Opinion ID: 201336
Heading Depth: 2
Heading Rank: 1

Heading: Validity of Cheal's Plea Colloquy

Text: 24 Cheal first contends that she consistently asserted her legal innocence throughout the hearing, never fully agreeing to the government's allegations and case against her, and that the court therefore lacked a sufficient factual basis to accept her plea. Second, Cheal claims that the court's failure to conduct the change-of-plea hearing in accordance with Rule 11 meant that she did not enter her plea intelligently, knowingly, and voluntarily. Although Cheal's behavior during the plea colloquy was erratic, her admissions, when combined with the government's evidence, provided a sufficient basis for the plea, and the court's procedure complied as a whole with Rule 11. 6 There was no error in the conduct of the change-of-plea hearing.
Rule 11 requires that 25 there be an admission, colloquy, proffer, or some other basis for thinking that the defendant is at least arguably guilty.... 26 . . . . 27 On a plea, the question under Rule 11(f) is not whether a jury would, or even would be likely, to convict: it is whether there is enough evidence so that the plea has a rational basis in facts that the defendant concedes or that the government proffers as supported by credible evidence. 28 United States v. Gandia-Maysonet, 227 F.3d 1, 6 (1st Cir.2000). Cheal pleaded guilty to mail and wire fraud. To prove these crimes, the government must show three elements: (1) a scheme to defraud based on false pretenses; (2) the defendant's knowing and willing participation in the scheme with the intent to defraud; and (3) the use of interstate mail or wire communications in furtherance of that scheme. United States v. Martin, 228 F.3d 1, 15 (1st Cir.2000). The factual predicate for the requisite mens rea may be inferred from all the evidence alluded to at the Rule 11 hearing. United States v. Marrero-Rivera, 124 F.3d 342, 352 (1st Cir. 1997); see also United States v. Japa, 994 F.2d 899, 903-04 (1st Cir.1993). 29 It is true that Cheal made a number of statements throughout the change-of-plea hearing contesting the government's version of the facts against her. After the government's initial recitation of facts, for example, Cheal responded: I agree with ten percent of what he said, about ten percent of it is correct. She then delivered a rambling narrative of her own version of the facts, which included several denials that she was running or even knew about the investment scheme promising a 1200% return over twelve weeks. Cheal claimed that she had simply solicited loans to purchase a bank that would help fund low-cost mortgages, and that her employees had modified this plan without her consent or knowledge. At first, Cheal claimed she had never sent faxes to anyone. Then, when the court asked why she had a fax machine in her home, she said she had sometimes faxed back a prayer request, and then that she had responded to people after they had been promised a hundred percent return. 30 Cheal also read a prepared statement in which she admitted that she misrepresented herself as being an experienced securities trader, that she recklessly mismanaged the loan proceeds received for Relief Enterprise from lenders, that in setting up these programs I made reckless decisions and judgments, and that she 31 recklessly allowed persons in my office ... to misrepresent the facts and nature of my loan program to prospective lenders which resulted in persons sending loan [sic] and money and applications to me with false information about the program.... Among the false statements provided to such lenders was that: (1) lenders could expect 100 percent of the loan value return from each one of their loans for twelve weeks ...; and (2) that all lenders' moneys were to be kept in a secured lenders' account. So, to all these charges I do plead guilty. 32 In a subsequent exchange with Cheal, the court tried to determine whether Cheal was admitting to having made the 1200% misrepresentation herself, or whether she was admitting only to failing to correct her employees' misrepresentations, which she had overheard: 33 THE COURT: So you acknowledge that people on your behalf were making these statements — 34 THE DEFENDANT: Yes, your honor. 35 THE COURT: — but you did not correct them? 36 THE DEFENDANT: Yes — well, I corrected them when I was aware of it, but I did not correct them when I found out afterwards. I couldn't do anything about it, I thought. The attorney since advised me there was something legally I could have done. 37 The government then submitted for the court's consideration a number of documents and faxes, which Cheal admitted were all in her handwriting, and recorded telephone conversations, in which Cheal admitted participating. This evidence showed conclusively that Cheal herself had represented that the scheme would return 100% per week for twelve weeks, that she was an experienced securities trader, that she had secured the services of another experienced trader, and that the lenders' money would be kept in a safe, nondepletion account and would not itself be risked in the trades. 38 This proffer of evidence, when combined with Cheal's own statements to the court, satisfied Rule 11's requirement of a factual basis for a plea of guilty, even if Cheal never admitted explicitly to a knowing and willing participation in the scheme, Martin, 228 F.3d at 15. On the basis of what it described as her statements to the court, on the tapes that she acknowledges are in her voice, [and] the letters and statements that are in her hand and/or signed by her, the district court was free to infer that Cheal had the requisite mens rea, Marrero-Rivera, 124 F.3d at 352, and that the plea otherwise had a rational basis in fact. 7 39 Cheal's argument is fundamentally flawed because it assumes that the district court could rely only on her admissions in court to find a sufficient factual basis to accept her plea. As Gandia-Maysonet and our other cases make clear, the court may find such a basis either in the defendant's admissions or from the government's presentation. In this case, not only did Cheal admit to substantial wrongdoing, including acknowledging repeatedly that she made numerous reckless decisions with investors' money, but the government also made extensive proffers of evidence — faxes in Cheal's handwriting and telephone calls in her voice — that it intended to use at trial. Given the wealth of information available to the court from these two sources, it did not err in finding a sufficient factual basis to accept Cheal's plea of guilty. 2. Cheal's Understanding of the Nature of the Charges and the Consequences of Her Plea 40 Rule 11 of the Federal Rules of Criminal Procedure ensures that a defendant who pleads guilty does so with an understanding of the nature of the charge and the consequences of his plea. McCarthy v. United States, 394 U.S. 459, 467, 89 S.Ct. 1166, 22 L.Ed.2d 418 (1969). Cheal argues repetitiously that her insistent denials at the change-of-plea hearing show that she could not have understood the charges against her or the consequences of her plea. We have already rejected this argument's premise — that Cheal did not admit to enough facts to allow the court to accept her guilty plea. Moreover, her factual disagreements, arguably skirting the edges of culpability, reveal the extent to which she fully understood the charges against her and the consequences of her plea. 41 In further support of her claim of confusion about the consequences of her plea, Cheal notes that, at one point in the hearing, she denied that she had told investors that their money would not be risked in the trades, and she said that a business associate of hers would come here and testify to this if it goes to the jury.... I was using my own money to trade. Cheal contends that this reference to a possible trial clearly shows the confusion she had regarding the purpose of the plea hearing. At the same time that Ms. Cheal is asserting her innocence, she is stating that she has witnesses who would testify at trial. Based on these statements alone an obvious confusion exists. 42 We disagree. In assessing Cheal's claim of confusion, we must review the totality of the Rule 11 hearing. 43 What is critical is the substance of what was communicated by the trial court, and what should reasonably have been understood by the defendant, rather than the form of the communication. At a minimum, Rule 11 requires that the trial court address the defendant personally in open court to ascertain that his plea is voluntary and intelligent. 44 United States v. Cotal-Crespo, 47 F.3d 1, 4 (1st Cir.1995) (citations omitted). We find that this minimum requirement was met here when, later in the hearing, the court explicitly asked Cheal if she understood that, with a guilty plea, she was giving up her right to a jury trial and her right to call witnesses on her behalf. To those questions, Cheal answered yes. 45 Cheal also complains that, after the government's proffer, the court did not immediately follow up by asking her whether she agreed with the evidence presented. Instead, the court launched into a series of questions asking Cheal whether she understood the maximum penalties under the mail and wire fraud laws, the sentencing guidelines, her right to trial, her right to counsel, and the other usual inquiries. Thus, Cheal says, despite the [court's] being cognizant of the Appellant's assertion of innocence, [it] makes no further inquiry of the Appellant regarding an acknowledgment of guilt nor does the [court] ascertain through further inquiry whether the Appellant's plea was knowing, voluntary and intelligent. Yet the colloquy cited by Cheal, required by Rule 11 and routine in change-of-plea hearings, is designed to confirm a knowing, voluntary, and intelligent plea. In Cheal's case, the colloquy did just that. Cheal's responses to the court's questions asking whether she understood the proceedings were almost always in the affirmative. When she said that she did not understand her right against self-incrimination, the court explained that right to her until Cheal said she did understand it. Cheal's insistence on that explanation confirms that she was not merely giving mindless answers to the court's other questions. 8 There was no error in the court's conduct of the change-of-plea hearing and its eventual acceptance of her guilty plea. 46