Court Opinion

ID: 802950
Source: CourtListenerOpinion
Date Created: 2012-06-22 18:47:21+00
Date Added: 2024-06-11T18:00:06.240374
License: Public Domain

PUBLISHED

UNITED STATES COURT OF APPEALS
             FOR THE FOURTH CIRCUIT

UNITED STATES OF AMERICA,              
                 Plaintiff-Appellee,
                v.                         No. 10-5289
HARRIET P. JINWRIGHT,
              Defendant-Appellant.
                                       

UNITED STATES OF AMERICA,              
                Plaintiff-Appellee,
               v.                          No. 10-5290
ANTHONY L. JINWRIGHT,
             Defendant-Appellant.
                                       
        Appeals from the United States District Court
  for the Western District of North Carolina, at Charlotte.
              Frank D. Whitney, District Judge.
       (3:09-cr-00067-FDW-2; 3:09-cr-00067-FDW-1)

                   Argued: May 18, 2012

                  Decided: June 22, 2012

          Before WILKINSON, NIEMEYER, and
                  KING, Circuit Judges.

Affirmed by published opinion. Judge Wilkinson wrote the
opinion, in which Judge Niemeyer and Judge King joined.
2                  UNITED STATES v. JINWRIGHT
                          COUNSEL

ARGUED: Ann Loraine Hester, FEDERAL DEFENDERS
OF WESTERN NORTH CAROLINA, INC., Charlotte, North
Carolina; Joshua Daniel Davey, MCGUIREWOODS, LLP,
Charlotte, North Carolina, for Appellants. David Alan Brown,
Sr., OFFICE OF THE UNITED STATES ATTORNEY,
Charlotte, North Carolina, for Appellee. ON BRIEF: Hender-
son Hill, Executive Director, FEDERAL DEFENDERS OF
WESTERN NORTH CAROLINA, INC., Charlotte, North
Carolina, for Appellant Harriet P. Jinwright; Jennifer L. King,
MCGUIREWOODS, LLP, Charlotte, North Carolina, for
Appellant Anthony L. Jinwright. Anne M. Tompkins, United
States Attorney, Craig D. Randall, Assistant United States
Attorney, OFFICE OF THE UNITED STATES ATTORNEY,
Charlotte, North Carolina, for Appellee.

                           OPINION

WILKINSON, Circuit Judge:

   Anthony and Harriet Jinwright, former co-pastors of
Greater Salem Church in North Carolina, appeal their convic-
tions and sentences arising from a tax evasion scheme in
which they omitted millions of dollars of taxable income from
their jointly filed tax returns. The Jinwrights raise a variety of
challenges on appeal. Finding each contention to be without
merit, we affirm the judgment of the district court.

                                I.

   Mr. and Mrs. Jinwright were convicted of conspiracy to
defraud the United States in violation of 18 U.S.C. § 371 and
of three counts of tax evasion for the years 2005-2007, and
aiding and abetting the same, in violation of 26 U.S.C. § 7201
and 18 U.S.C. § 2. Mr. Jinwright was convicted (and Mrs. Jin-
                  UNITED STATES v. JINWRIGHT                   3
wright acquitted) of three additional counts of tax evasion for
the years 2002-2004, as well as six counts of filing a false tax
return in violation of 26 U.S.C. § 7206(1). The Jinwrights
were also acquitted of several other charges not at issue in this
appeal. The Jinwrights’ convictions followed a four-week trial
that involved the admission of over 90,000 pages of documen-
tary evidence and the testimony of more than 70 witnesses.
The facts most relevant to this appeal are summarized here.

                               A.

   Prior to this litigation, Mr. Jinwright had served as senior
pastor of Greater Salem Church (GSC) since 1981. Mrs. Jin-
wright played an active role in church life during her hus-
band’s ministry and began to draw a salary from GSC as a
pastor of the church in about 2000. Over the course of their
time with GSC, the Jinwrights were co-chairs of the GSC
board of directors and served on a number of committees
within the church, including those responsible for financial
decisions. Mr. Jinwright had final authority over employee
salaries and church finances more generally.

   When Mr. Jinwright first became pastor at GSC, his salary
was about $10,000. By 2001, his salary had increased to
approximately $148,000. It reached about $300,000 by 2007.
Between 2001 and 2007, GSC provided Mr. Jinwright with
substantial benefits, in addition to his salary, that he underre-
ported on his tax returns. He received housing allowances of
between $130,000 and $160,000 per year, travel allowances
of $19,000 to $48,000 per year, payments for his children’s
tuition and his federal income tax liability, and unlimited use
of a luxury car leased by the church in addition to an annual
vehicle allowance. Mr. Jinwright also received annual
bonuses of $35,000 to $50,000, as well as separate Christmas
bonuses. He had use of a GSC credit card and received reim-
bursements for purported business-related expenses that
remained unsubstantiated. Taken together, Mr. Jinwright’s
total GSC compensation between 2001 and 2007 totaled
4                 UNITED STATES v. JINWRIGHT
nearly $3.9 million. During that time, Mrs. Jinwright received
similar compensation from GSC in the form of salary,
bonuses, allowances, and reimbursements, totaling nearly $1
million.

   The Jinwrights earned more income outside of GSC.
Together they earned tens of thousands of dollars in addi-
tional income for speaking at other churches that they failed
to report to the IRS. Mr. Jinwright established an organization
known as A.L. Jinwright Ministries, Inc. (ALJM), purportedly
to receive his income from outside speaking engagements.
Mrs. Jinwright was responsible for handling ALJM’s bank
statements and providing the corporation’s financial informa-
tion to the Jinwrights’ CPA. Although defendants kept the
income earned through this business, GSC paid its operating
expenses. Mr. Jinwright also founded the Pastors Consortium.
The consortium, with a membership of other pastors, held
annual events celebrating the anniversaries of the members’
churches. During these celebrations the participants would
exchange "gifts" to one another in the form of checks for
thousands of dollars.

   IRS Revenue Agent Linda Polk reconstructed defendants’
taxable income for the years 2002-2007 and testified at trial
as to her conclusions regarding defendants’ income and tax
liabilities for those years. She treated as taxable income all
GSC compensation by check, all payments for business-
related expenses for which there was no substantiation, and
payments received by defendants for speaking at other
churches. Polk testified that defendants understated their tax-
able income by $2,486,771 between 2002 and 2007, resulting
in a tax deficiency of $664,352 for those years.

                              B.

   In light of the substantial evidence that the Jinwrights
underreported their income from 2002 through 2007, the cen-
tral dispute at trial concerned the defendants’ knowledge of
                  UNITED STATES v. JINWRIGHT                  5
wrongdoing. See Sansone v. United States, 380 U.S. 343, 351
(1965) (elements of tax evasion under 26 U.S.C. § 7201 are
"willfulness; the existence of a tax deficiency, and an affirma-
tive act constituting an evasion or attempted evasion of the
tax") (internal citations omitted). Mr. Jinwright testified that
he and Mrs. Jinwright did not intend to evade their tax obliga-
tions. To establish that defendants knowingly understated
their taxable income, the government introduced evidence of
unreported income in the form of allowances, unsubstantiated
reimbursements, bonuses and "gifts." The government also
tendered evidence of defendants’ extravagant spending that
exceeded the income they reported, including over a million
dollars spent between 2001-2007 on mortgage and lease pay-
ments for two homes and several luxury cars.

   Between 2001 and 2007, defendants reported total income
of slightly more than $1.8 million, but claimed personal
deductions of nearly $1.6 million, which would have left them
with only about $28,000 to spend per year on nondeductible
expenses. Yet the Jinwrights spent substantially more than
that. Analysis of defendants’ bank accounts revealed that
from 2001-2007 the Jinwrights deposited and spent $3 million
in excess of their reported income for those years. They also
reported income on multiple loan applications between 2000
and 2006 that exceeded the reported income on their corre-
sponding tax returns. They claimed tens of thousands of dol-
lars in deductions for ALJM, even though the corporation had
no employees and GSC bore its primary operating costs.

   The government also presented evidence that the Jinwrights
were informed multiple times of their legal duties and contin-
ued to breach them. Between 2001 and 2004, GSC undertook
several audits to assist the church in obtaining tax-exempt sta-
tus under I.R.C. § 501(c)(3). The auditors identified several
problems with GSC’s finances and informed the Jinwrights
that they should be reporting their entire compensation pack-
age, including reimbursements for unsubstantiated expenses,
as well as payments from GSC and other churches designated
6                 UNITED STATES v. JINWRIGHT
as "love gifts." Nonetheless in 2001, for example, the Jin-
wrights’ tax return reported almost $150,000 less than the
auditors determined to be Mr. Jinwright’s total compensation
from GSC for that year. Several GSC employees, including
three individuals who worked in the position of finance
administrator, similarly told the Jinwrights that the variety of
payments they were receiving from GSC constituted taxable
income.

   Yet the Jinwrights failed to inform their personal CPA
Terry Lancaster about GSC compensation other than salary
and housing allowances, which Lancaster testified he would
have included as income in their returns had he known about
it. According to the government, the defendants also struc-
tured their GSC compensation to conceal it from the IRS. For
example, they directed that their non-salary compensation be
paid out of the GSC operating account, rather than the payroll
account. As a result, those payments were not included on the
Jinwrights’ W-2 forms and, per Mr. Jinwright’s instruction,
no 1099 forms were issued to disclose the added income to
the IRS. Jacqueline Joyner-Jones, who served as an adminis-
trative assistant to the Jinwrights from 2001-2007, testified
that the defendants instructed her to forge numerous checks
from GSC Women of Faith Ministry, a subsidiary of GSC
ministry. The checks were designated as reimbursements and
included a $15,000 check in 2006 to cover Mr. Jinwright’s tax
liability.

   The government presented evidence that defendants
instructed GSC employees to alter GSC financial records to
mislead both the congregation and the IRS. By 2002, the
church began experiencing financial difficulties. According to
several former GSC finance administrators, the Jinwrights
paired extra months of revenues with fewer months of
expenses in GSC’s financial reports to conceal the church’s
level of debt. The financial reports also buried the amount of
the Jinwrights’ compensation by including all GSC employee
salaries in one line item. Several of these misleading reports
                  UNITED STATES v. JINWRIGHT                  7
were submitted to the IRS with GSC’s applications for section
501(c)(3) tax-exempt status.

   Although GSC’s section 501(c)(3) application in 2002
understated Mr. Jinwright’s total compensation, the IRS none-
theless denied the application on the basis that his compensa-
tion was too high. CPA Robert Howze assisted with a second
application in 2003, and reported Mr. Jinwright’s compensa-
tion at more than $600,000 even though Mr. Jinwright had
reported only about $280,000 on his tax return. As a result,
the IRS began an investigation into the Jinwrights’ tax filings
and uncovered evidence that between 2002 and 2007 the Jin-
wrights had understated their taxable income by over $2 mil-
lion. The government eventually obtained a nineteen-count
superseding indictment against the Jinwrights. Their trial
resulted in conviction on charges of conspiracy to defraud the
United States, tax evasion and aiding and abetting the same,
and for Mr. Jinwright, filing false tax returns.

                              C.

   At sentencing, the district court determined that the Jin-
wrights had willfully omitted more than $3 million in taxable
income from their joint returns, causing a tax loss to the
United States and the State of North Carolina of approxi-
mately $1.3 million. The court relied on testimony from IRS
Agent Polk, who accounted for tax losses from 2002 through
2007, as well as tax losses for the years 1991-1993, 1998-
2001, and 2008. In calculating their base offense levels and
the amount of restitution each defendant owed, the court held
Mrs. Jinwright responsible for losses from 1998-2008, and
Mr. Jinwright responsible for losses from 1991-1993 and
1998-2008.

   The court applied sentencing enhancements for role in the
offense (two levels), the use of sophisticated means (two
levels), and abuse of a position of trust (two levels). Mr. Jin-
wright also received a two-level enhancement for obstruction.
8                  UNITED STATES v. JINWRIGHT
Each defendant was sentenced within the calculated Guide-
lines range: Mr. Jinwright to 105 months’ imprisonment and
restitution in the amount of $1,278,556, and Mrs. Jinwright to
80 months’ imprisonment and restitution in the amount of
$1,174,921. The Jinwrights appeal their convictions and sen-
tences. They raise a number of challenges and we shall
address each in turn.

                                II.

   The Jinwrights contend that the district court issued two
jury instructions that impermissibly relieved the government
of its burden of proof. We turn first to the trial court’s instruc-
tion on willful blindness, against which appellants advance
two arguments. First, that the trial evidence did not support
the issuance of a willful blindness instruction. Second, that
the instruction misstated the legal standard of willful blind-
ness. We review for abuse of discretion both the district
court’s decision to offer an instruction and the content of that
instruction. See United States v. Lighty, 616 F.3d 321, 366,
377 (4th Cir. 2010).

   The Jinwrights are correct that requests for willful blind-
ness instructions should be handled with caution. Id. at 378.
But they come close to seeking the categorical exclusion of
such instructions while pointing to no court that has adopted
so absolute a rule. There are cases where the evidence demon-
strates that a defendant undertook an active and deliberate
effort to avoid imbuing himself with the knowledge that
would support a criminal conviction. To allow the most
clever, inventive, and sophisticated wrongdoers to hide
behind a constant and conscious purpose of avoiding knowl-
edge of criminal misconduct would be an injustice in its own
right. As much of one, in fact, as a conviction under a plainly
impermissible recklessness or negligence standard. See
Global-Tech Appliances, Inc. v. SEB S.A., 131 S. Ct. 2060,
2069 (2011) ("The traditional rationale for this doctrine is that
defendants who behave in this manner are just as culpable as
                  UNITED STATES v. JINWRIGHT                   9
those who have actual knowledge."). For the reasons that fol-
low, we think the district court properly set a high bar in its
instruction for the government to prove willful blindness,
while simultaneously recognizing the powerful evidence of
such blindness in this case.

                               A.

   The Jinwrights first contend that the evidence did not sup-
port a willful blindness instruction. The trial court issued such
an instruction at the government’s request and over the Jin-
wrights’ objection. The crimes for which the Jinwrights were
convicted—both Jinwrights for conspiracy to defraud the
United States and tax evasion, Mr. Jinwright also for filing
false tax returns—each required the government to prove that
the defendants acted willfully. Willfulness with respect to tax
crimes has been defined in essence as a knowledge require-
ment, or the "intentional violation of a known legal duty."
United States v. Pomponio, 429 U.S. 10, 12 (1976) (per
curiam). When applied, the doctrine of willful blindness per-
mits the government to prove knowledge by establishing that
the defendant "deliberately shield[ed] [himself] from clear
evidence of critical facts that are strongly suggested by the
circumstances." Global-Tech, 131 S. Ct. at 2068-69. Willful
blindness may satisfy knowledge in a criminal tax prosecu-
tion, where "the evidence supports an inference that a defen-
dant was subjectively aware of a high probability of the
existence of a tax liability, and purposefully avoided learning
the facts pointing to such liability." United States v. Poole,
640 F.3d 114, 122 (4th Cir. 2011).

   These conditions were satisfied here. Mr. Jinwright denied
knowledge of his legal obligations and testified that he and
Mrs. Jinwright did not know that their tax returns contained
a deficiency. But the government presented evidence to sug-
gest that defendants were aware of a "high probability" that
they were understating their income to the IRS. For example,
defendants’ tax returns for 2001 to 2007 claimed personal
10                UNITED STATES v. JINWRIGHT
deductions of nearly $1.6 million despite reporting about $1.8
million of taxable income. During those years, defendants
deposited into their bank accounts and spent over $3 million
more than they reported as income on their tax returns.

   In addition, the government introduced evidence indicating
that the defendants purposely avoided learning the fact of
their liability. Between 2002 and 2007, several auditors and
GSC administrators advised the defendants that they were
underreporting their income, but defendants never raised these
concerns with their personal CPA, who could easily have
explained the law. The Jinwrights also failed to clarify their
alleged confusion regarding the tax treatment of honoraria and
"love offerings," instead simply excluding these payments
from income. The Jinwrights’ CPA testified that the Jin-
wrights never informed him of the substantial compensation
from GSC that they specifically structured so as not to appear
on their W-2s.

   The government’s presentation of evidence that the Jin-
wrights actually knew of their tax code violations did not pre-
clude it from seeking a willful blindness instruction. United
States v. Abbas, 74 F.3d 506, 513 (4th Cir. 1996). In light of
Mr. Jinwright’s denial of knowledge and the evidence sup-
porting an inference of deliberate ignorance on the part of
defendants, the court’s provision of a willful blindness
instruction was not an abuse of discretion.

                              B.

   Appellants next take issue with the content of the willful
blindness instruction. They contend that the court violated
their Fifth Amendment due process rights by allowing the
jury to convict them based on recklessness, thereby diminish-
ing the government’s burden of proving willfulness. The Fifth
Amendment Due Process Clause and the Sixth Amendment
jury trial right together require "criminal convictions to rest
upon a jury determination that the defendant is guilty of every
                   UNITED STATES v. JINWRIGHT                  11
element of the crime with which he is charged, beyond a rea-
sonable doubt." United States v. Gaudin, 515 U.S. 506, 510
(1995). A court runs afoul of this protection when it issues an
instruction that relieves the government of its burden of proof
with respect to an element of a charged offense. See Carella
v. California, 491 U.S. 263, 265 (1989) (per curiam). We con-
clude, however, that "the instructions, taken as a whole, ade-
quately state the controlling law." United States v. Wills, 346
F.3d 476, 492 (4th Cir. 2003).

   Appellants rely heavily on the Supreme Court’s recent
decision in Global-Tech Appliances, Inc. v. SEB S.A., 131 S.
Ct. 2060, 2070 (2011), which emphasized that willful blind-
ness has a "limited scope that surpasses recklessness and neg-
ligence." The Court defined a reckless defendant as "one who
merely knows of a substantial and unjustified risk of . . .
wrongdoing" and a negligent defendant as "one who should
have known of a similar risk but, in fact, did not." Id. at 2071.

   Unlike the instruction at issue in Global-Tech, however, the
one here specifically admonished the jury that it was not
enough to find that defendants "were reckless or foolish in
failing to recognize what was occurring" and that a "showing
of negligence is not sufficient to support a finding of willful-
ness or knowledge." The court cautioned the jury that a "will-
ful blindness charge does not authorize you to find that the
defendants acted knowingly because they should have known
what was occurring, or that in the exercise of hindsight they
should have known what was occurring, or because they were
negligent in failing to recognize what was occurring."

   The trial court’s instruction here was thus faithful to the
willful blindness standard set forth in Global-Tech. Global-
Tech synthesized the case law on willful blindness to identify
"two basic requirements": "(1) the defendant must subjec-
tively believe that there is a high probability that a fact exists
and (2) the defendant must take deliberate actions to avoid
learning of that fact." Global-Tech, 131 S. Ct. at 2070. The
12                 UNITED STATES v. JINWRIGHT
district court included this relevant language here, instructing
the jury: "If you find that the defendants were aware of a high
probability" that they were violating the law "and that the
defendants acted with deliberate disregard to these facts, you
may find the defendants acted knowingly" (emphasis added).
The Jinwrights were convicted before the Global-Tech deci-
sion, but the language of the willful blindness instruction still
tracks the factors enumerated there by the Supreme Court.

   At the end of the day, the trial court’s instruction required
that defendants’ ignorance be "solely and entirely the result of
a conscious purpose to avoid learning the truth." Taken as a
whole, the instruction plainly conveyed the government’s bur-
den to prove beyond a reasonable doubt conduct that tran-
scended recklessness and negligence, which the evidence
shows overwhelmingly the defendants’ conduct did. See
United States v. Martin, 773 F.2d 579, 584 (4th Cir. 1985).

                               III.

                               A.

   The Jinwrights also object to the district court’s instructions
to the jury regarding the tax treatment of payments from an
employer to an employee. As part of its burden of proof on
the charged offenses, the government was required to prove
that the Jinwrights received income that they did not properly
report on their tax returns. See, e.g., Boulware v. United
States, 552 U.S. 421, 424 (2008) ("One element of tax eva-
sion under § 7201 is ‘the existence of a tax deficiency.’"). To
that end, the government sought to establish that GSC made
payments to the Jinwrights that they were required to include
in gross income as compensation from their employer.

  During the government’s case-in-chief, however, three for-
mer GSC employees—business administrator Varnell Gray,
administrative assistant Jacqueline Joyner-Jones, and finance
administrator Travis Mauney—described payments from GSC
                  UNITED STATES v. JINWRIGHT                 13
to the Jinwrights as "gifts." Because gifts are excludable from
gross income, see I.R.C. § 102(a), the government objected in
each instance that this testimony would mislead the jury to
conclude that the compensation was nontaxable as a matter of
law. The court thus instructed the jury three times during the
presentation of evidence, and again during the final jury
charge, as follows:

    Any amount transferred by or for an employer to or
    for the benefit of an employee is income. Such pay-
    ments are not gifts under the Internal Revenue Code
    and may not be excluded from gross income regard-
    less of how the payments by the employer to the
    employee are characterized.

    Additionally, payments by an employer to an
    employee, or on the employee’s behalf as reimburse-
    ments for business-related expenditures, must be
    included in the gross income of the employee unless
    the expenses are ordinary and necessary business
    expenses, the business nature of the expenses has
    been substantiated, and any unsubstantiated pay-
    ments have been returned to the employer.

   The Jinwrights contend that the instruction unconstitution-
ally directed the jury to find an element of the offenses
charged, namely that the Jinwrights received payments that
they were required to report as gross income. See Carella, 491
U.S. at 265. For the reasons that follow, we disagree.

   A district court may instruct the jury on applicable law and
is permitted to "instruct the jury before or after the arguments
are completed, or at both times." Fed. R. Crim. P. 30(c). Here,
the court did just that. It is apparent that the relationship
between an employer and employee is one that is commonly
established for some kind of mutual benefit, a dynamic that
is altogether different from the "detached and disinterested
generosity" that normally prompts the tender of a gift.
14                UNITED STATES v. JINWRIGHT
Comm’r v. Duberstein, 363 U.S. 278, 285 (1960). The
instruction at issue correctly explained the relevant tax law,
which is clear that payments from an employer to an
employee are not gifts, but are presumed to be included in
gross income. A taxpayer must report as gross income "all
income from whatever source derived," I.R.C. § 61, unless
"excluded by law," 26 C.F.R. § 1.61-1(a); see Comm’r v.
Banks, 543 U.S. 426, 433 (2005). To be sure, § 102(a) of the
Code excludes from gross income "the value of property
acquired by gift." I.R.C. § 102(a). But the Code is explicit that
payments from an employer to an employee do not constitute
gifts under § 102(a), which "shall not exclude from gross
income any amount transferred by or for an employer to, or
for the benefit of, an employee." I.R.C. § 102(c).

   Absent a clarifying instruction, the jury may have mistaken
the testimony from several witnesses that GSC’s payments to
the Jinwrights were "gifts" as a legal conclusion that these
payments were nontaxable. To prevent juror confusion, the
district court alerted the jury that as a matter of law, payments
from an employer to an employee do not qualify as nontax-
able gifts, irrespective of the employer’s intent. But the jury
was left to determine that the Jinwrights did in fact receive
payments from their employer, GSC—an uncontroversial
point which the Jinwrights essentially conceded. From this
factual finding, it followed as a matter of law that GSC’s pay-
ments to the Jinwrights did not constitute gifts qualifying for
exclusion from gross income.

                               B.

   Although payment from an employer does not qualify as an
excludable gift, the jury instruction elaborated that employer
reimbursements may qualify for deduction from gross income
if certain conditions are satisfied. See I.R.C. § 62(a)(2)(A); 26
C.F.R. § 1.62-2. Appellants argue that the court thus created
a presumption that any employer payments were includable
gross income, impermissibly shifting the burden to defendants
                  UNITED STATES v. JINWRIGHT                  15
to prove that the unreported payments were deductible reim-
bursements for substantiated business expenses. But we will
not fault the district court for being thorough, as well as accu-
rate, in its explanation of the relevant law. Under the tax law,
the "burden of clearly showing the right to the claimed deduc-
tion is on the taxpayer." INDOPCO, Inc. v. Comm’r, 503 U.S.
79, 84 (1992) (internal quotation marks omitted).

   Our sister circuits have consistently applied this principle
in criminal tax cases—recognizing that "the burden is on the
defendant to prove that he had allowable deductions which
were not shown in his return once the Government establishes
unreported income." Elwert v. United States, 231 F.2d 928,
933 (9th Cir. 1956); see also United States v. Tarwater, 308
F.3d 494, 508 (6th Cir. 2002) ("[W]hile the government bears
the burden of proof throughout any criminal tax case, the gov-
ernment is not required to negate every possible source of
nontaxable income, to track down all possible expenses, or to
prove the absence [of] any off-setting costs or deductions.")
(collecting cases); United States v. Nathan, 536 F.2d 988, 991
(2d Cir. 1976) ("The applicable rule here is that uniformly
applied in tax evasion cases—that evidence of unexplained
receipts shifts to the taxpayer the burden of coming forward
with evidence as to the amount of offsetting expenses, if
any.") (quoting Siravo v. United States, 377 F.2d 469, 473
(1st Cir. 1967)).

   This case is unlike United States v. Mogavero, 521 F.2d
625 (4th Cir. 1975), where the instruction in a net worth tax
prosecution actually shifted to the defendant the government’s
ultimate burden of proof. Here, it is plain that the government
retained its burden of proof on every element of the charges,
including the burden to establish that the Jinwrights failed to
report income to the IRS. Before the burden shifted to the
defendants to demonstrate the deductibility of unreported
income, the government established that the Jinwrights
received several millions of dollars from their employer that
they omitted from gross income. This offer of proof created
16                UNITED STATES v. JINWRIGHT
a presumption that the income was taxable as a matter of law.
In turn, the defendants failed to establish that these payments
satisfied the reimbursement criteria under a plan qualifying
for deduction pursuant to I.R.C. § 62. See 26 C.F.R. § 1.62-2.
Because the instruction contained no constitutional infirmity,
but correctly guided the jury on the relevant law, it did not
constitute an abuse of discretion.

                              IV.

   In addition to instructing the jury on the tax treatment of
employer-employee payments, the trial court limited the
defense’s ability to cross-examine Gray, Joyner-Jones, and
Mauney about their belief that payments from GSC to the Jin-
wrights constituted gifts. The Jinwrights insist that the court’s
evidentiary limits burdened their ability to disprove the
offense element of willfulness, which for purposes of criminal
tax offenses requires "the Government to prove that the law
imposed a duty on the defendant, that the defendant knew of
this duty, and that he voluntarily and intentionally violated
that duty." Cheek v. United States, 498 U.S. 192, 201 (1991).
Appellants argue that the belief within the church community
that the GSC payments were nontaxable gifts, even if mis-
taken on the law, was relevant to show the Jinwrights’ own
ignorance of their legal duties.

   A defendant’s Fifth Amendment right to due process guar-
antees "the right to a fair opportunity to defend against the
State’s accusations," which, under the Sixth Amendment,
includes the "rights to confront and cross-examine witnesses
and to call witnesses in one’s own behalf." Chambers v. Mis-
sissippi, 410 U.S. 284, 294-95 (1973). The right to cross-
examine, however, "is not absolute." Id. at 295. A trial court
retains "discretion in limiting needless or confusing inquiry
into collateral matters." United States v. Cole, 622 F.2d 98,
100 (4th Cir. 1980) (per curiam). Moreover, a defendant’s
Sixth Amendment right "‘to be confronted with the witnesses
against him’" does "not give defendants a plenary right to
                   UNITED STATES v. JINWRIGHT                  17
elicit friendly testimony." United States v. Crockett, 813 F.2d
1310, 1313 (4th Cir. 1987) (quoting U.S. Const. amend. VI).
Instead, "that is the purpose of the Sixth Amendment right of
a defendant ‘to have compulsory process for obtaining wit-
nesses in his favor.’" Id. (quoting U.S. Const. amend. VI).

   The decision to limit cross-examination was a reasonable
precaution, in conjunction with the jury instruction on
employer-employee payments, to prevent juror confusion
regarding the taxability of income from GSC. The testimony
that the GSC payments were "gifts"—although offered by
witnesses called by the government—was favorable to the
defense and contrary to the government’s effort to establish
that the payments were taxable gross income. The defense’s
desire for the witnesses to elaborate on their beliefs under
cross-examination therefore fell outside "the confrontational
essence of the Confrontation Clause." Id. at 1314. Appellants
mistakenly conflate a defendant’s right to "challenge adverse
testimony," id. at 1314, with his Sixth Amendment right "to
have compulsory process for obtaining witnesses in his
favor," U.S. Const. amend. VI, a right with which the district
court did not interfere. In fact, the court explicitly invited the
Jinwrights to recall the favorable witnesses during their case-
in-chief in the event the testimony proved relevant to the
defense.

   Cheek v. United States, 498 U.S. 192 (1991), is not to the
contrary. Cheek held that a good faith misunderstanding of
one’s legal duties is a defense in a criminal tax prosecution
"whether or not the claimed belief or misunderstanding is
objectively reasonable." Id. at 202. The trial court in Cheek
therefore ran afoul of the Sixth Amendment when it instructed
the jury to disregard the defendant’s testimony that he misun-
derstood his obligations under the tax law. Id. at 203. Here,
by contrast, the district court did not impede the Jinwrights’
good faith defense. In fact, the court admitted, and the jury
considered, Mr. Jinwright’s testimony that he and Mrs. Jin-
wright were ignorant that they were violating the tax law.
18                UNITED STATES v. JINWRIGHT
   Moreover, Cheek emphasized that it "would of course be
proper to exclude evidence having no relevance or probative
value with respect to willfulness." Id. None of the witnesses
at issue claimed to have discussed with the Jinwrights his or
her belief that the payments from GSC were gifts and no evi-
dence established at that point that the Jinwrights relied on a
community-wide misunderstanding of the law. The district
court therefore properly concluded that testimony from these
witnesses on cross-examination about their own beliefs was
not relevant to the Jinwrights’ ignorance of the law. Nonethe-
less, as appellants concede, the trial court left open the possi-
bility of recalling these witnesses during the defense’s case
once Mr. Jinwright testified and a foundation had been laid
for a Cheek defense. Defendants’ failure to do so rests
squarely on their shoulders. We shall therefore uphold the evi-
dentiary ruling of the district court.

                               V.

                               A.

   Mrs. Jinwright contends that the district court erred by cal-
culating her tax loss amount at greater than $1 million, result-
ing in a base offense level of 22. See U.S.S.G. §§ 2T1.1,
2T4.1. The loss amount is critical to sentencing in criminal
tax cases simply because the greater the fraud upon the Trea-
sury, the more substantial the punishment. For an offense
involving tax evasion or a fraudulent or false return, tax loss
is "the total amount of loss that was the object of the offense."
U.S.S.G. § 2T1.1(c)(1). It includes losses arising from rele-
vant criminal conduct that is "part of the same course of con-
duct or common scheme or plan." United States v. Fleschner,
98 F.3d 155, 160 (4th Cir. 1996); see U.S.S.G. § 2T1.1 cmt.
n.2. In the case of conspiracy, relevant conduct that occurred
during commission of, or in preparation for, the offense of
conviction extends to "all reasonably foreseeable acts and
omissions of others in furtherance of the jointly undertaken
criminal activity." U.S.S.G. § 1B1.3(a)(1)(B).
                  UNITED STATES v. JINWRIGHT                 19
   The district court determined that Mrs. Jinwright was
responsible for a combined tax loss of $1,174,921 for the
years 1998-2008, adopting in large part the loss amounts cal-
culated by IRS Agent Polk. Mrs. Jinwright does not challenge
the accuracy of the loss computations, but argues instead that
the district court erroneously included loss amounts that were
not attributable to her criminal conduct. The jury acquitted
Mrs. Jinwright of tax evasion for years preceding 2005 and,
according to appellant, thereby discredited any evidence that
she had criminal knowledge before 2005.

   We are not persuaded. Although relevant conduct under the
Guidelines "must be criminal conduct," see United States v.
Dove, 247 F.3d 152, 155 (4th Cir. 2001), an acquittal "does
not necessarily establish the criminal defendant’s lack of
criminal culpability," United States v. Scott, 437 U.S. 82, 106
(1978) (Brennan, J., dissenting), and a "jury cannot be said to
have ‘necessarily rejected’ any facts when it returns a general
verdict of not guilty," United States v. Watts, 519 U.S. 148,
155 (1997) (per curiam). Instead, the "different standards of
proof that govern at trial and sentencing" enable the sentenc-
ing court to find a fact by a preponderance of the evidence
that the jury may not have found beyond a reasonable doubt.
Id. at 155.

   The sentencing court was therefore entitled to "consider
conduct of the defendants underlying charges of which they
had been acquitted" in determining the appropriate sentence.
Id. at 149. What is more, as part of its relevant conduct analy-
sis the district court was required to consider evidence of
losses not contained in the indictment but relevant to the
offense of conviction. United States v. Hayes, 322 F.3d 792,
801-02 (4th Cir. 2003); see also United States v. Jones, 31
F.3d 1304, 1316 (4th Cir. 1994) (relevant conduct may
include criminal acts that preceded the date the convicted
offense was committed). Thus the district court did not err in
considering Mrs. Jinwright’s criminal conduct before 2005.
20                UNITED STATES v. JINWRIGHT
   The court moreover provided a "sufficient explanation of
its rationale" to support its tax loss finding. United States v.
Wilkinson, 590 F.3d 259, 269 (4th Cir. 2010). The district
court found a pattern of "long-term conduct" that "went on
for, in [the] Court’s eyes, approximately a decade." Unlike the
three tax evasion counts of which Mrs. Jinwright was acquit-
ted, both she and her husband were convicted of conspiracy.
Although count one of the indictment charged the Jinwrights
with conspiring to defraud the United States between 2002
and 2008, the indictment alleged overt acts in furtherance of
the conspiracy committed as early as 1991 and 1998. The
government presented evidence at trial to support these alle-
gations, offering proof that the Jinwrights underreported their
income and filed false joint tax returns beginning in 1991.

   The district court therefore had ample basis to conclude
that losses arising from acts committed before 2002 occurred
"as part of the same course of conduct or common scheme or
plan." Fleschner, 98 F.3d at 160. And it held Mrs. Jinwright,
as a co-conspirator, responsible for all reasonably foreseeable
acts taken by Mr. Jinwright in furtherance of the joint scheme.
See U.S.S.G. § 1B1.3(a)(1)(B). The court found that the Jin-
wrights’ tax deficiencies from 1991 to 1993, arising largely
from unreported GSC compensation to Mr. Jinwright, were
not reasonably foreseeable by Mrs. Jinwright. Thus, it
declined to count those amounts in calculating Mrs. Jin-
wright’s tax loss amount. By contrast, the court found that
Mrs. Jinwright was "responsible for all the other years . . .
that’s ’98 through 2008" because "based on the evidence at
trial, she began to get much more involved in the operation of
the church and of the A.L. Jinwright Ministries." Mrs. Jin-
wright’s increasing role at GSC supports the conclusion that
by 1998 she was a participant in the conspiracy who could
reasonably foresee acts by Mr. Jinwright in furtherance of it.
Together with the court’s finding that the pattern of criminal
conduct spanned about a decade, the court sufficiently
explained its inclusion of tax loss amounts for Mrs. Jinwright
for 1998-2008.
                  UNITED STATES v. JINWRIGHT                 21
                              B.

   Mr. and Mrs. Jinwright argue that the district court erred in
calculating the amount of restitution they owed pursuant to
the Mandatory Victims Restitution Act (MVRA), 18 U.S.C.
§ 3663A. Mr. Jinwright was ordered to pay restitution in the
amount of $1,278,556 based on tax loss amounts for 1991-
1993 and 1998-2008, and Mrs. Jinwright to pay $1,174,921
based on tax loss amounts for 1998-2008.

   The Jinwrights contend that the district court erred when it
ordered them to pay restitution based on losses prior to the
years for which they were convicted of criminal conduct.
They rely on our observation in United States v. Llamas, 599
F.3d 381, 391 (4th Cir. 2010), that "in the context of a con-
spiracy, a restitution award under the MVRA is limited to the
losses attributable to the specific conspiracy offenses for
which the defendant was convicted." Appellants, however,
read too much into Llamas, which merely held that a defen-
dant may not be ordered to pay restitution for losses caused
by other similar fraudulent schemes in which he did not par-
ticipate and for which he was not convicted. It did not pass
on the issue before us here.

   Rather, our precedent suggests that the Jinwrights were
appropriately ordered to pay restitution for losses arising from
conduct underlying their convictions for conspiracy. The
MVRA orders that a defendant make restitution to the "victim
of the offense." 18 U.S.C. § 3663A(a)(1). With respect to "an
offense that involves as an element a scheme, conspiracy, or
pattern of criminal activity," a victim is defined broadly to
include "any person directly harmed by the defendant’s crimi-
nal conduct in the course of the scheme, conspiracy, or pat-
tern." Id. § 3663A(a)(2). We interpreted identical language
under the other federal restitution statute, the Victim and Wit-
ness Protection Act, 18 U.S.C. § 3663(a)(2), as "expanding
district courts’ authority to grant restitution" with respect to
losses arising from conspiracy offenses. United States v.
22                 UNITED STATES v. JINWRIGHT
Henoud, 81 F.3d 484, 488 (4th Cir. 1996). Specifically, a dis-
trict court is authorized to include in restitution the "losses
that result from a criminal scheme or conspiracy, regardless
of whether the defendant is convicted for each criminal act
within that scheme." Id. at 488. In Henoud we held that the
district court did not therefore err by "ordering restitution for
losses caused by acts for which the defendant was not con-
victed." Id. at 489. Rather, the district court properly looked
to the "specific conduct underlying the offense of conviction,"
meaning all "acts comprising the scheme to defraud." Id.

   We think a similar course is appropriate here and see no
basis to distinguish the identical language in the MVRA. The
conduct underlying the Jinwrights’ conspiracy conviction
extended back to 1991, the year the indictment alleges that
acts in furtherance of the conspiracy began. As discussed, the
district court determined that Mrs. Jinwright participated in
the conspiracy—and could reasonably foresee acts in further-
ance of it—as early as 1998. As for Mr. Jinwright, the court
credited the trial evidence that his pattern of fraudulent con-
duct began in 1991. This included evidence that beginning in
1991, the Jinwrights’ joint return underreported their taxable
income and the Jinwrights filed mortgage applications that
listed higher income than that reported to the IRS. The district
court therefore did not err in including the tax losses for 1991-
1993 in Mr. Jinwright’s restitution amount.

                               VI.

   The Jinwrights object to the district court’s imposition of a
two-level enhancement under section 2T1.1(b)(2) of the Sen-
tencing Guidelines for their use of "sophisticated means."
U.S.S.G. § 2T1.1(b)(2). The enhancement applies to "espe-
cially complex or especially intricate offense conduct pertain-
ing to the execution or concealment of an offense." Id. cmt.
n.4. Such conduct may include "hiding assets or transactions,
or both, through the use of fictitious entities, corporate shells,
or offshore financial accounts." Id. The district court’s deci-
                  UNITED STATES v. JINWRIGHT                23
sion to apply the sophisticated means enhancement was not in
error.

   The Jinwrights’ failure to accurately report their income
would not alone support imposition of the sophisticated
means enhancement. The enhancement requires some means
of execution that separates the offense before us from the
ordinary or generic. As the Seventh Circuit has explained, the
"average criminal tax fraud . . . involves some concealment;
‘sophisticated’ tax fraud must require more." United States v.
Kontny, 238 F.3d 815, 820-21 (7th Cir. 2001). On the other
hand, a defendant need not utilize the most complex means
possible to conceal his fraudulent activities in order for the
court to find that he used sophisticated means. United States
v. Madoch, 108 F.3d 761, 766 (7th Cir. 1997). The court need
only find "the presence of efforts at concealment that go
beyond (not necessarily far beyond . . . ) the concealment
inherent in tax fraud." Kontny, 238 F.3d at 821. A sentencing
court should consider the cumulative impact of the criminal
conduct, for the "total scheme" may be "sophisticated in the
way all the steps were linked together." United States v. Jack-
son, 346 F.3d 22, 25 (2d Cir. 2003); see also United States v.
Halloran, 415 F.3d 940, 945 (8th Cir. 2005) (upholding
enhancement where "certain aspects of [defendant’s] scheme
were not especially complex or especially intricate" but "his
total scheme was undoubtedly sophisticated").

   So it was here. The Jinwrights’ scheme spanned many
years and involved multiple organizations, including GSC and
the Pastors Consortium. The court adopted the presentence
report, which identified a variety of sophisticated techniques
used by defendants to conceal their tax evasion. The Jin-
wrights structured their compensation so as to prevent the
inclusion of income on their W-2 forms, drawing payments
from the GSC operating account, rather than the payroll
account. They disguised wages as allowances and reimburse-
ments for which they instructed GSC employees not to issue
1099 forms to disclose additional income to the IRS. They
24                UNITED STATES v. JINWRIGHT
directed GSC employees to manipulate GSC financial records
to conceal their income and misrepresented their financial sit-
uation to the IRS in GSC’s application for section 501(c)(3)
tax-exempt status. The Pastors Consortium provided another
elaborate way of concealing income through what the court
found was a kickback scheme. Specifically, the court found
that there was an implied quid pro quo between the consor-
tium members to exchange thousands of dollars from discre-
tionary church funds to speak at each other’s church
anniversary events.

   Ample trial evidence supported the district court’s conclu-
sion that these actions were proven for purposes of sentencing
by a preponderance of the evidence. Taken together, the
assorted methods of executing the offense involved especially
intricate offense conduct that rose to the level of sophisticated
means. See United States v. Wayland, 549 F.3d 526, 529 (7th
Cir. 2008) (holding that scheme of health care fraud, "which
lasted nine years and involved a series of coordinated fraudu-
lent transactions, was complex and sophisticated" even if
defendant’s "individual actions could be characterized as
unsophisticated").

   Appellants urge, however, that the sentencing court
improperly relied on evidence from the trial record that was
not included in the presentence reports, such as defendants’
use of A.L. Jinwright Ministries as a shell corporation to con-
vert funds donated in support of Mr. Jinwright’s ministerial
services into additional income. But central to the district
court’s broad discretion to fashion an appropriate sentence is
the ability to find facts and to determine their relevance to the
sentencing questions at hand. See United States v. Dean, 604
F.3d 169, 174 (4th Cir. 2010). Although Federal Rule of
Criminal Procedure 32 identifies information that should be
included in the presentence report, we see nothing there that
constrains a sentencing judge’s discretion to consider facts in
the record but outside the PSR, which in this case was neces-
sarily less comprehensive than the 90,000 pages of documen-
                  UNITED STATES v. JINWRIGHT                25
tary evidence admitted at trial. Instead, Rule 32(d) requires
that the PSR identify "all applicable guidelines" and "any fac-
tor relevant to" the "appropriate kind of sentence." Fed. R.
Crim. P. 32(d). Here the PSR did just that by specifying the
applicable provisions of the Guidelines, including all
enhancements relevant to the Jinwrights’ sentencing.

   It therefore sufficed that the PSR provided notice that
sophisticated means was a factor relevant to sentencing and
supplied a non-exhaustive list of defendants’ sophisticated
techniques that amply supported application of the enhance-
ment in and of themselves. And it was well within the court’s
discretion to supplement the examples identified in the PSR
with additional facts adduced at trial, especially because
defendants were able to contest the relevance of those facts at
the sentencing hearing and the court explained its finding on
the record. See U.S.S.G. § 6A1.3(a) ("When any factor impor-
tant to the sentencing determination is reasonably in dispute,
the parties shall be given an adequate opportunity to present
information to the court regarding that factor.").

                             VII.

   The district court imposed a two-level enhancement for
defendants’ abuse of a position of trust "that significantly
facilitated the commission or concealment of the offense."
U.S.S.G. § 3B1.3. It is undisputed that as spiritual leaders of
the GSC community and custodians of the church’s finances,
the Jinwrights held a position of trust with respect to GSC’s
membership. The district court found that they abused their
position when committing relevant criminal conduct under
U.S.S.G. § 1B1.3, specifically the embezzlement of money
from GSC to facilitate the tax evasion offense. As the court
found, for three years the Jinwrights routinely instructed Jac-
queline Joyner-Jones to forge checks to them from the GSC
Women of Faith Ministry. Through this scheme, the Jin-
wrights unlawfully converted about $60,000 from the GSC
coffers and evaded paying taxes on those funds. The Jin-
26                UNITED STATES v. JINWRIGHT
wrights argue, however, that an abuse of trust enhancement
may not be based on relevant conduct under U.S.S.G.
§ 1B1.3.

   We need not pass on the district court’s specific justifica-
tion in isolation, because the wide range of conduct in the
record amply supports the enhancement. We may affirm the
district court on the basis of "‘any conduct [in the record] that
independently and properly should result in an increase in the
offense level’ by virtue of the enhancement." United States v.
Garnett, 243 F.3d 824, 830 (4th Cir. 2001). Such a basis
exists here because GSC was a secondary victim of the tax
evasion scheme itself.

   It is well settled in our circuit that "whether a defendant
held a position of trust must be examined from the perspective
of the victim." United States v. Godwin, 272 F.3d 659, 671
(4th Cir. 2001). And it is undisputed that the government is
the primary victim of the Jinwrights’ scheme to avoid paying
taxes owed to the IRS. We have recognized, however, that the
offense of conviction may harm secondary victims as well.
See United States v. Akinkoye, 185 F.3d 192, 204 (4th Cir.
1999); United States v. Turner, 102 F.3d 1350, 1360 (4th Cir.
1996). Although the Jinwrights urge us not to extend the con-
cept of secondary victims to tax crimes, we are not persuaded
that the only possible victim of a tax offense is the govern-
ment. See United States v. Bhagavan, 116 F.3d 189, 193 (7th
Cir. 1997) (rejecting the "notion that there can be only one
victim of a tax evasion scheme—the United States"). In this
case, GSC was victimized by the Jinwrights’ efforts to con-
ceal their tax crimes from detection.

   The Jinwrights exploited their authority at GSC not only to
increase their compensation, but also to defraud the govern-
ment and to conceal their efforts to evade taxes. A position of
trust may "‘significantly contribute’ to the defendant’s execu-
tion or obfuscation of the offense simply ‘by making the
detection of the offense or the defendant’s responsibility for
                   UNITED STATES v. JINWRIGHT                  27
the offense more difficult.’" United States v. Brack, 651 F.3d
388, 393 (4th Cir. 2011) (quoting U.S.S.G. § 3B1.3 cmt. n.1).
Here, the Jinwrights used their position of influence to enlist
GSC employees and board members to conceal a significant
portion of their income from the IRS. They directed several
GSC finance administrators to pay their non-salary compensa-
tion from the GSC operating account and to exclude it from
their W-2s. Exercising his authority over financial matters,
Mr. Jinwright overruled employee suggestions that extra com-
pensation be disclosed to the IRS on 1099 forms. By instruct-
ing Joyner-Jones to forge checks as a source of additional
income, the Jinwrights not only embezzled from the church,
but also concealed these receipts from the IRS. The district
court also found that the Jinwrights told employees to falsify
annual reports in order to conceal the percentage of GSC’s
operating expenses that were attributable to them. These
reports were submitted to the IRS with GSC’s application for
tax-exempt status in furtherance of the conspiracy to defraud
the government.

   Each of these measures, however, also victimized the GSC
congregation, which was financially burdened by the Jin-
wrights’ acts of concealment. In addition to disguising the Jin-
wrights’ total compensation, the falsified reports hid GSC’s
financial difficulties by offsetting profits for the entire annual
period with expenses from only eleven months of the year. As
several GSC employees testified, Mr. Jinwright misled the
congregation in order to maintain morale and sustain dona-
tions to the church. And as the court found at sentencing, he
also misrepresented the church’s financial health to prevent
alterations to the budget and reductions to his compensation.
The concealment drove the church deeper into financial crisis
by forestalling remedial measures. As the dire financial condi-
tion of the church came to the attention of the board, the Jin-
wrights rebuffed efforts to trim the budget and reduce their
compensation. Several board members who called attention to
defendants’ fraudulent acts were replaced or forced to resign.
28                  UNITED STATES v. JINWRIGHT
   The abuse of trust enhancement enables the sentencing
court to punish those who wield their power to criminally take
advantage of those who depend upon them most. As leaders
of GSC, the Jinwrights were entrusted with the spiritual well-
being and financial stewardship of their religious community.
They exploited the trust of their unsuspecting congregation to
conceal criminal acts from the government, as well as the
church, and to maintain an extravagant lifestyle lived at the
church’s expense. We thus affirm the district court’s applica-
tion of the abuse of trust enhancement.

                               VIII.

     For the foregoing reasons, the judgment of the district court
is

                                                    AFFIRMED.