### I N THE UNI TED STATES COURT OF APPEALS FOR THE FI F TH CI RCUI T

No. 11-50143

UNITED STATES OF AMERICA,

Plaintiff - Appellee,

v.

SON G U. CHON, also known as The K orean; ALEJANDRO GARCIA–RICO; MANUEL C A RDOZA; YCL CORPORATION, doing business as The Gateway Hotel,

Defendants - Appellants.

Appeals from the United States District Court for the Western District of Texas

Before HIGGINBOTHAM, SMITH, and ELROD, Circuit Judges.
PER CURIAM:

A jury convicted D e fe ndant s

- Appel l ant s Song U. Chon ( “ Chon” )
, Al ej and ro
G a rc ia

– R ico (“G a rcia

– R ico ”), M a n u e l C a rd o za (“C a rd o za ”), a n d Y C L

C o rp o ra tio n (“Y C L ”) o f c o n sp irin g to sm u g g le
, tra n sp o rt, a n d h a rb o r ille g a l

a lie n s in v io la tio n o f 8 U .S .C

. § 1 3 2 4 (a )(1 )(A )(v )(I). A ju ry a lso co n v icte d C h o n

o f m o n e y la u n d e rin g in v io l a tio n o f 1 8 U .S .C

. § 1 9 5 6 (a )(1 )(A ) (i) a n d (B )(i), a n d

th re e c o u n ts o f w i llfu lly a id in g a n d a ssistin g in th e filin g o f a fa lse t a x re tu rn
in v io la tio n o f 2 6 U

. S

. C

. § 7 2 0 6 (2 ). C h o n , C a rd o za , a n d Y C L e a ch ch a lle n g e
th e ir co n v ictio n s a n d C h o n a n d G a rcia

– R ico ch a lle n g e th e ir se n te n c e s. F o r t h e

re a so n s th a t fo llo w , w e fin d n o re v e rsib l e e r ro r a n d , th e re fo re , A F F IR M

. U n i t e d S t a te s C o u r t o f A p p e al s

F i f t h C i rc u i t 

### F I L E D April 10, 2013

Ly l e W . Cay ce Clerk Case: 11-50143 Document: 00512204836 Page: 1 Date Filed: 04/10/2013No. 11-50143

I.

T h e fa cts o f th is ca se 1 in v o l v e t h e u se o f th e G a te w a y H o te l, w h ich is

lo ca te d i n clo se p ro x im ity t o th e U n ite d S ta te s -M e x ico b o rd e r in E l P a so , T e x a s,

a s a l o ca t io n to h a rb o r ille g a l a lie n s b e g in n in g in 2 0 0 3 a n d c o n tin u in g th ro u g h

M a y 2 0 0 9

. Y C L o w n e d th e G a te w a y H o te l u n til C h o n , o n e o f t h e f o u r d ire cto rs

o f Y C L
, p u rch a s e d it in F e b ru a ry 2 0 0 4

. 2 C h o n , a s o w n e r o f t h e G a te w a y H o te l
,

w o r k e d o n a d a ily b a sis i n a n o ffice n e a r th e f ro n t d e s k

. D u rin g th e y e a rs in

ques t i on, t he Gat ewa y H o te l e m p lo y e d A rm o n d o A rza te (“A rza te ” ) a s i ts g e ner al

m a n a g e r, G a rcia

– R ico a s a fro n t-d e sk cle rk
, a n d J o se H e r re ra ( “H e rre r a ”) a s a

m a in te n a n ce m a n

. T h e G a te w a y H o te l a l so re n t e d i ts re sta u ra n t a re a to J u o

H su a n H su (“M a y ”) w h o ra n M a y ’ s C a fé

. O v e rw h e lm in g , u n d isp u te d e v id e n ce w a s o ffe re d a t tria l th a t in d iv id u a ls

co n d u ctin g a lie n -sm u g g lin g o p e r a tio n s (“a lie n sm u g g l e r s”), in clu d in g C a rd o za ,

u t ilize d t h e G a te w a y H o te l a s a lo ca tio n to h a rb o r i l l e g a l a lie n s w h o h a d j u s t

cro sse d th e b o rd e r b e f

o re th e y w e re tra n sp o rte d to o th e r l o c a tio n s in th e U n ite d

S ta te s. T h e p ro se cu t i o n o f f e re d e v i d e n ce th a t C h o n , G a rcia

– R ico
, A rza te , H e rre r a , a n d M a y co o p e ra te d w ith th e a lie n sm u g g l e r s to fa cilita te t h e ir u se o f

th e G a t e w a y H o te l to h a r b o r ille g a l a lie n s

. F o r e x a m p le
, H e rre ra m a d e

a rra n g e m e n ts to a llo w ille g a l a lie n s to sn e a k in to ro o m s a t th e G a te w a y H o te l

w ith o u t la w e n fo rce m e n t n o ticin g a n d to w a sh th e d irty clo th in g o f th e ille g a l

a lie n s o n ce th e y m a d e i t i n t o t h e i r ro o m s. A t th e p h o n e re q u e s ts o f th e a lie n

sm u g g l e rs, G a te w a y H o te l e m p l o y e e s w o u ld r e g u la rly agr ee t o del i ver fo o d fro m
M a y ’ s C a fé d ire c tly to il l e g a l a lie n s w h o w e re h id in g in sid e h o te l r o o m s. T h e

1 We view the f

acts in t h e l i g h t m o s t f avorable to the jury verd ict as w e m us t. E. g. , U ni ted Sta tes v

. Ca ntu–Ra m i rez , 669 F. 3d 619, 622 n. 1 (5th Cir. 2012)

.

2 Even af

ter Chon p urchas ed the G atew ay H otel in February 2004, all f ilings relating to the bus ines s o c c u r r ing at the G atew ay H otel, s uch as f ed eral tax returns and hotel

o c c up ancy record s , continued to be m ad e in the nam e of “Y CL, Inc.
, d oing bus ine s s a s t h e G atew ay H otel. ”

2 Case: 11-50143 Document: 00512204836 Page: 2 Date Filed: 04/10/2013No. 11-50143

fro n t-d e sk cle r k s a lso fa cilita te d th e a lie n sm u g g le r’s u se o f th e G a te w a y H o te l

b y a llo w in g a lie n s m u g g le rs to p a y fo r ro o m s u se d b y ille g a l a lie n s

. Im m ig ra tio n a n d C u sto m s E n fo rce m e n t (“IC E ”) a g e n ts te s tifie d th a t d u rin g

se v e ra l ra id s, G a rcia

– R ico
, w h o w a s w o rk in g a t th e fro n t d e s k
, ca lle d th e ro o m s

w h e re ille g a l a lie n s w e re lo ca te d
, p r e su m a b ly t o w a rn th e ille g a l a lie n s o f th e

ra id

. L a w e n fo rce m e n t r e co r d e d n u m e ro u s te le p h o n e ca lls b e tw e e n G a te w a y
H o te l e m p lo y e e s a n d th e a lie n sm u g g le rs, in clu d in g a te le p h o n e ca l l b e tw e e n
G a rcia

– R ico a n d a n a lie n sm u g g l e r d u rin g w h i c h G a rcia

– R ico a g re e d to p a y $ 8 5 0 to t ra n sp o rt a n ille g a l a lie n w h o w a s sta y in g a t th e G a te w a y H o te l o u t o f

E l P a so

. M o re o v e r, e v id e n ce e sta b lish e d th a t G a rcia

– R ico
, A r za te , a n d H e rre ra

a ll re c e i v e d tip s fro m th e a lie n sm u g g le rs fo r t h e i r c o o p e ra tio n in h a rb o rin g
ille g a l a lie n s in th e G a te w a y H o te l

. IC E co n d u cte d r a id s o f t h e G a te w a y H o te l t h ro u g h o u t th e d u ra tio n o f t h e

a lle g e d co n sp ira cy , re su l tin g in th e d isco v e ry o f h u n d re d s o f ille g a l a lie n s.
C h o n , w h o a d m itte d t h a t h e k n e w ille g a l a lie n s w e r e b e in g h o u se d a t t h e
G a te w a y H o t e l
, w a s o fte n p r e se n t w h e n IC E co n d u cte d r a id s o f t h e G a te w a y
H o t e l

. 3 A fte r m o re th a n 1 0 0 ille g a l a lie n s w e re re m o v e d fro m th e G a te w a y
H o te l in a sin g l e ra id in 2 0 0 6 , A rza te su g g e ste d to C h o n th a t th e y ch a n g e th e

p a t h o f t h e b u sin e ss a w a y f r o m re n tin g to ille g a l a lie n s. C h o n re je cte d th is

su g g e stio n b y re sp o n d i n g th a t th e y h a d “n o a u th o rity to re q u e st p a p e rs.” C h o n

a n d A rza te o c c a sio n a lly d iscu sse d th e cre d it situ a tio n o f th e a l ie n s m u g g le rs

w h o w e re lo n g sta n d in g clie n ts o f th e G a t e w a y H o t e l. H e rre ra , in a re co rd e d

co n v e rsa t i o n w ith a n a lie n sm u g g le r, e x p la in e d t h a t C h o n “w a s m a k in g a b ig

d e a l a b o u t ” m o n e y a n a lie n sm u g g le r o w e d fo r ro o m s ille g a l a lie n s u se d a t t h e
G a te w a y H o te l.

C h o n w a s r e sp o n sib le f o r m a in ta in in g th e b o o k s fo r th e G a te w a y H o te l

3 M oreover, in 2007, the D ep artm ent of H om eland Security s ent Chon a letter notif ying him of the illegal activities occurring in his hotel and ins truct i n g him to “revok e the
p erm is s ion f

or us e of your p rop erty to thos e engaging in unlaw ful activities

. ”

3 Case: 11-50143 Document: 00512204836 Page: 3 Date Filed: 04/10/2013No. 11-50143

th ro u g h o u t th e d u ra tio n o f th e co n sp ira cy

. C h o n cre a te d tw o se t s o f b o o k s: o n e
th a t a ccu ra te ly p o rtra y e d th e g ro ss re ce ip ts, a n d a n o th e r th a t su b sta n tia lly

u n d e rsta te d g ro ss re ce ip ts. T o fa cilita te th is u n d e rre p o rtin g o f g ro ss re ce ip ts,
C h o n d i re c te d A rza te to se t a sid e $ 3 0 0 to $ 4 0 0 e a ch d a y fro m th e G a te w a y
H o te l’s g ro ss re ce ip t s. C h o n a lso sig n e d a n d p r e p a r e d Y C L ’s 2 0 0 5
, 2 0 0 6
, a n d

2 0 0 7 c o r p o ra te ta x re tu rn s. In e a ch y e a r , th e g ro ss re ce ip ts fro m th e G a te w a y
H o te l w e re su b s ta n t ia lly u n d e rsta te d

. In 2 0 0 9
, C h o n , G a rcia

– R ico
, C a rd o za , Y C L
, A rza te , H e rre ra , a n d M a y ,

a m o n g o th e rs, w e re ch a rg e d w ith co n sp irin g to sm u g g le
, tra n sp o r t, a n d h a rb o r
ille g a l a l ie n s in v io la tio n o f 8 U .S .C

. § 1 3 2 4 (a ) (1 )(A )(v )(I) ( “C o u n t I”). C h o n w a s

a lso ch a rg e d w ith m o n e y l a u n d e rin g in v io la tio n o f 1 8 U .S .C

. § 1 9 5 6 ( a )(1 )(A )(i)

a n d (B )(i) ( “C o u n t II”), a n d t h re e co u n ts o f w illfu lly a id i n g a n d a ssistin g in t h e
f i l i n g o f a fa l se ta x re tu rn i n v io la tio n o f 2 6 U .S .C

. § 7 2 0 6 (2 ) ( “C o u n ts II I
, I V
,

a n d V ”). A rza te , H e r re ra , a n d M a y e a ch p le d g u ilty p rio r t o t ria l. A j u r y fo u n d

C h o n , G a rcia

– R ico
, C a rd o za , a n d Y C L g u i lty o n a ll ch a rg e s. T h e d i strict co u rt

se n te n ce d C h o n to 1 2 0 m o n th s o f im p riso n m e n t o n C o u n t I, 1 8 0 m o n th s o n
C o u n t I I, w h ich w a s a n u p w a rd d e p a rtu r e fro m th e G u i d e lin e s ra n g e o f 1 0 8 to

1 3 5 m o n th s , a n d 3 6 m o n th s o n C o u n t s III, IV
, a n d V
, a ll to b e se rv e d

co n c u rre n t ly
, a n d o rd e re d C h o n to p a y re stitu tio n o f $ 4 8 1 ,8 1 2 .3 2

. T h e d istrict

co u r t s e n te n ce d G a rcia

– R ico to fifty -o n e m o n th s’ i m p riso n m e n t o n C o u n t I.

C h o n , G a rcia

– R ico , C a rd o za , a n d Y C L e a ch tim e ly file d a n o tice o f a p p e a l.

I I. Chon, Cardoz a , a n d Y C L e a c h c o n tend that t here was insufficient evidence

t o sustain their convictions. 4 E a ch defendant properly p reserved the i r

4 In ad d ition to Chon’s challenges to the s uf f iciency of the evid ence on each of his convictions
, Chon als o challenge s s e v e r a l ins tructions that the d is trict court gave the jury. H aving cons id ered the record and the p arties ’ argum ents regard ing the challe n g e d j u r y ins tructions
, w e c o n c l u d e that Chon has f ailed to d em ons trate that the d is trict court

com m itted revers ible error. Chon als o argues that the d is trict court abus ed its d is cretion by ref us ing to provid e a jury ins truction relating to the charges f or w illf ully p rep a r i n g a tax

4 Case: 11-50143 Document: 00512204836 Page: 4 Date Filed: 04/10/2013No. 11-50143

insufficiency-of-the-evidence claim; therefore, w e r eview each sufficiency challenge de novo

. United States v

. Grant
, 68 3 F

. 3 d 6 39, 642 ( 5th Cir. 2012) (citation o m i t t e d )

. Our review of the sufficiency o f the e vidence is “highly

deferential to the verdict.” United States v

. Harris
, 293 F

. 3d 863, 869 (5th Cir. 2002). “[V]iewing the evidence in the light most favorable t o the prosecution,”

we consider whether “ any r a t i o n a l t rier of fact could have found the e ssential

elements of the c rime beyond a reasonable doubt.” J ackson v. Virginia
, 443 U.S.
307, 319 (1979) (emphasis i n original). We “accept[] a ll credibility choices and

reasonable inf

e r e n c e s made by the trier of fact w hich tend to s upport the verdict,” United S tates v

. Asibor
, 109 F.3d 1 023, 1030 (5th Cir. 1997) (citation omitted), and resolve “any conflicts in t h e evidence

. . . in favor of the verdict.”

United S tates v. Duncan
, 9 19 F.2d 981, 990 (5th Cir. 1990) (citing United States

v. Clark , 741 F.2d 699, 703 (5th Cir. 1984)).

A

. W e first co n sid e r C h o n , C a rd o z a , a n d YCL’ s sufficiency challenges to their conspiracy convictions. To obtain a conviction under § 1324(a)(1)(A)(v)(I), the government must establish that the defendant: [ A ] greed with o n e o r more persons to transport or m ove ille g a l aliens w ithin the United States in f u r t h e rance of their unlawful
presence, or to conceal, harbor, or shield from d etection such aliens, knowingly or in reckless disregard of the fact that such aliens had

come to , entered, o r remained in the United States in v iolation of law.

United States v. Ahmed Khan
, 25 8 F

. A p p ’ x 714, 717 (5th Cir. 2007) (unpublished but persuasive).

In order to prove a co n s p iracy, the government must p rove b eyond a
reasonable d o u b t that an agreement existed to violate t h e law and each

return that is f

raud ulent as to any m aterial m atter. Becaus e Chon’s prof f ered ins truction w as not relevant to s uch a charge and
, theref ore, d id not concern an im p ortant p oint in the trial, the d is trict court d id not abus e its d is cretion in d enying the p rof fered ins truction. See, e. g. , U ni ted Sta tes v. Jobe
, 101 F .3d 1046, 1059 ( 5th C ir. 1996)

.
5 Case: 11-50143 Document: 00512204836 Page: 5 Date Filed: 04/10/2013No. 11-50143

conspirator knew of, i ntended to join, a nd voluntar i ly participated in the conspiracy. United States v. Davis
, 226 F.3d 346, 354 (5th Cir

. 2 000). The
agreement to violate the law does not h ave to be “explicit or forma l ; ” a t a c it
agreement is sufficient. United States v. Freeman
, 4 34 F.3d 369, 376 & n.5 (5th

Cir. 2005). The existence of an agreement to violate the law may be established solely by circumstantial evidence and may be inferred from “concert o f action.”

S e e , e .g. , U

nited States v

. Bieganowski
, 313 F .3d 264, 277 (5th C ir. 2002). Voluntary participation i n the conspiracy “may be inferred f rom a collocation of circumstances,” and kn o wledge of the conspiracy “may be inferred from

s urrounding circumstances.” Id. (citation and internal quotation ma r k s omitted). While a conspirator must k n owingly participate in s o m e w a y i n the larger objectiv e s o f t he c onspiracy, he does not need to k now all details of the

unlawful enterprise or have a major role in the unlawful enterprise. D avis
, 226
F.3d at 3 54. W e co n sid e r in tu rn e a ch d e fe n d a n t’s sufficiency challenge to their conspiracy conviction.

1

. C h o n p rim a r ily a rg u e s th a t th e e v id e n ce is in su fficie n t to p ro v e th a t h e

e n g a g e d in a n y co n d u ct th a t m a n ife ste d a n in te n t to co n ce a l, h a rb o r, o r sh ie ld

a lie n s fro m d e t e ctio n o r t h a t h e a g re e d w ith o n e o r m o r e co

- co n sp ira to rs to

v io l a te § 1 3 2 4 (a )(1 )(A )(v )(I). W e d isa g re e

. Viewing the evid e n c e i n t he light most favorable to the prosecution, a
rational trier of fact could infer that Chon agreed with A rzate, among others, to

encourage alien smugglers to rent rooms for i llegal a liens by providing a location

where illegal aliens could obtain food, shelter, and laundry services without the

need to leave their rooms a t the Gateway Hotel. Chon’s co ntention that he simply did not p re v e n t ille g a l a lie n s fro m re n tin g a ro o m a t th e G a te w a y H o te l

is b e lie d b y h is fa cilita tio n o f th e ir p re se n ce a n d h is w illin g n e ss to a llo w a lie n

sm u g g l e rs to re n t ro o m s o n b e h a l f o f g r o u p s o f ille g a l a lie n s. A lth o u g h th e re

6 Case: 11-50143 Document: 00512204836 Page: 6 Date Filed: 04/10/2013No. 11-50143

w a s n o d ire ct e v id e n c e o f a n e x p re ss a g re e m e n t b e tw e e n C h o n a n d th e a l ie n

sm u g g l e rs, th e co n ce rte d a c tio n a m o n g C h o n , h is e m p lo y e e s , a n d th e a lie n

sm u g g l e rs su p p o r ts a n in fe re n ce o f su ch a g re e m e n t. M o re o v e r , C h o n ’s

p a rticip a tio n in th e co n sp i r a cy w a s su p p o r te d b y d ire ct e v id e n ce , in clu d in g

t e s t i m o n y re g a rd in g h is w i llin g n e ss to o ffe r cre d i t to a lie n sm u g g l e rs a n d h i s

su b se q u e n t c o m p la in ts a b o u t a lie n sm u g g le rs w h o o w e d h im m o n e y

. T h e r e is

a lso stro n g circu m sta n tia l e v id e n ce t h a t C h o n w a s a w a re o f th e sco p e a n d

o b je ctiv e s o f th e co n sp ira cy , su ch a s h is a d m itte d p re se n ce a t th e G a te w a y
H o te l w h e n o v e r 1 0 0 ille g a l a lie n s w e re re m o v e d in a sin g le ra id a n d h is d a ily

“sk im ” o f $ 3 0 0 to $ 4 0 0 in ca sh re ce ip ts.

2

. C a rd o za , a l t h o u g h h e co n c e d e s th a t h e a g r e e d w i th a co -co n sp i ra to r to

tra n sp o rt a t le a st t w o ille g a l a lie n s, a rg u e s th a t th e re w a s in su f ficie n t e v id e n ce

to p ro v e th a t h is a c tio n s w e re in fu rth e ra n ce o f th e tw o a lie n s’ ille g a l p re se n ce

. T h is a rg u m e n t is w ith o u t m e rit. C a rd o za , in a re co rd e d p h o n e co n v e r s a t i o n

w ith a n o th e r m e m b e r o f th e co n sp ira cy , e x p licitly a g re e d to m o v e i lle g a l a lie n s
fro m h i s h o m e to a d ro p

- o ff lo ca tio n a n d p a y $ 9 0 0 to t ra n sp o rt th e ille g a l a lie n s
fro m E l P a s o t o o t h e r citie s in th e U n ite d S t a te s

. T his recorded phone

conversation is direct e vidence of C ardoza’s voluntary and knowing agreement
with another member of t he c o n s p iracy to participate i n transporting illegal

aliens in violation of § 1 3 2 4 (a )(1 )(A ) (v )(I). Moreover, f ederal a gents w itnessed

Cardoza carry o ut this a greemen t by t ransporting and d elivering two illegal

aliens to the agreed upon location. F i n a lly, Cardoza’s contention that th e re is

n o e v id e n c e th a t h e a g r e e d w ith a n y o th e r co -co n sp ira to r i s i rre le v a n t in lig h t

o f th e d ire ct e v id e n ce o f h is a g re e m e n t w ith o n e co -co n sp ira to r. C ardoza’s

conviction does not depend o n evidence t hat h e agreed to conspire directly with

Chon or a showing that he played a large p a rt i n the conspiracy. See Davis
, 226
F.3d at 354.

7 Case: 11-50143 Document: 00512204836 Page: 7 Date Filed: 04/10/2013No. 11-50143

3

. Y C L ’s o n ly a rg u m e n t o n a p p e a l is th a t th e re w a s in su fficie n t e v id e n ce
th a t Y C L ’s a g e n t s’ o r e m p lo y e e s’ a ctio n s in fu rth e ra n c e o f th e co n sp ira cy w e re

co m m i tte d w ith in th e i r s co p e o f e m p lo y m e n t. T h e re co rd d o e s n o t su p p o rt

Y C L ’ s a rg u m e n t. W e h a v e h e ld th a t “a co rp o r a tio n is crim in a l l y lia b le fo r t h e

u n la w fu l a cts o f its a g e n ts, p ro v id e d th a t th e co n d u ct is w ith in th e sco p e o f t h e

a g e n t’s a u th o rity
, w h e th e r a ctu a l o r a p p a re n t.” U n i ted S ta tes v

. In v

. E n ters.,
In c. , 1 0 F .3 d 2 6 3
, 2 6 6 (5 th C ir. 1 9 9 3 ) (citin g U n ited S ta tes v

. B i– C o P a v ers, In c. , 7 4 1 F .2 d 7 3 0
, 7 3 7 (5 t h C ir. 1 9 8 4 )). H e re , o v e rw h e l m in g e v id e n c e sh o w e d th a t

Y C L o p e ra te d th e G a te w a y H o te l d u rin g th e y e a r s in q u e stio n , in clu d in g ta x

re tu rn s file d u n d e r th e n a m e “Y C L
, In c., d o i n g b u sin e ss a s th e G a te w a y H o te l.”

M o re o v e r, e v id e n ce e sta b l ish e d t h a t C h o n w a s th e P re sid e n t a n d
, a cco rd in g ly
,

a n a g e n t o f Y C L

. C h o n ’ s a ctio n s th a t fo r m t h e b a sis fo r h is c o n sp ira cy

co n v i c tio n , a s d iscu sse d a b o v e , a lso se rv e a s th e b a sis fo r Y C L ’s co n v i c t i o n
b e ca u s e C h o n ’s a ctio n s w e re w ith i n th e sco p e o f h is a u th o rity a s P r e s i d e n t o f

Y C L

. 5

B

. We next consider t he sufficiency of t h e evidence in support of Chon’s

conviction for money laundering, in violation of § 1956(a)(1)(A)(i) and (B)(i). To

esta b lish t his o ffense, t he g overnment must prove that t he defendant: “(1)

conducted or a ttempted to conduct a f inancial transaction, ( 2 ) that the defendant

knew involved the proceeds of unlawful activity, and ( 3) t hat the d efendant k new

was designed to co n c e a l or disguise the nature, location, s ource, ownership, or
control of the proceeds of the unlawful activity.” Bieganowski
, 313 F.3d at 279

5 Y CL d oes not ad vance any argum ent that Chon’s actions s hould not be attributed to Y CL; rather, it tak es the p os ition that Chon w as “u n i n f o r m e d about [the hotel em p loyees ’] activities

. ” G iven the overw helm ing evid ence s up p orting a f ind ing that C h o n w as aw are of and encouraged his em p loyee’s activities in the cons p iracy, this argum ent is w ithout m erit.

8 Case: 11-50143 Document: 00512204836 Page: 8 Date Filed: 04/10/2013No. 11-50143

(citations omitted). “ The s u bstantive offense o f m oney laundering requires that

the defendant knew that the funds in que s t i o n represented the proceeds of

unlawful activity.” Id. at 278 (citing United States v

. Burns
, 162 F.3d 840, 847 (5th Cir. 1998)). Chon’s argument t hat the evidenc e w a s i nsufficient to prove
that he committed the offense of m oney laundering rests on his c ontention that

the evidence was i n s u fficient to prove t hat he was aware of the “unlawful activity,” namely the conspiracy to sm u g g le
, tra n sp o rt, a n d h a rb o r a lie n s.
B e ca u se th e e v i d e n ce su p p o rts a fin d in g th a t C h o n k n o w in g ly p a rticip a te d in

th e co n sp ira cy , C h o n ’s ch a lle n g e to th e su f ficie n cy o f th e e v id e n c e to su p p o rt h is

m o n e y -la u n d e rin g co n v ictio n a lso fa ils.

C

. F i n a lly
, C h o n co n te n d s th a t th e e v i d e n ce i s i n su fficie n t t o p ro v e th a t h e

w illfu lly a i d e d a n d a ssiste d in th e filin g o f a fa lse ta x r e tu r n

. H e a sse rts th a t

Y C L w a s n o t t h e o w n e r o f th e G a te w a y H o t e l a n d
, t h e r e fo re , Y C L h a d n o

o b lig a t io n to re p o rt a n y g r o ss re ce ip ts fro m G a te w a y H o te l. Chon’s argument

fails because § 7206(2) does not require that the defendant ove r state or

u n d e rstate income, or have any filing requirement, for that matter. Rather, a
conviction is proper u nder § 7206(2) if a defendant willfully aids or assists in the preparation of a r eturn which is fraudulent or i s false a s to any m aterial matter

. 26 U.S.C. § 7206(2). E ven under Chon’s theory of the c ase that Y CL d id not own
the G ateway H otel and t herefore had n o income t o report, Chon willfully aided

and assisting in the filing of a tax return t h a t f r a u dulently r eported that YCL

was the proper entity to r eport t he Gateway Hotel i n c o m e

. A ccordingly, the

e v i d e n ce is su f

f icie n t to su p p o rt th e g u i l t y v e r d ict o n e a ch co u n t o f w illfu lly

a id in g a n d a ssistin g in th e fillin g o f a fa lse ta x re tu rn

. III.

C h o n a n d G a rcia

– R ico a lso ch a lle n g e th e re a so n a b le n e ss o f th e ir

se n te n ce s. W e r e v i e w se n te n ce s f o r re a so n a b le n e ss u n d e r a n a b u se

- o f9 Case: 11-50143 Document: 00512204836 Page: 9 Date Filed: 04/10/2013No. 11-50143

d iscre t io n s t a n d a rd

. G a ll v

. U n i ted S ta tes , 5 5 2 U .S

. 3 8
, 4 6 (2 0 0 7 ). In conducting this review, w e “must first ensure that the district court committed

no significant procedural e rror, such as failing to calculate (or improperly calculating) the Guidelines r ange

. . . o r fa ilin g to a d e q u a te ly e x p l a in th e ch o se n

se n te n ce

— in clu d in g a n e x p l a n a t io n f o r a n y d e v ia tio n fro m th e G u id e lin e s

ra n g e .” I

d

. a t 51. If the district court’s sentencing decision i s procedurally sound, we “then consider the substantive reasonableness of the s entence imposed under an abuse-of-discretion standard.” 6 Id.

A.
Chon and Garcia–Rico both argue t hat i t was procedural error f or the

district court t o impose certain enhancements to their offense levels. We review

de novo a district c ourt’s applicatio n a n d interpretation of the Guidelines.

United States v. Solis–Garcia
, 420 F.3d 511, 514 (5th Cir. 2005). T h e f a c t u al findings that a dis t r i c t court makes in s upport of its decision to apply an
enhancement are r eviewed for clear error. United S t ates v. Mata
, 624 F .3d 170,

174 (5th Cir. 2010). “T h e re is n o c le a r e rro r if t h e d i strict co u rt’s fin d in g is

p la u sib le in lig h t o f t h e re c o rd a s a w h o le .” U n ited S t a tes v

. J u a rez– D u a rte , 5 1 3

F

. 3 d 2 0 4
, 2 0 8 (5 th C ir. 2 0 0 8 ) (cita tio n o m itte d )

. B ecause Chon and G arcia–Rico

both objected to the enhancements challenged o n appeal, we r e view their challenges to the Guidelines enhancements for harmless error. United States v.
Olano
, 507 U.S. 725, 734 (1993). An error is harmless if i t “ d o e s n ot affect substantial rights.” Fed. R. Crim. P. 52(a). The government bears the burden

of showing that an error was harmless beyond a reasonable doubt. Olano
, 507

6 G arcia–Rico d id not a r g u e that his fif ty- one- m onth s entence w as s ubs tantively

unreas onable. Chon als o d id not clearly argue that his 180- m onth s entence on the m oneylaund ering c o nviction w as s ubs tantively unreas onable; how ever, s everal s tatem ents in his brief ing ind icate that the dis trict court “d id not p r o p e r l y cons id er” the 18 U

. S. C. § 3553( a) f actors

. We have cons id ered the entirety of the record and Chon’s lim ited argum ent on this is sue and f

ind no bas is f

or overturning th e d i s t r i c t court’s dis cretion in s electing Chon’s

s entence.

10 Case: 11-50143 Document: 00512204836 Page: 10 Date Filed: 04/10/2013No. 11-50143

U.S. at 734.

1

. G a rcia

– R ico ’s o n ly claim on appeal is that it w as e rror for the district court

to im p o se a th re e -le v e l e n h a n ce m e n t to h is o ffe n se le v e l p u rsu a n t to U .S .S .G

. § 3 B 1 .1 (b ) fo r h is a lle g e d ro le a s a m a n a g e r o r s u p e r v iso r o f th e co n sp ira cy to

sm u g g l e , tra n s p o rt, a n d h a rb o r ille g a l a l i e n s i n v io la t io n o f 8 U .S

. C

. § 1 3 2 4 (a )(1 )(A )(v ) (I). S e c tio n 3 B 1 .1 (b ) a u th o rize s a t h re e

- le v e l e n h a n ce m e n t to
th e d e fe n d a n t’s o ffe n se le v e l if th e “d e fe n d a n t w a s a m a n a g e r o r su p e r v iso r (b u t

n o t a n o rg a n ize r o r le a d e r) a n d t h e c r i m in a l a ctiv i ty in v o lv e d f iv e o r m o re

p a rt i c i p ant s or w a s o th e rw ise e x te n siv e .” U.S.S.G. § 3 B 1 .1 (b ). T h e co m m e n ta ry

to § 3 B 1 .1 (b ) sta t e s th a t to q u a lify f o r a n a d

ju s t m e n t b a se d o n a ro le a s a

m a n a g e r o r su p e rv iso r: [T ]h e d e fe n d a n t m u st h a v e b e e n th e

. . . m a n a g e r[] o r s u p e rv iso r o f

o n e o r m o re o th e r p a rticip a n ts. A n u p w a r d d e p a rtu r e m a y b e

w a rra n te d
, h o w e v e r, i n th e ca se o f a d e fe n d a n t w h o d i d n o t

o rg a n ize
, le a d
, m a n a g e , o r su p e r v ise a n o th e r p a rticip a n t, b u t w h o

n e v e rth e l e s s e x e rcise d m a n a g e m e n t re sp o n sib ility o v e r th e p ro p e r ty , a sse ts, o r a ctiv itie s o f a crim in a l o rg a n iza tio n

. U.S.S.G. § 3 B 1 .1 cmt. n.2. G a rcia

– R i c o co n te n d s t h e d istrict co u rt’s fin d in g th a t

h e w a s a m a n a g e r o r s u p e r v i s o r w a s cle a rly e rro n e o u s b e ca u se h e d id n o t

m a n a g e o r su p e r v ise a n y o th e r p a rticip a n ts o r e x e rcise m a n a g e m e n t

re sp o n s ib ilitie s o v e r th e p r oper t y, as s et s , or ac t i vi t i es of a crim in a l o rg a n iza tio n

. T h is a rg u m e n t fa ils i n lig h t o f th e u n re b u t te d fa cts co n t a i n e d in G a rcia

– R ico ’s

p re -se n te n ce re p o rt (“P S R ” ), w h ich th e d i s t rict co u r t a d o p te d
, th a t p la u sib ly

s u p p o r t th e co n clu sio n th a t G a rcia

– R ico w a s a m a n a g e r o r su p e rv iso r o f t h e
crim in a l a ctiv ity in th i s ca se

. S ee U n ited S ta tes v

. H

a r r i s , 7 0 2 F .3 d 2 2 6
, 2 3 0 (5 th C ir. 2 0 1 2 ) ( e x p l a in in g th a t a d istrict co u rt “m a y a d o p t th e fa c ts co n ta in e d

in a [P S R ] w ith o u t f

u rth e r in q u iry if th o se fa cts h a v e a n a d e q u a te e v id e n tia ry
b a sis w ith su f

f i c i e n t in d icia o f re lia b ility a n d th e d e fe n d a n t d o e s n o t p re s e n t

re b u tta l e v id e n ce o r o th e rw ise d e m o n s tra te t h a t t h e in fo rm a tio n i n t h e P S R is

11 Case: 11-50143 Document: 00512204836 Page: 11 Date Filed: 04/10/2013No. 11-50143

u n re lia b le .” (a lte ra tio n in o rig in a l) ( q u o tin g U n ited S ta tes v

. T

ru jillo
, 5 0 2 F .3 d

3 5 3
, 3 5 7 ( 5 t h C i r

. 2 0 0 7 ))). T h e P S R c o n ta in e d in fo rm a tio n t h a t G a rcia

– R ico

re ce iv e d w ire d m o n e t a ry p a y m e n ts fro m a lie n sm u g g le rs th a t w e re t h e n u se d

to sm u g g le
, tra n sp o rt, a n d h a rb o r ille g a l a lie n s

. T h is fa ct, w h ich G a rcia

– R ico

fa ile d to re b u t o r o th e rw i se d e m o n stra t e w a s u n re l i a b le
, d ire ctly su p p o rts a
fin d in g th a t G a rcia

– R ico e x e rcise d m a n a g e m e n t re sp o n sib ility o v e r t h e

p ro p e rty o f th e ille g a l h a rb o rin g co n sp ira cy

. A cco r d in g ly
, th e d istrict c o u rt d id

n o t e rr, m u c h le ss cle a rly e rr, b y a d o p tin g th e fin d in g s a n d r e co m m e n d a tio n s
in th e P S R to a p p ly th e th re e -le v e l m a n a g e r o r su p e rv i so r e n h a n c e m e n t.

2

. C h o n ra ise s n u m e ro u s issu e s re la te d to th e ca lcu l a t i o n o f h is G u id e lin e s

ra n g e

. Most of the issues—specifically, the alle g e d errors i n calculating the adjusted offense l e v e l for Count I and Counts III, IV, and V—are h armless

because they d id not affect Chon’s sentencing range w hich, pursuant to U.S.S.G. § 3D1.3(a), was driven b y Chon’s Count II money-laundering conviction because

i t c a rried the greatest adjusted offense l e vel. S ee United States v. Ram o s , 7 1
F.3d 1150, 1 1 5 8 n.27 (5th Cir. 1995). Only t wo challenges relate to
enhancements that t he district court i m posed relating to the m oney-laundering

conviction. 7

Chon first argues that the district court erred b y i m p o sing a tw o -le v e l

e n h a n ce m e n t p u rsu a n t to U .S .S .G

. § 2 S 1 .1 (b )(3 ) b a se d o n its f in d in g th a t C h o n

u t ilize d so p h i s t i c a te d m e a n s in co m m ittin g th e m o n e y -la u n d e r in g o ffe n se

. W h ile Chon c oncedes that he maintained two sets of financial recor d s a n d

7 Chon als o argues that the d is trict court erred by ad op ting the P SR’s f ind ing that the “grand total of laund ered monetary ins trum ents d erived f rom the p roceed s of the s m uggling and harboring und ocum ented al i e n s i s $ 1
, 394, 268. 49. ” The calculation of the value of the laund ered f

und s is only relevant to the calculation of the G uid elines range if the bas e of f ens e level is s elected p urs uant to § 2S1. 1( a) ( 2)

— w hich d id not occur here. Accord ingly, w e conclud e that a n y e r ror in calculating the total value of laund ered fund s w as harm les s becaus e the enhancem ent d id not af f ect Chon’s G uid elines range.

12 Case: 11-50143 Document: 00512204836 Page: 12 Date Filed: 04/10/2013No. 11-50143

“skimmed” i ncome on a daily basis, he argues that these actions do not
constitute “sophisticated means” as defined i n the s entencing c ommentary. We disagree. M aintaining two s ets of books, skimming income on a daily b asis, and disguising alien-smuggling proceeds as “parking i ncome” i n an attempt to make

the c rimina l l y derived funds appear legitimate are s u fficiently c o mplex to
support the enhancement here. See United States v. Stewart
, 213 F. App’x 291,

2 9 3 ( 5th Cir. 2007) (unpublished but persuasive) (concl u d i n g t h a t a s o p h i s t i c a t e d

means enhancement was proper because the means utilized—instructing a bookkeeper to g e nerate separate books to support misstatements—were more complex than simply making misstatements without supporting books). Second, Chon argues that the d i strict court c l e a r l y erred by imposing a
four-level e n h a n c e m e n t pursuant to U

. S

. S .G

. § 3 B 1 .1 ( a ) b ased on its f inding that

C h o n w a s a le a d e r o r o rg a n ize r o f th e m o n e y

- la u n d e rin g o f fe n se

. Specifically,

Chon a rgues that “[t]he a bsence of e vidence that Chon led anyone or organized

any a l ien smuggling activity

. . . precludes a finding that he was a ‘leader/organizer’ o f the money laundering offense of w hich he was convicted.”

T h e re co r d
, w h i ch in clu d e s e v id e n ce th a t C h o n e x e rcise d d e c i sio n -m a k in g

a u th o r ity
, cla im e d a la rg e r sh a re o f t h e fru its o f th e cr i m e , a n d h a d a h ig h

d e g re e o f co n tro l a n d a u th o rity o v e r o th e rs, b e lie s C h o n ’ s a sse rtio n

. S ee
U.S.S.G. § 3B1.1 cmt. n.4 (p ro v id in g e x a m p l e s o f fa cto rs th a t d istin g u i sh “a

le a d e rsh ip a n d o rg a n iza tio n a l ro le fro m o n e o f m e r e m a n a g e m e n t o r

su p e rv isio n ”). T h e d istrict co u rt’s fin d in g that C h o n w a s a le a d e r o r o rg a n ize r

o f th e crim in a l a ctiv ity is p la u sib le in lig h t o f th e re co rd a s a w h o l e

. B

. C h o n a lso co n te n d s th a t th e d istrict co u rt co m m itte d p ro ce d u ra l e rro r b y
fa ilin g to a d e q u a te ly e x p la in its se le c t i o n o f a n 1 8 0 -m o n th se n te n ce o n t h e

m o n e y -la u n d e rin g o ffe n se , w h ich co n stitu te d a n u p w a rd d e p a rtu re o f fo rty -fiv e

m o n th s. C h o n d id n o t o b je ct b e fo re t h e d istrict co u rt a s t o th e p ro ce d u ra l o r

13 Case: 11-50143 Document: 00512204836 Page: 13 Date Filed: 04/10/2013No. 11-50143

su b sta n tiv e re a so n a b le n e s s o f h is se n te n ce

. B e ca u se C h o n f a ile d to r a ise a n

o b j e ctio n b e l o w , re v ie w is fo r p la in e rro r

. S ee U n ited S ta t e s v

. M o n d r a g o n

– S a n tia

g o , 5 6 4 F .3 d 3 5 7
, 3 6 1 (5 th C ir. 2 0 0 9 ). T o su cce e d o n p la in

e rro r re v ie w , C h o n m u st sh o w a cle a r o r o b v io u s fo rfe ite d e rro r th a t a ffe cte d h is

su b sta n tia l rig h ts. Id

. We have d iscretion to corr e c t the e rror only if it “seriously affects t h e fairness, integrity, or public reputation of judicial proceedings.” Id. (quotation omitted).

S e ctio n 3 5 5 3 (c) re q u i r e s t h a t : (1 ) a d istrict co u rt a t se n t e n c in g , in o p e n

co u r t, sta te th e re a so n s fo r its im p o sitio n o f th e p a rticu la r se n te n ce ; a n d (2 ) if

th e s e n t e n c e i s o u tsid e th e G u id e lin e s ra n g e , a d istrict c o u rt m u st sta te t h e

sp e cific re a so n fo r th e d e p a rtu re a n d m u st sta t e th o se re a so n s “w i t h sp e cificity

in a sta te m e n t o f re a so n s fo rm .” 18 U .S.C. § 3 5 5 3 (c); see a l so
M o n d r a g o n

– S a n tia

g o , 5 6 4 F

. 3 d a t 3 6 2 (“W h ile se n te n ce s w ith in th e G u id e lin e s

re q u ire little e x p la n a tio n , m o re is re q u ire d if t h e p a r tie s p r e se n t le g itim a te

re a so n s to d e p a rt fro m th e G u id e lin e s.” (q u o ta tio n a n d in te rn a l cita tio n

o m itte d )). A t C h o n ’s se n te n cin g h e a rin g , th e d istrict co u rt m a d e o n ly a sin g l e

p a ssin g re fe re n ce to § 3 5 5 3 (a ) a n d d i d n o t p ro v i d e a n y e x p la n a tio n fo r t h e

se n te n ce it se le cte d o r fo r its d e c isio n to d e p a rt f ro m th e a d v iso ry g u id e lin e

ra n g e o n C o u n t II. T h e d istrict co u rt d id
, h o w e v e r, in d ica t e o n th e sta te m e n t

o f re a so n s th a t it w a s d e p a rtin g “fro m th e a d v iso ry g u i d e lin e ra n g e fo r re a so n s

a u th o r ize d b y th e se n t e n c in g g u id e l in e s m a n u a l,” a n d th e n se l e c t e d t h e b o x
in d ica tin g th a t th e se n te n ce a b o v e th e a d v iso ry g u id e lin e ra n g e w as b a se d u p o n
th e “g o v e rn m e n t m o tio n fo r u p w a rd d e p a r tu re .”

C o n sid e rin g t h e d i strict co u r t’s sin g le p a ssin g re fe r e n c e to th e § 3 5 5 3 (a )

fa cto rs a n d la ck o f a n y e x p la n a tio n fo r t h e u p w a rd d e p a rtu re , b e sid e s t h e
in d ica tio n o n th e sta te m e n t o f re a so n s th a t it w a s b a se d o n th e g o v e rn m e n t’s

m o tio n f o r a n u p w a r d d e p a r tu re , th e d istrict co u rt co m m itte d p ro ce d u ra l e rro r.
S e e id

. a t 3 6 3

– 6 4 (fin d in g p ro ce d u ra l e rro r w h e r e t h e d istrict co u rt f a ile d t o

14 Case: 11-50143 Document: 00512204836 Page: 14 Date Filed: 04/10/2013No. 11-50143

a d e q u a te ly e x p la in its r e a so n s fo r a w ith in -G u id e l in e s se n te n ce ); U n ited S ta tes

v

. T isd a le
, 2 6 4 F

. A p p ’ x 4 0 3
, 4 1 1

– 1 2 ( 5 t h C ir. 2 0 0 8 ) (fin d i n g p ro ce d u ra l e rro r

w h e re th e d istrict c o u rt “g a v e n o in d ica tio n it h a d co n sid e re d [th e p a rtie s’] § 3 5 5 3 (a ) a rg u m e n t s o r a n y o f t h e § 3 5 5 3 (a ) fa cto rs” in se le ctin g a w ith in

G u id e l i n e s se n te n ce ). T h e se co n d e le m e n t o f th e p la in -e rro r te st is a lso m e t in

th is ca se b e ca u se “ th e la w re q u irin g co u r ts t o e x p l a in se n te n ce s is cle a r.”

M o n d r a g o n

– S a n tia

g o , 5 6 4 F

. 3 d a t 3 6 4 (citin g U n ited S ta tes v

. M

a res , 4 0 2 F .3 d

5 1 1 , 5 2 1 (5 th C ir. 2 0 0 5 )).

W e co n clu d e , h o w e v e r, t h a t C h o n h a s fa ile d to d e m o n stra te th a t th e e rro r

a ffe c te d h is s u b s t a n tia l rig h t s. In U n ited S ta tes v

. G o re , w e c o n clu d e d th a t a
d istrict co u rt’s fa ilu re to e x p la in its r e a s o n s fo r a n u p w a r d d e p a rtu re in o p e n

co u r t d id n o t a ffe ct th e d e f e n d a n ts’ su b sta n tia l rig h ts b e ca u se th e sta te m e n t o f

r e a s o n s re fe rre d to th e P S R
, w h ich p ro v id e d re a so n s fo r th e d e p a r tu re

. 2 9 8

F

. 3 d 3 2 2
, 3 2 4

– 2 6 (5 th C ir. 2 0 0 2 ). W e re a so n e d th a t b e c a u se t h e u ltim a te g o a l

o f § 3 5 5 3 (c) is t o p e rm it e ffe c tiv e a p p e lla te re v ie w o f se n te n cin g , th e d istrict

co u r t’s re fe re n ce to t h e P S R w a s su fficie n t to a llo w e f fe c tiv e r e v ie w o f t h e b a sis

fo r d e p a rtu re

. Id

. a t 3 2 5

– 2 6 ; see a lso U n ited S ta tes v

. F

a ja rd o , 4 6 9 F

. A p p ’x

3 9 3
, 3 9 5 (5 th C i r. 2 0 1 2 ) (u n p u b lish e d b u t p e rsu a siv e ) (sa m e ); U n ited S ta tes v

. S i lv a

– T o rres , 2 9 3 F

. A p p ’ x 3 1 6
, 3 1 9

– 2 0 (5 th C ir. 2 0 0 8 ) (u n p u b lish e d b u t

p e rsu a siv e ) (sa m e ). H e r e , t h e d istrict co u rt, in t h e w ritte n sta te m e n t o f

re a so n s, in d i ca t e d th a t th e u p w a rd d e p a r tu re w a s b a se d u p o n th e “ g o v e rn m e n t

m o tio n fo r u p w a rd d e p a rtu re .” T h e g o v e r n m e n t ’s m o t i o n fo r u p w a rd d e p a rtu re

e x t e n siv e ly d iscu sse d t h e r a t io n a le f o r re co m m e n d in g th a t t h e d istrict co u rt

se n te n ce C h o n t o th e sta t u to r y m a x im u m fo r e a ch co u n t o f co n v ictio n

. B e ca u se
th e d istrict c o u rt’s re fe re n ce to th e g o v e rn m e n t’s m o tio n a llo w s fo r re v ie w o f t h e
b a sis fo r th e u p w a rd d e p a rtu re in th is ca se , C h o n i s u n a b l e to d e m o n stra te th a t
th e co u rt’s fa ilu re to e x p la in its re a so n s fo r d e p a r t in g a t se n te n cin g a ffe cte d h is

su b sta n tia l rig h t s. S ee G o re , 2 9 8 F .3 d a t 3 2 5

– 2 6

.

15 Case: 11-50143 Document: 00512204836 Page: 15 Date Filed: 04/10/2013No. 11-50143

IV

. F o r th e fo r e g o in g re a so n s, th e D e fe n d a n ts-A p p e l l a n ts’ co n v ictio n s a n d

se n te n ce s a re A F F IR M E D

.

16 Case: 11-50143 Document: 00512204836 Page: 16 Date Filed: 04/10/2013