UNPUBLISHED

UNITED STATES COURT OF APPEALS 

FOR THE FOURTH CIRCUIT 

No. 06-5281

UNITED STATES OF AMERICA, 

 Plaintiff - Appellee, 

 v. 

TERESA HODGE, 

 Defendant – Appellant. 

Appeal from the United States District Court for the District of 

Maryland, at Greenbelt. Roger W. Titus, District Judge. (8:03-

cr-00133-RWT) 

Submitted: September 11, 2008 Decided: October 3, 2008 

Before TRAXLER, Circuit Judge, HAMILTON, Senior Circuit Judge, 

and James C. DEVER III, United States District Judge for the 

Eastern District of North Carolina, sitting by designation. 

Affirmed in part; vacated and remanded in part by unpublished 

per curiam opinion. 

David Schertler, SCHERTLER & ONORATO, L.L.P., Washington, D.C., 

for Appellant. Rod J. Rosenstein, United States Attorney, 

Baltimore, Maryland; Bryan E. Foreman, Assistant United States 

Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Greenbelt, 

Maryland, for Appellee. 

Unpublished opinions are not binding precedent in this circuit. 
PER CURIAM: 

 Teresa Hodge (Hodge) appeals her convictions on six counts 

of mail fraud, 18 U.S.C. § 1341, seven counts of interstate 

transportation of property obtained by fraud, 18 U.S.C. § 2314, 

and one count of money laundering, 18 U.S.C. § 1957(a). Hodge 

also appeals her sentence of eighty-seven months’ imprisonment. 

We affirm Hodge’s convictions in toto, but vacate her sentence 

and remand for resentencing absent application of the sentencing 

enhancement imposed pursuant to USSG § 3B1.1(c) (2000) in 

calculating her advisory sentencing range under the United 

States Sentencing Guidelines. 

I. 

 In 2000, Hodge and Marcus Dukes founded the Financial 

Warfare Club (FWC) as a Maryland nonprofit corporation.1 The 

pair, who are both African-Americans, purportedly created FWC to 

generate wealth within the African-American community by 

promoting investment literacy among those who typically lacked 

knowledge of financial markets and by providing investment 

 1

 FWC listed its principal office as 12138 Central Avenue, 

Suite 233, Mitchellville, Maryland, 20721, which address 

actually was the address for a mailbox at a Mailboxes, Etc. 

location. 

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opportunities in companies that would generate revenue that 

would stay within the African-American community. 

 Hodge and Dukes primarily sought to grow FWC through live 

presentations to African-American clergy and their respective 

congregations. The pastor of the hosting church usually 

introduced Hodge and Dukes to the attendees at the 

presentations. The pair would then make material 

misrepresentations to the attendees in order to induce them to 

become a member of FWC at one of three membership levels. 

 The top level required a $2,550.00 investment, the middle 

level a $1,050.00 investment, and the lowest level a $550.00 

investment. The top level entitled the member to three 

financial literacy courses; 2,000 shares of stock in each of 

three infrastructure companies that Hodge and Dukes were 

purportedly developing; and the opportunity to buy additional 

shares of stock in those companies at reduced prices before 

their initial public offerings (IPOs). The middle level 

entitled the member to two financial literacy courses, 500 

shares of stock in each of the three infrastructure companies, 

and the same opportunity to purchase more shares at pre-IPO 

prices. The least expensive level entitled the member to one 

financial literacy course, 250 shares of stock in each of the 

three infrastructure companies, and the opportunity to buy more 

shares at pre-IPO prices. 

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 Among other items, Hodge claimed that the African-American 

community had been intentionally locked out of achieving 

financial success on Wall Street via the sophisticated investor 

accreditation rules of the Securities and Exchange Commission of 

the United States (the SEC). Hodge held out FWC as a mechanism 

for African-Americans to bypass such rules. In this vein, Hodge 

falsely told attendees at FWC presentations that if a potential 

investor did not have an income of at least $200,000.00 during 

the previous three years, the SEC’s sophisticated investor 

accreditation rules prohibited such person from investing in an 

initial public offering of stock (IPO). 

 Hodge also falsely told attendees at FWC presentations that 

Dukes had considerable investment experience on Wall Street, 

including having personally taken the retail clothing store 

Today’s Man public. Hodge also knew that Dukes often falsely 

told attendees at FWC presentations that he had given financial 

advice to a church in Washington, D.C. and, as a result, the 

church made $50,000 and two church members bought matching 

Porsche automobiles with their profits. 

 Hodge, as well as others who introduced her during the 

presentations, told attendees that she was a wealthy woman with 

decades of business experience. Hodge also told the attendees 

that she had personally invested $1,000,000.00 in FWC. The 

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evidence at trial proved all of these representations to be 

false and misleading. 

 After making numerous FWC presentations to African-American 

churches in Maryland, Hodge and Dukes took FWC on the road, 

giving presentations at numerous churches throughout Georgia, 

Michigan, Ohio, New York, New Jersey, and Alabama. When it 

became apparent that FWC’s promised benefits (financial literacy 

courses and IPO profits) were not forthcoming, a number of FWC 

members requested a refund of their investments. Only a handful 

of members actually received a refund. When Dukes failed to 

respond timely to some FWC members’ complaints, some of those 

members complained about FWC to the Maryland Attorney General’s 

Office. 

 On March 5, 2001, the Maryland Securities Commissioner 

issued a cease-and-desist order (the Cease and Desist Order or 

Exhibit Maryland 1) against Dukes, Hodge, and FWC, ordering them 

to stop offering or selling unregistered securities, including 

memberships in FWC, and to stop violating the anti-fraud 

provision of the Maryland Securities Act, Md. Code Ann., Corps. 

& Ass’ns §§ 11-101 to 11-805. Hodge received her copy of the 

Cease and Desist Order on March 7, 2001. 

 Approximately one week later, on March 13, 2001, Dukes 

incorporated a new FWC entity in Washington, D.C. Around the 

same time, FWC moved out of its Maryland office. 

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 On April 10, 2002, Hodge and Dukes entered into a consent 

decree with the Maryland Securities Commission (the Consent 

Decree). Pursuant to the terms of the Consent Decree, Hodge and 

Dukes admitted to certain facts, including the fact that they 

had raised approximately $800,000.00 from about 800 FWC members, 

they had provided no financial literacy courses to FWC members, 

and none of the three infrastructure companies had any prospect 

of going public. The Consent Decree also contained the Maryland 

Securities Commission’s legal conclusions that Hodge and Dukes 

had committed securities and investment fraud under the Maryland 

Securities Act, which the pair neither admitted nor denied. In 

the Consent Decree, the Commission also repeated its orders to 

Hodge and Dukes to cease and desist from engaging in fraudulent 

investment activities. 

 In December 2003, Hodge and Dukes were indicted by a 

federal grand jury for mail fraud, interstate transportation of 

property obtained by fraud, and money laundering. A fourteencount second superseding indictment naming only Hodge was 

returned on November 28, 2005. The district court severed the 

cases for purposes of trial. 

 On June 8, 2005, a jury convicted Dukes on all but three 

counts, which three counts the district court had dismissed on 

the government’s motion. On July 3, 2007, we affirmed Dukes’ 

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convictions, but remanded for resentencing. United States v. 

Dukes, 242 Fed. Appx. 37 (4th Cir. July 3, 2007) (unpublished). 

 On June 6, 2006, following a three-week trial, the jury 

convicted Hodge on all counts. The district court sentenced 

Hodge to eighty-seven months’ imprisonment.2 Hodge noted this 

timely appeal. 

II. 

 The first issue on appeal concerns the Cease and Desist 

Order. Notably, Hodge premises several of her arguments with 

respect to this issue upon her claim that the entirety of the 

Cease and Desist Order, a.k.a., Exhibit Maryland 1, was sent to 

the jury room for the jury’s consideration during its 

deliberations. In contrast to Hodge’s version of events, in its 

appellate brief, the government claimed the jury’s only exposure 

to the text of the Cease and Desist Order occurred during the 

direct testimony of government witness Ronald Wilson, when the 

government read certain portions of such document into evidence 

while the same portions appeared simultaneously before the jury 

on a large video screen in the courtroom, known as the ELMO. 

Ronald Wilson was a securities fraud investigator with the 

 2

 The district court used the 2000 version of the United 

States Sentencing Guidelines Manual (effective November 1, 2000) 

in calculating Hodge’s advisory sentencing range. 

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Maryland Attorney General’s Office during the time that Hodge 

and Dukes operated FWC. As part of his investigation of FWC, 

Ronald Wilson attended a FWC presentation at a church in 

Maryland. He also served the Cease and Desist Order on Dukes. 

 After the completion of all appellate briefing, we remanded 

this case to the district court for a factual finding concerning 

the extent of the jury’s actual exposure to the contents of the 

Cease and Desist Order (Exhibit Maryland 1) during Hodge’s trial 

and ordered this appeal held in abeyance pending further order 

of this court. On remand, the district court agreed with the 

government’s version, finding that the Cease and Desist Order 

did not go to the jury room during deliberations, and that the 

jury only heard the portions of the Cease and Desist Order read 

into evidence by the government and put on the ELMO for the 

jury’s viewing during the government’s direct examination of 

Ronald Wilson. 

 This appeal is now back before us. The following portions 

of the Cease and Desist Order are the only portions of such 

order presented to the jury which are potentially troublesome 

from a Federal Rule of Evidence 403 (Rule 403) perspective. 

Those portions are: (1) “ORDERED, that Financial Warfare, Hodge 

and Dukes and anyone under their direction . . . cease and 

desist from violating the anti-fraud provisions of the 

[Maryland] Securities Act,” (J.A. 506); (2) “ORDERED that 

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respondents cease and desist from engaging in material 

misrepresentations or omissions in connection with the offer or 

sale of securities in this State,” (J.A. 516); and (3) “ORDERED 

that respondents cease and desist from engaging in material 

misrepresentations or omissions in connection with the offer of 

investment advice in this State.” (J.A. 517). 

 Without the Cease and Desist Order having been sent to the 

jury room, Hodge is left with her arguments that the portions of 

the Cease and Desist Order that were read into the record and 

simultaneously put on the ELMO violated her right to confront 

witnesses against her under the Sixth Amendment to the United 

States Constitution, as articulated in Crawford v. Washington, 

541 U.S. 36 (2004). Alternatively, she argues that the portions 

of the Cease and Desist Order that were read into the record and 

simultaneously put on the ELMO violated Rule 403. Neither 

argument has merit. 

 A. Confrontation Clause Argument. 

The Sixth Amendment guarantees that “[i]n all criminal 

prosecutions, the accused shall enjoy the right . . . to be 

confronted with the witnesses against him.” U.S. Const. amend. 

VI. In Crawford, the Supreme Court held that the Confrontation 

Clause prohibits the “admission of testimonial statements of a 

witness who did not appear at trial unless he was unavailable to 

testify, and the defendant had had a prior opportunity for 

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cross-examination.” Crawford, 541 U.S. at 53-54. “Only 

[testimonial] statements . . . cause the declarant to be a 

‘witness’ within the meaning of the Confrontation Clause. It is 

the testimonial character of the statement that separates it 

from other hearsay that, while subject to traditional 

limitations upon hearsay evidence, is not subject to the 

Confrontation Clause.” Davis v. Washington, 547 U.S. 813, 821 

(2006) (citation omitted). 

 Hodge’s Confrontation Clause argument is without merit. 

First, in the form of allegations and orders, the language of 

the Cease and Desist Order is obviously not testimonial in 

nature. Second, the allegations and ordering language are not 

hearsay because the government did not introduce them for the 

truth of the matter asserted, see Fed. R. Evid. 801(c), but 

rather to establish that Hodge was on notice of the allegations 

and the ordering language set forth in the Cease and Desist 

Order, and nonetheless, continued uninterrupted in her active 

role in recruiting FWC members. Such evidence was probative of 

Hodge’s fraudulent intent. 

 B. Rule 403 Argument. 

 In relevant part, Rule 403 provides that “[a]lthough 

relevant, evidence may be excluded if its probative value is 

substantially outweighed by the danger of unfair prejudice 

. . . .” Fed. R. Evid. 403. According to Hodge, the portions 

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of the Cease and Desist Order heard by the jury and put on the 

ELMO for the jury’s viewing “created an extreme danger that the 

jury would infer guilt on the part of Hodge in light of the fact 

that the Cease and Desist Order made it appear that the State of 

Maryland had already made such findings.” (Hodge’s Reply Br. at 

10). 

 We disagree. Even if we assume arguendo that the district 

court erred under Rule 403 in allowing the jury to see or hear 

any portion of the Cease and Desist Order, we can say with fair 

assurance that, without stripping the assumed erroneous 

admission from the whole, the jury’s verdict was not 

substantially swayed by the error. United States v. Curbelo, 

343 F.3d 273, 286 (4th Cir. 2003). Accordingly, any error would 

be harmless. In reaching this conclusion, we are mindful that 

we rejected, on the same rationale, Dukes’ evidentiary challenge 

to the admission of the entirety of the Consent Decree during 

his trial, which decree having contained the Maryland Securities 

Commission’s legal conclusions that Hodge and Dukes had 

committed securities and investment fraud under the Maryland 

Securities Act, contained far more prejudicial information than 

the Cease and Desist Order. See United States v. Dukes, 242 

Fed. Appx. 37, 48 (4th Cir. July 3, 2007) (unpublished). 

 In sum, we hold the district court did not commit 

reversible error when it allowed the government to read certain 

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portions of the Cease and Desist Order into the record and to 

put the same portions on the ELMO for the jury’s viewing, all 

during the direct testimony of government witness Ronald Wilson.3

III. 

 With respect to her sentence, Hodge first argues that the 

district court engaged in impermissible double-counting when it 

increased her offense level by two levels, pursuant to USSG 

§ 2F1.1(b)(4)(C) (2000), and increased her offense level by 

another two levels, pursuant to USSG § 2F1.1(b)(6)(A) (2000). 

According to Hodge, these two sentencing enhancements 

impermissibly punish the same conduct in her case. 

 When determining a sentence, the district court must 

calculate the appropriate advisory guideline range under the 

United States Sentencing Guidelines (the Guidelines) and 

consider it in conjunction with the factors set forth in 18 

U.S.C. § 3553(a). Gall v. United States, 128 S. Ct. 586, 596 

(2007). In reviewing the district court’s application of the 

 3

 We have also carefully reviewed and reject as without 

merit Hodge’s remaining two challenges to her convictions: (1) 

that the district court committed reversible error by denying 

her motion for a mistrial based upon the government’s brief 

reference to Timothy McVeigh during its rebuttal closing 

argument; and (2) that the testimony of securities law expert 

Michael Ferraro should have been excluded as irrelevant and 

unfairly prejudicial. Neither argument warrants further 

discussion. 

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Guidelines, we review findings of fact for clear error and 

questions of law de novo. United States v. Green, 436 F.3d 449, 

456 (4th Cir. 2006). 

 Hodge’s double-counting argument is without merit. USSG 

§ 2F1.1(b)(4)(C) provides for a two-level increase if the 

offense involved “a violation of any prior, specific judicial or 

administrative order, injunction, decree, or process not 

addressed elsewhere in the guidelines . . . .” Id. (emphasis 

added). See also USSG § 2F1.1(b)(4)(C) (2000), comment. (n.6) 

(“This enhancement does not apply if the same conduct resulted 

in an enhancement pursuant to a provision found elsewhere in the 

guidelines.”). USSG § 2F1.1(b)(6)(A) (2000) provides for a twolevel increase if “the defendant relocated, or participated in 

relocating, a fraudulent scheme to another jurisdiction to evade 

law enforcement or regulatory officials . . . .” Id.

 Here, the district court increased Hodge’s offense level by 

two levels, pursuant to USSG § 2F1.1(b)(4)(C) (2000), based upon 

Hodge’s violation of the Cease and Desist Order by continuing to 

make sales presentations and to accept new members in FWC (with 

membership applications directed to a mailing address for FWC in 

Maryland) after she received the Cease and Desist Order. The 

district court then increased Hodge’s offense level by two 

levels, pursuant to USSG § 2F1.1(b)(6)(A) (2000), based upon her 

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and Dukes’ relocation of FWC to Washington, D.C., to evade the 

jurisdiction of the Maryland Securities Commission. 

 Contrary to Hodge’s position, the district court based 

these two enhancements on different conduct. Notably, in 

sentencing Dukes, the district court applied these same two 

enhancements, and we rejected Dukes’ identical double-counting 

argument on the same basis. See Dukes, 242 Fed. Appx. at 51. 

In sum, we reject Hodge’s double-counting argument as without 

merit. 

IV. 

 Hodge further contends the district court erred when it 

increased her offense level by two levels, pursuant to USSG 

§ 3B1.1(c) (2000), for her alleged aggravating role in the 

offense. The government concedes that Hodge’s sentence should 

be vacated and the case remanded for Hodge’s resentencing absent 

the two-level increase in her offense level imposed pursuant to 

USSG § 3B1.1(c)(2000). We agree. 

 USSG § 3B1.1(c) (2000) provides for a two-level increase 

“[i]f the defendant was an organizer, leader, manager, or 

supervisor in any criminal activity . . . .” Id. Application 

Note 2 to this guideline makes clear that “[t]o qualify for an 

adjustment under this section, the defendant must have been the 

organizer, leader, manager, or supervisor of one or more other 

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participants.” USSG § 3B1.1(c) (2000), comment. (n.2). 

Application Note 1 defines “participant” as “a person who is 

criminally responsible for the commission of the offense, but 

need not have been convicted.” Id. comment. (n.1). 

 Here, the district court based its application of USSG 

§ 3B1.1(c) (2000) on Hodge’s recruitment and supervision of 

church leaders, in particular Pastor Samuel Hairston and Bishop 

Ralph Dennis. However, as the government concedes, at Dukes’ 

resentencing on October 12, 2007, the district court found that 

Pastor Samuel Hairston and Bishop Ralph Dennis were not “other 

participants” in Dukes and Hodge’s scheme to defraud, within the 

meaning of USSG § 3B1.1(c) (2000), comment. (n.2). Thus, the 

basis upon which the district court applied USSG § 3B1.1(c) 

(2000) in sentencing Hodge is infirm. Accordingly, we vacate 

Hodge’s sentence on this basis and remand for resentencing 

absent application of the two-level increase pursuant to USSG 

§ 3B1.1(c) (2000).4

 4

 We have carefully reviewed and find without merit Hodge’s 

two remaining challenges to her sentence: (1) that the district 

court erred in increasing her offense level by two levels, 

pursuant to USSG § 3C1.1 (2000), for obstruction of justice; and 

(2) that the district court erred by using the preponderance of 

the evidence standard instead of the more rigorous beyond a 

reasonable doubt standard in making its factual findings for 

purposes of calculating her advisory sentencing range under the 

Guidelines. Neither argument warrants further discussion. 

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V. 

 In conclusion, we: (1) affirm Hodge’s convictions in toto; 

and (2) vacate her sentence and remand for resentencing absent 

application of a two-level increase in her offense level 

pursuant to USSG § 3B1.1(c) (2000). 

AFFIRMED IN PART; 

VACATED AND REMANDED IN PART