Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-13-10510/USCOURTS-ca9-13-10510-0/pdf.json

Parties Involved:
William Aubrey
Appellant
United States of America
Appellee

Document Text:

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

WILLIAM AUBREY,

Defendant-Appellant.

No. 13-10510

D.C. No.

2:09-cr-00206-

KJD-PAL-1

OPINION

Appeal from the United States District Court

for the District of Nevada

Kent J. Dawson, Senior District Judge, Presiding

Argued and Submitted

May 11, 2015—San Francisco, California

Filed September 8, 2015

Before: Diarmuid F. O’Scannlain, Sandra S. Ikuta,

and N. Randy Smith, Circuit Judges.

Opinion by Judge N.R. Smith

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2 UNITED STATES V. AUBREY

SUMMARY*

Criminal Law

The panel affirmed a conviction and sentence for two

counts of conversion and misapplication of funds from a

tribal organization, in violation of 18 U.S.C. § 1163.

The defendant is a contractor who owned a controlling

interest in, and managed and controlled, two construction

companies. His conviction resulted from his involvement in

projects he performed for the Navajo Nation.

The panel held that for purposes of § 1163, funds paid

from an Indian tribal organization to a contractor continue to

be “property belonging to any Indian tribal organization,” as

long as the tribal organization maintains sufficient

supervision and control of disbursed funds and their ultimate

use. The panel held that a reasonable jury could find (a) that

the funds misappropriated or converted by the defendant

belonged to a tribal organization, even if the funds were

considered reimbursement for work already completed; and

(b) that the Navajo Housing Authority had sufficient

supervision and control ofthe funds allocated to it by the U.S.

Department of Housing and Urban Development pursuant to

the Native American Housing Assistance and SelfDetermination Act. The panel concluded that there was

sufficient evidence for a rational jury to conclude beyond a

reasonable doubt that the defendant was misappropriating the

tribal funds. 

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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UNITED STATES V. AUBREY 3

The panel held that the district court did not err by not

requiring a prosecution witness, a forensic auditor with

HUD’s Office of Inspector General, to be certified as an

expert; and that the district court did not abuse its discretion

by allowing the witness’s summary charts to be admitted into

evidence. The panel held that the district court did not err in

instructing the jury.

The panel held that the district court did not err in

applying sentence enhancements for loss more than

$1,000,000 but not more than $2,500,000 and abuse of trust.

COUNSEL

Michael J. Kennedy (argued), Chief Assistant Federal Public

Defender, Rene Valladares, Federal Public Defender, Reno,

Nevada, for Defendant-Appellant.

Scott A.C. Meisler (argued), Sung-Hee Suh, DeputyAssistant

Attorney General, and Leslie R. Caldwell, Assistant Attorney

General, United States Department of Justice, Criminal

Division, Appellate Section, Washington, D.C.; Daniel G.

Bogden, United States Attorney, Elizabeth Olson White,

Appellate Chief, Kathryn Newman and Adam McMeen

Flake, Assistant United States Attorneys, Las Vegas, Nevada,

for Plaintiff-Appellee.

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4 UNITED STATES V. AUBREY

OPINION

N.R. SMITH, Circuit Judge:

For purposes of 18 U.S.C. § 1163, funds paid from an

Indian tribal organization to a contractor continue to be

“property belonging to any Indian tribal organization,” as

long as the tribal organization maintains sufficient

supervision and control of disbursed funds and their ultimate

use. Accordingly, we reject William Aubrey’s contention

that the evidence presented at his trial was insufficient to

prove that he converted or misused property belonging to an

Indian tribal organization in violation of 18 U.S.C. § 1163. 

We also denyAubrey’s other challenges to his conviction and

sentencing.

BACKGROUND1

A. Overview of the federal funding of tribal housing

projects

Under the Native American Housing Assistance and SelfDetermination Act, 25U.S.C. §§ 4101–4212 (“NAHASDA”),

the U.S. Department of Housing and Urban Development

(“HUD”) allocates federal money to Indian tribes to fund the

construction andmaintenance of affordable housing on Indian

reservations. HUD evaluates a tribe’s specific needs and then

1 Aubrey contends that there was insufficient evidence that he converted

or misapplied housing grant funds that belonged to an Indian tribal

organization or were entrusted to that organization’s agents. Therefore,

we present the facts “in the light most favorable to the prosecution.” 

United States v. Hicks, 217 F.3d 1038, 1041 (9th Cir. 2000).

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UNITED STATES V. AUBREY 5

allocates money to the tribe, such funds are then termed a

block grant.

The Navajo Nation receives the largest amount of

NAHASDA block grant funds in the country. The Navajo

Housing Authority (“NHA”), the Navajo tribal organization

designated to receive the block grant funds from HUD,2

received approximately ninety million dollars annually

between the years of 2000 and 2004. To be eligible to

receive NAHASDA block grant funds, the NHA must file an

annual Indian Housing Plan to specify how the funds are to

be used. Once the NHA’s Housing Plan is approved by

HUD, the NAHASDA funds are then allocated to the NHA. 

However, even after the funds are allocated, they are not

immediately delivered to the NHA. Instead, the allocated

funds are only released by HUD when the NHA submits

requests, accompanied by supporting documentation, that

eligible work under the Housing Plan has been performed. 

For example, after a roofer completes work on houses under

the NHA’s Housing Plan, the roofer submits a bill (either

directly or through a contractor) to the NHA. The NHA then

requisitions the funds from HUD, who releases the funds to

the NHA in the form of a draw. Those funds must then be

used to pay the subcontractor whose work supported the

requisition (in this example, the roofer). The funds cannot be

used for other purposes. In short, NAHASDA funds must be

spent solely on work that is (a) eligible under the statute,

(b) approved under the Indian Housing Plan, and (c) verified

as completed by the responsible tribal organization. 25

2 Tribal organizations, such as the NHA, authorized by tribal

governments to receive grant funds and to provide assistance for

affordable housing for Indians are known, under NAHASDA, as “tribally

designated housing entities.” 25 U.S.C. § 4103(22).

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6 UNITED STATES V. AUBREY

U.S.C. § 4111(g) (“[A]mounts provided under a grant under

this section may be used only for affordable housing activities

under subchapter II of this chapter that are consistent with an

Indian housing plan approved under section 4113 of this

title.”).

NHA does not undertake all housing projects on the

Navajo Nation Reservation on its own. Because of the

Reservation’s size and political diversity (the Reservation

covers over 25,000 square miles and is divided into 110

chapters, which are comparable to county governments), the

NHA delegated responsibility for requisitioning and

disbursing NAHASDA funds to a number of sub-grantees.

One such sub-grantee was the Fort Defiance Housing

Corporation (“FDHC”). The FDHC was a non-profit

organization (formed under the laws of the Navajo Nation)

and was delegated responsibility for the administration of

NAHASDA funds to provide housing to the Navajo people. 

FDHC signed formal sub-grant agreements with NHA,

pledging to adhere to the annual Indian Housing Plans

submitted by NHA and also to abide by the governing federal

and Navajo Nation laws and regulations. In its sub-grant

agreement, FDHC understood and agreed that NAHASDA

block grant funds would be allotted “on a cost reimbursement

basis” through HUD’s line-of-credit system. To obtain

NAHASDA funds, FDHC had to submit a standard

requisition form (supported by relevant documents such as

bills and invoices), identifying the funding-eligible work

performed during the relevant period, requesting payment,

and agreeing to return any excess funds. NHA inspectors

would then verify that the claimed work had actually been

completed and approve FDHC’s request. Once the request

was approved, HUD would release the NAHASDA funds to

NHA, which would issue a check to FDHC. Once the funds

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UNITED STATES V. AUBREY 7

were in FDHC’s possession, it had a fiduciary duty to manage

the funds and to pay them to the party who had performed the

work that formed the basis for the requisition.

B. FDHC and Lodgebuilder’s Relationship

William Aubrey is a contractor who owned a controlling

interest in, and actively managed and controlled, two

construction companies: Lodgebuilder, Inc., a Nevada forprofit corporation, and Lodgebuilder Management, Inc., a

Montana corporation (collectively, “Lodgebuilder”). Aubrey

has had a long history of building houses on Indian lands

throughout the country. Aubrey’s conviction, at issue in this

appeal, resulted from his involvement in projects he

performed for the Navajo Nation from 2000 to 2004.

Between 1996 and 2004, Lodgebuilder and FDHCentered

into a series of development, construction, and consulting

agreements for various projects throughout the Navajo Nation

Reservation. In fact, Lodgebuilder’s and FDHC’s

relationship became so intertwined that FDHC’s Chief

Operations Officer, Marcus Tulley, testified at trial that

Aubrey, as the person managing and controlling

Lodgebuilder, had the real authority over FDHC’s finances

and financial management. By mid-2002, FDHC’s

relationship with Lodgebuilder had raised red flags with

HUD’s Southwest Office of Native American Programs

(“SWONAP”). SWONAP issued a report in August 2002

addressing various issues arising from that relationship,

ultimately finding that FDHC was in violation of fiscal

controls and was unable to substantiate that NAHASDA

funds were being used solely for authorized purposes.

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8 UNITED STATES V. AUBREY

Notwithstanding those findings, FDHC entered into a

renewed five-year agreement (the “Consultant Agreement”)

with Lodgebuilder in October 2002. The Consultant

Agreement stated that Lodgebuilder would provide

construction management services for FDHC’s projects,

including preparing the monthly payment requests for

approval by FDHC and NHA, distributing the NAHASDA

funds awarded to FDHC to the suppliers and contractors who

performed the work, and securing the third-party funding

needed to cover the full cost of the projects. As for

Lodgebuilder’s own compensation, the agreement specified

that Lodgebuilder would be paid like the other companies that

Lodgebuilder was regulating–on a line-item basis in

accordance with NAHASDA cost guidelines.

C. The Chilchinbeto project

Two months after entering into the Consultant

Agreement, NHA submitted its 2003 Indian Housing Plan to

HUD. The Indian Housing Plan requested $9.374 million in

NAHASDA funds for a housing development to be built in

Chilchinbeto, Arizona during the 2003 fiscal year. This

amount was in addition to $2.26 million in NAHASDA grant

funds that had been allocated during the 2002 fiscal year to

get the project started. In May 2003, the FDHC entered into

a sub-grant agreement with NHA whereby the FDHC agreed

to build 90 units at Chilchinbeto, utilizing the $11.6 million

in allocated NAHASDA funds. As directed by the Consultant

Agreement, FDHC delegated the management of the

Chilchinbeto project to Lodgebuilder (and thereby to

Aubrey).

Construction at Chilchinbeto began in the summer of

2003. Lodgebuilder prepared monthly requisition requests

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UNITED STATES V. AUBREY 9

that FDHC signed and submitted to NHA. NHA then verified

that the work had been completed, drew funds from its HUD

line of credit, and issued checks to FDHC. FDHC then issued

checks to Lodgebuilder, which Aubrey endorsed and

deposited into his joint money market account that he shared

with his wife, Brenda Todd. Through the relevant periods of

time, the NHA received $9,593,000 in NAHASDA funds, of

which $9,164,573 was deposited into Aubrey’s bank account.

Aubrey used his money market account both for

professional payments on the Chilchinbeto job and for

personal expenses.3 Thus, once the funds were deposited into

Aubrey’s account, it became extremely difficult to trace how

he was using the NAHASDA funds. He also transferred

money from the joint account to another personal account to

finance gambling debts and buy jewelry.

The commingling of NAHASDA funds with personal

finances did not seem to prevent Aubrey from paying the

subcontractors doing the work at Chilchinbeto during the

early phases of the job. However, starting in the spring of

2004, Aubrey’s longtime employee, Dale Rowton, heard

complaints that contractors were not being paid for the work

they had completed. After hearing the complaints, Rowton

asked Aubrey if the contractors could be paid. Aubrey told

Rowton not to release checks, because NHA had not paid

Lodgebuilder on the requested draws. However, contrary to

Aubrey’s statement to Rowton, NHA had (with a few

exceptions) paid all eligible work expenses listed in FDHC’s

requisitions totaling more than $9.1 million through June

2004. NHA’s payments were for completed work, such as

3 Both parties agree that Aubrey was not legally obligated to keep

NAHASDA funds separate from his other funds.

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10 UNITED STATES V. AUBREY

site electrical work, flooring, and stucco work; however,

Aubrey did not pay many of these companies.

The government points to the experience of Four States

Electric as its clearest example of Aubrey’s failure to use

NAHASDA requisitioned funds for their designated purpose. 

In March 2004, Four States contacted Rowton to bid on

electrical work at Chilchinbeto. Rowton accepted Four

States’s bid and signed a contract with the company on behalf

of FDHC. Four States performed the agreed-upon work in

March and April 2004 and submitted timely bills to FDHC. 

The ensuing requisitions reflected Four States’s performance

and requested the contracted bid of a total of $200,000 in

NAHASDA funds for site electrical work. On each occasion,

NHA issued checks containing the requested amounts to

FDHC, which passed the funds to Aubrey. Aubrey, in turn,

deposited those funds at his bank and moved them among his

various accounts. Aubrey used the funds to pay personal

expenses, including payments to two casinos totaling more

than $100,000 in May 2004 and another $50,000 payment to

the Paris Casino in June 2004. Yet neither FDHC nor Aubrey

(on FDHC’s behalf) paid Four States Electric.

After learning that FDHC failed to pay vendors and

contractors at Chilchinbeto, NHA terminated FDHC’s subgrant agreement and investigated the whereabouts of the

NAHASDA funds. When the finance officials were able to

review Lodgebuilder’s finances, NHA confirmed that Aubrey

had failed to pay numerous contractors and vendors for their

work at Chilchinbeto and could not verify all of

Lodgebuilder’s claimed expenditures as permissible. An

audit (conducted in the course of FDHC’s subsequent

bankruptcy) determined that Lodgebuilder had received $11.6

million in NAHASDA funds for the Chilchinbeto project in

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UNITED STATES V. AUBREY 11

fiscal years 2002 and 2003, but that Lodgebuilder continued

to owe $1,562,921 to vendors who had worked on the project. 

The audit also concluded that, because Lodgebuilder had

received $11.6 million in NAHASDA funds but could only

verify $7,098,659 in expenses for the project, Lodgebuilder

should have had $4,501,341 in grant funds from which it

could have paid the subcontractors.

D. Aubrey’s Trial and Sentencing

In December 2012, a grand jury returned a second

superseding indictment charging Aubrey with (among other

counts) two counts (Counts Four and Five) of conversion and

misapplication of funds from a tribal organization, in

violation of 18 U.S.C. § 1163.

Aubrey’s trial began on April 9, 2013, and continued for

fifteen days. One of the prosecution witnesses was James

Hoogoian, a forensic auditor with the HUD’s Office of

Inspector General. Hoogoian introduced a series of charts

reflecting the movement of funds among Aubrey’s business

and personal accounts, following each NHA requisition

payment between July 2003 and June 2004. Hoogoian

prepared the charts by reviewing multiple bankers’ boxes

worth of documents and tracking the series of transactions

that consumed each deposit. When questioned by the

prosecutor, Hoogoian agreed that he followed a procedure

“similar in concept” to the “last-in-first-out” accounting

method. Aubrey objected to Hoogoian’s testimony, arguing

that Hoogoian was testifying as an expert even though he had

not been certified. The government responded that Hoogoian

was providing foundation for the charts to be introduced as

summary exhibits under Federal Rule of Evidence 1006,

which allows parties to “use a summary, chart, or calculation

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12 UNITED STATES V. AUBREY

to prove the content of voluminous writings . . . that cannot

be conveniently examined in court.” The district court

admitted the exhibits over Aubrey’s objection, and allowed

Aubrey a continuing objection to the testimony. The court

also denied Aubrey’s subsequent motion for a mistrial.

After the government rested its case, Aubrey moved for

a judgment of acquittal on Counts Four and Five pursuant to

Federal Rule of Criminal Procedure 29(a). The district court

subsequently denied the motion.

At the close of the trial, Aubrey objected to two of the

court’s proposed jury instructions. Proposed Jury Instruction

No. Fifteen, which addressed Count Four, outlined in part:

In order to convict defendant AUBREY of

this offense, the government must prove each

of the following elements beyond a reasonable

doubt:

First, that during the period from May 20,

2004, to on or about June 8, 2004, defendant

Aubrey knowingly and wilfully converted to

his own use or wilfully misapplied money or

funds; and

Second, that those funds or that money

belonged to an Indian tribal organization or

was intrusted to the custody or care of an

agent of an Indian tribal organization.

Proposed Jury Instruction No. Sixteen, which was very

similar, outlined in part:

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UNITED STATES V. AUBREY 13

In order to convict defendant AUBREY of

the offense charged in Count Five, the

government must prove each of the following

elements beyond a reasonable doubt:

First, that on or about June 24, 2004,

defendant AUBREY knowingly and willfully

embezzled stole, converted to his own use or

misapplied money or funds; and

Second, that those funds or that money

belonged to an Indian tribal organization or

was intrusted to the custody or care of an

agent of an Indian tribal organization.

Aubrey objected to these instructions on the basis that the

instruction split the crime into two elements rather than three,

as Aubrey had requested in his proposed instructions. When

objecting, Aubrey’s counsel explained his objection,

reasoning:

[T]he objection there would be that the . . .

first element is the specific intent crimes. . . .

[I]n this case it’s either conversion or

misapplication. Then not every conversion or

misapplication is a crime under the statute. It

has to be the money or funds belonging to an

Indian Tribal Organization. And then the

third element is the jury has to find as a matter

of fact that it is an Indian Tribal Organization. 

So that’s why I set it out in three elements.

Thus, Aubrey’s requested jury instructions read, in relevant

part:

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14 UNITED STATES V. AUBREY

Second, those monies and funds belonged to

the Navajo Housing Authority and its

subgrantee, Fort Defiance Housing

Corporation, as agents of the Navajo Nation,

rather than belonged to defendant William

Aubrey or someone else; and

Third, the Navajo Housing Authority and its

subgrantee Fort Defiance Housing

Corporation were Indian tribal organizations.

The district court denied Aubrey’s objection, reasoning that

“the Court believes that the jury is adequately instructed with

the combination instruction that includes a definition of

Indian Tribal Organization later on in the instructions.” 

Accordingly, the court gave its Proposed Instructions Nos.

Fifteen and Sixteen. After deliberation, the jury found

Aubrey guilty on Counts Four and Five. Aubrey renewed his

Rule 29 motion, which the district court again denied.

On September 10, 2013, the district court sentenced

Aubrey to imprisonment for fifty-one months, to be followed

by three years of supervised release. In calculating Aubrey’s

sentence, the court applied a sixteen-level increase pursuant

to the United States Sentencing Guidelines Manual

(“U.S.S.G.”) § 2B1.1(b)(1)(I) (2012) for loss more than

$1,000,000 but not more than $2,500,000, and a two-level

enhancement for abuse of trust pursuant to U.S.S.G. § 3B1.3. 

Aubrey appeals.

DISCUSSION

Aubrey presents four challenges to his conviction and

sentence. First, Aubrey argues that the district court erred by

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UNITED STATES V. AUBREY 15

denying his motion for judgment of acquittal, because

(a) payments for verified, certified, and approved

construction progress do not belong to an Indian tribal

organization or are not held in trust after they are paid out,

and (b) there was insufficient evidence that Aubrey converted

or misapplied housing grant funds. Second, Aubrey argues

that the district court erred by admitting Hoogoian’s

testimony as summary testimony and by admitting the

summary exhibits, because he was not certified as an expert

witness. Third, Aubrey argues that the district court erred in

its jury instructions by failing to adequately guide the jury’s

deliberations and omitting Aubrey’s proposed theory of

defense language. Fourth, Aubrey argues that the district

court erred at sentencing by applying both the sixteen and

two-level sentencing increases. We address each contention

in turn.

I.

Aubrey argues that the government failed to prove all of

the elements of 18 U.S.C. § 1163. Section 1163 allows for

the conviction of a person who:

embezzles, steals, knowingly converts to his

use or the use of another, willfullymisapplies,

or willfully permits to be misapplied, any of

the moneys, funds, credits, goods, assets, or

other property belonging to any Indian tribal

organization or intrusted to the custody or

care of any officer, employee, or agent of an

Indian tribal organization[.]

Thus, the government had to prove (1) Aubrey knowingly and

willfully embezzled, stole, converted to his own use, or

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16 UNITED STATES V. AUBREY

misapplied money or funds and (2) those funds or that money

belonged to an Indian tribal organization or was intrusted to

the custody or care of an agent of an Indian tribal

organization.

We “review de novo the district court’s denial of a

Federal Rule of Criminal Procedure 29 motion for judgment

of acquittal.” United States v. Wiggan, 700 F.3d 1204, 1210

(9th Cir. 2012).

A. Funds belonging to any Indian Tribal Organization

Aubrey argues that the money he received from FDHC

ceased being funds “belonging to any Indian tribal

organization or intrusted to the custody or care of any officer,

employee, or agent of an Indian tribal organization” when the

funds were disbursed to him. According to Aubrey, because

the disbursements were made after work had been completed

and verified by the NHA, those funds constituted

reimbursement for the work he had already completed; the

tribe could not accept completed work and also continue to

own the funds it used to pay for the work.

Although creative, Aubrey’s contention is not supported

by legal authority.

4

Instead, tribal disbursements continue to

belong to the NHA, a tribal organization, for the purposes of

18 U.S.C. § 1163, because the tribe exercises supervision and

control over the funds and their ultimate use even after they

have been disbursed.

4 Aubrey does not cite to any cases, Ninth Circuit or otherwise, to

support this argument.

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UNITED STATES V. AUBREY 17

We have not previously defined what it means for funds

to “belong[] to any Indian tribal organization.” All of our

cases dealing with § 1163 have either dealt with situations

where a tribal official (who was intrusted funds as an agent of

the tribe) embezzled those funds, see, e.g., United States v.

Coin, 753 F.2d 1510, 1510–11 (9th Cir. 1985); United States

v. Brame, 657 F.2d 1090, 1091 (9th Cir. 1981), or where the

defendant actually stole tribal property, see United States v.

Tidwell, 191 F.3d 976, 978–79 (9th Cir. 1999) (dealing with

the theft of tribal masks). In neither of these lines of cases

did we evaluate what it meant for funds or property to

“belong[] to any Indian tribal organization,” because it was

clear that the property at issue belonged to an Indian tribal

organization.

At trial, the government specifically chose not to argue

that Aubrey was an agent of the tribe who had been intrusted

with tribal funds. The government admits as much in its

appellate briefing, instead reasoning that “it is ‘extremely

unlikely’ that the jury was confused as to the relevant ‘agent’

of the Navajo Nation when . . . the jury instructions listing the

elements of the Section 1163 offense identified NHA and

FDHC as the agents, and the government did not urge

conviction on an Aubrey-as-an-agent theory.”5 Therefore, the

government cannot rely on the entrustment language in

§ 1163 to support Aubrey’s conviction, unless the

government had previously argued that Aubrey misapplied

and willfully converted funds while theywere intrusted to the

5 The jury instructions read, in relevant part, “defendant . . . did

knowingly and willfully convert to his own use and misapply moneys and

funds . . . intrusted to the custody and care of the Navajo Housing

Authority and Fort Defiance Housing Corporation as agents of the Navajo

Nation.”

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18 UNITED STATES V. AUBREY

NHA and FDHC. The government has never made that

contention. Instead, all of the government’s contentions

concerning Aubrey’s misdeeds have to do with his use of the

funds once they were disbursed to him. Therefore, for

Aubrey’s conviction to stand, the funds must have continued

to belong to the NHA and FDHC after they were disbursed,

when Aubrey willfully converted or misapplied them.

To determine the meaning of the phrase “belonging to any

Indian tribal organization,” we look to the ordinary meaning

of the phrase “belonging to.” See Metro One Telecomms.,

Inc. v. C.I.R., 704 F.3d 1057, 1061 (9th Cir. 2012) (“When

interpreting a statute, we must start with the language of the

statute. Moreover, ‘[i]n the absence of an indication to the

contrary, words in a statute are assumed to bear their

ordinary, contemporary, common meaning.’” (alteration in

original) (citations omitted)). “Belong” is commonly defined

as “to be the property of a person or thing.” Belong,

Webster’s New International Dictionary (3rd ed. 1993); see

also Belong, Black’s Law Dictionary (9th ed. 2009)

(providing the same definition). Therefore, § 1163

criminalizes a defendant’s “embezzl[ing], steal[ing],

knowingly convert[ing] to his use or the use of another,

willfully misappl[ying], or willfully permit[ing] to be

misapplied” the property of an Indian tribal organization.

We have previously explored what it means to be

“property of” in a related context. The general federal theft

statute, 18 U.S.C. § 641 (upon which § 1163 was modeled),

punishes:

[w]hoever embezzles, steals, purloins, or

knowingly converts to his use or the use of

another, or without authority, sells, conveys or

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UNITED STATES V. AUBREY 19

disposes of any record, voucher, money, or

thing of value of the United States or of any

department or agency thereof, or any property

made or being made under contract for the

United States or any department or agency

thereof[.]

Id.; see Chilkat Indian Vill. v. Johnson, 870 F.2d 1469, 1472

(9th Cir. 1989). When determining whether funds stolen or

embezzled were “of the United States,” we have held that this

requirement was satisfied when the United States had “‘title

to, possession of, or control over’ the funds involved.” See

United States v. Kranovich, 401 F.3d 1107, 1113 (9th Cir.

2005) (quoting United States v. Faust, 850 F.2d 575, 579 (9th

Cir. 1988)). Further, we have “also looked to the amount of

control the government has retained over funds when seeking

to determine whether the funds are government funds within

the purview of § 641.” Faust, 850 F.2d at 579. In United

States v. Von Stephens, we held that the federal government

“has sufficient interest in its funds, even if commingled [with

state and county funds], where it exercises supervision and

control over the funds and their ultimate use.” 774 F.2d

1411, 1413 (9th Cir. 1985) (per curiam).

We now adopt the standards from Kranovich, Faust, and

Von Stephens for use in the § 1163 context. Tribal funds

disbursed continue to be “property belonging to any Indian

tribal organization” as long as the tribe maintains “title to,

possession of, or control over them.” Kranovich, 401 F.3d at

1113 (citation omitted). Thus, funds that have been

disbursed, even as reimbursement for completed work,

continue to belong to the tribal organization if the tribal

organization “exercises supervision and control over the

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20 UNITED STATES V. AUBREY

funds and their ultimate use.” Von Stephens, 774 F.2d at

1413.

Utilizing this standard, it is clear that the NHA exercised

sufficient control over the grant funds to conclude that the

funds belonged to the tribal organization. First, before grant

funds could be released by HUD, NHA was required to verify

that actual, reimbursable work had already been completed. 

To comply with this requirement, the NHA reviewed all

documents and invoices submitted byFDHC and Aubrey, and

conducted site inspections before any disbursements were

made. Prior approval of fund disbursements indicates

supervision and control. See United States v. Johnson,

596 F.2d 842, 846 (9th Cir. 1979) (“[U]rban funds granted to

the agencies . . . should be utilized under the strictest of

supervision, including submission by the union of verified

payrolls before additional sums are advanced by the

redevelopment agency.”). Second, NHA’s requisition form

(the form submitted by Aubrey for all grant fund

reimbursements) indicated NHA’s continued interest in the

funds. The requisition form required the following

certification:

I certify the data reported and funds requested

on this voucher are correct and the amount

requested is not in excess of immediate

disbursement needs for this program. In the

event the funds provided become more than

necessary, such excess will be promptly

returned (via NHA) as directed by HUD.

Thus, NHA’s form made it clear that, even after funds were

disbursed, NHA retained an interest in the funds. Third,

the sub-grant agreement required FDHC (and

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UNITED STATES V. AUBREY 21

Aubrey/Lodgebuilder who, through the Consultant

Agreement, stepped into FDHC’s shoes with regard to

managing the NAHASDA funds) to comply with NHA’s

policies and submit numerous reports to NHA. Additionally,

the sub-grant agreement gave NHA the authority to audit and

demand accountings from FDHC and its sub-grantees. The

ability to audit and require periodic reporting indicates

supervision and control. See Von Stephens, 774 F.2d at 1413

(reasoning that audit and reporting requirements, as well as

power to examine fund recipient’s bank accounts, constituted

supervision and control); United States v. Gibbs, 704 F.2d

464, 465–66 (9th Cir. 1983) (per curiam) (finding supervision

and control when periodic reports and audits were required). 

Trial testimony confirmed that NHA exercised its audit and

investigation authority in response to Aubrey’s suspected

misuse of the grant funds. The testimony also confirmed that

NHA eventually obtained records from Lodgebuilder in an

effort to account for misappropriated funds. Taken together,

a reasonable jury could find (a) that the funds

misappropriated or converted by Aubrey belonged to a tribal

organization, even if the funds were considered

reimbursement for work alreadycompleted; and (b) that NHA

had sufficient supervision and control of the NAHASDA

funds.

B. Sufficiency Challenge

Aubrey was convicted of two counts of embezzlement or

misapplication under 18 U.S.C. § 1163. Count Four focused

on the period from May 20, 2004 to June 8, 2004, and Count

Five dealt with events on or about June 24, 2004. Aubrey

argues that there was insufficient evidence to convict him of

either Count. “In reviewing the sufficiency of the evidence,

[the court] construe[s] the evidence in the light most

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22 UNITED STATES V. AUBREY

favorable to the prosecution, and then ask[s] whether any

rational trier of fact could have found the essential elements

of the crime beyond a reasonable doubt.” Wiggan, 700 F.3d

at 1210 (quoting United States v. Nevils, 598 F.3d 1158, 1161

(9th Cir. 2010)) (internal quotation marks omitted). “Because

the government does not need to rebut all reasonable

interpretations of the evidence that would establish the

defendant’s innocence, or ‘rule out every hypothesis except

that of guilt beyond a reasonable doubt’ . . . , a reviewing

court may not ask whether a finder of fact could have

construed the evidence produced at trial to support acquittal.” 

Nevils, 598 F.3d at 1164 (quoting Jackson v. Virginia,

443 U.S. 307, 326 (1979)). Therefore, we focus on the

evidence that, when taken in the light most favorable to the

prosecution, supports Aubrey’s conviction.

1. Aubrey’s Count Four Conviction

Taken in the light most favorable to the prosecution, the

non-payment of funds to Four States Electric presents

sufficient evidence such that any rational trier of fact could

have convicted Aubrey on Count Four. Four States

performed the electrical work on the Chilchinbeto project in

March and April 2004 and submitted timely bills to FDHC. 

The ensuing requisitions reflected Four States’s performance

and requested a total of $200,000 in NAHASDA funds for

site electrical work. On each occasion, NHA issued checks

containing the requested amounts to FDHC, which then

passed the funds to Aubrey. Aubrey, in turn, deposited those

funds in his bank account and moved them among accounts

from which he paid personal expenses, including payments to

two casinos totaling more than $100,000 in May 2004. Yet

neither FDHC nor Aubrey (on behalf of FDHC) paid Four

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UNITED STATES V. AUBREY 23

States Electric. This pattern was repeated for many other

subcontractors who worked on the Chilchinbeto project.

As discussed above, the NAHASDA funds distributed to

Aubrey belonged to the NHA, a tribal organization, because

it had the authority to supervise and control the funds even

after they had been delivered to Aubrey. Witness testimony

established that Aubrey was not free to use the NAHASDA

funds as he saw fit, but was obligated to make sure they were

delivered to the subcontractors who had requisitioned the

funds. Despite the fact that funds had been delivered to

Aubrey to pay Four States for its site electrical work, Four

States never received payment from either Aubrey or FDHC. 

In the same period of time, Aubrey made large payments

from the same account to satisfy his personal gambling debts. 

When combined with evidence that Aubrey lied when

confronted about the non-payment, his conceded failure to

put the NAHASDA funds to their designated purpose

constitutes sufficient evidence that could allow a rational trier

of fact to conclude, beyond a reasonable doubt, that Aubrey

had embezzled or misapplied those funds.

Both at trial and before this court, Aubrey provided

various alternative explanations for why he was authorized to

retain NAHASDA funds for his own use. He argued that

(1) he spent $690,000 of his own money for the Chilchinbeto

project and was therefore entitled to keep the NAHASDA

funds as reimbursement; (2) the government was not able to

show that he was using NAHASDA funds to pay for his own

personal expenses; and (3) the Chilchinbeto project was

underfunded and the reason subcontractors were not getting

paid was because of under funding, not misappropriation. 

However, none of these arguments explain why money paid

to Aubrey (for the sole purpose of paying specific

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24 UNITED STATES V. AUBREY

subcontractors) never made it to the subcontractors. If

Aubrey were paying the subcontractors from his own funds

and then keeping the NAHASDA reimbursement funds as he

claims, the subcontractors still would have been getting paid. 

Even if the project were underfunded, the subcontractors

would have at least been paid up to the NAHASDA limit for

their work, and they would only be unpaid to the extent that

the NAHASDA funds were insufficient to cover their

submitted invoices. Instead, the evidence showed that

NAHASDA funds were being used by Aubrey, and

subcontractors were not receiving payment. This evidence

was sufficient to allow any rational jury to conclude, beyond

a reasonable doubt, that Aubrey was misappropriating the

tribal funds.

2. Aubrey’s Count Five Conviction

Count 5 dealt with payments delivered to Aubrey in June

2004. The evidence showed that (1) FDHC requested

$133,700 in payment for work prior to June 1 on streets

($84,000), site electrical ($36,000), and gutters ($13,000);

(2) NHA issued a check in the requested amount; (3) Aubrey

deposited the check into an FDHC account at his bank on

June 21, 2004; and (4) the next day, Aubrey transferred

$45,000 from that FDHC account to the joint Aubrey-Todd

account. Two days later, on June 24, Aubrey cut a $50,000

check to the Paris Casino from his separate personal account,

and the bank covered that check by sweeping in $25,400

attributable to the recently deposited grant funds. These

actions followed Aubrey’s pattern of depositing grant money

into his personal accounts and then, within days, paying out

large-scale expenses. Taken in the light most favorable to the

prosecution, this evidence supported the jury’s reasonable

inference that Aubrey was putting grant funds earmarked for

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UNITED STATES V. AUBREY 25

another purpose to his personal use or was, at the very least,

misappropriating the funds to the payment of parties other

than the subcontractors whose invoices supported the

requisitions.

Once again, although Aubrey presents alternative

explanations for why he was entitled to keep the funds

requisitioned in June, the jury heard his explanations and

rejected them. Because sufficient evidence was presented to

support his conviction, the district court did not err in denying

Aubrey’s Rule 29 motion for acquittal.

II.

Aubrey argues that (1) the district court erred by not

requiring Hoogoian to be certified as an expert witness and

compelling expert disclosures, and (2) the district court erred

by allowing Hoogoian’s summary charts to be admitted into

evidence.

A. Expert Certification

A trial court’s decision to admit or exclude expert

testimony is reviewed for abuse of discretion. United States

v. Gonzales, 307 F.3d 906, 909 (9th Cir. 2002); United States

v. Laurienti (Laurienti I), 611 F.3d 530, 547 (9th Cir. 2010). 

Under the abuse of discretion standard, if the district court

identified the correct legal rule, then its ruling must be

affirmed unless the “court’s application of the correct legal

standard was illogical, implausible, or without support in

inferences that may be drawn from the facts in the record.” 

United States v. Redlightning, 624 F.3d 1090, 1110 (9th Cir.

2010).

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Aubrey argues that the district court was required to

certify Hoogoian as an expert witness, solely because of his

use of the “last-in-first-out” accounting method in preparing

his summary charts. Aubrey cites to no authority to support

this contention. Rather, he argues broadly that “‘last-in-firstout’ is neither a Federal Rule of Evidence 1006 summary nor

an example of lay witness opinion proper under Federal Rule

of Evidence 701.”

In addressing Aubrey’s objection and motion for mistrial,

the court ruled:

I don’t think anything that he’s testified to

would call for expert opinion testimony or

involve expert opinion testimony under 702. 

All of his testimony’s been under 701,

lay–laywitness testimony. And he may be an

expert, but he hasn’t testified as an expert. 

He’s testifying to facts of which he had

personal knowledge. And he [is] subject to

cross-examination on his . . . conclusions as to

what those expenses were. . . . [P]ersonal

knowledge would include his own

investigation as to the payees and he’s subject

to cross-examination on that. Personal

knowledge as to the checks that he saw.

The court then asked whether all of the source material, on

which Hoogoian was basing his testimony, had been provided

to Aubrey. Aubrey answered, “It was produced in

discovery.” Further, when the government asked Hoogoian

about other forms of analysis that he may have used when

creating his summary, the district court recognized that the

question was “get[ting] into the area of kind of dealing with

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UNITED STATES V. AUBREY 27

expert testimony” and prevented the government from

pursuing that line of questioning.

Hoogoian was not required to be certified as an expert. 

Hoogoian testified about his own personal investigation of

FDHC and Lodgebuilder in his capacity as a HUD auditor in

accordance with Federal Rule of Evidence 701. Although

Hoogoian might have been eligible to be certified as an

expert, the district court properly restricted his testimony to

the areas in which he had personal knowledge (the

documents, investigation, and the methods he used to prepare

his summary) and prevented him from providing in-depth

analysis of various accounting methods. Simply because

Hoogoian stated that he used “last-in-first-out” to construct

his summary charts did not transform his testimony into

expert testimony. Instead, Hoogoian was merely providing

foundation for the evidence he was presenting. Further, when

Hoogoian was prompted by the prosecution to discuss the

merits of the “last-in-first-out” accounting method, the

district court properly prevented Hoogoian from answering,

as that sort of testimony could stray into the realm of expert

testimony. Accordingly, two passing references to the “lastin-first-out” method (when explaining his own procedure in

constructing the charts) is not sufficient to require the district

court to certify Hoogoian as an expert witness. See Teen-Ed,

Inc. v. Kimball Int’l, Inc., 620 F.2d 399, 403 (3d Cir. 1980)

(“The fact that Zeitz might have been able to qualify as an

expert witness on the use of accepted accounting principles

in the calculation of business losses should not have

prevented his testifying on the basis of his knowledge of

appellant’s records about how lost profits could be calculated

from the data contained therein.”).

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B. Summary Evidence

“It is long established that, where records are voluminous,

a summary, either oral or written, may be received in

evidence.” Sam Macri & Sons, Inc. v. U.S. for Use of Oaks

Const. Co., 313 F.2d 119, 128–29 (9th Cir. 1963). However,

the summary must meet the requirements of Rule 1006. See

Frank Music Corp. v. Metro-Goldwyn-Mayer, Inc., 772 F.2d

505, 515 n.9 (9th Cir. 1985) (holding that a “self-calculated”

and “unverified” summary was properly admitted when the

underlying records supporting the summary were made

available to the other party and where the party was given

“ample opportunity to cross-examine” the person who

oversaw the preparation of the summary). Rule 1006 requires

that “[t]he proponent must make the originals or duplicates

[of the voluminous writings] available for examination or

copying, or both, by other parties at a reasonable time and

place.” We review for abuse of discretion “a district court’s

admission of summary evidence.” United States v. Anekwu,

695 F.3d 967, 981 (9th Cir. 2012).

When preparing his summary testimony and charts,

Hoogoian sifted through multiple bankers’ boxes worth of

documents concerning deposits and withdrawals from

Aubrey’s bank accounts. Under the plain language of Rule

1006, the government was permitted to “use a summary,

chart, or calculation to prove the content of voluminous

writings, recordings, or photographs that cannot be

conveniently examined in court.” Multiple bankers’ boxes of

bank statements constitute the type of materials anticipated

by Rule 1006. Further, the district court ensured that the

government made the documents underlying the summary

available to Aubrey, as Aubrey admitted they had done. 

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UNITED STATES V. AUBREY 29

Therefore, nothing suggests that the government failed to

satisfy Rule 1006.

The district court did not abuse its discretion by allowing

Hoogoian’s summary charts to be admitted into evidence. In

United States v. Rizk, we held that summary evidence is

admissible as evidence if “the underlying materials upon

which the summary is based (1) are admissible in evidence

and (2) were made available to the opposing party for

inspection.” 660 F.3d 1125, 1130 (9th Cir. 2011). 

Additionally, in Anekwu, we noted that “we have not

articulated a bright-line rule against admission of summary

charts as evidence.” 695 F.3d at 981–82 (citation and

alterations omitted). In fact, the district court has “discretion

under Federal Rule of Evidence 611(a) to admit summary

exhibits for the purpose of assisting the jury in evaluating

voluminous evidence.” Id. at 982 (citation and alterations

omitted). We further concluded in Anekwu that “we need not

embrace or condemn the procedure followed by the district

court,” because “the error is harmless given admissibility of

the underlying data, lack of objection to accuracy of the

summary, and the limiting instruction.” Id.(citation omitted).

Aubrey never objected to the accuracy of the summaries

at trial. Instead, he merely objected to Hoogoian’s testimony,

because he thought that Hoogoian should have been required

to be certified as an expert. On appeal, Aubrey now argues

that admission of the summarycharts into evidence was error. 

However, the underlying bank account records were

admissible6and delivered to Aubrey in discovery. Therefore,

under Rizk, the district court did not abuse its discretion in

allowing the summary charts to be entered into evidence. 

 

6

 Aubrey has not argued that the records were inadmissible.

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30 UNITED STATES V. AUBREY

Further, even if admitting the summary charts into evidence

were error, that error was harmless under Anekwu. The

district court provided the Ninth Circuit’s Pattern Instruction

4.16 (as a limiting instruction) that said “[c]ertain charts and

summaries have been admitted in evidence,” those “[c]harts

and summaries are only as good as the underlying supporting

material,” and jurors should “give them only such weight as

you think the underlying material deserves.” Therefore,

“given [the] admissibility of the underlying data, lack of

objection to [the] accuracy of the summary, and the limiting

instruction,” any error was harmless. See Anekwu, 695 F.3d

at 82.

III.

Aubrey argues that the district court erred by providing a

jury instruction containing the language, “Second, those

funds or that money belonged to an Indian tribal organization

or was intrusted to the custody or care of an agent of an

Indian tribal organization.” Aubrey argues that the district

court should have instead used his proposed instruction that

read, “Second, those monies and funds belonged to the

Navajo Housing Authority and its subgrantee Fort Defiance

Housing Authority, as agents of the Navajo Nation, rather

than belonged to defendant William Aubrey or someone else.” 

On appeal, Aubrey argues that the given jury instruction

(1) failed to address his theory of defense that the

NAHASDA funds belonged to Aubrey or subcontractors, not

the NHA or FDHC, and (2) allowed the jury to convict

Aubrey under an agency theory. At trial, although Aubrey

objected to the instruction, his objection merely argued that

the instruction should have been split into three elements

instead of two. He did not object on the ground that the

instruction did not cover his theory of defense. Because

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UNITED STATES V. AUBREY 31

Aubrey failed to “state with adequate specificity the grounds

for an objection to a jury instruction before the jury retires,”

we review this claim for plain error.7 United States v. Hofus,

598 F.3d 1171, 1175–76 (9th Cir. 2010).

“A defendant is entitled to have the judge instruct the jury

on his theory of defense, provided that it is supported by law

and has some foundation in the evidence.” United States v.

Mason, 902 F.2d 1434, 1438 (9th Cir. 1990), overruled on

other grounds by Dixon v. United States, 548 U.S. 1 (2006). 

“[B]ut it is not reversible error to reject a defendant’s

proposed instruction . . . if other instructions, in their entirety,

adequately cover the defense theory.” Id.

The district court did not err by giving its jury instruction

rather than Aubrey’s proposed instruction. The jury

instructions adequately covered Aubrey’s theory of defense. 

Section 1163 allows for a conviction if the defendant

“embezzles, steals, knowingly converts to his use or the use

of another, willfully misapplies, or willfully permits to be

misapplied,” funds “belonging to any Indian tribal

organization or intrusted to the custody or care of any officer,

employee, or agent of an Indian tribal organization.” The

jury instruction provided by the court followed the statute

closely. The court’s jury instructions then defined

conversion, willful misapplication, embezzlement, and

stealing. Each of these definitions included the phrase “of

another” or “belongs to another.” Thus, under the

instructions provided by the court, it would have been clear

7 To satisfy the plain error standard of review, “[t]here must be an ‘error’

that is ‘plain’ and that ‘affect[s] substantial rights.’” United States v.

Olano, 507 U.S. 725, 732 (1993) (quoting Fed. R. Crim. Proc. 52(b))

(second alteration in original).

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32 UNITED STATES V. AUBREY

to the jury that it could not convict Aubrey if it found that the

funds belonged to him. The instructions also provided that

Aubrey could not be convicted if the jury found that the funds

belonged to the subcontractors. Instructions fifteen and

sixteen only allowed for Aubrey’s conviction if the jury

found that the funds “belonged to an Indian tribal

organization or was intrusted to the custody or care of an

agent of an Indian tribal organization.” Under the plain

meaning of this instruction, if the jury found that the funds

belonged to subcontractors, it could not convict Aubrey,

because then the funds would not belong to a tribal

organization. Nothing would be gained by adding Aubrey’s

proposed language “rather than belonged to defendant

William Aubrey or someone else.” Therefore, the district

court did not err by providing the instructions it did to the

jury. See United States v. Keyser, 704 F.3d 631, 641–42 (9th

Cir. 2012) (“[A] defendant is entitled to have his theory fairly

and adequately covered by the instructions, but is not entitled

to an instruction in a particular form.”). Without error, there

can be no plain error.

The court’s jury instruction also did not allow Aubrey’s

conviction on an improper agency theory. Section 1163

expressly allows conviction if the jury finds that the funds

were intrusted to an agent of an Indian tribe. The jury

instructions provided by the court specifically identified “the

Navajo Housing Authority and Fort Defiance Housing

Corporation as agents of the Navajo Nation.” Therefore, the

jury would have reasonably understood that NHA and FDHC

were the applicable agents under instructions fifteen and

sixteen. The jury instructions were not “misleading or

inadequate to guide the jury’s deliberations,” because they

properly stated the law and expressly identified the basis

upon which the government sought conviction. See United

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UNITED STATES V. AUBREY 33

States v. Johnson, 680 F.3d 1140, 1147 (9th Cir. 2012)

(quoting United States v. Holmes, 229 F.3d 782, 786 (9th Cir.

2000) (internal quotation marks omitted)). Thus, the district

court did not commit error, plain or otherwise, in providing

the jury the instructions that it did.

IV.

Aubrey challenges two sentencing enhancements that the

district court imposed: (1) a sixteen-level increase pursuant to

U.S.S.G. § 2B1.1(b)(1)(I) for loss more than $1,000,000 but

not more than $2,500,000; and (2) a two-level enhancement

for abuse of trust pursuant to U.S.S.G. § 3B1.3.

A. Sixteen-level increase

We review a district court’s factual calculation of the

amount of loss under the Guidelines for clear error. United

States v. Stargell, 738 F.3d 1018, 1024 (9th Cir. 2013). “A

reviewing court must ask whether, ‘on the entire evidence,’

it is ‘left with the definite and firm conviction that a mistake

has been committed.’” Id. (alterations omitted) (quoting

Easley v. Cromartie, 532 U.S. 234, 242 (2001)).

Looking at all of the evidence in this case, the district

court did not clearly err by finding a loss more than $1

million, but not more than $2.5 million. When making its

sentencing determination, the district court pointed to two

measures, both of which indicated a loss greater than $1

million but less than $2.5 million. The district court

reasoned:

I have concluded that because of the failure to

pay contractors for whom funds had been

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34 UNITED STATES V. AUBREY

requisitioned, there was a cascade of

consequences including the fact that NHA had

to take steps at that point–once they learned

that at least one contractor hadn’t been paid

with requisition monies, they had to pull the

plug, and that caused consequential damages

that exceeded $1 million. The NHA figure is

2.2 million.

The district court then noted that it “put some stock in

Hoogoian[‘s] analysis, but [it didn’t] rest [its] decision

entirely on that in finding that the loss amount was more than

$1 million but less than $2,500,000.” Hoogoian’s analysis

indicated that $1,989,339 of NAHASDA funds were spent for

Aubrey’s personal use. Other evidence, presented at trial also

supports the enhancement. The FDHC bankruptcy audit

indicated that Lodgebuilder owed $1,562,921 to contractors

who had worked on the Chilchinbeto project and that

Lodgebuilder should have had access to $4,501,341 in

allocated NAHASDA grant funds to pay those contractors. 

However, the NAHASDA funds were not used for their

designated purpose. Thus, even though Aubrey presents

alternative theories about why the amount of loss should be

less, the district court’s finding is not clearly erroneous. See

United States v. Reed, 80 F.3d 1419, 1424 (9th Cir. 1996)

(“Where there are two permissible views of the evidence, the

factfinder’s choice between them cannot be clearly

erroneous.”) (quotingAnderson v. City of Bessemer, 470 U.S.

564, 574 (1985)).

B. Two-level enhancement

The Guidelines prescribe a two-level enhancement “[i]f

the defendant abused a position of public or private trust . . .

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UNITED STATES V. AUBREY 35

in a manner that significantly facilitated the commission or

concealment of the offense.” U.S.S.G. § 3B1.3.

As a preliminary matter, we first address Aubrey’s

contention that the enhancement in § 3B1.3 cannot apply in

his case, because an abuse of trust or skill is included in the

offense of his conviction. We review this argument de novo,

because it involves interpretation § 3B1.3 of the Sentencing

Guidelines. See United States v. Gomez-Leon, 545 F.3d 777,

782 (9th Cir. 2008). Section 3B1.3 provides:

If the defendant abused a position of public or

private trust, or used a special skill, in a

manner that significantly facilitated the

commission or concealment of the offense,

increase by 2 levels. This adjustment may not

be employed if an abuse of trust or skill is

included in the base offense level or specific

offense characteristic.

(emphasis added). According to Aubrey, the second sentence

of § 3B1.3 precludes its application to his case, because the

offense he was convicted of included “an abuse of trust or

skill.” However, Aubrey misinterprets § 3B1.3. In Laurienti

I, this court clarified, “The [abuse-of-trust] enhancement is

inapplicable only if the base offense level necessarilyincludes

an abuse of trust, regardless whether the defendant’s offenses

of conviction include an abuse of trust.” 611 F.3d at 556

(alteration in original). Therefore, it is the base offense level

that matters, not the offense of conviction. Here, the base

offense level of Aubrey’s charges was derived from U.S.S.G.

§ 2B1.1. In United States v. Ajiboye, we held:

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36 UNITED STATES V. AUBREY

Ajiboye was assigned a base offense level of

4 under Section 2B1.1(b)(1) (“Larceny,

Embezzlement, and Other Forms of Theft”). 

This provision of the Guidelines does not

include “an abuse of trust or skill” in it. 

Ajiboye’s two-level enhancement for abuse of

a position of trust thus cannot be attacked on

that basis.

961 F.2d 892, 895 n.4 (9th Cir. 1992). Under Ajiboye, the

base offense level in Section 2B1.1 does not include an abuse

of trust or skill. Therefore, Aubrey’s preliminary argument

fails.

We now address the district court’s application of § 3B1.3

to the facts of Aubrey’s case. We review a district court’s

application of an abuse-of-trust enhancement under a twostep analysis. See United States v. Laurienti (Laurienti II),

731 F.3d 967, 973 (9th Cir. 2013). First, we determine

“[w]hether a defendant acted from a ‘position of trust’ as

defined by the Guidelines” under de novo review. Id. Then,

“[i]f we decide that the defendant held a position of trust, we

review for clear error the [district] court’s decision whether

the defendant’s abuse of his position significantly facilitated

the offense.” Id.

Turning to the first step of the “abuse of trust” analysis,

Aubrey was in a position of trust. “[T]he presence or lack of

‘professional or managerial discretion’represents the decisive

factor in deciding whether a defendant occupied a position of

trust.” Id. (quoting United States v. Contreras, 581 F.3d

1163, 1166 (9th Cir. 2009)). “A defendant has this discretion

when, because of his or her special knowledge, expertise, or

managerial authority, he or she is trusted to exercise

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UNITED STATES V. AUBREY 37

substantial discretionary judgment that is ordinarily given

considerable deference.” Id.(citation and alterations omitted). 

Aubrey argues that “[w]hile [he] had professional and

managerial discretion with respect to his private for-profit

company Lodgebuilder, he did not have that same position

within FDHC or NHA to warrant this enhancement.” This

argument is contradicted by the evidence presented at trial. 

Trial evidence supported the conclusion that FDHC delegated

financial management of the Chilchinbeto project to Aubrey’s

company, that his company then stepped into the shoes of

FDHC, and that Aubrey had “the real authority” at FDHC,

because he “handle[d] all of the finances.” The district court

looked at these facts and concluded:

This case is more than a simple case of

misapplication. It involves a person who was

really controlling the entire operations of a

nonprofit and combining millions of dollars

in–running millions of dollars through a

personal account, combining it with trust

monies, and then gambling and doing the

other things that were evidenced during the

trial.

Reviewing the evidence of this case de novo, we conclude

that the district court did not err by concluding that Aubrey

occupied a position of trust.

Under the second prong, the district court found that

Aubrey’s position of trust facilitated the crime. This finding

is reviewed for clear error. Id. We conclude that the district

court’s finding was not clearly erroneous. The evidence

showed that FDHC handed Aubrey millions in grant funds

and exercised little oversight as he shifted the funds among

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38 UNITED STATES V. AUBREY

the various accounts he controlled. In fact, Aubrey (rather

than FDHC) controlled the FDHC’s financial records sought

byNHA officials when they started investigating the reported

non-payments. That FDHC really had no idea what Aubrey

was “up to” indicates that he was in a position of trust and

used that position to facilitate or conceal the mismanagement

of the NAHASDA grant funds. Thus, we conclude that the

district court’s finding that Aubrey’s position of trust

facilitated the commission of this crime was not clearly

erroneous.

AFFIRMED.

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