PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v. No. 97-4892

EDGAR FRANKLIN FRANCE,

Defendant-Appellant.

Appeal from the United States District Court

for the Middle District of North Carolina, at Greensboro.

James A. Beaty, Jr., District Judge.

(CR-96-262, CR-97-101)

Argued: September 22, 1998

Decided: December 29, 1998

Before WILKINSON, Chief Judge, WIDENER, Circuit Judge, and

MAGILL, Senior Circuit Judge of the United States Court of

Appeals for the Eighth Circuit, sitting by designation.

_________________________________________________________________

Affirmed by published opinion. Judge Widener wrote the opinion, in

which Chief Judge Wilkinson and Senior Judge Magill joined.

_________________________________________________________________

COUNSEL

ARGUED: Edward Jennings, Winston-Salem, North Carolina, for

Appellant. Paul Alexander Weinman, Assistant United States Attorney, Winston-Salem, North Carolina, for Appellee. ON BRIEF: Walter C. Holton, Jr., United States Attorney, Winston-Salem, North

Carolina, for Appellee.

_________________________________________________________________
OPINION

WIDENER, Circuit Judge:

Edgar France appeals following his conviction on two counts of

perjury pursuant to 18 U.S.C. § 1623(a) and one count each of money

laundering, 18 U.S.C. § 1956(a)(1)(A)(i), and conspiracy, 21 U.S.C.

§ 846. We affirm.

I.

Evidence indicated that France's involvement in the drug trade in

and around Mount Airy, North Carolina continued for a number of

years throughout the 1980s and 1990s. One of his co-conspirator's in

that endeavor was Tommy McBride; another was Judy King. During

the course of a federal investigation into McBride's illegalities,

France gave immunized testimony before a grand jury three times in

1996; once on July 30, again on August 27, and finally on October

28. On two of those occasions, France denied prior statements made

to investigators in 1991 and in 1993 naming McBride as his source

of drugs. Those denials served as the basis for France's perjury convictions.

Mrs. King's participation in the conspiracy gave rise to France's

money laundering charge. In addition to introducing some of the drug

conspiracy's key players to one another, Mrs. King traveled to New

York to purchase cocaine which she supplied to France and McBride.

While returning from one such trip, in February 1995, New Jersey

police arrested Mrs. King on state drug charges. France helped her

post bail, securing her release during the pendency of those charges.

The government based France's money laundering charge on the

financial transaction relating to Mrs. King's bail.

France's first trial addressed the two perjury charges. On February

12, 1997, the jury found him guilty on both counts. Following another

trial on July 7, 1997, a second jury returned a guilty verdict on the

conspiracy and money laundering counts. On September 30, 1997, the

court sentenced France for all four offenses. France filed one notice

of appeal for all of the four convictions, and we consider the four here

as one case.

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France raises five issues on appeal: (1) whether sufficient sources,

independent of his immunized grand jury testimony, existed for the

evidence presented against France in his second trial; (2) whether the

evidence supported the verdict and whether the perjury indictment

was sufficient as alleged; (3) whether there was sufficient evidence to

convict France of money laundering; (4) whether the district court

erred in enhancing France's sentence; and (5) whether the district

court's evidentiary rulings were erroneous.

II.

A.

On June 30, 1997, the district court held an evidentiary hearing on

France's motion to dismiss his indictment pursuant to the Supreme

Court's decision in Kastigar v. United States , 406 U.S. 441 (1972),

that the government must establish an independent source for all evidence used to prosecute a witness who had previously testified under

a grant of immunity. See United States v. Harris , 973 F.2d 333 (4th

Cir. 1992). France's motion was denied on July 3, 1997, and on September 10, 1997, the court entered an order making factual findings

that a sufficient independent source existed for all of the evidence

presented by the government at France's trial.

France's complaint regarding the evidence used to indict and eventually try him appears to be two fold. First, he contends that the testimony resulting from his prior grand jury appearances, all of which

was immunized, contained common threads which were used by the

government, albeit indirectly, in the context of the investigation

which led to his indictment and prosecution. Next, France contests the

government's direct use at trial of a series of checks which he produced before the grand jury and the testimony which accompanied

them in support of the money laundering charge against him. With

respect to most of the evidence in question, that which France claims

was indirectly used against him, we are of opinion that the district

court's determination that the government proved a sufficient independent source for that evidence was not clearly erroneous. The government did, however, introduce the series of checks in support of the

money laundering charge. Sixteen checks, as well as the identity of

France's brother who cashed them, were identified by a government

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witness and admitted into evidence. The record demonstrates not only

did the same prosecutor who obtained those checks from France during the course of his grand jury testimony introduce them into evidence, the government also acknowledged, prior to trial, that it had

no independent source for the information concerning France's

brother and would, therefore, be unable to introduce such at the trial.

With respect to the immunized testimony which France argues

indirectly supported the conspiracy count, the court found that an

independent investigation conducted by the investigating agents

revealed the extent of France's involvement in the drug conspiracy at

issue. The court relied on evidence of interviews with witnesses, other

than France, conducted prior to France's grand jury testimony, which

established his involvement with Mrs. King and Charles Hairston.

Mrs. King then became the government's primary witness against

France. Furthermore, the court emphasized that nothing in France's

grand jury testimony bore any relevance to the conspiracy charge.

The district court found that, because France lied about the nature of

his involvement with his co-conspirators, the information that he gave

the grand jury was not, itself, helpful to the government, nor did it

provide the government with any investigative leads.

It also found that, regardless of when Mrs. King and Hairston were

actually interviewed, the government knew of their involvement with

France before he ever took the witness stand. These findings of the

district court were not clearly erroneous, nor was its determination

that this knowledge constitutes a sufficient independent source for

Kastigar purposes.

Establishing an independent source for the money laundering count

is more difficult, but once again, with respect to the evidence claimed

by France to have indirectly impacted his prosecution, the district

court was not clearly erroneous in finding one. The government presented evidence at France's Kastigar hearing that a Currency Transaction Report filed in early 1996 provided the government with much

of the critical information connecting France to Mrs. King's New Jersey bail. Interviews with two other witnesses named in that report

filled in the gaps. Government agents cooperated with local officers

to determine where France did his banking. All of this occurred prior

to France's testimony before the grand jury. Furthermore, Chris Grif-

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fen, the I.R.S. agent who worked on France's case, testified that he

received France's bank statements for the period in question and the

signature card from his account pursuant to a subpoena issued to

France's bank. Griffin testified that he did not know of France's grand

jury testimony when he procured the subpoena. Based on Agent Griffin's testimony, the district court determined that the government had

a sufficient independent source. That determination was not clearly

erroneous.

France's principal claim of error at this point, however, is over evidence pertaining to the money laundering count and rests on the series

of checks, cashed by his brother, which the government obtained

through France's grand jury testimony and then introduced at trial.

The district court made no specific fact finding with respect to this

evidence. Furthermore, France failed to object to its introduction at

the time of trial. Thus, if we are to review this issue at all, we must

review it for plain error under Fed. R. Cr. P. 52. See Johnson v.

United States, 65 U.S.L.W. 4305, 4306 (U.S. May 12, 1997) (No. 96-

203). Plain error review requires us to analyze the issue under the four

part test set out by the Supreme Court in United States v. Olano, 507

U.S. 725 (1993), and discussed in Johnson, 65 U.S.L.W. at 4307. See

United States v. Jarvis, 7 F.3d 404, 412-13 (4th Cir. 1993). First,

there must indeed be error. Johnson, 65 U.S.L.W. at 4307 (quoting

Olano, 507 U.S. at 732). Second, that error must be plain. Johnson,

65 U.S.L.W. at 4307 (quoting Olano, 507 U.S. at 732). Third, it must

"affect substantial rights," and finally, it must "seriously affect the

fairness, integrity, or public reputation of judicial proceedings."

Johnson, 65 U.S.L.W. at 4307 (quoting Olano , 507 U.S. at 732 (citations omitted)).

There is no question that the government's introduction of the

checks at issue and the accompanying reference to France's brother's

participation constitute error. France delivered the checks to the government and referred to his brother's participation during his immunized grand jury testimony. The government put forth no evidence

tending to establish an independent source for this evidence at

France's Kastigar hearing, and in fact, admitted that it had no independent source for the information regarding France's brother. The

government then proceeded to introduce that evidence at trial.

Undoubtedly, that action violated the rule set forth in Kastigar, and

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thus, constituted error under the first prong of the plain error analysis.

Because the Supreme Court has interpreted "plain" as "synonymous

with `clear' or, equivalently, `obvious,'" the government's conduct in

this instance easily meets the second prong of the plain error test as

well. Johnson, 65 U.S.L.W. at 4307 (quoting Olano, 507 U.S. at 734).

Having established error, which is plain, we must also consider

whether it "affect[s] substantial rights." Johnson, 65 U.S.L.W. at

4307. In Olano, the Supreme Court expounded on this prong of the

plain error analysis, saying "in most cases it means that the error must

have been prejudicial: It must have affected the outcome of the district court proceedings." 507 U.S. at 734. The Court likened this

inquiry to the harmless error analysis provided for by Rule 52(a). See

Olano, 507 U.S. at 734.

As well as introducing the checks France complains about, the government introduced the bank statement from France's checking

account which covered the very withdrawals accomplished by those

checks. That statement noted a series of nine thousand nine hundred

dollar withdrawals from France's bank account. Therefore, any further reference to the amounts of the withdrawals was merely cumulative. The jury had access, via France's bank statement, to the very

same information that the checks revealed. We hold that the introduction of the sixteen checks was not prejudicial because merely cumulative and harmless beyond a reasonable doubt. Harris, 973 F.2d at 338.

Likewise, the government's referral to France's brother's participation during the introduction of those checks does not meet the requirement of affecting substantial rights for plain error review. France's

brother's participation simply does not tend to establish guilt. Therefore, its mention was harmless beyond a reasonable doubt and not

reversible error.

As plain error has not been established, we do not reach the final

hurdle for an appellate court seeking to correct plain error which

involves a determination that "the forfeited error `seriously affect[s]

the fairness, integrity, or public reputation of judicial proceedings.'"

Johnson, 65 U.S.L.W. at 4308 (quoting Olano, 507 U.S. at 736 (citations omitted)).

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We hold that the factual findings made by the district court in

accordance with Kastigar were not clearly erroneous. That being so,

and the introduction of the two items of evidence (the checks and the

reference to France's brother) in violation of Kastigar, being harmless

beyond a reasonable doubt, the district court correctly did not dismiss

the indictment.

B.

France also questions the sufficiency of both counts of his perjury

indictment and as well the sufficiency of the evidence to support the

conviction. The indictment was under 18 U.S.C. § 1623(a), which

provides that a statement under oath before a grand jury if false, material, and knowingly made, constitutes a crime.

The indictment charged that on August 27, 1996, before the federal

grand jury in Greensboro, France testified that he had not named

Tommy McBride as the person who had gotten him the cocaine that

he had sold to Jackie Stewart, and further, that he had not told one

of the investigating officers that he had gotten cocaine from Tommy

McBride. It also charged that, on or about October 28, 1996, before

the Greensboro grand jury, France testified that he had not told the

investigating officers that he had gotten cocaine from Tommy

McBride. At trial, however, the officers testified that France had told

them as charged that he had received cocaine from McBride.

The jury convicted, simply believing the officers. We are of opinion the testimony of the officers was sufficient to support the convictions and that France's objection to the indictment is without merit.

C.

France also questions the sufficiency of the evidence against him

regarding the money laundering count arising out of the procurement

of Mrs. King's appearance bond. If, when viewed in the light most

favorable to the government, substantial evidence supports the jury's

verdict, that verdict must be upheld. Glasser v. United States, 315

U.S. 60, 80 (1942).

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Money laundering under 18 U.S.C. § 1956 requires: (1) that the

defendant conduct a financial transaction with at least a de minimis

effect on interstate commerce; (2) that the transaction involved the

proceeds of a specified unlawful activity; (3) that the defendant knew

that those proceeds were derived from that specific unlawful activity;

and (4) that the defendant engaged in the transaction intending to promote that unlawful activity. See United States v. Wilkinson, 137 F.3d

214, 220 (4th Cir. 1998). The government's evidence showed that

France posted bond for Mrs. King to secure her release during the

pendency of her New Jersey drug charges. The posting of bond constitutes a sufficient financial transaction for money laundering purposes. See United States v. Laurenzana, 113 F.3d 689, 692 (7th Cir.

1997). The legality of posting bond is irrelevant. The statute requires

only that the proceeds used in that transaction be derived from unlawful activity and that the defendant's intent be to promote the unlawful

activity in question. 18 U.S.C. § 1956(a)(1)(A)(I). In this case, the

government put on evidence of France's involvement with Mrs. King

and McBride in illegal drug trafficking. In fact, Mrs. King made regular trips to New York to buy drugs for France and McBride. The government's evidence further tended to show that even though McBride

claimed ownership of the $180,000 in question, that France handled

the money and ran it through his bank account, and that France was

not reporting enough legitimate income to establish a legal source for

that sum of money. Taken together, this constitutes substantial, albeit

circumstantial, evidence that France used drug money to post Mrs.

King's bail and that he did so in furtherance of his drug trafficking

activity. The jury's verdict is sustained.

D.

France contends that his offense level was erroneously enhanced

both for his role in the offense and for obstruction of justice. Courts

of appeal review applications of the United States Sentencing Guidelines that depend on findings of fact under a clearly erroneous standard; legal determinations are reviewed de novo . United States v.

Jones, 31 F.3d 1304, 1315 (4th Cir. 1994); United States v.

Daughtrey, 874 F.2d 213, 217 (4th Cir. 1989). A sliding scale is used

for issues which are mixed questions of law and fact. Jones, 31 F.3d

at 1315; Daughtrey, 874 F.2d at 217.

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France makes no argument on appeal as to why he believes the two

point obstruction of justice enhancement to be erroneous. He merely

claims that it is. According to U.S.S.G. (1995)§ 3C1.1, Application

Note 3(b), committing perjury is cause for the enhancement. Factually, there is no question but that a jury convicted France of perjury.

Legally, Application Note 6 to § 3C1.1, forbids the application of the

enhancement, without evidence of further obstruction, to the offense

level for a perjury conviction. France's guidelines, however, were calculated based on an offense level of 32 for his drug conviction, not

the lesser offense level for his perjury conviction. Therefore, the

enhancement is proper under Application Note 3(b).

Neither is France's contention regarding the impropriety of his

three level enhancement based on his role in the offense justified.

Section 3B1.1(b) of the Guidelines calls for a three level offense level

increase when a defendant "was a manager or supervisor (but not an

organizer or leader) and the criminal activity involved five or more

participants." The government clearly established the participation of

more than five individuals in this drug operation. France, McBride,

Hairston, and Mrs. King make four, and the government presented

evidence of two other men, Barry France and Deemus Chambers, who

accompanied Mrs. King on buying trips for Edgar France and

McBride. Furthermore, Mrs. King testified that Edgar France

recruited her to join the conspiracy, that he along with McBride provided the money that she used to purchase cocaine in New York City,

and that most of her contact with the conspiracy came through Edgar

France.

Even so, the district court did not, as France suggests, "subscribe

in wholesale fashion to the government's motion for enhancement."

Considering the evidence, the court actually rejected the government's suggestion that France's conduct warranted a four level

enhancement for a leader or organizer and instead, applied the three

level enhancement properly attributed to a supervisor. Application

Note 2 to Guideline § 3B1.1 applies this adjustment to a defendant

who acts as the "supervisor of one or more other participants." In light

of the evidence regarding France's relationship with Mrs. King, we

cannot say that the district court's determination that France acted as

a supervisor was clearly erroneous.

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E.

France's final contention regards the district court's decisions to

admit certain evidence at trial. Evidentiary rulings as to relevancy are

reviewed under an abuse of discretion standard. United States v.

Zandi, 769 F.2d 229, 237 (4th Cir. 1985). We find no abuse of discretion in this case.

The evidence in question concerns the testimony of Darrell Leonard that he sold drugs for McBride and that during the course of their

involvement, McBride assaulted him. This was the extent of Leonard's testimony. He did not know Edgar France, and he never conducted any business with him, illegal or otherwise. Thus, France

contends that this evidence was inflammatory and prejudicial.

The district court, however, limited the introduction of Leonard's

testimony to that concerning the time period during which France and

McBride were conspiring to distribute cocaine. As a co-conspirator,

France is responsible for any acts of McBride within the scope and

in furtherance of the conspiracy. United States v. Irvin, 2 F.3d 72, 75

(4th Cir. 1993). Leonard's testimony may have pertained to points in

the chain of distribution in which France was not directly involved,

but, as part of the overall conspiracy, he bears responsibility for them

nevertheless. The court did not abuse its discretion in admitting Leonard's testimony.

III.

Although it is likely whistling in the wind, we feel it necessary to

remark that many, or perhaps most, of the reversals and new trials following convictions in criminal cases are brought on by overkill or like

overzealous or reckless prosecution on the part of the government. In

this case, the government did not follow the admonition of this court

in Harris, and other courts, that the government show that prosecuting

officials were aware of the immunity problem and follow reliable procedures for segregating the immunized testimony and its fruits from

officials pursuing any subsequent investigations. See Harris, 973 F.2d

at 336-338.

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That the Department of Justice recognizes the problem is shown by

the recommendation in its manual that prosecution of a compelled

witness be handled by an attorney unfamiliar with the substance of

the compelled testimony. In the prosecution of France, the government took little or no account of these precautions and is saved from

reversal only by our application of the plain error rule.

The convictions and sentence of France are accordingly

AFFIRMED.

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