Opinion ID: 768508
Heading Depth: 2
Heading Rank: 1

Heading: sufficiency of the evidence

Text: 10 Ross first challenges the sufficiency of the evidence for the money laundering conviction, arguing that the financial transactions charged did not involve the proceeds of an unlawful activity under the money laundering counts. 3 11 The gravamen of Ross' argument is that the money laundering convictions must be reversed because the Government did not prove an essential element of the crime; namely, that the funds deposited into Consortium's business account were proceeds of some previously completed illegal activity. Instead, he argues that the indictment merely charged the receipt and deposit of proceeds and contends that the mere deposit of money received from the underlying wire fraud does not evidence his use of proceeds to promote the carrying on of illegal activity under § 1956(a)(1)(A)(i). 12 The cases relied upon by Ross are readily distinguishable from this case to the extent they are factually inapposite from the instant case. These cases, such as United States v. Shoff, 151 F.3d 889 (8th Cir. 1998) (the money laundering statute may not be so broadly construed that it becomes a money spending statute) are based on violations of the Money Laundering Control Act of 1986 not charged in Ross' indictment and turn on the fact that the allegations of money laundering are based on the same transaction charged in the predicate act thereby raising double jeopardy concerns. See generally, United States v. Johnson, 971 F.2d 562 (10th Cir. 1992) (§ 1957 money laundering charge predicated on wire fraud transfers to defendants account where wire fraud counts charged the same wire transfers); United States v. Christo, 129 F.3d 578 (11th Cir. 1997) (reversing conviction for money laundering where the money laundering counts were based on the same transmission of funds as the underlying criminal activity of bank fraud and misapplication of bank funds). 13 We rejected an argument substantially similar to Ross' in United States v. Hildebrand, 152 F.3d 756 (8th Cir. 1998). The defendants in Hildebrand were involved in a conspiracy through which they collected a $300 fee from persons for the purpose of filing a claim on their behalf in a pro se class action suit. The co-conspirators represented that for their participation, claimants could share in a substantial damage award. Throughout the course of the conspiracy, the group collected over $1.3 million. Id. at 761. Like Ross, the defendants were indicted under 18 U.S.C. § 1956(a)(1)(A) and (a)(1)(B) for participating in a conspiracy to launder money. Following conviction, three defendants appealed arguing the Government failed to prove the elements of the crime. Id. at 762. We affirmed the convictions based on the evidence that the defendants deposited over $1.1 million in mail fraud proceeds into bank accounts and then expended the proceeds to promote the ongoing scheme to defraud by paying for office supplies, secretarial services, and staff wages. Id. See also United States v. Kennedy, 64 F.3d 1465, 1477-78 (10th Cir. 1995) (affirming § 1956 conviction for money laundering predicated on acts of mail fraud separate and distinct from acts charged as money laundering); Johnson, 971 F.2d at 566 (finding jury could conclude defendant promoted fraudulent scheme in violation of § 1956 where evidence showed he used illegal proceeds to purchase Mercedes to impress investors and paid off mortgage on residence from which he operated fraudulent scheme). 14 Ross' wire fraud convictions were predicated on facsimile transmissions of various documents to potential borrowers (e.g., FCAs, letters promising to fund loans, and a letter terminating a loan agreement). The money laundering convictions arose from related, but separate and distinct transactions, namely the deposit of wire fraud proceeds and subsequent acts promoting the carrying on of illegal activity. 15 At trial, the Government presented proof that Consortium was engaged in a broad scheme to defraud and that Consortium's continuing operation was funded almost exclusively by fees received from potential borrowers due to fraudulent means. The evidence showed these funds were deposited into Consortium's business account and thereafter checks were written on the business account to partially fund another loan, fund employee travel to Luxembourg in order to establish bank accounts abroad to conceal assets from the United States, and to pay Consortium's rent and overhead to maintain its appearance of validity throughout the scheme. Further, trial testimony indicated that the salaries of Druck and Adelman were artificially inflated in order to allow each to pay Ross $1,000 cash every two weeks in lieu of Ross receiving traceable compensation from Consortium. 4 16 From this evidence, a jury could reasonably find that the deposited funds were the proceeds of wire fraud and that Ross thereafter used the deposited proceeds to sustain and promote the illegal scheme in violation of § 1956(a)(1). Because we find ample evidence in the record to support the jury's verdict, we affirm the money laundering convictions.