Opinion ID: 699628
Heading Depth: 1
Heading Rank: 1

Heading: facts

Text: 2 Karterman is a real estate broker in Sun Valley, Idaho. The Internal Revenue Service and Drug Enforcement Agency began investigating him in the late 1980s. Pursuant to warrant searches of Karterman's residence, government agents seized evidence of tax evasion and drug-related paraphernalia. 3 Karterman was charged with six counts: Two counts of making false statements on his income tax returns for 1985 and 1986 (counts 1 and 2); attempted income tax evasion for 1987 (count 3); conspiracy to distribute cocaine (count 4); distribution of cocaine (count 5); and using his residence to facilitate narcotics trafficking, thus justifying forfeiture of the property (count 6). The first five counts were tried in June and July 1993. Count 6 was tried separately and is not a part of this appeal. 4 On the false tax return counts, the government presented evidence that Karterman had significantly more income than he had reported on his tax returns, and that he had intentionally falsified financial loan documents. The government's theory was that the unreported income came from drug trafficking. Karterman argued that any underreporting to the IRS was not intentional, and he tried to show that the amount of unreported income was less than the government claimed. His own figures, however, indicated that he did have unreported income in both years. 5 On the drug counts, the government presented witnesses who claimed to have purchased drugs from Karterman at various times during the 1980s. Two of them testified that the drugs were purchased in quantities and in packages appropriate for resale. Karterman admitted prior drug use but denied any drug trafficking activity. He presented evidence of his good character and attempted to undermine the credibility of the government's witnesses. 6 The jury convicted Karterman on counts 1 and 2 (the false tax return counts) and acquitted him on counts 4 and 5 (the drug conspiracy and distribution counts). The district court granted Karterman's motion for acquittal on count 3. 7 Karterman was sentenced on October 1, 1993. Over Karterman's objection, the court adjusted his base offense level upward two levels for obstruction of justice and two more levels for failing to report income exceeding $10,000 that came from criminal activity. The obstruction of justice enhancement was based on Karterman's alleged attempt to influence the testimony of his bookkeeper and government witness, Jacqueline Vork. The criminal activity enhancement was based on the court's determination that Karterman's unreported income (which exceeded $10,000) came from narcotics trafficking. Karterman timely appeals his conviction and sentence.