[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

________________________

No. 18-11248

________________________

D.C. Docket No. 1:16-cr-20390-BB-1

UNITED STATES OF AMERICA, 

Plaintiff–Appellee,

 versus

GERTI MUHO,

Defendant–Appellant.

________________________

Appeal from the United States District Court

for the Southern District of Florida

________________________

(October 22, 2020)

Before MARTIN and NEWSOM, Circuit Judges, and WATKINS,* District Judge.

* Honorable W. Keith Watkins, United States District Judge for the Middle District of 

Alabama, sitting by designation.

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WATKINS, District Judge:

Gerti Muho was convicted for bank fraud, wire fraud, aggravated identity 

theft, and money laundering. He was sentenced to 264 months of incarceration. 

Muho appeals his conviction and the sentence imposed by the district court. After 

careful review, and with the benefit of oral argument, we affirm the district court 

as to both the conviction and sentence. 

I.

After graduating from law school, Gerti Muho began working for Fletcher 

Asset Management (FAM), an investment firm. FAM had a number of subsidiary 

and related entities, including RF Services and Soundview Elite, Ltd. Muho’s role 

granted him access to the personal information of current and former employees 

and interns of the firms.

In April 2013, Muho resigned from his positions at FAM, Soundview Elite, 

and other entities. He then used a series of fraudulent documents purporting to reestablish his own authority and, in turn, to take control of FAM’s entities using 

Leveraged Hawk, a shell company that he controlled. Among his many misdeeds, 

he eventually convinced a bank, HSBC-Monaco, that he had legal authority to 

execute financial transactions on behalf of Soundview Elite (which he did not)—

inducing HSBC-Monaco to wire transfer more than $2 million from Soundview 

Elite’s account to Leveraged Hawk’s account with another bank.

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Muho was first indicted in May 2016. In September 2016, a grand jury 

returned a 40-count second superseding indictment charging him with bank fraud, 

in violation of 18 U.S.C. § 1344 (Counts 1–17); wire fraud, in violation of 18 

U.S.C. § 1343 (Counts 18–19); aggravated identity theft, in violation of 18 U.S.C. 

§ 1028A(a)(1) (Counts 20–37); and money laundering, in violation of 18 U.S.C. 

§ 1957 (Counts 38–40). 

Muho’s case involved a number of trial and sentencing rulings that are 

relevant here. First, Muho was represented by a rotating cast of attorneys. While 

represented by his third attorney, David Harris, he moved for leave to proceed pro 

se with Harris as standby counsel. After a hearing, Muho’s request was granted. 

Second, Muho, proceeding in forma pauperis, moved the court to waive costs and 

issue subpoenas for eight witnesses under Federal Rule of Criminal Procedure 

17(b). As relevant to this appeal, the court granted the motion as to all but two 

witnesses; as to those two, the motion was denied without findings or explanation. 

After an eleven-day trial and less than three hours of jury deliberation, Muho 

was convicted on all charges. He was sentenced to 264 months’ imprisonment:

240 months as to Counts 1–19 and 120 months as to counts 38–40, to be served 

concurrently; 24 months as to Counts 20–37, to be served concurrently with each 

other and consecutively to the remaining counts; and five years of supervised 

release. In calculating Muho’s sentence, the court applied a two-level 

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enhancement under U.S.S.G. § 2B1.1(b)(16)(A), which applies if “the defendant 

derived more than $1,000,000 in gross receipts from one or more financial 

institutions as a result of the offense.”

On appeal, Muho raises four issues:

(1) Whether the district court erred in not reinstating counsel for Muho 

despite his valid invocation of his right to self-representation;

(2) Whether the district court abused its discretion in denying, in part, 

Muho’s Fed. R. Crim. P. 17(b) motion;

(3) Whether the district court erred in applying a two-level sentencing 

enhancement for deriving more than $1,000,000 from a financial institution where 

Muho fraudulently induced a bank to transfer funds from another customer’s 

account; and 

(4) Whether the district court imposed a sentence that was substantively 

unreasonable. 

II.

A. Failure to Appoint Counsel

Muho argues that the district court erred by allowing him to proceed pro 

se—that is, by not sua sponte reinstating counsel for Muho—after he invoked his 

right to self-representation. 

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Muho cycled through a number of attorneys before moving for leave to 

proceed pro se with his then-attorney, David Harris, as standby counsel, in January 

2017. The government responded by requesting a Faretta hearing.1 There, the 

court informed Muho that he lacked a constitutional right to standby counsel. 

Muho reiterated his desire to push forward, confirming that he understood the 

risks, believed himself capable, and had no diagnoses of mental illness. The court 

found that Muho had voluntarily, knowingly, and intelligently waived his right to 

counsel and was competent to proceed pro se. Muho did. Although he 

periodically appeared to reconsider, Muho reaffirmed (and the court recognized, 

after correctly questioning Muho to confirm) his desire to represent himself on 

numerous occasions.

On appeal, Muho does not contest that he validly waived his right to 

counsel. Rather, he argues that he “was deprived of his right to a fair trial when he 

was allowed to continue to represent himself, even after he vacillated about selfrepresentation . . . .” Muho is wrong.

1. Faretta urged that a defendant be “made aware of the dangers and disadvantages of 

self-representation, so that the record will establish that ‘he knows what he is doing and his 

choice is made with eyes open.’” Faretta v. California, 422 U.S. 806, 835 (1975) (quoting 

Adams v. United States ex rel. McCann, 317 U.S. 269, 279 (1942)). Our Circuit has understood 

this language “to mean that ideally a trial court should hold a hearing to advise a criminal 

defendant on the dangers of proceeding pro se and make an explicit finding that he has chosen to 

represent himself with adequate knowledge of the possible consequences.” Nelson v. Alabama, 

292 F.3d 1291, 1295 (11th Cir. 2002). These hearings are often referred to as “Faretta

hearings.” 

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The Sixth Amendment to the United States Constitution guarantees familiar 

rights to a criminal defendant: “In all criminal prosecutions, the accused shall 

enjoy the right . . . to have the Assistance of Counsel for his defence.” But “[t]he 

Sixth Amendment does not provide merely that a defense shall be made for the 

accused; it grants to the accused personally the right to make his defense.” Faretta 

v. California, 422 U.S. 806, 819 (1975) (emphasis added). Accordingly, a criminal 

defendant has a “constitutional right to proceed without counsel when he 

voluntarily and intelligently elects to do so.” Id. at 807.

Faretta protects an individual’s right to self-representation despite the

possible downsides. “It is the defendant . . . who must be free personally to decide 

whether in his particular case counsel is to his advantage. And although he may 

conduct his own defense ultimately to his own detriment, his choice must be 

honored out of ‘that respect for the individual which is the lifeblood of the law.’” 

Id. at 834 (quoting Illinois v. Allen, 397 U.S. 337, 350–351 (1970) (Brennan, J., 

concurring)). Faretta and subsequent caselaw make clear that, while a court may 

terminate a defendant’s self-representation, that action is discretionary. See, e.g., 

id. at 834 n.46 (“[T]he trial judge may terminate self-representation by a defendant 

who deliberately engages in serious and obstructionist misconduct.”). On the other 

hand, this Court has explicitly recognized that “a trial court can commit reversible 

constitutional error . . . by denying a proper assertion of the right to represent 

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oneself, and thereby violating Faretta.” Cross v. United States, 893 F.2d 1287, 

1290 (11th Cir. 1990).

Put simply, the trial court’s failure to override sua sponte the defendant’s 

waiver of his right to counsel—where, as here, the waiver’s validity was clear, 

uncontested on appeal, and repeatedly reaffirmed after signs of uncertainty—is due 

to be affirmed.2 To find otherwise would contradict a “nearly universal conviction, 

on the part of our people as well as our courts, that forcing a lawyer upon an 

unwilling defendant is contrary to his basic right to defend himself if he truly 

wants to do so.” Faretta, 422 U.S. at 817. Muho’s arguments to the contrary are 

unpersuasive. He is not entitled to relief on this issue.

B. Denial of Subpoenas After Rule 17(b) Motion

Muho also argues that the district court abused its discretion in denying, in 

part, his motion under Federal Rule of Criminal Procedure 17(b). Proceeding in 

forma pauperis, Muho asked the court to waive costs and issue subpoenas for eight 

witnesses under Rule 17(b). In his motion, Muho explained the relevance of two 

2. Typically, review of a waiver of right to counsel would be de novo. See, e.g., United 

States v. Garey, 540 F.3d 1253, 1268 (11th Cir. 2008) (noting that whether waiver of counsel 

was knowing and voluntary is “a mixed question of law and fact which this Court reviews de 

novo”). Here, however, Muho did not raise the issue below, which would ordinarily trigger plain 

error review. See, e.g., United States v. Rodriguez, 398 F.3d 1291, 1298 (11th Cir. 2005). We 

have not resolved the appropriate standard in such a context: “No published case in this Circuit 

explicitly addresses the question, though the mine run of cases apply de novo review without 

discussing whether a defendant formally objected at trial.” United States v. Stanley, 739 F.3d 

633, 644 (11th Cir. 2014). We need not resolve this issue here; under either standard, the district 

court is due to be affirmed.

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of these witnesses—Dr. Eli Shalenberger and Justice James Vaughn of the 

Delaware Supreme Court—as follows:

Defendant’s third witness is Eli Shalenberger, Defendant’s 

psychiatrist between 2012 and 2015. Defendant needs and expects Mr. 

Shalenberger to testify that Defendant’s intentions were not to defraud 

his hedge funds but to save them from misuse and to comply with the 

law. This will negate that Defendant perpetrated a fraud scheme and 

that Defendant used proceeds of fraud to engage in monetary 

transactions. Defendant also expects Mr. Shalenberger to testify as to 

Defendant’s state of mind from his conversations with the Defendant 

relating to all counts of the case. Absent Mr. Shalenberger’s testimony, 

Defendant will not be able to prove or show his defense to the jury of 

the charged counts in this case.

Defendant’s fourth witness is Justice Vaughn of the Delaware 

Supreme Court. Defendant needs and expects Justice Vaughn to testify 

about the contents of an unrecorded telephone conference on a case 

arising from the dispute of control of Defendant’s hedge funds that 

Defendant needs to show and prove [to] the jury his intention not to 

defraud his hedge funds, engage in a fraud scheme, or engage in 

monetary transactions from criminal funds, and that will establish and 

support Defendant’s defense regarding his intentions and motives for 

all charged counts of the case. Without Justice Vaughn, Defendant will 

not be able to show or prove to the jury that Defendant was the victim 

set up by actors of said conference in their attempt to wrest away 

Defendant’s control over his hedge funds and that Defendant lacked 

criminal intent for all the charged counts of the case.

The court granted Muho’s motion for all witnesses except these two—as to whom 

the motion was denied without explanation. 

This court reviews the denial of a Rule 17(b) motion for abuse of discretion. 

See United States v. Rinchack, 820 F.2d 1557, 1566 (11th Cir. 1987) (“The grant or 

denial of a Rule 17(b) motion is committed to the discretion of the district court 

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and is subject to reversal on appeal only upon a showing of abuse of that 

discretion.”). “A district court abuses its discretion if it fails to apply the proper

legal standard or to follow proper procedures in making the determination, or 

makes findings of fact that are clearly erroneous.” United States v. Izquierdo, 448 

F.3d 1269, 1276 (11th Cir. 2006) (internal quotation marks and citation omitted). 

If the evidentiary ruling was in error, the harmless error standard applies. United 

States v. Henderson, 409 F.3d 1293, 1300 (11th Cir. 2005). That is, a decision 

constitutes reversible error only if it “ha[s] a ‘substantial influence’ on the outcome 

of a case or leave[s] ‘grave doubt’ as to whether [it] affected the outcome of a 

case.” United States v. Frazier, 387 F.3d 1244, 1266 n.20 (11th Cir. 2004) (en 

banc) (alterations added). 

Rule 17(b) allows indigent defendants to subpoena a witness at the 

government’s expense whose presence is a “necessity” to an “adequate defense.” 

But the Rule places the burden on the defendant: “[A] defendant making a Rule 

17(b) request bears the burden of articulating specific facts that show the relevancy 

and necessity of the requested witness’s testimony.” Rinchack, 820 F.2d at 1566. 

Courts considering a Rule 17(b) request may also consider the materiality, 

competency, and timeliness of the request. See id. “The appellate courts have 

upheld the refusal of district courts to issue a Rule 17(b) subpoena where the 

request was untimely, the testimony sought was cumulative, or the defendant failed 

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to make a satisfactory showing of indigency or necessity.” Id.; see also United 

States v. Link, 921 F.2d 1523, 1528 (11th Cir. 1991) (summarizing the valid 

considerations of courts considering a request made under Rule 17(b)). 

Muho correctly points out that the district court provided no rationale, and 

made no factual findings, when it denied the two requests. Findings would have 

been helpful. But even without such findings, this Court can affirm based on its 

own review of the record if it finds that the rejection was proper. See, e.g., United 

States v. Gill, 864 F.3d 1279, 1280 (11th Cir. 2017) (“[W]e can affirm the district 

court’s judgment on any ground supported by the record—even if that ground was 

not considered or advanced in the district court.”).

Upon an independent review of the record, the trial court did not err in 

denying the Justice Vaughn request. Muho’s proffer described testimony that 

involved an unrecorded phone call between unidentified persons about unspecified 

facts. It further asserted that the phone call would support certain conclusions 

regarding Muho’s intent. But Muho’s proffer failed to indicate what facts 

supported the conclusions, and it did not indicate why or how the evidence would 

be relevant or admissible over hearsay or other objections. These assertions fell 

short of meeting Muho’s burden to articulate “specific facts that show the 

relevancy and necessity of the requested witness’s testimony.” Rinchack, 820 F.2d 

at 1566 (emphasis added). 

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Turning to Dr. Shalenberger, Muho stated that this witness would testify that 

Muho’s “intentions were not to defraud his hedge funds” and about his “state of 

mind . . . relating to all counts of the case”—a possible violation of Federal Rule of

Evidence 704(b). Although Rule 704(b) forbids expert testimony on the ultimate

issue in a case, a defendant may seek testimony from a psychiatrist regarding his 

diagnosis, the particulars of a mental disease or defect, and his opinion as to a 

defendant’s mental state. See United States v. Manley, 893 F.2d 1221, 1223 (11th 

Cir. 1990). 

Again, Muho has not made the requisite showing; he has not demonstrated 

specific facts or admissible opinions from this witness that show relevancy and 

necessity. Where a defendant does not meet his required burden, we have upheld 

denials even when it is alleged that the court failed to make a relevant inquiry. 

See, e.g., Rinchack, 820 F.2d at 1568 (“Although Rinchack argues that the district 

court erred in not inquiring into what the two men might be expected to testify, the 

law is crystal clear that the burden of showing necessity and relevance is on the 

defendant.”). The trial court did not abuse its discretion in denying the 

Shalenberger subpoena.

In any event, any purported error was harmless. Muho was convicted 

quickly and under a great weight of evidence. After a trial lasting eleven days, the 

jury deliberated for less than three hours before convicting Muho on all counts. 

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Further, as he concedes, Muho was able to present the lack-of-intent defense

allegedly supported by the two witnesses. And, finally, nothing in the relevant 

proffer or in Muho’s appellate briefing indicates that the testimony, if allowed and 

admissible, would have substantially improved his case or his chances of a 

different verdict. Given these facts, “we do not harbor a grave doubt that the jury 

would have changed its verdict,” Henderson, 409 F.3d at 1300, if these two 

witnesses had testified. We find no error that “affect[ed] a substantial right” of 

Muho. Frazier, 387 F.3d at 1266 n.20 (alterations added). 

C. Application of Sentencing Enhancement

Muho argues that the district court wrongly applied a two-level enhancement 

in calculating his sentence. Again—although in a case of first impression—he is 

incorrect. 

The United States Sentencing Guidelines provide a two-level enhancement 

when “the defendant derived more than $1,000,000 in gross receipts from one or 

more financial institutions as a result of the offense.” U.S.S.G. § 2B1.1(b)(16)(A)

(2016 ed.).

3

 “Gross receipts from the offense” is defined as “all property . . . 

which is obtained directly or indirectly as a result of [the] offense.” Id. § 2B1.1 

cmt. n.12(B) (2016 ed.); U.S.S.G. § 2B1.1 cmt. n.13(B) (2018 ed.). We review de 

3. This enhancement is currently codified at U.S.S.G. § 2B1.1(b)(17)(A). Below, for the 

sake of clarity, the enhancement is referred to as the § 2B1.1(b)(16)(A) enhancement. 

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novo whether this enhancement applies. United States v. Rodriguez, 732 F.3d 

1299, 1305 (11th Cir. 2013) (noting that this Court “reviews de novo the 

interpretation and application of the Guidelines”).

HSBC-Monaco’s status as a financial institution is uncontested, but this 

Circuit has not explicitly interpreted what it means to “derive[]” receipts from a 

financial institution in this context. It is no small project. Section 2B1.1 of the 

Guidelines applies to a broad range of criminal conduct including larceny, 

embezzlement, and other forms of theft; offenses involving stolen property and

property damage or destruction; fraud and deceit; forgery; and offenses involving 

altered or counterfeit instruments. In turn, these broad categories encompass bank 

fraud, college scholarship fraud, Ponzi schemes, health care fraud, and a host of 

other wrongs. Even when limited to property4 taken from financial institutions, the 

range of entities is vast.

5

 Crafting a standard that applies universally is all but 

impossible.

4. We use the term “property” to refer to “gross receipts” as defined in the Guidelines. 

U.S.S.G. § 2B1.1 cmt. n.12(B) (2016 ed.); U.S.S.G. § 2B1.1 cmt. n.13(B) (2018 ed.).

5. The relevant Guideline defines “financial institution” as “any institution described in 

18 U.S.C. § 20, § 656, § 657, § 1005, § 1006, § 1007, or § 1014; any state or foreign bank, trust 

company, credit union, insurance company, investment company, mutual fund, savings (building 

and loan) association, union or employee pension fund; any health, medical, or hospital 

insurance association; brokers and dealers registered, or required to be registered, with the 

Securities and Exchange Commission; futures commodity merchants and commodity pool 

operators registered, or required to be registered, with the Commodity Futures Trading 

Commission; and any similar entity, whether or not insured by the federal government. ‘Union or 

employee pension fund’ and ‘any health, medical, or hospital insurance association,’ primarily 

include large pension funds that serve many persons (e.g., pension funds of large national and 

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But we are not dealing with the economic universe here. Our factual starting 

point is a specific spot on the financial map: financial institutions that exercise 

control over the property of others. Muho argues that the government had to prove 

that HSBC-Monaco owned, invested, or otherwise had unrestrained discretion to 

alienate its depositor’s funds in order for the enhancement to apply. He asserts that 

Soundview Elite’s status as depositor renders HSBC-Monaco’s control over the 

funds irrelevant. The government counters that, by tricking the bank into 

transferring Soundview’s funds to Muho’s account at another bank, Muho stole 

from a bank account over which he had no authority and over which the bank 

exercised control. 

We hold today that, to trigger the § 2B1.1(b)(16)(A) enhancement, at least in 

a case involving property held by a financial institution for a depositor, the 

financial institution (1) must be the source of the property, which we interpret as 

having property rights in the property, and (2) must have been victimized by the 

offense conduct. These two requirements follow straightforwardly from the 

Guideline’s text—that the defendant’s gross receipts be (1) “derived . . . from” a 

financial institution (2) “as a result of the offense.” Because of the broad range of 

conduct to which § 2B1.1 applies, this standard may not be a perfect fit for all 

international organizations, unions, and corporations doing substantial interstate business), and 

associations that undertake to provide pension, disability, or other benefits (e.g., medical or 

hospitalization insurance) to large numbers of persons.” U.S.S.G. § 2B1.1 cmt. n.1.

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possible scenarios under this Guideline. However, it fits typical banking practices 

involving funds held by banks for depositors. We will discuss the elements of this 

standard in turn. 

The words “derived . . . from” must be given their plain and ordinary 

meaning. United States v. Tham, 118 F.3d 1501, 1506 (11th Cir. 1997). To 

“derive” means “[t]o receive, as from a source . . . ; to obtain . . . by transmission.” 

Webster’s New International Dictionary (2d ed. 1934). Thus, “derived . . . from”

calls for identification of the specific source of the property. See United States v. 

Stinson, 734 F.3d 180, 184 (3d Cir. 2013) (first citing Black’s Law Dictionary 444 

(6th ed. 1990); and then citing Webster’s Ninth New Collegiate Dictionary 342 

(1986)). “Source” means that the financial institution, before the offense conduct,

possesses and controls the property to be filched: the “from” in “derived from.” In 

shorthand, the financial institution “holds” the property. To clarify the source 

requirement and its application here, some elementary background on banks—and 

their relationship to the property they hold—is in order. We all use banks in our 

daily lives, but what exactly does a bank do? As Merriam-Webster defines it, a 

bank is “an establishment for the custody, loan, exchange, or issue of money, for 

the extension of credit, and for facilitating the transmission of funds.” Bank, 

Merriam-Webster Online, https://www.merriam-webster.com/dictionary/bank (last 

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visited Oct. 22, 2020). Typical banking involves third-party financial 

arrangements between a bank and its customers—usually depositors or borrowers. 

In facilitating those transactions, the bank either takes a non-exclusive 

property interest in another’s (the depositor’s) property or holds the property with 

contractual instructions in the nature of a bailment. Either arrangement gives the

bank possession of and a measure of control over the property. See Shaw v. United 

States, 137 S. Ct. 462, 466 (2016). It may be property held in an ordinary deposit 

account, in trust, or in a safe deposit box or other storage arrangement (say, 

valuable art), or it may be property that has been foreclosed upon or repossessed 

and that is awaiting disposition. Thus, money deposited in a bank by a third-party 

depositor is property necessarily involving property rights.

Shaw is instructive here because it rejects the argument that Muho now 

makes—namely, that full ownership is required. Shaw involved a prosecution 

under 18 U.S.C. § 1344 for defrauding a financial institution. Section 1344 makes 

it unlawful for anyone to “knowingly execute[] . . . a scheme . . . to obtain any of 

the moneys . . . owned by, or under the custody or control of, a financial 

institution, by means of false or fraudulent pretenses, representations, or 

promises.” 18 U.S.C. § 1344(2). Shaw wrongfully took money from the deposit 

account of another depositor at the bank by means of deception of the bank, much 

the same as Muho’s conduct here. Shaw argued that the statute does not cover 

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schemes to deprive a bank of customer deposits; it only covers the taking of the 

bank’s own property. The Supreme Court disagreed. “The basic flaw in this 

argument lies in the fact that the bank, too, had property rights in Hsu’s [the other 

depositor’s] bank account.” Shaw, 137 S. Ct. at 466 (emphasis added) (alterations 

added). The Court likened such arrangements to a bailment: 

[A]s bailee, the bank can assert the right to possess the deposited 

funds against all the world but for the bailor . . . . This right, too, is a 

property right. . . . Thus, Shaw’s scheme to cheat Hsu was also a 

scheme to deprive the bank of certain bank property rights. 

Hence, for purposes of the bank fraud statute, a scheme 

fraudulently to obtain funds from a bank depositor’s account normally 

is also a scheme fraudulently to obtain from a “financial institution,” at 

least where, as here, the defendant knew that the bank held the deposits, 

the funds obtained came from the deposit account, and the defendant 

misled the bank in order to obtain those funds.

Id. (emphasis added). We see no difference, in the context of a bank holding 

deposited funds for a third party, in “obtaining” funds (statute) and “deriving” 

funds (guideline) from a financial institution. In defining “gross receipts,” the

Sentencing Commission said as much: “all property . . . which is obtained directly 

or indirectly as a result of [the] offense.” § 2B1.1 cmt. n.13(B) (2018 ed.)

(emphasis added). In both cases, the source of the funds is the bank. 

Importantly, the financial institution as a “source” need not have full 

ownership of the property. Our perspective recognizes the routine practices of 

many financial institutions, like banks, which exercise varying degrees of 

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dominion or control over property that is technically owned by others. Had the 

Sentencing Commission intended for this enhancement to apply solely to property

“owned by” a financial institution, it would likely have employed the terms 

“owned by” or “belonging to” rather than “derived . . . from.” Cf. Loughrin v. 

United States, 573 U.S. 351, 366 n.9 (2014) (“[T]he broad language in § 1344(2) 

describing the property at issue—‘property owned by or under the custody or 

control of’ a bank—appears calculated to avoid entangling courts in technical 

issues of banking law about whether the financial institution or, alternatively, a 

depositor would suffer the loss from a successful fraud.”) (citation omitted). 

Muho relies on the Third Circuit’s decision in Stinson. In that case, which 

did not involve banking at all, but rather investment companies as financial 

institutions, the Third Circuit held that “[a] financial institution is a source of a 

defendant’s gross receipts if it owns the funds,” and it defined ownership as

“exercis[ing] dominion and control over the funds and ha[ving] unrestrained 

discretion to alienate the funds.” 734 F.3d at 186. Muho’s suggestion—that 

ownership of the property determines from whom it was “derived”—is inconsistent 

with the plain language of the Guidelines and with modern banking practices.

The Stinson Court, despite its definition of “source,” did not resolve the 

issue consistently with its own definition. There, the fraudster, Stinson, used 

fictitious marketing materials to induce two legitimate investment firms, 

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Brentwood and TWM, to market his fraudulent enterprise to investors. Brentwood 

and TWM were financial institutions, which formed the basis for the guideline 

application. The key distinction in Stinson for our purposes was made by the Court 

itself. On the record before it, the Court could not say whether the investment 

firms only advised their clients to invest directly with Stinson, or whether the 

investment firms “retained control over the assets of certain clients and invested . . 

. on their behalf.” Id. at 182 (emphasis added). Stinson argued “the money flowed 

from individual investors, not financial institutions like Brentwood and TWM.” 

Id. at 183. In a telling conclusion, the Court admitted: “[W]e are unable to 

conclude definitively that the enhancement does not apply because the record is 

unclear as to whether Brentwood or TWM invested any money on behalf of their 

clients. The record as developed on remand may indeed support application of the 

enhancement.” Id. at 187 (emphasis added). 

Thus, Stinson did not hold that the financial institution had to be the sole 

owner of the funds obtained by fraud, and it remanded the case for the trial court to 

resolve the source of some of the funds. If the financial institution controlled or 

possessed investor funds with the “unrestrained discretion” to invest them on 

behalf of the investor, id. at 186, Stinson suggests that the enhancement would 

apply even in spite of a potential finding on remand that the financial institution 

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did not actually own the funds in question.6

 Accordingly, Stinson does not carry 

the freight of Muho’s argument. 

Finally, to establish the financial institution as the source of the derived 

funds, the sentencing court must find that the relevant property flowed directly or 

indirectly from the possession or control of the financial institution to the 

defendant. See generally United States v. Van Alstyne, 584 F.3d 803, 819 (9th Cir. 

2009) (“Under this language, the only effect on a financial institution that counts is 

money flowing from a financial institution into the defendant’s coffers.”). It

clearly did so here: HSBC-Monaco transferred $2 million from Soundview Elite’s 

HSBC-Monaco bank account to Leveraged Hawk’s Citibank account—as a result 

of Muho’s trickery.

Which brings us logically to the second prong: Because the enhancement 

applies only if the defendant’s derivation of gross receipts from a financial 

institution is “as a result of the offense,” the financial institution must be—as 

HSBC-Monaco was—victimized by the offense conduct. This element is easily 

met when the financial institution’s own property has been “derived” by a thief or 

fraudster, such as in larceny or in an “inside” job, like embezzlement, loan fraud, 

6. There may be a reason to define “source” differently in the investment realm as 

opposed to banking, but Stinson did not address banking and banks—and we do not address 

investment houses—as financial institutions.

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or theft of bank property by an employee. And it is equally true here: Muho used

fraudulent documents to convince the bank that he had control over the account of 

another, thereby inducing the bank to wire the funds of another to Muho’s account 

without even looking at the third base coach to see if it should swing or not. The 

bank swung away and made contact. Muho caught the funds and made out of the 

stadium gates like a bat out of Boston.7

 

This play separates the facts of our case from those in United States v. 

Huggins, 844 F.3d 118 (2d Cir. 2016), a case in which investors were duped by a 

fraudster to deposit funds into the fraudster’s account from which the fraudster,

predictably and legally, withdrew them. The Second Circuit recognized that, 

though the funds were withdrawn from the bank, the defendant derived property

from the investors, not the bank. In a fit of unintended understatement, the Court 

wrote that “[a]pplying the enhancement to all cases where a defendant merely 

withdraws money from his own bank account at a financial institution cuts too 

broadly . . . .” Id. at 120–21. Our holding today is consistent with Huggins. The 

financial institution must be a target of the offense conduct.

The Guideline’s history supports such a reading. Prior to its amendment, 

this Guideline enhancement called for a four-level enhancement “[i]f the 

offense . . . affected a financial institution and the defendant derived more than 

7. We do not intend to implicate the Red Sox in this fraud. 

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$1,000,000 in gross receipts from the offense.” U.S.S.G. § 2B1.1(b)(6)(B) (2000 

ed.) (emphasis added). As the Ninth Circuit pointed out, “under this [previous] 

language any impact on a financial institution would do.” Van Alstyne, 584 F.3d at 

819. In contrast, the modern Guideline “makes equally clear that the enhancement 

only applies if gross receipts in excess of $1 million are derived from a financial 

institution.” Id. (emphasis added). The new Guideline is thus narrower than its 

predecessor. As the Third Circuit recognized, “mere tangential effects on financial 

institutions will not support application of the enhancement.” Stinson, 734 F.3d at

186. “Deriving” gross receipts from a financial institution demands more than 

being “affected.” While a financial institution may be “affected” if it faces 

heightened exposure to risk or serves as a conduit for transfers of property, 

property is only “derived” from a financial institution if sufficient indicia of source 

and victimization are present.8

8. District courts are instructed to apply this narrower two-level enhancement or to apply 

a four-level enhancement “[i]f . . . the offense (i) substantially jeopardized the safety and 

soundness of a financial institution; or (ii) substantially endangered the solvency or financial 

security of an organization that, at any time during the offense, (I) was a publicly traded 

company; or (II) had 1,000 or more employees,” whichever is greater. U.S.S.G. § 

2B1.1(b)(16)(B) (2016 ed.); U.S.S.G. § 2B1.1(b)(17)(B) (2018 ed.). One rationale for the

enhancement, illustrated by its bifurcation into two- and four-level applications, is that deriving 

more than $1 million from a financial institution has greater potential spillover effects than 

deriving more than $1 million from Mr. or Ms. Private Citizen. Taking that much money from a 

financial institution impacts the financial system because, e.g., it could trigger an FDIC audit or 

payout, it could endanger the deposits or investments of many innocent people, and it could 

prompt layoffs or stock selloffs. In a small enough financial institution or a big enough heist, 

such conduct could jeopardize the institution’s solvency, shake public or community confidence 

in the financial system, and deter individuals from depositing or investing their money. 

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These factors—source and victimization—are cousins. They both overlap 

and operate independently to define the scope of the enhancement’s application. 

The source prong requires an intentional, close examination and finding of from 

whence the property is derived, and our definition clarifies that a defendant may 

“derive” property of which the financial institution is not the sole owner. The 

victimization prong acts to cabin the meaning of “source.” It ensures that the 

enhancement does not apply when the defendant derived property that he or she

had some lawful right of ownership, possession, or control over, as in Huggins. In 

other words, the offender cannot be the owner of the property, nor have a right to 

control the property for the enhancement to apply. When it is the offender’s own 

funds that are being held by the bank, he cannot victimize the bank because he can 

do whatever he wants with his own money. 

Nor does the enhancement apply when the bank holds the property, but is 

not the victim of the heist. An example would be if, as stated above, Muho 

convinced Soundview Elite to direct HSBC-Monaco to wire Soundview funds 

from its account into Muho’s account. Or a nefarious nephew might unduly 

influence a rich aunt to go into her safe deposit box and give him cash and jewels 

in excess of $1 million. In both examples, the enhancement would not apply, but 

the property was held by a bank which was not the victim.

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Furthermore, our holding does not implicate pass-through banking conduct, 

like ordinary checking transactions and wire transfers.9

 An ordinary wire transfer 

is simply an electronic check, an instant transfer of funds rather than a multistep 

transfer of a piece of physical paper representing funds the bank holds for a 

depositor. An ordinary check takes days to clear in customary banking practices; a 

wire transfer “clears” almost instantly. But it is the same transaction: Funds pass 

from one bank to another, not through a bank. The sending bank possesses the 

funds initially; the recipient bank possesses them ultimately. In no way would the 

guideline apply to either ordinary wire transfers or checking transactions, not 

because of the source requirement, but because of the victimization requirement.

In many cases involving banks, the victimization prong may end up doing 

most of the work. Muho snookered the system; he tricked the bank with forged 

documents, inducing the bank to initiate the wire transfer. As it happened, the 

9. A wire transfer is a “transfer of funds done electronically across a network of banks . . . 

around the world.” Julia Kagan, What Is a Wire Transfer?, Investopedia (May 29, 2020), 

https://www.investopedia.com/terms/w/wiretransfer.asp (last visited Oct. 22, 2020). “No 

physical money is transferred between banks or financial institutions when conducting a wire 

transfer [nor does a check transfer physical money].” Id. (brackets added). “Instead, information 

is passed between banking institutions about the recipient, the bank receiving account number, 

and the amount transferred.” Id. “The sending bank sends a message to the recipient’s bank 

with payment instructions through a secure system . . . . The recipient’s bank receives all the 

necessary information from the initiating bank and deposits its own reserve funds into the correct 

account.” Id. “The two banking institutions then settle the payment on the back end (after the 

money has already been deposited) [same as a check].” Id. (brackets added).

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bank was both the source of the funds and the victim of the offense, and the 

guideline enhancement was triggered. 

To sum up, the Guideline was correctly applied. First, HSBC-Monaco, not 

Muho, was a source of the derived property. Second, control over the property

transferred directly from HSBC-Monaco to Muho. Third, the bank was not just a 

conduit for a transfer of property that resulted from criminal conduct directed 

elsewhere; rather, the bank was a victim of Muho’s fraud. For purposes of this

sentencing enhancement, we hold that Muho derived the property from HSBCMonaco. The sentencing court did not err in applying the two-level enhancement.

D. Substantive Reasonableness of Sentence

Finally, Muho argues that his sentence was substantively unreasonable. We 

review a claim that a sentence is substantively unreasonable under “a deferential 

abuse of discretion standard.” United States v. Early, 686 F.3d 1219, 1221 (11th 

Cir. 2012). 

In considering the reasonableness of a sentence, the Eleventh Circuit looks 

to the 18 U.S.C. § 3553(a) factors, “tak[ing] into account the totality of the 

circumstances.” Gall v. United States, 552 U.S. 38, 51 (2007). A district court 

“abuses its considerable discretion” only when it “(1) fails to afford consideration 

to relevant factors that were due significant weight, (2) gives significant weight to 

an improper or irrelevant factor, or (3) commits a clear error of judgment in 

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considering the proper factors.” United States v. Rosales-Bruno, 789 F.3d 1249, 

1256 (11th Cir. 2015) (quoting United States v. Irey, 612 F.3d 1160, 1189 (11th 

Cir. 2010) (en banc)). In this context, Muho must show that his sentence “lies 

outside the range of reasonable sentences dictated by the facts of the case.” Irey, 

612 F.3d at 1190 (internal quotation marks and citation omitted). Perhaps 

unsurprisingly, sentences are rarely overturned. See, e.g., id. at 1191.

Muho’s sentence was not substantively unreasonable. Though the 

Guidelines are not themselves dispositive, sentences that fall within the Guidelines 

range or that are below the statutory maximum are generally reasonable. See, e.g.,

United States v. Hunt, 941 F.3d 1259, 1264 (11th Cir. 2019) (“We have said that if 

the sentence imposed is below the statutory maximum . . . that is a factor indicating 

that the sentence is reasonable.”). Muho received a small downward variance and

his sentence was far below the applicable statutory maximum. Moreover, Muho 

concedes that the district court considered the relevant factors and “determined that 

a slight variance was warranted.” 

Accordingly, having reviewed the substantive reasonableness of Muho’s 

sentence, we find that the district court did not abuse its discretion.

III.

Muho’s conviction and sentence are AFFIRMED.

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