the Government committed a violation of Brady

v. Maryland, 373 U.S. 83 (1963), because it did not disclose an advertisement

featuring Mr. Hiep Huynh. According to Nguyen, the advertisement supported his

theory that Huynh orchestrated the bust-out scheme and recruited him as an innocent

participant. In Brady, the Supreme Court held that due process is violated if the

prosecution suppresses evidence that is material to the defendant’s guilt. Id. at 87.

To establish a Brady violation, Nguyen must show that the Government suppressed

evidence, the evidence was favorable to him, and the evidence was material to the

issue of guilt. United States v. Brown, 360 F.3d 828, 833 (8th Cir. 2004). 

During trial, the district court ruled that the advertisement was irrelevant

because there was no evidence that Nguyen saw it or relied upon it. The court denied

a new trial based on Brady because the advertisement was immaterial to Nguyen’s

guilt and was disclosed during trial in time for Nguyen to make use of it. We agree

that the Government was not expected to imagine ways that the advertisement could

somehow be relevant to Nguyen’s defense. The district court did not abuse its

discretion.

Third, Nguyen objects that the district court wrongly excluded evidence that

Huynh had been involved in other bust-out schemes. We review this evidentiary

ruling for an abuse of discretion and will not reverse unless substantial rights were

affected. United States v. Gregg, 451 F.3d 930, 933 (8th Cir. 2006). Nguyen asserts

that the evidence of Huynh’s orchestration of other schemes was relevant to his state

of mind and intent, based on the theory that Huynh duped him. The district court

admitted evidence of Huynh’s involvement with Nguyen’s transactions, but ruled that

evidence of other schemes was irrelevant as to his knowledge and intent regarding the

allegations in the indictment. We agree; the district court’s ruling was not erroneous.

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IV.

Accordingly, we affirm the judgment of the district court.

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