* Circuit Judge of the United States Court of Appeals for

the Seventh Circuit, sitting by designation.

1

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

_________________________

No. 99-20695

_________________________

UNITED STATES OF AMERICA,

Plaintiff-Appellee-Cross-Appellant,

v.

ALI REZA DADI, also known as Raymond Dadi,

Defendant-Appellant-Cross-Appellee.

_________________________________________________________________

Appeals from the United States District Court

for the Southern District of Texas

December 20, 2000

Before KING, Chief Judge, CUDAHY*, and WIENER, Circuit Judges.

CUDAHY, Circuit Judge:

On February 23, 1999, a grand jury charged that Ali Reza 

Dadi, Homa Dadi (his sister) and Siamak Mackvandian entered into

an agreement among themselves and others to execute a scheme to

defraud federally insured financial institutions. Dadi was

convicted and sentenced to serve 84 months in prison. He appeals

and we affirm.

I.Factual and Procedural Background

The 17-count superseding indictment charged Ali Reza Dadi
2

with one count of conspiracy, in violation of 18 U.S.C. § 371;

one count of aiding and abetting bank fraud, in violation of 18

U.S.C. § 1344; and 15 counts of aiding and abetting the conduct

of monetary transactions with criminally derived property, in

violation of 18 U.S.C. § 1957. A jury trial was held in the

Southern District of Texas, Houston Division, and on March 26,

1999, the jury found Dadi guilty on all counts. On April 16, the

district court denied Dadi’s post-verdict motion for a judgment

of acquittal and then ordered the preparation of a pre-sentence

investigation report (PSR). In carrying out that task, the

probation officer grouped the offenses and based Dadi’s offense

level on the Sentencing Guideline applicable to a violation of

the money laundering statute, 18 U.S.C. § 1957. Under that

Guideline, Dadi’s base offense level was 17. Four levels were

then added under U.S.S.G. § 2S1.2(b)(2) for the amount of money

derived from the bank fraud (more than $600,000). Four

additional levels were added since Dadi was an organizer or

leader in the offense which involved more than five participants. 

See U.S.S.G. § 3B1.1(a).

In addition, Dadi had four prior convictions, giving him six

criminal history points. Further, because Dadi committed this

offense while awaiting designation to a prison facility on a

prior obstruction of justice conviction, two more points were

added to his criminal history score under U.S.S.G. § 4A1.1(d). 
3

Given his offense level of 25 and criminal history category of IV

(based on his eight criminal history points), Dadi’s imprisonment

range was 84 to 105 months.

Before sentencing, the government filed a notice of intent

to enhance the sentence for committing the offense while on

release on another offense (18 U.S.C. § 3147 and U.S.S.G. §

2J1.7) but the district court rejected this enhancement. On July

12, the district court sentenced Dadi to serve 84 months in

prison, followed by a five-year term of supervised release. The

court also ordered Dadi to pay $161,239 in restitution and $1,700

in special assessments. The clerk entered a notice of appeal on

Dadi’s behalf, and a federal defender was appointed to represent

him on appeal. The government cross-appealed the district

court’s rejection of the § 2J1.7 enhancement. 

Viewing the facts in the light most favorable to the 

verdict, we will attempt to describe the multifarious scheme

concocted by Dadi and his co-conspirators. They had access to

numerous bank accounts into which they deposited counterfeit

checks. The various parties to the conspiracy later withdrew

funds from these accounts to use for their own benefit. The

process began when Dadi persuaded Yvonne and Yvette Reyes, his

wife’s cousins, to allow him to use the bank account of their

deceased mother, Stella Reyes. Dadi offered to pay the sisters

$10,000 for the use of Stella’s account at Texas Commerce Bank. 
2According to Mackvandian’s testimony, Dadi had given him

this counterfeit check, and the handwriting on the payable-to

line looked like Dadi’s. He also testified that the $9,000

remainder was received in cash, and split between Dadi and him.

3Loretta Wolsey, a lead analyst for the fraud prevention

unit of the Chase Bank of Texas, testified that Khayambashi had

opened the Southwest Oil Company account. Khayambashi also owned

N&M Petrochemical. The $53,000 counterfeit check deposited into

that account was drawn on one Ebrahim Yazdanpanah’s account. 

Khayambashi was indicted by a Texas grand jury in connection with

that counterfeit check.

4

He later deposited a counterfeit check in the amount of $95,728

into that account. That money was later withdrawn, re-routed

through the account of one of Dadi’s confederates and then in the

form of cash dropped into Dadi’s pocket. 

Dadi also deposited counterfeit checks into the bank

accounts of Southwest Oil Company and N&M Petrochemical Company,

which were maintained at Texas Commerce Bank and Highlands Bank,

respectively. Those accounts had been opened by Naser

Khayambashi. On May 30, 1997, a counterfeit check for $130,000,

drawn on Gillman Auto Group’s account at Nationsbank in North

Carolina, was deposited into the Southwest Oil account at Texas

Commerce Bank. On June 5, a $77,650 counterfeit Gillman check

was deposited into the same account.

A check for $50,000 was later drawn on the Southwest Oil

account, payable to Siamak Mackvandian, who used the proceeds to

purchase a Texas Commerce Bank check for $41,000 payable to

Logistic Express.2 This check was signed by Khayambashi.3

Mackvandian deposited that check into his Logistic Express
5

account at Wells Fargo Bank, and—-two days later—-issued a check

drawn on that account for $30,000, payable to Dadi. Dadi used

the proceeds of this check to purchase a Wells Fargo cashier’s

check in the amount of $20,500, which he deposited into his Frost

National Bank account. Later, Mackvandian and Dadi issued a

check for $4,000, drawn on the Wells Fargo Logistic Express

account, payable to Mackvandian. The proceeds were provided to

Dadi. 

A check was drawn on the N&M Petrochemical account (into

which counterfeit checks had been deposited) for $52,000, payable

to Homa Dadi, who deposited the check into her Coastal Banc

account. The drawee was designated in Dadi’s handwriting. The

following day, Dadi and Homa Dadi issued a check drawn on N&M

Petrochemical for $40,000, payable to Dadi. Dadi then deposited

that amount into his Frost National Bank account. Later, Dadi

and Homa Dadi drew a check on Homa Dadi’s Coastal Banc account

for $1,500, payable to Dadi. 

Dadi issued a check for $9,500, payable to Yvette Reyes. 

Seven days later, Dadi issued three checks payable to Yvette

Reyes: one for $9,000 and two for $16,000. Yvonne and Yvette

Reyes used these funds to purchase a house for the use and

benefit of Dadi’s family. Dadi and his wife Carmen later sold

the house without the knowledge of the Reyes sisters. The

following month, a counterfeit check drawn on “Southern Polymer”
4Harry Watson, a controller with a company called Southern

Polymer, testified that this check was not authentic, and the

signatures on the check were forged.

6

for $95,728 was deposited into the account of Stella Reyes at the

Texas Commerce Bank; Dadi allegedly made this deposit.4 Later

that month, Dadi and Mackvandian issued a check for $42,500,

drawn on the Stella Reyes account and payable to Mackvandian, who

deposited this check into his account at the Frost National Bank. 

Mackvandian then issued a check drawn on that account payable to

“cash” and used the proceeds to purchase a cashier’s check

payable to All American Delivery. This check was deposited into

Mackvandian’s All American Delivery account at Bank United. 

Mackvandian later used the proceeds to purchase a cashier’s check

for $25,000 payable to Logistic Express and deposited that into

the Wells Fargo Bank Logistic Express account. He then drew a

$24,5000 check on this account and gave the proceeds to Dadi.

The $95,728 deposit into the Stella Reyes account was the

basis for the charge of bank fraud. The checks drawn against the

counterfeit funds in amounts exceeding $10,000 were the basis for

the money laundering violations.

II.Sufficiency of the Evidence

In determining whether the evidence was sufficient to

support a conviction, we review all the evidence in the light

most favorable to the verdict to determine whether a rational

trier of fact could have found the defendant guilty beyond a
7

reasonable doubt. See Jackson v. Virginia, 443 U.S. 307, 319

(1979); United States v. Aubin, 87 F.3d 141, 144 (5th Cir. 1996);

United States v. McDow, 27 F.3d 132, 135 (5th Cir. 1994) (also

noting that the reviewing court must “accept all reasonable

inferences which tend to support the jury’s verdict”). “The

evidence need not exclude every reasonable hypothesis of

innocence or be wholly inconsistent with every conclusion except

that of guilt, and the jury is free to choose among reasonable

constructions of the evidence.” United States v. Bermea, 30 F.3d

1539, 1551 (5th Cir. 1994), cert. denied, 513 U.S. 1156 (1995).

Dadi first argues that there was insufficient evidence to

sustain a conspiracy charge. Under 18 U.S.C. § 371, the

government must prove that (1) two or more persons conspired to

pursue an unlawful objective; (2) the defendant knew of the

unlawful objective and voluntarily agreed to join the conspiracy

with the intent to further the objective; and (3) one or more of

the members of the conspiracy committed an overt act in

furtherance of the objective of the conspiracy. See United

States v. Pettigrew, 77 F.3d 1500, 1519 (5th Cir. 1996); United

States v. Campbell, 64 F.3d 967, 975 (5th Cir. 1995). The

government must prove the same degree of criminal intent as is

necessary for proof of the underlying substantive offense. See

United States v. Bordelon, 871 F.2d 491, 493-94 (5th Cir.), cert.

denied, 493 U.S. 838 (1989). In Pettigrew, all the evidence
8

pointing toward the agreement and intent elements of the crime

was circumstantial. The court affirmed the conviction because

the evidence was such that a rational juror could infer both

these elements of the offense. See Pettigrew, 77 F.3d at 1519. 

Dadi argues that here there was no evidence of an agreement,

citing Mackvandian’s testimony that there was no agreement to

defraud a bank, and that he was unaware that any of the checks

involved in the scheme were counterfeit. Dadi also cites the

testimony of Yvette Reyes that she never agreed to defraud a

bank. But these disclaimers must be weighed against all the

evidence of activity from which an unlawful agreement may be

inferred.

The government, of course, contends that the evidence

indicating a conspiracy outweighs Mackvandian’s and Yvette Reyes’

disclaimers. Several pieces of evidence support this argument:

for example, Dadi and Khayambashi had a close relationship; Dadi

recommended Khayambashi to the Wallis State Bank; Dadi’s

fingerprints were found on counterfeit checks drawn on

Khayambashi’s account; and checks drawn on that account were

passed through Homa Dadi’s account. Dadi assisted Mackvandian

and Khayambashi in acquiring bank accounts through which

counterfeit checks were later funneled. Mackvandian also

admitted at trial that he thought he and Dadi were using other

people’s money without their knowledge or consent. And Dadi
9

received most of the profits from the transactions involving the

counterfeit checks. 

In some situations, circumstantial evidence is sufficient to

support a finding of fraudulent intent. See Crowe v. Henry, 115

F.3d 294, 297 (5th Cir. 1997); see also United States v. Ryan,

213 F.3d 347, 350 (7th Cir. 2000) (“Intent to defraud can be

proven by circumstantial evidence and by inferences drawn from

the scheme itself.”). “Fraudulent intent may be found from

circumstantial evidence that one party arranged matters with

another party in such a way as would facilitate the commission of

fraud, especially where the evidence further shows that the first

party gained money or advantage at the expense of the second.” 

Crowe, 115 F.3d at 297. Viewing the evidence in the light most

favorable to the verdict, we find that the circumstantial

evidence available in this case is more than sufficient to

support an inference that Dadi was guilty of the § 371

conspiracy.

Dadi next argues that there was insufficient evidence to

show specific intent to defraud a bank or that he voluntarily

participated in an agreement to defraud a bank. Under 18 U.S.C.

§ 1344, the government must prove beyond a reasonable doubt that

the defendant “knowing[ly] execute[d] or attempt[ed] to execute a

scheme or artifice (1) to defraud a financial institution; or (2)

to obtain any property owned by, or under the custody or control
10

of, a financial institution, by means of false or fraudulent

pretenses, representations or promises.” Campbell, 64 F.3d at

975. 

The bank fraud charge is premised on the $95,728 check that

was deposited in the account of Stella Reyes at the Texas

Commerce Bank. Dadi argues that because Mackvandian and Yvette

Reyes testified that they never agreed with Dadi to defraud a

bank, and because there was no proof that Dadi knew the $95,728

check was counterfeit, there was insufficient evidence of bank

fraud. These assertions do nothing to explain what Dadi thought

he was doing when he deposited a $95,728 Southern Polymer check

he claims he didn’t know was counterfeit, into the bank account

of a deceased woman, and later withdrew funds from that account. 

This evidence is sufficient to persuade a reasonable jury of

Dadi’s guilt. 

Dadi also disputes the sufficiency of the evidence to

support the aiding and abetting charges. To convict under 18

U.S.C. § 1957, the government must prove that “the defendant

‘knowingly engage[d] or attempt[ed] to engage in a monetary

transaction in criminally derived property that is of a value

greater than $10,000 and is derived from specified unlawful

activity.’” United States v. Dupre, 117 F.3d 810, 821 (5th Cir.

1997) (citing 18 U.S.C. § 1957(a)). To prove that a defendant

aided and abetted the commission of a criminal offense, the
11

government must show that the defendant intentionally associated

with, and participated in, the criminal venture and acted to make

the venture succeed. See United States v. Beuttenmuller, 29 F.3d

973, 981 (5th Cir. 1994). 

Most of the counts at issue involve banking transactions by

Mackvandian. Because Mackvandian is implicated as a

counterfeiter and as a participant in this scheme, Dadi argues

that—-to the extent that Mackvandian’s testimony implicated

Dadi—-Mackvandian’s testimony is not credible. This assertion is

unavailing on appeal. The credibility of witnesses is a matter

for the jury and its determinations demand deference. See United

States v. Meshack, 225 F.3d 556, 567 n.6 (5th Cir. 2000).

Dadi also argues that the only evidence against him is his

familial relationships with Homa Dadi, Yvette, Yvonne and Stella. 

However, Dadi is asking this court to ignore persuasive evidence

that he assisted others in procuring bank accounts for the

purpose of depositing and withdrawing funds from counterfeit

checks. The evidence viewed in the light most favorable to the

verdict appears to support an inference that the elements of the

aiding and abetting charge were present.

III.The Organizer/Leader Enhancement

This court reviews a district court’s finding that a

defendant is an organizer or leader for clear error. See United

States v. Ronning, 47 F.3d 710, 711 (5th Cir. 1995); United
5Dadi cites two cases in which a court of appeals reversed

the decision applying the enhancement because there was no proof

that the defendant exercised control over the others involved. 

United States v. Mustread, 42 F.3d 1097, 1104-05 (7th Cir. 1994);

United States v. Sostre, 967 F.2d 728, 733 (1st Cir. 1992). 

These cases are in other circuits and are factually

distinguishable. 

12

States v. Liu, 960 F.2d 449, 456 (5th Cir. 1992). As long as the

sentencing court’s finding on a sentencing factor is plausible in

light of the record read as a whole, a factual finding is not

clearly erroneous. See United States v. Valencia, 44 F.3d 269,

272 (5th Cir. 1995). Absent some evidence of clear error, this

court must affirm the district court’s finding, “even [if] the

district court failed to specifically articulate a factual basis

for its determination.” Valencia, 44 F.3d at 273. 

The district court concluded that Dadi was an organizer or

leader, and therefore added four levels to his base offense

level. Under the Sentencing Guidelines, a court may increase a

defendant’s conspiracy offense level by four levels “[i]f the

defendant was an organizer or leader of a criminal activity that

involved five or more participants or was otherwise extensive.” 

U.S.S.G. § 3B1.1(a). 

Dadi argues that this enhancement is inapplicable because

there was no proof that he controlled or influenced anyone

involved in the offense.5 The PSR recommended the enhancement

based, Dadi contends, simply on the fact that Dadi suggested to

the others that they commit the offense—-a fact that is not
13

sufficient to establish that he exercised control or influence

over the others. Even if he was a major participant in the

offense, he argues, this is still not enough to justify the

enhancement absent some showing of control or influence. See

United States v. Castellone, 985 F.2d 21, 26 (1st Cir. 1993);

United States v. Sostre, 967 F.2d 728, 733 (1st Cir. 1992);

United States v. Litchfield, 959 F.2d 1514, 1522-23 (10th Cir.

1992). We find, however, that the conclusion that Dadi is an

organizer or leader is plausible in light of the record.

Dadi also contends that the offense did not involve five or

more participants—-another factor required to justify the

enhancement. Dadi cites United States v. Maloof, 205 F.3d 819,

830 (5th Cir. 2000), for the proposition that failure to find

that each of the people identified was criminally responsible

requires reversal of the application of the enhancement. 

However, Maloof also makes clear that the additional participants

need not have been convicted of the offense. See id. Dadi

offers nothing to refute the PSR finding that he was an

organizer, and that Mackvandian, Yvette Reyes, and Yvonne Reyes,

Homa Dadi, Naser Khayambashi and Mike Maharaj were involved in

the scheme. While the evidence on the involvement of the latter

three is weaker than the evidence of the involvement of

Mackvandian and the Reyes sisters, that—-without more—-is
6In addition, the Guideline is applicable to schemes

involving fewer than five participants if the scheme “was

otherwise extensive.” U.S.S.G. § 3B1.1(a). The plausibility of

the involvement of five or more participants is therefore

buttressed by the clear plausibility that a court could find the

scheme to be “otherwise extensive.” 

14

insufficient to support a finding of clear error.6

Dadi further argues that he could not have been an organizer

or leader because he did not receive a larger share of the

profits than the other codefendants. Dadi bases this conclusion

on the fact that the total loss was found to be $807,100, and

Dadi received only $102,500. That Dadi received “only” $102,500

does little for his argument that he was not an organizer or

leader, and he does not advance any argument that another scheme

participant received a greater share of the profits.

Given Dadi’s weak attacks on the district court finding that

he was an organizer or leader, and the wealth of evidence from

which such a finding could be inferred, we see no reason to

disturb this sentence. It is entirely plausible that—-based on

the evidence viewed as a whole–-a court could conclude that Dadi

was an organizer or leader. 

IV.Foreseeability of Loss from the Khayambashi Checks

The district court found that the amount of the loss

attributable to Dadi was $807,100. Had the Khayambashi checks

been excluded, the total loss attributable to Dadi would have

been $95,728. Thus, without the Khayambashi checks, Dadi’s base
7The Guidelines provide for a one-level increase if the loss

exceeds $100,000. If it had excluded the Khayambashi checks, the

district court may have decided to include other checks

attributable to Dadi that it did not consider at sentencing. 

Dadi concedes that such a calculation could have led to the

conclusion that Dadi profited by $102,500 from counterfeit checks

totaling $198,728.

15

offense level would have been increased—-at most—-by only one

level (instead of four) under the relevant Sentencing Guidelines. 

See U.S.S.G. §§ 2S1.2(b)(2); 2S1.1(b)(2)(B).7

The losses to be considered were attributed to the $53,000

Yazdanpanah check, the $95,728 Southern Polymer check (deposited

into Stella Reyes’ account) and the forged Gillman checks for

$130,000, $77,650, $125,000, $75,750, and $249,972. All these

checks were deposited into one of Khayambashi’s accounts

(Southwest Oil, N&M Petrochemical or his personal account at the

Wallis State Bank). Dadi argues that, even if the evidence was

sufficient to convict him, the trial court erred in attributing

to him the six checks deposited into Khayambashi’s accounts.

In order to find a defendant accountable for a coconspirator’s acts, the trial court must expressly find that the

acts were reasonably foreseeable to the defendant. See United

States v. Evbuomwan, 992 F.2d 70, 74 (5th Cir. 1993) (to hold a

defendant accountable for losses arising from a check fraud

scheme, the scheme must be within the scope of the conspiracy and

the losses must be foreseeable); United States v. Studley, 47

F.3d 569, 574 (2d Cir. 1995) (for a defendant to be sentenced
16

based on the acts of a co-conspirator, “a district court must

make a particularized finding as to whether the activity was

foreseeable to the defendant.”). 

Dadi contends that only the $95,728 check should be

attributed to him because the other checks were presented for

deposit into Khayambashi’s accounts——something not reasonably

foreseeable to Dadi. Dadi’s contention is based on the thesis

that there was no connection between him and Khayambashi aside

from the fact that Dadi “allegedly” referred Khayambashi to the

Wallis State Bank. The government did not establish, Dadi

argues, that there was an agreement between Dadi and Khayambashi,

that—-even if there were such an agreement–-the Khayambashi

checks were within the scope of that agreement, or that the

checks were reasonably foreseeable to him. But see United States

v. Sneed, 63 F.3d 381, 389-90 (5th Cir. 1995)(sufficient evidence

of money laundering where the scheme was defendant’s idea and

defendant profited).

The government argues that the record supports the

foreseeability of these losses, citing the facts that (1)

Patricia Mackvandian (Mackvandian’s wife) issued a $30,000 check

payable to Dadi from an account into which Mackvandian deposited

a Khayambashi check; (2) the handwriting on a Gillman Properties

counterfeit check—-deposited into Khayambashi’s Wallis State Bank

account—-resembled that on other checks prepared by Dadi; and (3)
17

the other checks involved Mike Maharaj, the “mysterious” man with

whom Dadi dealt in counterfeit checks, according to Mackvandian’s

testimony. The government notes that a “common denominator” in

the transactions involving these checks was Mike Maharaj. Also,

the government argues that the trial testimony traces the

proceeds of all these checks back to Dadi.

 Dadi argues that, because the amount of the loss was not

reasonably foreseeable to him, the trial court erred in

attributing that amount to him. See United States v. Scurlock,

52 F.3d 531, 539 (5th Cir. 1995) (noting that defendants are only

responsible for the amount of loss reasonably foreseeable to

them). But there was sufficient evidence that the losses from the

Khayambashi checks were foreseeable to Dadi; he received the

profits from them and was heavily involved in the entire scheme. 

We may reverse the factual findings of a trial court only if

there is clear error. There is no clear error if a finding is

plausible in light of the record as a whole; and, if a monetary

loss is involved, the trial court need not determine the amount

of the loss with precision. See United States v. Humphrey, 104

F.3d 65, 71 (5th Cir. 1997). We therefore do not see any clear

error in the trial court’s findings.

V.Application of the Money Laundering Guideline

Dadi argues that the district court erred in its application

of the Sentencing Guidelines by failing to apply the more lenient
18

fraud guidelines instead of the money laundering guideline. Dadi

finds his strongest support from United States v. Smith, a Third

Circuit opinion in which that court determined that the initial

choice of sentencing guideline should be governed by a

“heartland” analysis: whether the offense is outside the

heartland of the conduct normally punished using a particular

guideline. 186 F.3d 290, 297-300 (3d Cir. 1999). Dadi argues

that the money laundering guidelines, U.S.S.G. §§ 2S1.1 and

2S1.2, are intended to apply to large scale drug and organized

crime enterprises that launder large amounts of money—-not

“simple fraud cases.” A district court’s choice of a Sentencing

Guideline is a matter of law, and therefore the decision is

subject to de novo review. See Smith, 186 F.3d at 297; see also

United States v. Franklin, 148 F.3d 451, 459 (5th Cir. 1998).

Here, the district court was required to group the fraud and

money laundering offenses because those crimes involved multiple

offenses that were linked by a common illegal objective. See

United States v. Leonard, 61 F.3d 1181, 1185 (5th Cir. 1995)

(noting that § 3D1.2(d) explicitly provides for grouping of

offenses covered by the fraud and money laundering guidelines). 

Further, the district court properly imposed a sentence under the

money laundering guideline, which produced the higher offense

level. See id. The district court did not err in this

application of the guidelines.
19

Dadi correctly notes that a court is authorized to depart

downward if the offense falls outside the “heartland” of the

conduct for which a Sentencing Guideline was intended. Dadi

argues that departure from money laundering and use of the more

lenient fraud guideline as a guide is appropriate here. He cites

our decision in United States v. Hemmingson, in which we held

that the district court did not err in applying the fraud

guideline where the money laundering offenses did not fall within

the heartland of the money laundering guideline. 157 F.3d 347,

361-63 (5th Cir. 1998). And in United States v. Bart, a Texas

district court used the fraud guideline as a guide for its

downward departure from the money laundering guideline. 973

F.Supp. 691, 695-96 (W.D. Tex. 1997). The court determined—-

based on the legislative history of the money laundering

statutes—-that the guideline was targeted at “large scale drug

and organized crime enterprises laundering large amounts of

money.” 973 F.Supp. at 696. Dadi claims further support from

cases in which the money laundering statutes were deemed

inapplicable because the money laundering was incidental to the

underlying offense; the underlying offense in this case, Dadi

asserts, is bank fraud. See United States v. Threadgill, 172

F.3d 357, 377-78 (5th Cir. 1999), cert. denied, 120 S.Ct. 172

(1999); Smith, 186 F.3d at 299. 

The cited cases, while interesting, are clearly inapplicable
8Even if we were to conclude that the district court

misapplied the money laundering guideline, the error would

arguably be harmless. If the district court had applied the fraud

guideline, the total offense level would have been 23, and Dadi

would have been subject to an imprisonment range of 70 to 87

months (which would authorize the 84 months to which he was

sentenced). However, under that analysis we would have to

address Dadi’s argument that, although his 84-month sentence is

within that range (but at the high end), that sentence would have

been at the low end of the range the court would apply under the

money laundering guidelines. See United States v. Tello, 9 F.3d

1119, 1131 (5th Cir. 1993).

20

here. They discuss when a downward departure is permissible,

i.e., when a reviewing court will decline to interfere with a

district court’s decision to depart. But that invokes an

entirely different standard from the one applied when a district

court declines to depart downward. Because the district court

here made no mistake about whether it was permitted to depart

downward, we leave the sentence intact.

A decision not to depart downward is not subject to review

in this circuit. See Leonard, 61 F.3d at 1185. In United States

v. Powers, 168 F.3d 741 (5th Cir. 1999), this court declined to

invalidate a refusal to depart downward absent a district court

misunderstanding of the law. Thus, unless the refusal to depart

“is premised upon the [sentencing] court’s mistaken assumption

that the Guidelines do not permit such a departure,” we have no

jurisdiction to review the sentence. Id. at 753 (citing United

States v. Palmer, 122 F.3d 215, 222 (5th Cir. 1997)). Here,

there was no such erroneous belief, and therefore the choice not

to depart downward is not subject to our review.8
21

We also note that—-unlike in Smith—-Dadi’s case involves

violations that fall within the heartland of a violation of §

1957. In Smith, the defendants were involved in an

embezzlement/kickback scheme, for which money laundering was

incidental, and for which the money laundering guideline was

inappropriate. 186 F.3d at 300. The defendant in Powers argued

against this reasoning—-claiming, like Dadi, that the court

should have departed downward because his conduct fell outside

the heartland of offenses intended to be the object of the

guideline. 168 F.3d at 753. That argument did not work for

Powers, and it does not work here. 

VI.The Failure to Apply the Enhancement 

for an Offense Committed while on Release

The government, in a cross-appeal, asserts that the district

court should have adjusted Dadi’s offense level under the

authority of 18 U.S.C. § 3147, which provides for a sentencing

enhancement for offenses committed while on release on another

charge. The Sentencing Guidelines implement this statutory

provision through § 2J1.7. Under that section:

If an enhancement under 18 U.S.C. § 3147 applies, add 3

levels to the offense level for the offense committed while

on release as if this section were a specific offense

characteristic contained in the offense guideline for the

offense committed while on release.
22

That Dadi committed this offense while on release on another

federal charge is not controverted. 

First, we address Dadi’s argument that the cross-appeal

should be dismissed because it was not approved by an appropriate

authority. Dadi argues that application of this enhancement is

impermissible because the government failed to show that it

secured personal approval of the Attorney General, the Solicitor

General or a Deputy Solicitor General designated by the Solicitor

General for this purpose. Therefore, he argues that we must

dismiss the cross-appeal. See United States v. Thibodeaux, 211

F.3d 910 (5th Cir. 2000) (dismissing the government’s appeal

because the government had failed to brief or include in the

record proof that it had received authority to appeal). In

Thibodeaux, we held that the government’s appeal of a sentence

was subject to dismissal, absent evidence that it ever received

approval to pursue the appeal. 211 F.3d at 912. Here, the

government has provided the required proof as an attachment to

its reply brief. Gov. Reply Br. App. B. The fact that the

government has now demonstrated the requisite permission cures

this defect and we will not dismiss the cross-appeal on these

grounds. 

The cross-appeal does fail, however, for lack of adequate

notice to Dadi that he would be subject to this enhancement. The

government concedes that this enhancement can only be imposed
23

after sufficient notice has been given to the defendant by either

the government or the court. Notice must be given at the time of

the defendant’s release from custody in order to be deemed

sufficient. The government contends that Dadi was given notice

on August 26, 1996, when he was released from custody to await

the designation of a facility in which to serve his sentence on

another criminal charge. But the government failed to offer any

evidence of this. The government also argues that the formal

notice it issued on June 23, 1999 was sufficient, because Dadi

had the opportunity to object to the enhancement. 

But such notice is clearly insufficient. This circuit held

in United States v. Onick that failure by the releasing judge to

give the defendant notice of the § 3147 enhancement bars the

sentencing judge from applying it later. 889 F.2d 1425, 1433-34

(5th Cir. 1989). The government did not file its notice of

intent to enhance Dadi’s sentence until more than a month after

the PSR was initially disclosed to counsel, and 19 days after the

deadline for filing objections had passed. There is no support

in the record for the belief that Dadi was advised about the

possible enhancement when he was sentenced on the previous

charge. 

The government relies on an Eleventh Circuit case to assert

that notice was adequate. In United States v. Bozza, 132 F.3d

659, 661 (11th Cir. 1998), the court concluded that notice of the
9In Pierce, the error was considered harmless because the

sentence actually imposed was less severe than the maximum

sentence the defendant would have received without the

enhancement. 5 F.3d at 793-94. Here, the error would not be

similarly harmless.

10Because application of the enhancement fails for lack of

notice, we need not address the issue on which the district court

based its decision: that applying both the criminal history

points and the enhancement would be impermissible double counting

(two upward adjustments for the same conduct). In United States

v. Franklin, however, this court held that “double counting is

legitimate where a single act is relevant to two dimensions of

the Guideline analysis.” 148 F.3d 451, 461-62 (5th Cir. 1998)

(quoting United States v. Kings, 981 F.2d 790, 796 (5th Cir.

1993). As this circuit noted in Kings, “The offense level

represents a judgment as to the wrongfulness of a particular act. 

The criminal history category principally estimates the

likelihood of recidivism.” 981 F.2d at 796 (quoting United

States v. Campbell, 967 F.2d 20, 24 (2d Cir. 1992). Thus, the

two adjustments were relevant to two different dimensions, and

therefore arguably not impermissible double counting. However,

we need not reach this issue today. 

24

§ 2J1.7 enhancement did not have to be given prior to the guilty

plea. But in that case, as Dadi correctly points out, the court

noted a conflict with this circuit, because we had held that it

was error not to inform the defendant of the enhancement prior to

his guilty plea. See id.; United States v. Pierce, 5 F.3d 791,

793-94 (5th Cir. 1993).9 More important, the defendant in Bozza

had received notice upon release for the prior conviction. See

id. The government can point to nothing in the record to show

that Dadi received such notice upon his release. Therefore, the

district court’s decision not to apply the enhancement under §

3147 will stand.10 

VII.CONCLUSION
25

For the foregoing reasons, we AFFIRM the decision of the

district court.