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. e du/thir dc ir c uit_2001/175Filed August 7, 2001

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 00-4330

UNITED STATES OF AMERICA

v.

AUSTIN O. OMORUYI, a/k/a

Charles Oloro a/k/a Bobby Pierce

Austin O. Omoruyi,

Appellant

On Appeal from the United States District Court for the Middle District of Pennsylvania (Criminal No. 00-00103-1) District Judge: Honorable Sylvia H. Rambo

Argued July 11, 2001

BEFORE: SLOVITER, ALITO, and GREENBERG, Circuit Judges

(Filed: August 7, 2001)

James V. Wade
Federal Public Defender Thomas A. Thornton (argued)
Assistant Federal Public Defender 100 Chestnut Street, Suite 306 Harrisburg, PA 17101

Attorneys for AppellantDavid M. Barasch

United States Attorney Kim Douglas Daniel Assistant United States Attorney Theodore B. Smith (argued) Assistant United States Attorney

P.O. Box 11754 Harrisburg, PA 17108

Attorneys for Appellee

OPINION OF THE COURT

GREENBERG, Circuit Judge.

This matter comes on before this court on Austin O. Omoruyi's appeal from a final judgment of convictio n and sentence entered on December 12, 2000, on a 14-coun t indictment charging him with mail fraud affecting a financial institution and money laundering. Omoruyi pled guilty to the mail fraud counts and does not challe nge his conviction or sentence on those counts. Rather, he limits his challenge to his conviction and sentence for mo ney laundering, arguing that the evidence was insuffici ent to establish that he had committed that crime or, alternatively, that the district court erred by app lying the money laundering rather than the fraud sentencing guidelines in calculating his sentence. Because we find that neither of Omoruyi's contentions has merit, we will affirm his conviction and sentence in all respects.

I. BACKGROUND

In February 1999, a person not known to the authori ties
stole seven blank "convenience checks" attached to the
bottom of First USA credit card statements from the mail in Texas. Later, in April 1999, a similarly unknown pe rson stole three blank American Express convenience chec ks
from the mail in New York.

In approximately March and April 1999, Omoruyi open ed three savings accounts at banks in the Middle Distr ict of

2Pennsylvania in the names of "Charles Oloro" or "Ro bert

Pierce." Thereafter, all ten of the stolen checks w ere made payable to Pierce or Oloro in amounts varying betwe en $5,100 and $9,890, and deposited in the savings acc ounts,
nine via the mail and the tenth at a teller's windo w.1 Later, on May 6, 1999, a counterfeit commercial check draw n against a law firm's account at a New York City ban k was mailed to one of the banks for deposit, but the ban k never credited the account for the proceeds of the check because it was suspicious of the transaction.

After the banks credited the accounts with the depo sits, Omoruyi began withdrawing funds from the accounts v ia automatic teller machine ("ATM") and teller window withdrawals.2 Most of the ATM withdrawals took plac e in New York and New Jersey, while most of the teller w indow withdrawals took place in Pennsylvania.

Ultimately, postal inspectors determined that Omoru yi was "Robert Pierce" and "Charles Oloro." Accordingl y, they established a surveillance on a Brooklyn mail drop Omoruyi had opened. When Omoruyi arrived at the mail drop o n June 1, 1999, the inspectors arrested him.

Following Omoruyi's arrest, the government first he ld him for prosecution in the United States District Court for the Southern District of New York on the charge of maki ng his third illegal entry into the United States. On Febr uary 2, 2000, based on a conviction predicated on his plea of guilty, that court sentenced him to 51 months incarceration. Meanwhile, on July 21, 1999, postal inspectors filed a complaint in the Middle District of Pennsylvania charging Omoruyi with mail fraud. On M arch 29, 2000, a grand jury returned a 14-count indictme nt, charging Omoruyi with six counts of mail fraud affe cting a financial institution and eight counts of money lau ndering.
The six counts of mail fraud stemmed from the maili ng of

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1. The Government states the deposits totaled $77,6 26, while Omoruyi states the total deposits were $80,424. The discrep ancy is not material to our disposition of this case.

2. Omoruyi admits he withdrew $33,900 from these ac counts, while the Government contends he withdrew almost $70,000. The parties do not suggest that the discrepancy is material here.

3the counterfeit check as well as five of the ten ch ecks to

banks in the Harrisburg area. The money laundering counts were based on eight teller window withdrawal s by Omoruyi, utilizing false identification, at Harrisb urg-area banks.

On June 8, 2000, Omoruyi pled guilty to the mail fr aud counts and submitted to a bench trial on the money laundering counts. The trial was premised almost en tirely upon stipulated testimony and exhibits establishing that Omoruyi "opened [three] savings accounts and withdr ew funds using the false names under which the savings accounts were established." Appellant's Br. at 6. A fter the court took the matter under advisement, on June 19, 2000, it found Omoruyi guilty on all eight money launderi ng
counts.

On December 11, 2000, the court sentenced Omoruyi t o 63 months incarceration on each mail fraud and mone y laundering count followed by three years of supervi sed release on each of these counts, and required him t o pay $1,400 in special assessments and restitution in th e amount of $31,209. The court ordered that the sente nces run concurrently with each other as well as concurr ently with Omoruyi's 51-month sentence imposed in the Southern District of New York. Thereafter, Omoruyi timely appealed to this court.

II. DISCUSSION

The district court had original jurisdiction over o ffenses against the United States pursuant to 18 U.S.C.S 32 31. We have jurisdiction over an appeal of a final decisio n by a district court pursuant to 28 U.S.C. S 1291 and ove r an appeal of a final sentence in a criminal case pursu ant to 18 U.S.C. S 3742(a).

A. Validity of the Money Laundering Conviction

Omoruyi contends first that there was insufficient evidence to establish the elements of money launder ing
because he did not conduct a financial transaction with "proceeds" of the mail fraud. He argues that the ma il fraud was not complete, and therefore did not yield "proc eeds"

4until he took possession of the cash credited to th e

accounts. Thus, in his view, the cash withdrawals c ould not serve as the basis for the money laundering counts. On this point, to the extent that the appeal involves legal determinations we exercise plenary review, but when the sufficiency of the evidence is challenged, we revie w the
record to determine if there was substantial eviden ce to support the verdict. See United States v. Conley , 37 F.3d 970, 975 (3d Cir. 1994); United States v. Pungitore , 910 F.2d 1084, 1129 (3d Cir. 1990).3

On this appeal, we are concerned with the construct ion of 18 U.S.C. S 1956(a)(1) which defines illegal mon ey laundering as:

Whoever, knowing that the property involved in a financial transaction represents the proceed s of some form of unlawful activity, conducts or attem pts to
conduct such a financial transaction which i n fact involves the proceeds of specified unlawful activity--

(A)(i) with the intent to promote the carryi ng on of specified unlawful activity; or

. . .

(B) knowing that the transaction is designed in whole or in part --

(i) to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity . . . .

Accordingly, section 1956(a)(1) sets forth the four elements of a money laundering offense: (1) an actual or att empted financial transaction; (2) involving the proceeds o f specified unlawful activity; (3) knowledge that the transacti on involves the proceeds of some unlawful activity; an d (4) either an intent to promote the carrying on of spec ified unlawful activity or knowledge that the transaction s were designed in whole or in part to conceal the nature, location, source, ownership, or control of the proceeds of sp ecified

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3. In fact, the principles applicable to the validi ty of the conviction

are essentially legal in character.

5unlawful activity.4 See id. ; see also United State s v. Morelli,

169 F.3d 798, 803 (3d Cir.), cert. denied, 528 U.S. 820, 120 S.Ct. 63 (1999).

In Conley, 37 F.3d at 978, we considered whether th e deposit of illegal gambling proceeds could support a conviction for the money laundering object of a con spiracy. There the defendant argued that the government fail ed to establish the essential elements of money launderin g because the conduct upon which the government based the charge was essentially the same as that supporting the illegal gambling charges. See id. We explained the
defendant's contention as follows:

McGrath contends before us that a wide varie ty of transactions involving the money placed into the video poker machines is necessarily part of the il legal gambling business, including collecting and counting money, dividing up money, transferring and transporting money, depositing money into ba nks and withdrawing money from banks. McGrath conten ds that this same conduct cannot be properly al leged to be money laundering.

Id. We disagreed with the defendant's contentions. See id. at 978-79. In doing so, we acknowledged that "[o]bv iously, whenever a defendant makes money from criminal acti vity he has something to do with it," and that "Congress did not enact money laundering statutes simply to add to th e penalties for various crimes in which defendants ma ke money." Id. at 979. But, we found that section 1956 (a)(1) addressed this concern, and therefore delineated cl early between the underlying offense and the money launde ring offense, by including an intent requirement. See id . We
stated:

Section 1956(a)(1), quite clearly, does not prohibit all
financial transactions that are conducted wi th the proceeds of specified unlawful activity. It only proscribes those transactions that are condu cted with the intent to promote certain further illega l activity, under subsection (A), or that are designed t o conceal under subsection (B).

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4. Omoruyi does not appear to contest the first and third elements.

6These requirements would preclude the appli cation of

section 1956 to non-money laundering acts su ch as a defendant's depositing the proceeds of unlaw ful activity in a bank account in his own name and using the money for personal purposes.

Id. (citing United States v. Jackson, 935 F.2d 832 (7th Cir. 1991)).

Furthermore, we indicated that for money to become "proceeds" it must be derived from a completed offe nse, or a completed phase of an ongoing offense. See id. a t 980. That being said, the conduct constituting the under lying offense conduct may overlap with the conduct consti tuting money laundering. See id. To that end, we found tha t the money, once collected from the various video poker machines, became " `proceeds of specified unlawful activity' " within the meaning of the money launder ing statute, even though there may have been some overl ap in the acts alleged to constitute the conduct of an il legal gambling business and money laundering. Id. (quotin g 18 U.S.C. S 1956(a)(1)).

Applying Conley here, it is clear that there was substantial evidence supporting Omoruyi's money laundering conviction. Omoruyi contends, in an argu ment similar to that of the defendant in Conley, that th e conduct charged as money laundering was the same conduct constituting mail fraud. Nevertheless, inasmuch as the money was deposited in bank accounts under false na mes, and Omoruyi used false identification to withdraw i t, he clearly conducted the transactions charged with the intent to conceal or disguise the nature, source, ownershi p and control of the proceeds of the mail fraud. As we no ted in Conley, section 1956 would not apply to a defendant 's depositing the proceeds of unlawful activity in a b ank account "in his own name" and using the money for personal purposes, as neither the "promote" or"conc eal" aspects of the money laundering statute would be me t. Id. at 979 (emphasis added). Here, however, there is su fficient evidence of concealment, and of Omoruyi's intent to conceal, to sustain his conviction.

Moreover, Conley establishes that, at the very late st, the

7money acquired through the mail fraud became "proce eds"

at the time the checks were honored by the various banks. As we found in Conley, proceeds are derived from an already completed offense or a completed phase of a n ongoing offense. See id. at 980. Here, the indictme nt charged six counts of mail fraud based on the maili ng of fraudulently obtained checks to the various banks, while the money laundering counts were based upon eight subsequent teller window cash withdrawals. Therefor e, the mail fraud offenses were complete as of the time th e six checks were placed in the mail for delivery to the banks, and thus the money thereafter derived from the chec ks constituted the proceeds of the already completed o ffenses.5

Notwithstanding Conley, Omoruyi also argues, citing United States v. Johnson, 971 F.2d 562, 569-70 (10t h Cir. 1992), that money cannot be "proceeds" until the de fendant has possession of it. Relying on the fact that the money was in bank accounts under false names, he contends tha t he was not in possession of it until he actually withd rew it and therefore the money could not be deemed proceeds un til that time.6 He argues that "[t]he essential determi nation is when and how could possession of the funds be obtai ned,"
and because "the funds were never credited to an ac count

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5. The crime of mail fraud is defined as:

Whoever, having devised or intending to devi se any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representatio ns, or promises, . . .

for the purpose of executing such scheme or arti fice or attempting so

to do, places in any post office or authorized depository for mail matter, any matter or thing whatever to be s ent or delivered by the
Postal Service . . . .

18 U.S.C. S 1341. In fact, even if the mail fraud w as not completed until the banks collected the proceeds, our result would not be altered as the mail fraud would have been completed before the cas h withdrawals.

6. To this end, Omoruyi also relies on the court's statement in United States v. Edgmon, 952 F.2d 1206, 1209 (10th Cir. 19 91), that "merely spending the proceeds of illegal activity does not violate the money laundering statute." As discussed previously, howev er, Omoruyi did not simply spend the proceeds of illegal activity. Rath er, he engaged in a financial transaction designed to conceal the sourc e, ownership and control of the proceeds.

8under the name Austin Omoruyi," he could not be dee med

to have possession over them until he had the cash. Appellant's Br. at 12.

In Johnson, however, the court found the defendant had possession over the money so that it constituted"pr oceeds"
once the wire transfers at issue were credited to h is account. See Johnson, 971 F.2d at 569-70. We recogn ize
that the account in Johnson was under the defendant 's name, while the accounts here were under false name s, but this factual distinction is not of legal consequenc e in the resolution of this case. Although deposited under f alse names, the money was credited to accounts over whic h Omoruyi had control, and therefore the money was in his possession. His utilization of fictitious names and identification to access the accounts enhances, rat her than detracts from the money laundering aspect of Omoruy i's
conduct as he used these names and identification t o conceal the source, ownership and control of the mo ney. Accordingly, we find that there was substantial evi dence supporting Omoruyi's convictions for money launderi ng which we thus affirm.7

B. Applicability of the Money Laundering Sentencing
Guideline

Alternatively, Omoruyi contends that the district c ourt erred in applying the money laundering sentencing guidelines, as opposed to the fraud guidelines, in calculating his sentence.8 This point is important because if everything else with respect to sentencing is eq ual, the money laundering guidelines will yield a higher sen tencing range than the fraud guidelines. Resolution of this issue requires us to consider preliminarily whether we sh ould apply amended money laundering guidelines, effectiv e on November 1, 2000, to Omoruyi's sentence as the cour t

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7. Moreover, Omoruyi contends that the government's action in prosecuting him for money laundering was "piling on " in violation of its own prosecution policies. We see no basis for this contention but in any event the policy, even if violated, does not create substantive rights entitling him to relief on this appeal. See Pungito re, 910 F.2d at 1120.

8. We review the district court's application of th e sentencing guidelines de novo. See United States v. Bockius, 228 F.3d 305 , 308 (3d Cir. 2000).

9sentenced him on December 11, 2000, or whether we

instead should apply the guidelines in effect at th e time of his offense. In light of our recent decision in Uni ted States v. Diaz, 245 F.3d 294 (3d Cir. 2001), we conclude t hat ex post facto principles preclude the application of t he amended guidelines here.

As a general rule, sentencing courts must apply the guidelines in effect at the time of sentencing. See United States v. Menon, 24 F.3d 550, 566 (3d Cir. 1994). H owever, where application of the guidelines in effect at se ntencing would result in a more severe penalty than applicat ion of those in effect at the time of the offense, the cou rt, to avoid an ex post facto violation, must apply the guidelin es in effect at the time of the offense. See, e.g., Unite d States v. Brannan, 74 F.3d 448, 450 n.2 (3d Cir. 1996); Unite d States v. Cherry, 10 F.3d 1003, 1014 (3d Cir. 1993) . Here, the conduct forming the basis of Omoruyi's convicti on occurred between March and June 1999, well prior to the effective date of the amended guidelines, while he was sentenced on December 11, 2000, approximately one a nd
one-half months afterwards. While the district cour t did not discuss the effect of the amendments to the guideli nes and thus did not note the ex post facto problem we have identified, in fact it sentenced Omoruyi without ap plying the November 1, 2000 amendments.9 Nevertheless, unl ess the November 1, 2000 amendments made the penalty mo re severe we should apply them on this appeal and shou ld take them into account when considering Omoruyi's a ppeal of his sentence. Therefore, we must consider in our sentencing discussion whether Omoruyi would be subj ect to a more severe penalty under the amended guidelin es than under the guidelines in effect at the time of his

offense.

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9. The presentence report indicated that the"senten cing guidelines effective November 1, 1998, were used in [its] calc ulations." The court,

in turn, indicated that it used the "factual findings and the guideline application in the presentence report" in imposing sentence with exceptions unrelated to the adoption of the Novembe r 1, 2000 amendments. In fact, we are not even certain whethe r the court or the parties at the time of the sentencing were aware of the November 1, 2000 amendments for, as Omoruyi points out, "[t]here was no discussion of the amendments at sentencing." Reply Br. at 7.

10In Diaz, we considered whether the November 1, 2000

amendments to the sentencing guidelines should appl y retroactively to the defendant's sentence. See Diaz , 245 F.3d at 296. Determination of this issue required u s to consider whether the amended guidelines altered the law in effect at the time of the offense or merely clarifi ed the law so that there was no substantive change between the dates of the offense and the sentencing. See id. at 301. After comparing the law prior to the amendments, namely o ur decision in United States v. Smith, 186 F.3d 290 (3 d Cir. 1999), superseded by rule as stated in Diaz, 245 F. 3d at 294, and the amended guidelines, we concluded that Smith, and its approach to applying the guidelines, is no longer "good law." See Diaz, 245 F.3d at 303. 10 In cases such as that here, in which several counts, including mail fraud and money laundering, have been grouped pursuant to U.S.S.G. S 3D1.2(b), the amendments make it mandato ry for the sentencing court to apply the guideline car rying the highest applicable offense level. See id. Under the guidelines prior to the amendments, however, the sentencing court was to conduct a heartland analysi s of the guidelines, determine whether the defendant's condu ct is atypical of cases usually sentenced under that guid eline and, if so, determine what guideline would be more appropriate under the circumstances. See id. at 301 (citing Smith, 186 F.3d at 297-98).

While it is true that the process that Smith requir ed constituted a legal determination, see Smith, 186 F .3d at 297-98, still it introduced a degree of uncertainty into the selection of the applicable guidelines that the Nov ember 1, 2000 amendments eliminate. Thus, it is understandab le
that in Diaz we found that the amendments substanti vely changed the sentencing guidelines as interpreted by Smith and its progeny, and that application of the amende d guidelines to a sentence issued prior to their effe ctive date was precluded by ex post facto considerations. See Diaz, 245 F.3d at 305. Diaz clearly is controlling here.1 1

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10. Of course, we did not mean that Smith was not " good law" with respect to cases involving offenses committed prior to November 1, 2000. 11. In theory in Diaz we could have held that if un der Smith the preNovember 1, 2000 money laundering guidelines were a pplicable then application of the amendments would be appropriate as there would not be an ex post facto problem. We did not, however, u se this circular reasoning.

11Accordingly, we will apply the pre-amendment guidel ines,

meaning the analysis established in Smith and its p rogeny, to this case and thus in this regard will use the s ame methodology in determining the applicable guideline s as the
district court.12

Pursuant to Smith, we conduct a heartland analysis of the money laundering guidelines to determine whethe r the conduct being punished is "atypical" of the conduct usually sentenced under the guidelines. See Smith, 186 F.3d at 297. If so, then we are to determine what other gui delines would be more appropriate for sentencing. See id.

In Smith, the defendants were convicted of conspira cy to defraud, interstate transportation of stolen proper ty, causing unlawful interstate transportation with int ent to distribute stolen property, and money laundering. S ee id. at 296-97. The money laundering count was based on che cks written by another defendant on the proceeds of kic kbacks where the defendant ordered that many of these chec ks be written to his creditors, as opposed to directly to him. See id. The district court grouped the four offenses an d applied the money laundering guideline. See id. at 292. On appeal,

we vacated the defendants' sentences and remanded t he case for resentencing under the fraud guideline. Se e id. at

300.

Applying the analysis described above, we found tha t the use of the money laundering guidelines was inapprop riate. See id. We concluded that the defendants engaged in conduct inconsistent with concealment, such as leav ing a paper trail, that any efforts at concealment were disingenuous, and that when considered with the ent ire course of conduct, the money laundering was an inci dental by-product of the fraud. See id. Inasmuch as we dee med
this conduct to be outside of the heartland of cond uct intended to be punished by the money laundering sta tute, the money laundering guidelines did not apply. See id.

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12. In Hameen v. Delaware, 212 F.3d 226, 237-38 (3d Cir. 2000), cert. denied, 121 S.Ct. 1365 (2001), we recognized the pr inciple that if a discretionary sentence becomes mandatory after the offense is committed there is a ex post facto violation. This principle is similar to that applied
in Diaz.

12Since then, we have decided several cases applying the

Smith analysis, the most relevant of which are Unit ed States v. Mustafa, 238 F.3d 485 (3d Cir. 2001), and Diaz. In
Mustafa we held that the district court did not com mit plain error in sentencing the defendant under the m oney laundering guidelines. See id. at 496. There, the d efendant, while operating a supermarket, deposited more than $1.5 million worth of fraudulently obtained food stamps into his bank account. See id. at 487. In order for him to p articipate in the food stamp program, the government required the defendant to submit an application to the United St ates Department of Agriculture acknowledging that the ba nk account would be used to deposit food stamps obtain ed in accordance with governing law. See id. In addition, with each stamp deposit the defendant completed a requir ed "redemption certificate" which purported to verify that the food stamps had been obtained legally. See id. Fol lowing the defendant's guilty plea to, among other things, 40 counts of money laundering, the district court util ized the money laundering guidelines and sentenced him to 13 5 months imprisonment. See id. at 488-89.

On appeal, we rejected the defendant's argument tha t the sentencing court improperly applied the money laund ering guidelines because his conduct did not fall within the heartland of the money laundering statute, namely c onduct involving the proceeds of large-scale drug traffick ing and organized crime. See id. at 496. In doing so we fou nd that the food stamp deposits were separate and distinct from the criminal activity from which they derived, namely t he purchase of food stamps from persons involved in th eir illegal trafficking. See id. at 495. Further, with each deposit, the defendant represented that he had rece ived the food stamps legitimately. See id. at 495-96. Theref ore, his conduct was intended to create an appearance that t he illegally obtained proceeds were themselves legitim ate. See id. at 496. That the defendant had to deposit the f ood stamps for them to have any cash value was not
determinative because he still intended to and was concealing the original source of the funds. See id

. Accordingly, we affirmed the district court's appli cation of the money laundering guidelines. See id.

13We reached the opposite result, however, in Diaz . There,

the defendant pled guilty to a four-count indictmen t charging her with, among other things, fraud and mo ney laundering resulting from a scheme to obtain federa l student financial assistance fraudulently on behalf of her cosmetology school. See Diaz, 245 F.3d at 296-98. T he
district court calculated her sentence based on the guidelines applicable to money laundering, and the defendant appealed. See id. at 296.

On appeal, we examined Smith and the cases applying its methodology. See id. at 305-08 (citing and discussi ng Mustafa, 238 F.3d at 488-96; United States v. Bocki us, 228 F.3d 305, 309-13 (3d Cir. 2000); United States v. C efaratti, 221 F.3d 502 (3d Cir. 2000); Smith, 186 F.3d at 297 -300). We found these cases rejected a reading of Smith t hat would limit the use of the money laundering guideli nes only to cases involving the proceeds of drug trafficking and organized crime. See id. at 309. Instead:

Mustafa, Bockius, Cefaratti, and Smith all a re in accord that the heartland of the money laundering g uidelines includes, in addition to drugs and organized crime, cases involving typical money laundering, fi nancial transactions that are separate from the unde rlying crime and that are designated either to make illegally obtained funds appear legitimate, to conceal the source of some funds, or to promote additional crim inal conduct by reinvesting the funds in addition al criminal

conduct.

Id. at 309-10. We distinguished these types of case s from "ordinary cases of routine fraud, . . . the simple receipt and deposit or use of illegally obtained funds, or . . . cases in which any money laundering is not separate from the underlying fraud, but merely an `incidental by prod uct' of that underlying fraud." Id. at 310. Therefore, "whe re the defendant has not made a serious, concerted effort to conceal or to legitimize the funds or to reinvest t hem in additional criminal activity, it is not appropriate to sentence that defendant under the money laundering guideline ." Id.

Applying these principles, we found that the distri ct court improperly sentenced the defendant under the money

14laundering guidelines rather than the fraud guideli nes. See

id. at 311. The defendant, while having violated th e money laundering statute by engaging in a monetary transa ction in criminally derived property, neither used the pr oceeds of her fraudulent activities to promote additional cri minal conduct, nor made any effort to disguise the source or nature of the funds.13 See id. We deemed the defend ant's deposit of the student assistance funds to be insep arable from and an incidental by-product of the fraud and minimal in comparison to the totality of the unlawf ul conduct. See id. Therefore, we vacated the defendan t's sentence and remanded the matter for resentencing u nder the fraud guidelines. See id. at 312.

Omoruyi contends his sentence should have been calculated under the fraud guidelines because his m oney laundering conduct was minimal and incidental to th e mail fraud. We reject that argument and hold that the co urt properly sentenced Omoruyi under the money launderi ng guidelines. First, the conduct charged in the indic tment, eight teller window withdrawals, was separate from the underlying crime of obtaining fraudulently and mail ing the convenience checks to the various banks. Further, t his case is distinguishable from Diaz as there the money lau ndering count was predicated only on the defendant's deposi t of the
federal student assistance checks in the school's b ank account. Arguably, had Omoruyi merely deposited the checks, his conduct would not be deemed separate fr om the underlying crime, and this case would be more akin to Diaz. However, Omoruyi took the additional step of withdrawing the proceeds of his criminal conduct, a n activity clearly not part of the underlying mail fr aud.

Second, Omoruyi's conduct involved a concerted effo rt to conceal or to legitimize the funds obtained through the mail fraud. In that regard, this case is quite similar t o Mustafa.

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13. Diaz pled guilty to violating 18 U.S.C. S 1957( a) which makes it illegal to "knowingly engage[ ] . . . in a monetary transac tion in criminally derived property . . . and is derived from specifie d unlawful activity. .

. ." Therefore, unlike section 1956(a)(1), section 1957( a) contains neither a promote nor a conceal element. That Diaz was prosec uted under a different money laundering statute, however, does n ot affect our analysis
under Smith.

15In conduct similar to that of the defendant in Must afa,

though on a lesser scale, Omoruyi deposited approxi mately $75,000 worth of fraudulently obtained convenience checks in various bank accounts. Also, as in Mustafa , the deposits
were intended to conceal the source and nature of t he proceeds and create an appearance of their legitima cy. Moreover, Omoruyi laundered the proceeds through accounts he opened using two different aliases, fur ther compounding his attempts to conceal the funds and h is

control over them.

Finally, in Mustafa we found that the fact that the defendant had to deposit the food stamps for them t o have value did not negate the fact that he engaged in mo ney laundering. See Mustafa, 238 F.3d at 496. This conc lusion renders unmeritorious Omoruyi's contention that the mail fraud was not complete until he received the funds from those offenses because before then the proceeds of the criminal conduct were of no use. Therefore, we find that under the version of the sentencing guidelines prio r to their November 1, 2000 amendment, the district court appropriately sentenced Omoruyi under the guideline s applicable to money laundering.

III. CONCLUSION

For the foregoing reasons, we will affirm the judgm ent
and sentence of the district court entered December 12,

2000.

A True Copy:

Teste:

Clerk of the United States Court of Appeals
for the Third Circuit

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