Court Opinion

ID: 9493596
Source: CourtListenerOpinion
Date Created: 2023-08-05 15:12:42.523126+00
Date Added: 2024-06-11T17:55:55.323343
License: Public Domain

LOKEN, Circuit Judge,
concurring in part and dissenting in part.
I respectfully dissent from Part III of the court’s opinion, which affirms the imposition of an upward special skills sentencing adjustment. I concur in the court’s disposition of the forfeiture issue but for reasons not addressed in Part II. In all other respects, I join the court’s opinion.
I.
In Part III, the court affirms the district court’s finding that Covey used his special skills as a CPA to effectuate the money laundering offense. The court frames the issue as being “whether the defendant’s special skills aided him in performing the task.” Ante at 647. That understates the government’s burden in proving this role-in-the-offense adjustment. The Guidelines provide for a two-level upward adjustment if the defendant “used a special skill, in a manner that significantly facilitated the commission or concealment of the offense.” U.S.S.G. § 3B1.3 (emphasis added); see United States v. Graham, 60 F.3d 463, 468 (8th Cir.1995). Applying this more stringent standard, I conclude the district court’s finding was clearly erroneous.
The Sentencing Commission included accountants in its examples of persons who possess the requisite special skills. See U.S.S.G. § 3B1.3, comment, (n. 3). But the question is whether Covey used those skills to significantly facilitate the money laundering loan transaction. The drug dealers, Gary and Darrell Hart, did not seek out Covey for his accounting skills. They dealt with him as a lender, and Covey made the loan through his personal investment company, MCM. The district court reasoned that Covey used his special training and experience in creating a loan amortization schedule and in documenting the loan transaction. In fact, Covey used a computer program to generate the amortization schedule and loan documentation. Such resources are readily available to any lender such as MCM, and are doubtless available to any layman wishing to make an isolated loan to a friend or acquaintance. Thus, the record does not support a finding that Covey used his special skills as a CPA to significantly facilitate the commission of the offense. Compare United States v. Hemmingson, 157 F.3d *649347, 359-60 (5th Cir.1998); United States v. Foster, 876 F.2d 377, 378 (5th Cir.1989).
The record also contains no evidence that Covey used his CPA skills to significantly facilitate the concealment of the money laundering offense. Indeed, the evidence was to the contrary. Covey attempted to conceal his receipt of cash collateral by having the loan documents grant MCM a security interest in the Harts’ motorcycle shop inventory. But the loan was made before the inventory was acquired, and the loan documents failed to include a routine provision extending the lender’s security interest to after-acquired inventory. In addition, when Covey sought legal advice in December 1995 (long after the June 1993 loan), counsel advised him to file an IRS Form 8300, a cash transaction report that must be filed by persons who receive more than $10,000 cash in a transaction entered into in the course of their trade or business. I have little doubt that a sophisticated money launderer would have known the cash transaction reporting requirements and would have attempted to structure the loan to the Harts so as to avoid those requirements. Absent proof by the government to the contrary, these facts suggest either that Covey was an incompetent CPA, or that after-acquired security interests and cash transaction reports are not part of a CPA’s special knowledge and skill, or that Covey had the knowledge and skill but did not apply them to this transaction. No matter which inference is accurate, the upward special skills adjustment is unwarranted.
By ignoring uncontroverted evidence that Covey either did not have or did not use special CPA skills to significantly facilitate this offense, the district court and this court have impermissibly broadened § 3B1.3 to increase Covey’s sentence based on his mere status as a CPA. I respectfully dissent in part.
II.
Although I agree with the result reached by the court in Part II of its opinion, I find the forfeiture issue more difficult than the court acknowledges. One principle has been established — in this circuit, a preliminary forfeiture order is not appealable as a final order or judgment. See United States v. Coon, 187 F.3d 888, 901 (8th Cir.1999), cert. denied, — U.S. —, 120 S.Ct. 1417, 146 L.Ed.2d 310 (2000); contra United States v. Christmas, 126 F.3d 765, 768 (6th Cir.1997). But here, after entering a preliminary order forfeiting “$70,000 in United States currency,” the district court entered a final Judgment reciting that Covey had been found guilty of “Criminal Forfeitures.” When a forfeiture is included in the final judgment, “prior case law would suggest that the preliminary order of forfeiture is an appealable part of the judgment.” Coon, 187 F.3d at 901; accord United States v. Pelullo, 178 F.3d 196, 202 (3d Cir.1999), and cases cited.
As the court notes, Covey’s final Judgment does not specify what property was forfeited. But the preliminary order forfeited Covey’s interest in $70,000 of currency, which of course is fungible property. The preliminary order and the final Judgment together surely give the government as judgment creditor the right to proceed against the forfeited property. And that is precisely how the parties interpreted the situation. After entry of the final Judgment, Covey appealed and moved this court for an order staying the criminal forfeiture. The government opposed that motion, arguing that it should be permitted as a judgment creditor to immediately seize the forfeited property. We denied the motion for stay, Covey paid the forfeited amount, and the government filed a satisfaction of judgment. In these circumstances, Coon and Pelullo apply and make the forfeiture order final and appeal-able.
But there is another wrinkle to the problem, one that has not yet been addressed in the evolving law of criminal forfeitures. On appeal, Covey does not *650challenge the sufficiency of the government’s forfeiture evidence. Nor does he raise any issue about his interest in the forfeited property, since the subject of this forfeiture is currency. Rather, he argues, first, that he and the Harts are jointly and severally liable for the $70,000 forfeiture and the government has improperly collected from both; and second, that forfeiting the entire $70,000 from him results in an unconstitutional excessive fíne under Austin v. United States, 509 U.S. 602, 621-22, 113 S.Ct. 2801, 125 L.Ed.2d 488 (1993), and its progeny. These are issues going to the manner in which the government collects its forfeiture judgment. They are not ripe for final disposition — by this court or by the district court — until the government has collected its forfeiture judgments against Covey and the Harts. In my view, the forfeiture issues Covey raises are not appealable for this reason, without regard to whether the district court’s forfeiture order is now final. ■
This distinction may be important in the further proceedings the parties contemplate. Both parties agree that Covey and the Harts as conspirators are jointly and severally liable for forfeitures under 21 U.S.C. § 853(a)(1) — an issue this court has not yet addressed.5 Covey argues that the government has collected more than it deserves — $70,000 from Covey and additional forfeitures from the Harts. The government responds that property seized from the Harts “represented proceeds of their drug activities” and therefore is not “applicable” to Covey’s forfeiture. This dispute raises an unresolved issue of law: when drug proceeds are exchanged by a money launderer for “clean” cash, and the drug dealers use that cash to invest in a legitimate business, may the government recover twice the amount of the drug proceeds by forfeiting both the money launderer’s cash and the drug dealer’s property? I think not. But the issue should not be resolved until the government has completed its forfeiture collections. Similarly, Covey’s excessive fine argument should not be addressed until the district court has held an evidentiary hearing to determine what portion of the $70,000 in drug proceeds the government has collected from Covey, as opposed to the drug dealers, Gary and Darrell Hart.
The government has conceded on appeal that Covey is entitled to a hearing on these issues after it completes its forfeiture collections, and that Covey will be entitled to a refund if he has overpaid his forfeiture liability. Therefore, I concur in the court’s decision that the forfeiture issues Covey seeks to raise on appeal are premature.

. See United States v. Pitt, 193 F.3d 751, 765 (3d Cir.1999); United States v. McHan, 101 F.3d 1027, 1043 (4th Cir.1996), cert. denied, 520 U.S. 1281, 117 S.Ct. 2468, 138 L.Ed.2d 223 (1997); United States v. Benevento, 836 F.2d 129, 130 (2d Cir.1988); cf. United States v. Simmons, 154 F.3d 765, 769 (8th Cir.1998) (conspirators are jointly and severally liable for the proceeds of a RICO offense).