Opinion ID: 6290
Heading Depth: 3
Heading Rank: 1

Heading: Jose Puig and Abigail Puig

Text: 23 The Puigs' conviction on count seventeen (17) under section 1956(a)(1) arises out of a marihuana run made to Florida in May of 1989. 5 Valles testified that Jose and Abigail Puig requested that she accompany Abigail on a trip from Laredo to Florida. On May 22, 1989, Valles and Abigail Puig drove from Laredo to San Antonio, Texas, where they picked up a load of marihuana. From San Antonio, Valles and Abigail Puig continued on to Okeechobee, Florida. After arriving in Florida, they rented a hotel room and contacted Jose Puig. The next day, two buyers, Terry and Lettie Willis, came to the hotel room and gave Abigail Puig $47,000 in exchange for the marihuana. After the exchange, Valles and Abigail Puig returned to Laredo with the money. Valles testified that the last time she saw the money it was still in the possession of Abigail Puig. There was no evidence of what, if anything, happened to the money thereafter. 24 The Puigs contend that, under these facts, they cannot be convicted of a violation of section 1956(a)(1)(A)(i) because the government failed to establish all of the requisite elements of the offense. Specifically, the Puigs argue that the government was required to prove that they engaged in a financial transaction involving the proceeds of an unlawful activity. And, although the money Abigail Puig received in exchange for the marihuana was the proceeds of an unlawful activity, her mere subsequent transportation of those proceeds by car does not constitute a financial transaction within the meaning of the statute. We agree. 25 Section 1956 defines financial transaction as a transaction which in any way or degree affects interstate or foreign commerce (i) involving the movement of funds by wire or other means or (ii) involving one or more monetary instruments.... 18 U.S.C. Sec. 1956(c)(4)(A) (emphasis added). By definition, then, a financial transaction must, at the very least, be a transaction, i.e., a purchase, sale, loan, pledge, gift, transfer, delivery, or other disposition or some action involving a financial institution or its facilities. 6 18 U.S.C. Sec. 1956(c)(3). 26 Although it is clear that the transportation of money by car is not a purchase, sale, loan, pledge, or gift, whether such transportation is a transfer or delivery is less clear. However, the statute makes plain that for something (not involving a financial institution or its facilities) to be a transaction, it must be a disposition. Disposition most commonly means a placing elsewhere, a giving over to the care or possession of another. WEBSTER'S THIRD NEW INTERNATIONAL DICTIONARY, 654 (1961). 27 Considering the facts adduced at trial, we are persuaded that there was no showing of any action concerning the sales proceeds related to a financial institution, and, further, that the government failed to demonstrate that Abigail Puig effected a disposition of the proceeds of the sale. Indeed, there is no evidence that Abigail Puig did anything with the money after she and Valles returned to Laredo. The only evidence offered in this regard was the following exchange between the prosecutor and Valles: 28 MR. McCORMICK [the prosecutor]: After you got to Laredo, what happened to the money if you know? 29 MS. VALLES: She kept the money. I don't know what happened to it. 30 MR. McCORMICK: The last time you saw it, where was it? 31 MS. VALLES: It was hidden in the car, under the dash of the car. 32 MR. McCORMICK: Did you take any of the money? 33 MS. VALLES: No, sir. 34 MR. McCORMICK: Who was the last person that had control--that you saw, that had control of that car when it had the money in it? 35 MS. VALLES: Ab[igail Puig]. 36 The only permissible inference from the government's proof is that Abigail was in possession of the proceeds of unlawful activity. Nowhere is there any evidence that Abigail effected a disposition of those proceeds; i.e., that she g[ave] over to the care or possession of another the money she had received in exchange for the marihuana. Without such proof, her mere transportation of the proceeds of unlawful activity is not a transaction within the statute. For this reason, the government failed to establish the facts necessary to find that Abigail Puig engaged in a financial transaction within the meaning of section 1956. As the only basis for Jose Puig's conviction of this charge was that he aided and abetted Abigail's asserted violation, his count seventeen (17) section 1956 conviction is infirm for the same reason. Accordingly, we reverse the Puigs' convictions under count seventeen (17) for money laundering. 37 Our conclusion is consistent with that of the Sixth Circuit in United States v. Samour, 9 F.3d 531 (6th Cir.1993). In a case factually analogous to the instant case, the Samour court held that merely transporting [drug money concealed in automobile] does not meet the definition of 'financial transaction' for purposes of the money laundering statute. Id. at 536. 38 Our conclusion is also in accord with our reasoning in United States v. Ramirez, 954 F.2d 1035 (5th Cir.1992), in which we concluded that the government's proof of the possession of drug proceeds was insufficient to establish a financial transaction under section 1956. In Ramirez, the defendant was convicted of money laundering after DEA agents searched a house used by the drug trafficking ring of which the defendant was a part and discovered a shoe box containing $132,980 in cash. We concluded that although the jury could infer that the money found [in the house] represented proceeds from illegal activity, the evidence did not allow the inference that Sanchez transferred, delivered, moved, or otherwise disposed of the money as required by statute. Id. at 1039-40. 39 The government contends that the delivery and transfer of cash from [the Willises] to Abigail in Florida, and her subsequent movement of these cash proceeds interstate, constitutes a financial transaction. However, because the money did not become proceeds of unlawful activity until the sale of the marihuana was completed, what the government describes as one transaction is actually two separate actions: the first, the sale by the Puigs of the marihuana to the Willises and their payment to Abigail Puig for same, is a transaction (and an unlawful one) but is not shown to have been one which involved the proceeds of unlawful activity; the second, Abigail Puig's transportation of the money from Florida to Laredo, involves the proceeds of unlawful activity but is not a transaction. 40 The government also contends that because the facts of the case sub judice resemble those of United States v. Gallo, 927 F.2d 815, 822 (5th Cir.1991), and United States v. Hamilton, 931 F.2d 1046 (5th Cir.1991), we must follow the results of those cases and affirm the Puigs' conviction. In Gallo, the defendant (Gallo) was convicted of violating section 1956 following his arrest while transporting a box containing approximately $300,000 cash in his car on an interstate highway. Evidence offered by the government suggested that the defendant had accepted delivery of the cash from Cruz, a suspected drug trafficker, and that Cruz had been given the money in exchange for twenty-five kilograms of cocaine. Based on these facts, we concluded that the defendant's transportation of the proceeds of drug trafficking affected interstate commerce, and that there is sufficient evidence to sustain his money laundering conviction. Gallo, 927 F.2d at 823. The question whether the evidence was sufficient to establish the transaction requirement of the statute, however, was not addressed by the Gallo court. 41 In Hamilton, the defendant was convicted of money laundering for mailing approximately $18,000 in drug activity proceeds to Perez, a drug dealer in California. On appeal we concluded, without discussion, that the terms of the statute prohibit mailing the proceeds of drug sales. Hamilton, 931 F.2d at 1051. Accordingly, we affirmed the conviction. 42 Although the analysis of the transaction issue is minimal in Hamilton and nonexistent in Gallo, unlike the case sub judice, both Hamilton and Gallo clearly involve a disposition of the proceeds of unlawful activity. In Gallo, proceeds of a drug sale were delivered from Cruz to the defendant; in Hamilton, the defendant attempted to deliver the proceeds of drug activity to Perez. We conclude that Gallo and Hamilton are not controlling in the present context.