Court Opinion

ID: 177645
Source: CourtListenerOpinion
Date Created: 2010-10-21 18:22:41+00
Date Added: 2024-06-11T17:25:42.568360
License: Public Domain

UNPUBLISHED

                 UNITED STATES COURT OF APPEALS
                     FOR THE FOURTH CIRCUIT

                            No. 09-4825

UNITED STATES OF AMERICA,

               Plaintiff – Appellee,

          v.

LEANDRA SMITH, a/k/a Leanra Smith, a/k/a Rhonda L. Barber,

               Defendant – Appellant.

                            No. 09-4838

UNITED STATES OF AMERICA,

               Plaintiff – Appellee,

          v.

ANEWA TIARI-EL, a/k/a Annie B. Williams,

               Defendant – Appellant.

                            No. 09-4893

UNITED STATES OF AMERICA,

               Plaintiff – Appellant,

          v.
LEANDRA SMITH, a/k/a Leanra Smith, a/k/a Rhonda L. Barber;
ANEWA TIARI-EL, a/k/a Annie B. Williams,

                Defendants – Appellees.

Appeals from the United States District Court for the Western
District of North Carolina, at Charlotte.    Graham C. Mullen,
Senior District Judge. (3:03-cr-00219-GCM-DCK-2; 3:03-cr-00219-
GCM-DCK-1)

Submitted:   September 17, 2010           Decided:   October 21, 2010

Before GREGORY, SHEDD, and DAVIS, Circuit Judges.

Affirmed in part; vacated and remanded in part by unpublished
per curiam opinion.

James S. Weidner, Jr., JAMES S. WEIDNER, JR., Charlotte, North
Carolina, for Leandra Smith; Claire J. Rauscher, Ross H.
Richardson, FEDERAL DEFENDERS OF WESTERN NORTH CAROLINA, INC.,
Charlotte, North Carolina, for Anewa Tiari-El. Edward R. Ryan,
United States Attorney, Charlotte, North Carolina; John A.
DiCicco, Acting Assistant Attorney General, Alan Hechtkopf,
Karen M. Quesnel, Katie Bagley, UNITED STATES DEPARTMENT OF
JUSTICE, Washington, D.C., for the United States.

Unpublished opinions are not binding precedent in this circuit.

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PER CURIAM:

                 Anewa Tiari-El and Leandra Smith were convicted, after

a    jury    trial,      of   conspiracy        to    file     false    claims       for    tax

refunds, filing false claims for tax refunds, and aiding and

abetting others in violation of 18 U.S.C. §§ 286, 287, and 2

(2006).          The   district     court      sentenced       Tiari-El    to    60       months

imprisonment and Smith to 42 months imprisonment and ordered

both Defendants to pay restitution in the amount of $244,287.86

to   clients       who   paid     them    to    file    the     false     refund      claims.

Tiari-El and Smith appeal, contending that the district court

erred       by   allowing     the    introduction         of     evidence       of    a    non-

testifying codefendant’s guilty plea and by denying their motion

for a new trial based on the Government’s failure to turn over

exculpatory        evidence.        The     Government         cross-appeals,         arguing

that the district court erred by failing to order restitution to

the Internal Revenue Service.                  We affirm Tiari-El’s and Smith’s

convictions,           but    vacate      the        sentences     and      remand          with

instructions for the district court to imposed restitution in

favor of the Internal Revenue Service.

                 The Government’s evidence showed that the Defendants

engaged in a scheme conducted through Tiari-El and Associates

(“TEA”), a law firm that provided credit counseling services,

loan approval and education on home ownership.                           They offered to

recoup from the Internal Revenue Service interest accrued on tax

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payments made by individuals.                TEA falsely informed its clients

that the IRS maintains a master file on each taxpayer.                         The tax

payments        made     into    this   master     file     accrue    interest,       and

according to TEA, the taxpayer can obtain the interest earned on

this account by filing amended returns.

                TEA directed their clients to provide their completed

prior year tax returns, sign the cover page of a Form 1040X, and

sign a limited power of attorney.                  TEA would then, unbeknownst

to the taxpayer, complete a Form 2439 “Notice to Shareholder of

Undistributed Long-Term Capital Gains,” and submit it to the

IRS, along with the amended return, claiming a refund in amounts

ranging     from       $33,000    to    $89,000.      The    Government       presented

evidence that the individuals named in the amended returns filed

by   TEA   did     not    have    the   undistributed       gains    to    support    the

requested refund.           TEA provided that the refund checks from the

IRS were to be sent directly to the TEA offices.                           TEA charged

clients $150 to $305 for each tax year in which they filed an

amended return claiming this fictitious refund.                            TEA clients

also agreed to pay TEA fifteen to twenty-five percent of the

refunds they received.

                Tiari-El’s       daughter,    Tajah   Yesher-El,          testified    on

behalf     of    the     Defendants.         During   the    cross-examination         of

Tajah,     the     Government       sought    to   elicit     testimony       that    her

husband, Malik Yesher-El, was charged with the same offenses as

                                             4
Smith and Tiari-El, and that he pled guilty.                       The district court

initially prohibited this questioning, but upon request by the

Government, reconsidered the ruling, and over the Defendants’

objections, allowed the Government to question Tajah about the

guilty plea. The Defendants assert that this ruling violated

their rights under the Confrontation Clause.

            “[E]vidence of a non-testifying co-defendant’s guilty

plea should not be put before the jury.”                           United States v.

Blevins,    960        F.2d    1252,    1260      (4th    Cir.     1992)     (citations

omitted).         The    reasons       for    this     restriction     are     that   the

codefendant       is    not    present       to   be    cross-examined       about    his

motives for pleading guilty and the concern that the jury will

consider    the     codefendant’s        guilty        plea   as    evidence    of    the

defendant’s guilt.            Id.   Admission of such evidence is reviewed

de novo, and a mistrial must be declared unless the court is

satisfied beyond a reasonable doubt that the error was harmless.

Id. at 1262.

            “If for whatever reason the jury does learn that co-

defendants have pled guilty, the court upon request should issue

a limiting instruction to jurors.”                     Blevins, 960 F.2d at 1260

(emphasis added).             However, the Defendants did not request a

limiting instruction and failed to object to the absence of one

in the jury charge.             The district court was not required, sua

sponte, to give a limiting instruction.

                                              5
             Moreover,         our    review         of     the      record       leads    to    the

conclusion that the admission of this evidence was harmless when

“measured against the other evidence presented at trial.”                                        Id.

at 1263 (citing Arizona v. Fulminante, 499 U.S. 279 (1991)).

The Defendants asserted that they merely gathered the relevant

taxpayer    information         and       sent       it   to    Jo    El     Bey    in    Atlanta,

Georgia,    who     added      the    Forms       2439       and     prepared       the    amended

returns and submitted them to the IRS.                            They asserted that they

did   not   know       the    actual      basis       upon      which       the    refunds      were

requested     and       did    not     know          that      the    refund       claims       were

fraudulent.        However, contrary to this stance, the Government

presented testimony that Smith and Tiari-El personally informed

clients of the ability to receive from the IRS the interest

accumulated       in    their       “master      file”         with    the    IRS.         Several

witnesses testified that the signatures on the filed amended tax

returns, the Forms 2439, and the powers of attorney were forged.

The clients were not aware of the actual basis for the refunds

as stated in the amended returns.                         Additionally, upon executing

a search warrant of TEA’s offices, officials discovered hundreds

of partially completed Forms 2439 and numerous computer files

containing    Forms          2439    which       were       completed       and     able    to   be

attached to the refund claims.

             Additionally,           in    March          2003,       the    Defendants         were

specifically told by an IRS criminal investigator that the tax

                                                 6
refund     scheme    was    fraudulent.           Two    separate    state     court

injunctions were imposed prohibiting Defendants from continuing

to prepare amended tax returns on behalf of clients because of

the fraudulent nature of the claims, and more than 400 letters

were   received     by    TEA    clients     rejecting   the    refund    claims    as

false.     Despite these events, Tiari-El and Smith continued to

file false claims for tax refunds on the same basis.

            When faced with this overwhelming evidence of Smith

and Tiari-El’s knowledge of the fraudulent nature of the refund

requests and their continued conduct of the scheme after being

informed    that    the    claims     were     false,    we    conclude    that    the

isolated reference to Malik Yesher-El’s guilty plea during the

five-day jury trial was harmless beyond a reasonable doubt.                        See

Blevins, 960 F.2d at 1262.

            Next,    the        Defendants     contend    that    the     Government

failed to disclose exculpatory evidence in violation of Brady v.

Maryland, 373 U.S. 83 (1963).              They contend that, at the time of

their trial, the Government was preparing to arrest Jo El Bey in

Georgia after a three-year investigation into his conducting the

same type of tax refund scheme as that with which the Defendants

were   charged.          They    assert    that   the    Government       failed    to

disclose this information, and in fact, claimed that Jo El Bey

did not exist and “crippl[ed] Appellants’ defense.”

                                           7
            The       Government            points      out    that       the    person      who   was

being investigated in Georgia was Joseph Jordan.                                     Although the

Defendants assert that Jordan and Jo El Bey are the same person,

there     was        no        evidence       of     this.            Notably,        during       the

investigation             of     the    Defendants,           several        cancelled        checks

written to Joseph Jordan were discovered, but none made payable

to Jo El Bey.

            Additionally,                   the     investigation               of   Jordan        was

conducted       by    the       United       States     Attorney’s          Office     for    Middle

District of Georgia, whereas the Defendants were prosecuted in

the Western District of North Carolina.                              There is no requirement

that    prosecutors             in    one     district        be    aware       of   and   disclose

information      in        the       possession      of   other       governmental         offices.

See United States v. Pellullo, 399 F.3d 197, 216 (3d Cir. 2005);

Kyles v. Whitley, 514 U.S. 419, 438 (1995); see also United

States v. Mero, 866 F.2d 1304, 1309 (11th Cir. 1989) (holding

that prosecutor in Florida not in possession of and therefore

not obligated to disclose information known to prosecutors in

Georgia    and       Pennsylvania).                 Because         the    prosecutor        in    the

Defendants’          case        is     not       imputed          with    knowledge         of    the

investigation in Georgia, no Brady violation can be shown by the

Government       not       disclosing          to   the       Defendants         details     of    the

investigation of Joseph Jordan.

                                                    8
             The final issue in these appeals is the Government’s

contention       that      the     district         court’s          failure          to     order

restitution in favor of the Internal Revenue Service was error.

Although it is clear from our review of the record that the

district court intended that restitution be made to the IRS in

the    amount    of   $1,394,474.67       —       the   amount          paid    on    the    false

claims submitted by clients of TEA — the court failed to order

restitution in the Judgment and Commitment Orders.                                   Rather, the

court ordered restitution in the amount of $244,287.86 for the

individual       victims    who    were     clients          of    Tiari-El          and    Smith.

Based on its concern over the IRS recouping the money paid to

taxpayers under this fraudulent scheme, the court decided to

wait for an accounting of monies recovered before imposing the

restitution      award.        While   this       is    a     legitimate         concern,       the

failure     to   award     restitution        to       the    IRS,       a     victim      of   the

Defendants’      fraudulent       scheme,     violates            the    Mandatory         Victims

Restitution Act of 1996.            18 U.S.C.A. § 3663A(a)(1) (West 2000 &

Supp. 2010); United States v. Roper, 462 F.3d 336, 338 (4th Cir.

2006); see also United States v. Ekanem, 383 F.3d 40, 42-44 (2d

Cir. 2004) (holding that government may be an eligible victim).

             Further, the Act provides, “In no case shall the fact

that    a    victim      has      received        or     is       entitled        to       receive

compensation with respect to a loss from insurance or any other

source be considered in determining the amount of restitution.”

                                              9
18 U.S.C. § 3664(f)(1)(B) (2006) (emphasis added).                    Rather, the

Act provides that “[a]ny amount paid to a victim under an order

of restitution shall be reduced by any amount later recovered as

compensatory damages for the same loss by the victim” in any

Federal or State civil proceeding.”            See 18 U.S.C. § 3664(j)(2)

(2006).   Thus, despite the fact that the IRS may recoup some of

its losses from the taxpayers who received refunds under TEA’s

scheme, the district court erred by failing to order restitution

to the IRS in the full amount of its losses, with the amount to

later be reduced by amounts recouped from taxpayers.                   See United

States v. Ruff, 420 F.3d 772, 775 (8th Cir. 2005) (discussing

mandatory nature of restitution award and the bar against double

recovery); United States v. Scott, 270 F.3d 30, 52 (1st Cir.

2001) (interpreting restitution order entered in fraudulent tax

return case as allowing government to recover the total amount

of restitution from any of several individual defendants, but

restricting total recovery to amount of loss).

          Accordingly,       while   we    affirm    Tiari-El’s       and   Smith’s

convictions,   we   vacate    the    judgments      in   part   and    remand   the

cases to the district court for the limited purpose of ordering

restitution in favor of the IRS.           We dispense with oral argument

because the facts and legal contentions are adequately presented

                                      10
in the materials before the court and argument would not aid the

decisional process.

                                               AFFIRMED IN PART;
                                    VACATED AND REMANDED IN PART

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