Opinion ID: 3010764
Heading Depth: 3
Heading Rank: 1

Heading: Case Law Guidance

Text: Although the legislative history is unavailing, other cases have suggested how we should construe Congress' intent behind S1956(a)(1). The case that speaks to this issue most directly is United States v. Holmes, 44 F.3d 1150 (2d Cir. 1995). There, the defendant was charged with two separate counts of violating S1956, S1956(a)(1)(B)(i) (the conceal or disguise provision) and (ii) (the reporting requirements provision), arising out of the same underlying misconduct. The court in Holmes rejected the argument that the same financial transaction could give rise to two separate crimes under these provisions: We cannot accept the government's implicit contention that the same financial transaction gives rise to separate crimes simply because the defendant, at the time he deposited the money, knew that what he was doing -- the prohibited conduct -- was designed for two unlawful purposes: concealing proceeds and avoiding reporting requirements. The statute punishes the conducting of a financial transaction with guilty knowledge. Having knowledge of two improper purpses rather than one does not multiply the offense of a single financial transaction into two offenses. Id. at 1155. Accordingly, the court concluded that given the language of S1956, congress must be deemed to have intended only a single punishment for each transaction even though the defendant may have had two improper purposes in mind. Id. at 1155-56. We note, however, that this conclusion was based only on the court's reading of the text of the statute; the opinion does not cite to any legislative history or other texts influencing its decision. Although not with the clarity of Holmes, other circuits have reached the same essential result. In United States v. Brown, 944 F.2d 1377 (7th Cir. 1991), for example, the U.S. Court of Appeals for the Seventh Circuit considered a set of factual circumstances similar to the present case. The indictment charged that the defendant violated both the promotion and conceal or disguise subsections of 13 S1956(a)(1), but the government's proof and argument, as well as the trial court's instructions, only discussed the conceal or disguise alternative. The court held that [t]he possibility that the jury nevertheless based its verdict on the [promotion prong] ... though troubling in the abstract, is not fatal to the conviction .... Id. at 1387. Although Brown appears to support the alternate means interpretation of S1956, the Seventh Circuit was clearly uncomfortable with that result: [W]e renew our caution ... that the government should in the usual case charge defendants under one prong of the statute or another as it will be the rare case in which the government will be able to prove that a single transaction was intended to promote an illegal activity and conceal the origin of the funds used in that activity. Id. While this statement demonstrates some pause on behalf of the court, it does not undermine the Seventh Circuit's basic conclusion that Congress intended that the jury could be instructed in the disjunctive. See also United States v. Alford, 999 F.2d 818, 824 (5th Cir. 1993) (rejecting without discussing, under plain error standard, defendant's claim that specific unanimity instruction is required in indictment for violation of subsections (a)(i) and (B)(i)). We have not clearly weighed in on this question. Defendants point us to two cases which they contend reflect a belief that Congress intended the S1956 alternatives at issue to be treated as separate offenses. They rely principally on United States v. Paramo, 998 F.2d 1212 (3d Cir. 1993). There, the defendant was convicted of five counts of violating subsection (A)(i) (the promotion alternative). Although not charged with violating subsection (B)(i) (or, for that matter, (B)(ii)), Paramo contended that the trial court had erred by failing to instruct the jury that they could not convict him under S1956(a)(1)(A)(i) if they found him guilty under S1956(a)(1)(B)(i). Paramo, 998 F.2d at 1218, n.3. We rejected this claim in the margin, noting that contrary to Paramo's suggestion, a finding of guilt under subsection (B)(i) is not a defense to a prosecution under 14 subsection (a)(i). Id. at n.3. Defendants contend that the Paramo footnote stands for the proposition that a defendant could be prosecuted separately under the promotion and concealment subsections, and that the Paramo panel must have concluded that Congress intended those subsections to be treated as separate offenses. In our view, the Paramo footnote is insufficiently clear to compel a reversal here on a plain error standard of review. The proposition that Paramo rejected is that a jury could not convict a defendant under subsection (A)(i) if they found him guilty under subsection (B)(i). As noted above, Paramo stated that a finding of guilt under subsection (B)(i) is not a defense to a prosecution under subsection (A)(i). This footnote admits of two possible readings. It could mean either that the (A)(i) prosecution would not be barred on double jeopardy grounds -- which would imply that (A)(i) and (B)(i) are separate offenses with distinct elements -- or simply that a S1956(a)(1) defendant cannot defend the charge that he intended to promote an unlawful activity by claiming that he actually intended only to conceal or disguise the proceeds from that activity. In other words, a finding of intent to conceal under subsection (B)(i) is not inconsistent with a finding of intent to promote under subsection (A)(i). If Paramo means the latter, then its holding would be entirely consistent with the view that S1956(a)(1) sets forth separate means of committing a single offense. In light of the fact that Paramo was not charged with violating subsection (B)(i), and had not (at least as appears from the opinion) been charged with a (B)(i) violation based on the same conduct in the past, we are hesitant to conclude that the panel in Paramo was reaching out to decide a novel double jeopardy issue (without any discussion) which was not squarely before it. Moreover, we believe that the second interpretation of the Paramo footnote -- which need not be predicated on afinding that Congress intended to create separate offenses -- is more plausible. We recognize, however, that the import of Paramo is unclear. Since we are reviewing the defendants' conviction for plain error, though, we are not persuaded that the Paramo footnote itself satisfies defendants' burden 15 under Olano of demonstrating that Congress clearly intended S1956(a)(1) to create three separate offenses. Unlike Paramo, defendants' second case, United States v. Conley, 37 F.3d 970 (3d Cir. 1994), is not of much moment. Conley only states that to violate S1956(a)(1), the transaction must be committed with the intent either to promote the specified unlawful activity or to conceal the nature and source of the income. Id. at 978. This certainly is an accurate statement, but it does not stand for the proposition defendants urge -- namely, that we have recognized two separate offenses under S1956. Conley only restates the question.