Opinion ID: 747207
Heading Depth: 2
Heading Rank: 2

Heading: sufficiency of the evidence

Text: 10 We next address the defendants' contention that the government presented insufficient evidence to sustain their convictions on the substantive counts of money laundering. When considering whether the evidence is sufficient to support a guilty verdict, we view the evidence in the light most favorable to the government, giving the government the benefit of all reasonable inferences. United States v. Herron, 97 F.3d 234, 236 (8th Cir.1996), cert. denied, --- U.S. ----, 117 S.Ct. 998, 136 L.Ed.2d 877 (1997). We reverse only if no reasonable jury could have found the defendant[s] guilty beyond a reasonable doubt. United States v. Taylor, 82 F.3d 200, 201 (8th Cir.1996) (internal quotations omitted). 11 Nattier and Coley argue that the general verdicts on the money laundering counts must be set aside because the government did not prove every element of each form of money laundering charged. Each money laundering count charged that the specified conduct violated two subsections--18 U.S.C. § 1956(a)(1)(A)(i) and 18 U.S.C. § 1956(a)(1)(B)(i). The two subsections, each requiring proof of three elements, share two common elements. Both subsections require the government to prove that the defendants (1) engaged in the specified transactions involving illegal proceeds and (2) knew that the funds were illegal proceeds. See United States v. Rounsavall, 115 F.3d 561, 565 (8th Cir.1997) (setting forth the requirements under 18 U.S.C. § 1956(a)(1)(B)(i)), cert. denied, --- U.S. ----, 118 S.Ct. 256, --- L.Ed.2d ---- (1997); United States v. Jenkins, 78 F.3d 1283, 1288 (8th Cir.1996) (setting forth the requirements under 18 U.S.C. § 1956(a)(1)(A)(i)). Nattier and Coley do not dispute that they engaged in the specified financial transactions and knew that the proceeds of unlawful activity were involved. Thus, the first two elements of each subsection are satisfied. 12 Nattier and Coley challenge only the government's proof on the final element of each subsection. The final element of subsection (a)(1)(A)(i) requires proof that the defendants intended to promote the carrying on of embezzlement, and the final element of subsection (a)(1)(B)(i) requires proof that the defendants knew that the transaction was designed to conceal the illegal proceeds. Because the general verdict on each money laundering count does not indicate which alternative the jury found in this case, we examine the sufficiency of the evidence under each subsection. 13 First, the defendants argue that the transactions specified in the indictment could not have furthered or promoted the carrying on of the embezzlement within the meaning of subsection (a)(1)(A)(i), because the embezzlement was complete by the time these transactions took place. We disagree. Nattier and Coley were engaged in an embezzling and money laundering scheme designed to promote the goals of and to reap a profit for IRI, their real estate investment company. The scheme was devised and carried out after the defendants discovered a similarity in name between IRI and one of Mercantile Bank's customers to whom dividends were owing but unclaimed. Due to this similarity in name between the two companies, IRI and its financial transactions were integral to the embezzlement scheme. While the unlawful act of embezzlement may have been complete at the time Marc obtained the checks for IRI, the funds could not benefit the overall criminal scheme until successfully deposited in IRI's bank account and made available for the real estate and other financial transactions specified in the indictment. All of the defendants' financial transactions after first depositing the embezzled checks in IRI's account furthered this scheme and contributed to the overall prosperity of the conspiracy and the act of embezzlement. See United States v. Cavalier, 17 F.3d 90, 93 (5th Cir.1994) (holding a defendant can conduct a financial transaction to promote, or contribute to the prosperity of, a completed unlawful activity for purposes of section 1956(a)(1)(A)(i)); See also United States v. Montoya, 945 F.2d 1068, 1076 (9th Cir.1991) (holding deposit of bribery proceeds into a bank account was a transaction intended to promote the carrying on of the bribery by characterizing the proceeds as legitimate funds) (cited with approval in United States v. Morris, 18 F.3d 562, 569 (8th Cir.1994)); United States v. Pelullo, 961 F.Supp. 736 (D.N.J.1997) (holding even if embezzlement was completed when funds were transferred to account, additional financial transactions were necessary to realize a benefit from the embezzlements, so transactions were within the scope of 18 U.S.C. § 1956(a)(1)(A)(i)). But see United States v. Heaps, 39 F.3d 479, 485-86 (4th Cir.1994) (criticizing and disagreeing with both Montoya and Cavalier ). 14 Second, Nattier and Coley contend that their actions did not demonstrate an intent to conceal their identity and relationship to the funds because they were readily identifiable as officers of the corporation through which they were spending the funds. Regardless of whether Nattier and Coley attempted to conceal their ownership of or relationship to the funds, their intent to conceal the nature or source of the funds within the meaning of section 1956(a)(1)(B)(i) was evident. Nattier and Coley concealed the nature and source of the funds by placing the embezzled funds in the seemingly legitimate business account of IRI and passing them off as funds of a legitimate business. Also, Count XIX charged that Nattier laundered funds by settling an $86,539 tax debt with payment of $3,600 of embezzled funds. Nattier concealed the source and ownership of the funds used to extinguish his tax debt by depositing them first in IRI's account, then transferring them to an account in Harlingen, Texas, in the name of his father and himself. Nattier told the IRS that he had no funds with which to pay the tax debt and further represented to the IRS that he had borrowed the money from his father to pay the settlement amount. Thus, even though the defendants did not use false names in an attempt to conceal their identity, they used their legitimate real estate business and Nattier's father in an attempt to conceal the source of the funds within the meaning of subsection (a)(1)(B)(i). 15 The defendants also argue that allowing their convictions to stand would turn the money laundering statute into a money spending statute, contrary to our prior holding in United States v. Rockelman, 49 F.3d 418, 422 (8th Cir.1995). See also Herron, 97 F.3d at 237. We conclude that Rockelman and Herron are distinguishable from this case. In Rockelman, we reversed a money laundering conviction for lack of concealment where the defendant purchased a cabin with cash, which consisted of illegal proceeds, placed the title in the name of his business, and made no attempt to conceal either his own identity or the source of the funds. 49 F.3d at 422. In Herron, we reversed a money laundering conviction for lack of concealment where the financial transaction at issue was a wire transfer of funds and the defendant made no attempt to conceal his identity. 97 F.3d at 237. In the present case, however, the defendants first deposited the embezzled Mercantile Bank's checks in IRI's business bank account and then invested the illegal proceeds in property by drawing checks on IRI's account, thus representing the illegal proceeds as funds of their legitimate business. Additionally, Nattier transferred some of the illegal funds from IRI's account to the Texas bank account and represented the funds as money borrowed from his father. This was not a case of a person simply using illegally obtained funds to purchase personal items, Cavalier, 17 F.3d at 93; therefore, an affirmance of these convictions will not convert the money laundering statute into a money spending statute. 16 We conclude that a reasonable jury could have found beyond a reasonable doubt that, by investing the illegal proceeds through their business, Nattier and Coley intended to promote the carrying on of specified unlawful activity within the meaning of section 1956(a)(1)(A)(i), and also that they knew they were concealing the nature or source of the proceeds of the unlawful activity within the meaning of section 1956(a)(1)(B)(i).