Court Opinion

ID: 9487255
Source: CourtListenerOpinion
Date Created: 2023-08-05 12:11:54.474114+00
Date Added: 2024-06-11T17:52:10.172948
License: Public Domain

PAUL KELLY, Jr., Circuit Judge,
dissenting.
The focus of this appeal centers on whether Mr. Salcido’s acceptance of what he believed to be proceeds of unlawful activity with the intent to transport them across state lines constitutes conducting or attempting to conduct a “financial transaction” with the intent to conceal or disguise the nature of such funds in violation of § 1956(a)(3)(B). The statute defines “financial transaction” as “a transaction which in any way or degree affects interstate of 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. § 1956(c)(4)(A). A “transaction” “includes a purchase, sale, loan, pledge, gift, transfer, delivery, or other disposition_” 18 U.S.C. § 1956(c)(3).
Both the Fifth and Sixth Circuits have recently held that the mere transportation of cash concealed either in a car or on one’s person from one point to another, even with the knowledge that the cash represents proceeds of specified unlawful activity, does not constitute a “financial transaction” for purposes of 18 U.S.C. § 1956(a)(1)(B)(i).1 See United States v. Puig-Infante, 1994 WL 126773 at *6-7 (5th Cir.1994); United States v. Samour, 9 F.3d 531, 536 (6th Cir.1993). But see United States v. Dimeck, 24 F.3d 1239, 1246 (10th Cir.1994). Even if we expand the meaning of “financial transaction” to include mere concealed transportation, Dimeck, 24 F.3d at 1246, the government’s case fails for another reason. On this record, there is a complete lack of evidence that Mr. Salcido did anything or had the intent to do anything to “conceal or disguise the nature” of the illegal proceeds. “[B]y the express terms of the statute, a design to conceal or disguise the source or nature of the proceeds *1247is a necessary element for a money laundering conviction.” Sanders, 928 F.2d at 946 (emphasis added); see also Dimeck, 24 F.3d at 1246 (“[T]he government [must prove] that the transaction was designed to conceal the attributes of the illegal proceeds.”); United States v. Gilliam, 975 F.2d 1050, 1056 (4th Cir.1992) (“[T]he Government must prove a specific intent to structure a transaction so as to conceal the true nature of the proceeds.”); United States v. Jackson, 935 F.2d 832, 838 (7th Cir.1991) (“[T]he government must prove that the transaction was designed to conceal one or another of the enumerated attributes of the proceeds involved.”). The requisite intent to “conceal or disguise the nature” of illegal proceeds can be gleaned only from acts designed to conceal what kind of money is involved — i.e., drug money — in a financial transaction, not merely the fact that money is involved. Therefore, mere physical concealment and transport is not what was contemplated as an offense under either § 1956(a)(l)(B)(i) or § 1956(a)(3)(B). The court’s decision fails to account for this legal distinction and merely distinguishes the recent Dimeck decision on factual grounds.
A review of the record reveals no evidence of any intent to conceal the nature of the funds or the identity of the participants to the transaction. Mr. Salcido requested the funds be in the form of large bills to facilitate their concealment on his person while a passenger on a commercial flight from Missouri to California. These facts are not disputed; the dispute lies in their import. Mr. Salci-do’s request for large bills provides evidence only of his intention to conceal the fact that he was carrying money. There is simply no evidence that he attempted or intended to conceal the character of the money. Therefore, the government failed to prove that Mr. Salcido violated § 1956(a)(3)(B).
Mr. Salcido was also convicted of conspiracy with Arnold Pruneda and Kevin Dimeck
“to conduct and attempt to conduct a financial transaction affecting interstate commerce which involved the proceeds of marijuana distribution, knowing that the property involved in the financial transaction represented the proceeds of some form of unlawful activity, and further knowing that the transaction was designed to conceal and disguise the nature, location, source, and ownership of the proceeds of the specified unlawful activity, in violation of Title 18, United States Code, Section 1956(a)(1)(B)© [and in violation of 18 U.S.C. § 371].”
Superceding Indictment, I.R. doc. 6 at 6. In order to prove a § 1956(a)(1)(B)® conspiracy the government was required to show 1) an agreement between at least two conspirators to conduct a financial transaction; 2) knowledge that the transaction involved proceeds from a specified unlawful activity; 3) the transaction in fact involved the proceeds of a specified unlawful transaction; and 4) the conspirators designed the transaction with the intent to conceal or disguise the nature, location, source, ownership or control of such ill-gotten proceeds. See 18 U.S.C. §§ 371, 1956(a)(1)(B)®.
Even assuming that Mr. Salcido conspired to conduct a transaction that in fact involved the proceeds of specified unlawful activity, the government has failed to prove a conspiracy to violate § 1956(a)(1)(B)®. As explained above, money laundering in violation of § 1956(a)(1)(B)® involves the concealment of the character or other enumerated attribute of ill-gotten gain. A conspiracy to violate § 1956(a)(1)(B)®, therefore, must involve an agreement to conduct a financial transaction designed to effect such concealment. Here, the government’s proof fell short — the record indicates only that the members of this scheme intended to conceal the fact that certain persons were in possession of unlawfully obtained funds in an effort to transport them. Like Dimeck, the record in this case reflects Mr. Salcido had no involvement in the fabricated retrieval of the money from the DEA and the alleged concealment attendant thereto; only Mr. Pruneda and the Mr. Moore were privy to that transaction. Invoking Pinkerton, the court attempts to tie Mr. Sal-cido into Mr. Pruneda’s involvement in the feigned procurement of a check from the DEA under false pretenses. Mr. Pruneda committed no criminal act, other than conspiring with Mr. Moore, for which Mr. Salci-do could be liable. The court fails to recognize that it was legally impossible for Mr. *1248Pruneda to conspire with a government agent. See United States v. Reyes, 979 F.2d 1406, 1408 n. 4 (10th Cir.1992); United States v. Barboa, 777 F.2d 1420, 1422 (10th Cir.1985). Because no one other than Mr. Moore was involved in the scheme to recover the funds from the DEA, Mr. Pruneda had no coconspirator in this regard. Thus, what the court labels as the second conspiracy could not have included the feigned recovery of the money from the DEA.
Because the government failed to adduce evidence that any member of this second conspiracy acted or attempted to act to conceal the nature or source of the funds, the government failed to prove a conspiracy to violate § 1956(a)(l)(B)(i). Accordingly, I respectfully dissent.

. The difference between § 1956(a)(l)(B)(i) and § 1956(a)(3)(B) is that the former covers offenses that involve the actual proceeds of unlawful conduct and the latter is designed to criminalize authorized sting operations involving property believed by the defendant to be the proceeds of specified unlawful activity. Because this distinction makes no difference in the context of our analysis, interpretations of § 1956(a)(l)(B)(i) apply equally to our interpretation of § 1956(a)(3)(B).