United States Court of Appeals

For the First Circuit

No. 99-1349

UNITED STATES OF AMERICA,

Appellee,

v.

NASSER NTEGE SEBAGGALA,

Defendant, Appellant.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Reginald C. Lindsay, U.S. District Judge]

Before

 Selya, Circuit Judge,

Cyr, Senior Circuit Judge,

and Lipez, Circuit Judge.

Ralph J. Perrotta for appellant.

Theodore D. Chuang, Assistant United States Attorney, with

whom Donald K. Stern, United States Attorney, was on brief, for

appellee.

July 16, 2001

-3-

SELYA, Circuit Judge. A jury found defendant-appellant

Nasser Ntege Sebaggala guilty of two counts of making false

statements on United States Customs forms, four counts of bank

fraud, and two counts of transporting altered securities. See

18 U.S.C. §§ 1001, 1344, 2314. The district court imposed a

fifteen-month incarcerative term and ordered the appellant to

pay both a $10,000 fine and $44,000 in restitution. The

appellant challenges the sufficiency of the evidence on two

counts, as well as various evidentiary rulings. Discerning no

error, we affirm the judgment below.

I. BACKGROUND

We recount the facts in the light most flattering to

the government's theory of the case, consistent with record

support. See United States v. Singh, 222 F.3d 6, 8 (1st Cir.

2000).

The appellant is a Ugandan national, mayor of the

capitol city of Kampala, proprietor of a successful currency

exchange bureau in Uganda, and a frequent visitor to this

country. On September 29, 1997, he opened an account at a

Waltham, Massachusetts, branch of a Boston bank. Over the next

few months, he caused four fraudulently altered third-party

checks to be deposited in the account. Prior to deposit, each

check had been negotiated at a South African financial
-4-

institution and stolen during subsequent processing within the

banking system. The Boston bank eventually discovered that

these checks were bogus. Before the bank came to that

realization, however, the appellant had withdrawn, transferred,

or otherwise siphoned off substantial sums for personal use,

campaign expenses, and the like.

In the midst of these shenanigans, the appellant went

to Great Britain. He reentered the United States at Logan

International Airport, Boston, Massachusetts, on January 1,

1998, carrying approximately $108,000 worth of travelers' checks

(more than half of which had been reported lost or stolen). He

nonetheless presented customs officials with a completed customs

form (Form 6059B) in which he declared that he was not carrying

currency or monetary instruments in excess of $10,000. When

questioned about this declaration, he orally reaffirmed that he

had less than $10,000 in currency or monetary instruments in his

possession. A customs inspector then asked the appellant how

much he was carrying, and the appellant replied that he had

$4,000 in travelers' checks.

Apparently dissatisfied with this response, customs

officials escorted the appellant to an interview room. When

questioned anew, the appellant began to waffle. He admitted

carrying $40,000 and completed a new form (Form 4790) containing
-5-

that information. A subsequent consensual search of his luggage

revealed the full extent of the travelers' checks in his

possession. Customs officials seized the bulk of the travelers'

checks and permitted the appellant to go about his business.

These events prompted a federal grand jury to indict

the appellant on two counts of making false statements, four

counts of bank fraud, and two counts of illegally transporting

altered securities in foreign commerce. Following a month-long

trial, a jury found him guilty on all counts. This appeal

ensued.

II. ANALYSIS

This appeal encompasses four principal assignments of

error. First, the appellant contends that the district court

erred in denying his motion for judgment of acquittal, Fed. R.

Crim. P. 29, on the false statement counts. Second, he assigns

error to the court's exclusion of proffered expert testimony.

Third, he maintains that the court erred in allowing rebuttal

evidence. Fourth, he posits that the court irretrievably

prejudiced him by permitting the introduction of an unduly large

number of the seized travelers' checks. We address these

asseverations sequentially.

A. The Rule 29 Motion.
-6-

Because the appellant's arguments about the sufficiency

of the evidence on the first and second "false statement" counts

differ from each other, we treat the two counts separately. As

to both counts, however, we review the district court's denial

of the motion for judgment of acquittal de novo. Singh, 222

F.3d at 9. The test is whether the evidence, construed

favorably to the government, permitted rational jurors to

conclude, beyond a reasonable doubt, that the defendant was

guilty as charged. Id. This test sets the bar quite high — and

the appellant fails to clear it on either count.

1. The First False Statement ("Less Than $10,000").

In order to convict a defendant of making a false statement

under 18 U.S.C. § 1001, the prosecution must prove that the

defendant, in a matter within the jurisdiction of the United

States government, knowingly made a material statement to the

government, which was false. United States v. Notarantonio, 758

F.2d 777, 785 (1st Cir. 1985). The appellant concedes falsity

and the government's jurisdiction over customs matters, but

argues vociferously that he did not knowingly make the first

false statement because he misunderstood the question and, in

all events, lacked knowledge that travelers' checks were

included within the definition of "monetary instruments."
1This conclusion is buttressed by the fact that even after

customs officials informed him orally that travelers' checks had

to be reported, the appellant gave a second false statement as

to the total amount of travelers' checks in his possession.

-7-

This argument is unpersuasive: the customs form on

which the appellant made his initial declaration referred

specifically to travelers' checks and made crystal clear that

they were reportable monetary instruments. What is more, the

government adduced evidence that the appellant had answered

other questions on the customs form accurately; and that, on a

prior visit to the United States, he had responded to an inquiry

about "how much" he was carrying by alluding to the amount of

travelers' checks in his possession. Then, too, the government

adduced circumstantial evidence which strongly indicated that

the first false statement was not the result of a

misunderstanding: on this record, a rational jury surely could

have inferred that the appellant prevaricated in order to

conceal his possession of a large cache of stolen and altered

travelers' checks.1 To cinch matters, the government presented

proof sufficient to ground a reasonable inference that the

appellant had the facility not only to understand the inquiry

contained on the form but also to appreciate the definitions

incorporated therein. This evidence revealed that the appellant

had earned both a general certificate of education and a
-8-

business administration diploma from British educational

institutions; that he had reviewed and discussed English

language materials with George Colvin, an American diplomat, and

Ted Kaster, an American serving as Uganda's honorary consul; and

that various persons (including the customs inspectors with whom

he dealt) found him able to communicate in English without

difficulty.

We see little point in rehearsing the minutiae of the

government's proof. It suffices to say that, on this record, a

finding of scienter was clearly supportable. See Singh, 222

F.3d at 10 (finding sufficient evidence that the defendant, who

answered other questions on Social Security forms intelligently

and was able to communicate with INS officials in English, had

knowledge of false statements); United States v. Rodriguez, 592

F.2d 553, 557 (9th Cir. 1979) (holding that defendant's

execution of a customs form that clearly explained the currency

reporting requirement was sufficient to show that he knowingly

made a false statement).

The appellant has a fallback position: he points out

that he admitted, the second time around, to carrying over

$10,000 in currency equivalents. He treats this second

declaration as "amending" the first and, analogizing to cases

involving perjury, e.g., United States v. Scivola, 766 F.2d 37,
2The perjury statute provides in pertinent part:

Where, in the same continuous court or grand

jury proceeding in which a declaration is

made, the person making the declaration

admits such declaration to be false, such

admission shall bar prosecution under this

section if, at the time the admission is

made, the declaration has not substantially

affected the proceeding, or it has not

become manifest that such falsity has been

or will be exposed.

18 U.S.C. § 1623(d).

-9-

43-46 (1st Cir. 1985); United States v. Goguen, 723 F.2d 1012,

1016-18 (1st Cir. 1983), he says that this "amendment" negated

his earlier false statement.

The analogy is not apt. Although an individual

sometimes can avoid a perjury prosecution by recanting a prior

false statement, that result flows from a specific statutory

provision applicable only to perjury cases.2 The statute under

which the appellant was charged and convicted is devoid of any

comparable safe harbor; it simply provides for criminal

consequences if a person “knowingly and willfully makes any

materially false, fictitious, or fraudulent statement or

representation" in a matter within the government's

jurisdiction. 18 U.S.C. § 1001. The appellant cites no

authority that would support transplanting the provisions of

section 1623(d) into the unreceptive soil of section 1001. For
-10-

our part, we see no basis for writing into section 1001 a

recantation defense that Congress chose to omit. After all,

"[c]ourts may not create their own limitations on legislation,

no matter how alluring the policy arguments for doing so."

Brogan v. United States, 522 U.S. 398, 408 (1998).

We hasten to add that the appellant's argument would

fail even if the criteria found in 18 U.S.C. § 1623(d) were

imported into prosecutions brought under 18 U.S.C. § 1001. In

order effectively to recant a prior perjurious statement, the

declarant must make an outright retraction and repudiation. See

Scivola, 766 F.2d at 45. He also must "explain unambiguously

and specifically" the respects in which his earlier answer was

false. Goguen, 723 F.2d at 1018. In this case, the appellant

never tendered either an outright retraction or a meaningful

explanation of his first false statement: he did nothing more

than substitute a second false statement for it. The core

purpose of the recantation provision is "to encourage truthful

testimony." United States v. Moore, 613 F.2d 1029, 1040 (D.C.

Cir. 1979) (citing legislative history). In light of this

purpose, we do not believe that a person can recant simply by

replacing one lie with another.

2. The Second False Statement ("$40,000"). The

appellant asserts that as long as he reported possession of over
-11-

$10,000 in currency or currency equivalents, any inaccuracy in

the total amount reported was immaterial (and, thus, his second

false statement was not violative of 18 U.S.C. § 1001).

Although the appellant's underlying premise is correct —

materiality is an element of a section 1001 offense, United

States v. Arcadipane, 41 F.3d 1, 7 (1st Cir. 1994) — this

assertion lacks force.

The controlling legal principle is well-settled. The

test of materiality is whether the false statement in question

had a natural tendency to influence, or was capable of

influencing, a governmental function. Id.; Notarantonio, 758

F.2d at 785. Thus, if a statement could have provoked

governmental action, it is material regardless of whether the

agency actually relied upon it. United States v. Corsino, 812

F.2d 26, 31 (1st Cir. 1987); United States v. Alemany Rivera,

781 F.2d 229, 234 (1st Cir. 1985).

The evidence presented at trial was sufficient to

support a reasonable inference that the appellant's second false

statement — his claim that he possessed $40,000 in travelers'

checks — was material. The second false statement was inscribed

on a form that specifically required a declaration of the total

amount of currency or monetary instruments being transported.

The form explained quite plainly that a failure to disclose the
-12-

correct amount would subject the declarant to criminal or civil

penalties. Testimony at the trial indicated that the amount

reported by a person entering the country bears directly upon

customs officials' decisions about what further action (if any)

should be taken (e.g., whether to seize the currency or currency

equivalents in the declarant’s possession, whether to

investigate the matter further, etc.). Given this testimony, it

seems self-evident that an underreporting of some $68,000,

comprising more than 150% of the amount falsely reported, had

the potential to influence customs officials' actions. See,

e.g., United States v. Yuzary, 55 F.3d 47, 48 (2d Cir. 1995)

(upholding conviction under 18 U.S.C. § 1001 when defendant was

carrying $480,000 but reported only $30,000); United States v.

Masters, 612 F.2d 1117, 1122 (9th Cir. 1979) (affirming section

1001 conviction for underreporting of $22,670); cf. United

States v. McGough, 510 F.2d 598, 603 (5th Cir. 1975) (finding

that understatements in financial statements had the capacity to

influence the conduct of a government function and thus were

material to false statement charges under section 1001). We

conclude, therefore, that the government adduced sufficient

evidence to satisfy the materiality element of section 1001 in

respect to the second false statement.
-13-

B. The Proffered Expert Testimony.

The appellant next assigns error to the district

court's refusal to allow a proffered expert witness, Dr.

Aloysius Lugira, to testify on the linguistic and cultural

traits of the Baganda tribe (to which the appellant belongs).

The appellant argues that this testimony, if admitted, would

have aided the jury in assessing his ability to understand the

forms that he signed (and, therefore, his culpability vel non on

the two false statement counts).

Federal Rule of Evidence 702 provides in relevant part

that "[i]f scientific, technical, or other specialized knowledge

will assist the trier of fact to understand the evidence or to

determine a fact in issue, a witness qualified as an expert by

knowledge, skill, experience, training, or education, may

testify thereto in the form of an opinion or otherwise," as long

as certain conditions are satisfied. When the issue is whether

expert testimony will (or will not) materially assist a jury

within the intendment of this rule, trial courts enjoy

considerable latitude in deciding whether to admit or exclude

it. See United States v. Ladd, 885 F.2d 954, 959 (1st Cir.

1989); United States v. Wilson, 798 F.2d 509, 517 (1st Cir.

1986). As we wrote some fourteen years ago:

The trial judge has a hands-on familiarity

with the nuances of the case — nuances which
-14-

may not survive transplantation into a cold

appellate record. Thus, the district

court's assessment of what will or will not

assist the jury is entitled to considerable

deference in the Rule 702 milieu.

United States v. Hoffman, 832 F.2d 1299, 1310 (1st Cir. 1987).

We review the district court's rulings on the admission

or exclusion of expert testimony for abuse of discretion.

United States v. Montas, 41 F.3d 775, 783 (1st Cir. 1994). We

discern no such abuse in the lower court's refusal to admit the

proffered testimony anent linguistic and cultural traits

associated with the Baganda tribe. The court considered the

proffer fully and concluded that Dr. Lugira's proposed testimony

was grounded primarily in "anecdotal experiences" and was

"speculative at best." In the court's view, this testimony

would not materially assist the jury in assessing the

appellant's ability to comprehend customs forms. We explain

briefly why this determination was well within the encincture of

the lower court's discretion.

To the extent that the proffered testimony concerned

Bagandan cultural tribal traits and customs (including

affability), the connection between it and the issues in the

case seems tenuous at best. To the extent that the proffered

testimony concerned tribal forms of nonverbal communication, the

appellant employed none in this instance (and, thus, the
-15-

testimony seems totally irrelevant). Finally, to the extent

that the proffered testimony concerned linguistic aptitude, it

was simply unnecessary.

One of the criteria for the admission of expert

testimony under Rule 702 is whether a lay person can be expected

to decide the issue intelligently without an expert's help. See

United States v. Salimonu, 182 F.3d 63, 73-74 (1st Cir. 1999);

United States v. Brien, 59 F.3d 274, 277 (1st Cir. 1995); see

also Ruiz-Troche v. Pepsi Cola of P.R. Bottling Co., 161 F.3d

77, 81 (1st Cir. 1998). Here, common sense supports the

district court's determination that jurors would understand,

without the aid of expert testimony, that an individual whose

primary language is other than English might have difficulty

comprehending bureaucratic forms.

C. The Rebuttal Evidence.

The appellant next complains that the district court

erroneously permitted the government to call rebuttal witnesses

regarding his proficiency in the English language. This

complaint need not occupy us for long. Appellate courts

traditionally afford trial courts a wide berth in respect to

regulating the scope of rebuttal testimony. See Geders v.

United States, 425 U.S. 80, 86-87 (1976); Faigin v. Kelly, 184

F.3d 67, 85 (1st Cir. 1999). We review challenges to such
-16-

rulings for abuse of discretion, Faigin, 184 F.3d at 85; United

States v. LiCausi, 167 F.3d 36, 52 (1st Cir. 1999), and we find

none here.

In his case in chief, the appellant presented several

witnesses, some of them Ugandan nationals, who testified that he

had difficulty speaking and understanding English. To counter

this evidence, the government sought to present rebuttal

witnesses who had found the appellant proficient in reading and

speaking English. We think that it was permissible for the

district court to allow the government to proceed in this

fashion. It is a bedrock principle that “[r]ebuttal evidence

may be introduced to explain, repel, contradict or disprove an

adversary's proof," United States v. Laboy, 909 F.2d 581, 588

(1st Cir. 1990), and this case is a classic example of the

genre. Consequently, we reject the appellant's third assignment

of error.

D. Rule 403.

The appellant's final argument posits that the district

court denied him a fair trial on the bank fraud and

transportation of altered securities counts by allowing the

government to introduce, over objection, the mass of travelers'

checks seized at the airport. The appellant claims that this
-17-

blizzard of stolen and altered paper amounted to "bad act

overkill" which overshadowed the real issues in the case and

compromised the fairness of the trial.

We set the stage. The appellant filed two pretrial

motions: a motion in limine to exclude anticipated government

evidence and a motion for relief from prejudicial joinder. By

these motions, he sought either to bar introduction of the

seized travelers' checks or to sever the false statement charges

from the remainder of the indictment. The district court denied

both motions. It found that the stolen and altered travelers'

checks had distinct probative value in regard to the false

statement counts because they provided a likely motive for

attempting to deceive the customs officials. It also found that

the travelers' checks were relevant as to the other charges and

that the danger of unfair prejudice did not substantially

outweigh their probative value.

The checks were admitted en masse at trial. The

appellant now challenges the district court's denial of his

motion in limine and simultaneously challenges the denial of his

post-trial motion for a new trial (which raised essentially the

same point). He does not, however, appeal from the denial of

the motion for severance.
3The rule provides:

Evidence of other crimes, wrongs, or acts is

not admissible to prove the character of a

person in order to show action in conformity

therewith. It may, however, be admissible

for other purposes, such as proof of motive,

opportunity, intent, preparation, plan,

knowledge, identity, or absence of mistake

or accident.

Fed. R. Evid. 404(b).

4The latter rule provides:

Although relevant, evidence may be excluded

if its probative value is substantially

outweighed by the danger of unfair

prejudice, confusion of the issues, or

misleading the jury, or by considerations of

undue delay, waste of time, or needless

presentation of cumulative evidence.

Fed. R. Evid. 403.

-18-

A two-pronged framework implementing Federal Rule of

Evidence 404(b) governs the admissibility of "bad act" evidence.3

First, the proffered evidence must not merely show a defendant's

reprehensible character or predisposition towards knavery, but,

rather, must possess some special relevance to a disputed issue

in the case. Udemba v. Nicoli, 237 F.3d 8, 15 (1st Cir. 2001);

United States v. Devin, 918 F.2d 280, 286 (1st Cir. 1990). Even

if the evidence so qualifies, it still must run a second

gauntlet; Rule 404(b) incorporates sub silentio the prophylaxis

of Federal Rule of Evidence 403.4 This means that the evidence,
-19-

although relevant, nonetheless must be rejected if its likely

prejudicial impact substantially outweighs its likely probative

worth. Veranda Beach Club Ltd. P'ship v. W. Sur. Co., 936 F.2d

1364, 1373 (1st Cir. 1991); Devin, 918 F.2d at 286.

We review the trial judge's decision to admit or

exclude Rule 404(b) evidence for abuse of discretion. United

States v. Guyon, 27 F.3d 723, 729 (1st Cir. 1994); United States

v. Hadfield, 918 F.2d 987, 994-95 (1st Cir. 1990). In this

instance, no such abuse occurred. The disputed evidence easily

passes the initial Rule 404(b) screen. As the district court

recognized, the stolen and altered travelers' checks were

probative of motive on the false statement counts; their

existence furnished a cogent reason for the appellant to lie to

the customs inspectors about the value of the monetary

instruments in his possession.

By the same token, the seized travelers’ checks also

were probative of scienter in respect to the bank fraud and

transportation of altered securities counts. The majority of

the travelers' checks in the appellant’s possession displayed a

large rubber stamp that concealed an underlying bank processing

stamp. This same model stamp was used to modify three of the

four checks involved in the bank fraud counts. Two of these

same checks — which were boosted, respectively, from 99¢ to

$39,000, and from $2,340.43 to $99,000 — formed the basis for
-20-

the transportation counts. Moreover, a significant number of

the travelers' checks were stolen from a single financial

institution, Standard Bank of South Africa, as were three of the

checks involved in the bank fraud counts. Again, the

transportation counts were founded on two of these same checks.

In short, the similarities shared by the travelers' checks and

the third-party checks that formed the basis of the other

charges sufficed to show the requisite special relevance. See,

e.g., United States v. Bice-Bey, 701 F.2d 1086, 1089 (4th Cir.

1983) (finding evidence of prior fraudulent credit-card

transactions relevant to rebut claim of innocent involvement in

subsequent credit-card fraud).

The challenged evidence also passes the second screen.

We have observed before that "[o]nly rarely — and in

extraordinarily compelling circumstances — will we, from the

vista of a cold appellate record, reverse a district court's onthe-spot judgment concerning the relative weighing of probative

value and unfair effect." Freeman v. Package Mach. Co., 865

F.2d 1331, 1340 (1st Cir. 1988). There is nothing so

extraordinary about the circumstances here as would impel us to

second-guess the district court's careful calibration of the

probative value/prejudicial effect scales. Evidence of

uncharged fraud activity that is substantially similar to the

activity underlying a charged fraud scheme often is admitted to
-21-

show knowledge or intent to defraud with respect to the charged

fraud scheme. See, e.g., Guyon, 27 F.3d at 729; United States

v. Rodriguez-Estrada, 877 F.2d 153, 156 (1st Cir. 1989); United

States v. Scelzo, 810 F.2d 2, 4 (1st Cir. 1987). And, we see

little risk here that the evidence — which had obvious probative

value — was likely to have overwhelmed the jurors' emotions or

led them to behave irrationally. We therefore decline to

disturb the district court's fact-sensitive judgment concerning

the admissibility of the travelers' checks under the Rule 403

balancing test.

III. CONCLUSION

We need go no further. To the extent that the

appellant advances other arguments, they are insubstantial and

do not require comment. It suffices to say that the appellant

was fairly tried and justly convicted. The judgment below

must, therefore, be

Affirmed.