Court Opinion

ID: 3025543
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:33:54.91971+00
Date Added: 2024-06-11T11:47:46.744738
License: Public Domain

United States Court of Appeals
                            FOR THE EIGHTH CIRCUIT
                                   ___________

                                   No. 00-1768
                                   ___________

United States of America,               *
                                        *
             Plaintiff - Appellee,      *
                                        * Appeal from the United States
             v.                         * District Court for the
                                        * Western District of Missouri.
Charles I. Covey,                       *
                                        *
             Defendant - Appellant.     *
                                   ___________

                             Submitted: September 15, 2000
                                 Filed: November 16, 2000
                                  ___________

Before WOLLMAN, Chief Judge, LOKEN, and MURPHY, Circuit Judges.
                             ___________

MURPHY, Circuit Judge.

       Charles Covey was convicted by a jury of conspiracy to commit money
laundering and aiding and abetting money laundering in violation of 18 U.S.C. §§
1956(a)(1)(B)(i), 1956(h), and 1956 (a)(2). The district court1 entered a preliminary
forfeiture order for $70,000 pursuant to 18 U.S.C. § 982 and Fed. R. Civ. P. 32(d)(2);
it later denied Covey's motion for reconsideration or clarification. Covey was
sentenced to 57 months imprisonment and a $19,118.44 fine. Covey now appeals his

      1
        The Honorable Gary A. Fenner, United States District Judge for the Western
District of Missouri.
conviction, sentence, and the preliminary order of forfeiture. We affirm the judgment
and dismiss the forfeiture appeal as premature.

       Charles Covey was a certified public accountant (CPA) and sole officer, director
and shareholder of MCM Enterprises, Inc. (MCM). His sister, Mary Closser, asked
him to speak to Gary and Darrell Hart about making them a loan. The Harts were drug
dealers who sold and distributed marijuana and who wanted to use cash proceeds from
their drug business to start a motorcycle sales and repair shop. They were unable to
use more than $10,000 cash to buy inventory for the shop without filing federal forms
so they were looking for ways to launder their money. The Harts rewarded Closser for
connecting them with Covey by paying for a new driveway in front of her house.

      During spring 1993 Covey and the Harts had a series of meetings, and Covey
agreed to loan the Harts $50,000 through MCM in exchange for their $70,000 cash
payment to him. During one meeting Gary Hart told Covey that the cash was from drug
proceeds. On June 9, 1993 the parties executed a loan agreement prepared by Covey.
The agreement provided that MCM would loan Hart Independence Motorcycles
$50,000 at a 13% annual interest rate and the latter would pay MCM $3,072.38 per
month for 18 months. The agreement was signed by Covey as president of MCM.
Deena Rauscher, Gary Hart's wife, signed the agreement for herself and Sharon Hart,
Darrell Hart's wife, who was not present. Darrell Hart signed as a guarantor.

       The loan agreement represented that the inventory of the motorcycle business
was to be collateral for the loan. The inventory did not yet exist, however, and Covey
did not take a security interest in the later-acquired inventory. Instead, the Harts met
Covey one night in a restaurant parking lot where they gave him a paper bag containing
$70,000 in bills. The money was in one thousand dollar stacks held together with
rubber bands. Contrary to the recitation in the loan agreement, the coconspirators
agreed that the collateral for the principal of the loan was $50,000 in cash, $10,000 was
collateral for interest, and $10,000 was termed a loan origination fee.

                                          -2-
       After the agreement was signed, Covey sent the Harts a $50,000 check, which
the Harts deposited in an account under the name of Hart Independence Motorcycles.
Covey had not required any financial, tax, or employment information from the Harts.
Neither did he file a federal form reporting his receipt of over $10,000 in cash from the
Harts. Between July 2, 1993 and January 1994, the Harts made six payments on the
loan, totaling $18,441.31. Covey put these payments into MCM's account and then
withdrew corresponding amounts for deposit into his personal account.

      The motorcycle business was not a success, and the Harts stopped making
payments on the loan after January 1994. On October 3, 1994, Covey sent a letter
informing the Harts that the loan was in default and that he would begin taking
payments from the cash collateral. Thereafter, Covey began to deposit currency from
the $70,000 cash payment into MCM's bank account. He deposited approximately
$36,000 from these funds and later transferred the money to his personal account.

      In December 1995, Covey sent a check for $19,561.86 by certified mail to
Darrell Hart with the notation "Refund Excess Loan Collateral." The Harts suspected
that Covey was cooperating with law enforcement, and they did not retrieve the mail
from the post office. About that time, Covey filed an Internal Revenue Service Form
8300 to report receipt of more than $10,000 in a cash transaction. Covey reported that
MCM Enterprises had received $70,000 cash in return for a loan of $50,000 and
checked the "suspicious transaction" box on the form. Unlike the loan agreement,
which stated that the motorcycle shop inventory was collateral for the loan, the form
reported that $60,000 in cash was received as collateral and that the remaining $10,000
was a loan fee.

       On December 15, 1998, a federal grand jury returned a three count indictment
against Covey. Count I charged Covey with conspiracy to commit money laundering
in violation of 18 U.S.C. § 1956(h). Count II charged Covey with aiding and abetting
money laundering in violation of 18 U.S.C. §§ 1956(a)(1)(B)(i) and (2). Count III

                                          -3-
sought forfeiture of $70,000 from Covey under 18 U.S.C. § 982. On July 28, 1999, the
district court dismissed Count I on the grounds that the count did not adequately
apprise the defendant of the charge. On August 9, 1999, a grand jury filed a
superseding indictment which restated all three counts and added factual allegations to
the conspiracy charge in Count I.

        At trial, the jury was given an instruction on conspiracy, which read in pertinent
part:

        It is not necessary that the government prove, beyond a reasonable
        doubt, that more than one act was done in furtherance of the
        conspiracy. It is sufficient if the government proves beyond a
        reasonable doubt, one such act; but in that event, in order to return a
        verdict of guilty, you must unanimously agree upon which act was
        done.

Jury Instruction 19.

       The jury returned a guilty verdict on all three counts, including the forfeiture
count. The district court then entered a preliminary order requiring Covey to forfeit
$70,000. Covey objected that he had not had sufficient notice or opportunity to be
heard and that the amount of the forfeiture was excessive. The district court denied his
motion for reconsideration or clarification and sentenced him to 57 months and a
$19,118.44 fine. The court found that Covey had used special skills and experience in
accounting and finance to further the money laundering scheme and added two levels
to his adjusted offense level, resulting in a guideline range of 57 - 71 months. Covey
moved for a new trial, judgment of acquittal, arrest of judgment, and a stay of further
seizures and accounting of seized assets. The motions were denied. Covey paid over
the $70,000 and received a document entitled "Satisfaction of Judgment" on June 5,
2000.

                                            -4-
       Covey raises a variety of issues on appeal, including insufficient evidence,
incomplete jury instructions, and violation of his Fifth and Sixth Amendment rights.
He also challenges his conspiracy conviction on the grounds that Count I of the
superseding indictment did not allege an overt act in furtherance of the conspiracy, an
element he asserts is essential to the charge. He objects to the preliminary order of
forfeiture, arguing that he was not given adequate notice or an opportunity to be heard
and that the amount was excessive. He contends that the district court erred when it
enhanced his sentence for use of special skills in furtherance of the money laundering
scheme. The government counters all points. It argues an overt act is not an essential
element of a money laundering offense, that the language of the money laundering
statute, 18 U.S.C. § 1956(h),2 is nearly identical to that for drug conspiracies, 21
U.S.C. § 846,3 which does not require an overt act be proven as an element of the
offense, see United States v. Shabani, 513 U.S. 10, 12 (1994); United States v. Severe,
29 F.3d 444, 447 (8th Cir. 1994), cert. denied, 513 U.S. 1096 (1995). Since 18 U.S.C.
§ 1956(h) was modeled on 21 U.S.C. § 846, it should be given a similar construction.
The government argues that this court does not have jurisdiction to hear Covey's appeal
of the preliminary forfeiture order because it is not a final order, that Covey had
adequate advance notice and a sufficient hearing, and that the amount was not
excessive. The government asserts that the special skills enhancement was appropriate,
the evidence was sufficient, and there is no merit to Covey's other arguments.

                                          I.

      2
       "Any person who conspires to commit any offense defined in this section . . .
shall be subject to the same penalties as those prescribed for the offense the
commission of which was the object of the conspiracy." 18 U.S.C. § 1956(h) (2000).
      3
       "Any person who attempts or conspires to commit any offense defined in this
subchapter shall be subject to the same penalties as those prescribed for the offense,
the commission of which was the object of the attempt or conspiracy." 21 U.S.C. §
846 (2000).

                                          -5-
       A challenge to the sufficiency of an indictment is reviewed de novo. See United
States v. O'Hagan, 139 F.3d 641, 651 (8th Cir. 1998). Count I of the superseding
indictment charged:

      That between August, 1992, up to January, 1996, said dates being
      approximate, in the Western District of Missouri, CHARLES I.
      COVEY and MARY ANN CLOSSER, defendants herein, did
      knowingly and intentionally combine, conspire, confederate and agree
      with each other and other persons, both known and unknown to the
      grand jury, to willfully conduct and attempt to conduct, financial
      transactions affecting interstate commerce, including the transfer of
      approximately $50,000 from CHARLES I. COVEY to the bank
      account of Hart Independence Motorcycles, Inc., and the transfer of
      approximately $19,561.86 by a check drawn on the checking account
      of MCM Enterprises, Inc.; knowing that the transactions were
      assigned in whole or in part, to conceal and disguise the nature,
      location, source, ownership and control of the proceeds of specified
      unlawful activity, that is the distribution of marihuana; and that while
      conducting and attempting to conduct the financial transactions knew
      that the property involved in the transactions represented the proceeds
      of some form of unlawful activity . . . .

Superseding indictment at 1-2.

      An indictment is not required to take a particular form and should not be read in
a "hyper-technical fashion." See id. It should be "deemed sufficient 'unless no
reasonable construction can be said to charge the offense.'" United States v. Morris,
18 F.3d 562, 568 (8th Cir. 1994) (citation omitted). Here, a fair reading of Count I was
sufficient to notify Covey that the transfers of checks in the amounts of $50,000 and
$19,561.86 were acts the government alleged he performed in furtherance of the money
laundering conspiracy.

                                          -6-
      The offense of money laundering is described in this way in the statute :

      Whoever, knowing that the property involved in a financial transaction
      represents the proceeds of some form of unlawful activity, conducts
      or attempts to conduct such a financial transaction which in fact
      involves the proceeds of specified unlawful activity knowing that the
      transaction is designed in whole or in part to conceal or disguise the
      nature, the location, the source, the ownership, or the control of the
      proceeds of specified unlawful activity . . . shall be sentenced to a fine
      of not more than $500,000 or twice the value of the property involved
      in the transaction, whichever is greater, or imprisonment for not more
      than twenty years, or both.

18 U.S.C. § 1956 (a)(1)(B)(i) (2000). Here, the object of the conspiracy was to
conceal the nature of the Harts' drug proceeds. Covey committed acts in furtherance
of that conspiracy when he gave the Harts checks in return for cash that he knew was
derived from illegal activities. See United States v. Norman, 143 F.3d 375, 377-78 (8th
Cir. 1998). Count I charged him with knowingly conducting a financial transaction
designed to disguise the source of illegal proceeds by transferring $50,000 and
$19,561.86 checks to Hart Independence Motorcycles. It thus alleged overt acts in
furtherance of the conspiracy. See United States v. Hutchinson, 488 F.2d 484, 490 (8th
Cir. 1973) (an overt act is "an act of one or more of the conspirators to effect the object
of the conspiracy" (citation omitted)).

                                            II.

       Federal Rule of Criminal Procedure 32(d)(2) provides that "the court may enter
a preliminary order of forfeiture after providing notice to the defendant and a
reasonable opportunity to be heard on the timing and form of the order." The
preliminary order is not a judgment or a final order. See United States v. Coon, 187
F.3d 888, 901 (8th Cir. 1999), cert. denied, 120 S.Ct. 1417 (2000). Rather, the
forfeiture becomes final when "a final order of forfeiture shall be made part of the

                                           -7-
sentence and included in the judgment." FED. R. CRIM. P. 32(d)(2). After the order of
forfeiture is included in the judgment, the preliminary order is appealable as part of the
judgment. See Coon, 187 F.3d at 901.

       In this case no final order of forfeiture was included in the judgment. The
judgment indicates that the jury returned a guilty verdict on Count III, but makes no
other reference to the forfeiture. The space after the preprinted section with the
heading "The defendant shall forfeit the defendant's interest in the following property
to the United States:" was left blank. No forfeiture amount is mentioned in the
judgment. Covey complied with the court's preliminary post verdict order to forfeit
$70,000, and the government conceded at oral argument that he still has a right to
question the amount for which he should finally be held accountable.4 We do not have
jurisdiction when no final forfeiture order or judgment has been entered so the appeal
must be dismissed as premature. See id. (citing United States v. Casas, 999 F.2d 1225,
1231-32 (8th Cir. 1993), cert. denied, 510 U.S. 1078 (1994)).

                                            III.

      The sentencing guidelines provide for an enhancement of two levels if "the
defendant . . . used a special skill, in a manner that significantly facilitated the
commission or concealment of the offense . . . ." U.S. SENTENCING GUIDELINES
MANUAL § 3B1.3 (1998). "'Special skill' refers to a skill not possessed by members of

       4
        The concurrence suggests that Covey would not be liable for the full $70,000
if the Harts forfeit some part of that amount. The cases cited by the concurrence
indicate, however, that in criminal forfeiture all coconspirators may be liable for the full
amount of the proceeds involved in the criminal enterprise. See, e.g., United States v.
McHan, 101 F.3d 1027, 1042 (4th Cir. 1996) (citing with approval cases that indicate
that cumulative forfeitures may be permissible). In any event, Covey will have an
opportunity to be heard on remand before a final forfeiture judgment is entered against
him.

                                            -8-
the general public and usually requiring substantial education, training or licensing.
Examples would include pilots, lawyers, doctors, accountants, chemists, and demolition
experts." Id. at cmt. 3.

       Covey argues that the two level enhancement to his sentence was inappropriate
because he did not use any special skills to make the loan to the Harts. A district
court's factual determination that the defendant used special skills in the commission
or concealment of the offense is reviewed for clear error. See United States v. Graham,
60 F.3d 463, 468 (8th Cir 1995); United States v. Garfinkel, 29 F.3d 1253, 1261 (8th
Cir. 1994). The sentencing judge presided at Covey's three day trial and had an
opportunity to hear and see the witnesses and make credibility assessments. He
determined that Covey had used his special skills as a CPA to effectuate the money
laundering scheme, finding that Covey had been a CPA since 1972, that he had skills
and experience in accounting and finance, that he had prepared an amortization
schedule, a loan agreement and other loan-related financial documentation, and that he
had used multiple bank accounts in order to carry out the scheme. Because the district
court did not clearly err, we will not disturb its factual findings. See Koon v. United
States, 518 U.S. 81, 97 (1996).

        Covey claims that members of the general public can prepare loan documents
and amortization tables and that he used a loan document program to prepare them.
The legal question is not whether the task could be performed by a person without
special skills, but whether the defendant's special skills aided him in performing the
task. See United States v. Noah, 130 F.3d 490, 500 (1st Cir. 1997) (tax preparer used
special skills in fraudulently filing online tax returns); United States v. Lewis, 41 F.3d
1209, 1214 (7th Cir. 1994) (truck driver employed specialized driving skills during a
theft); United States v. Fritzson, 979 F.2d 21, 22 (2d Cir. 1992) (accountant used
special skills in filing fraudulent tax returns for his children). There is no requirement
in the guidelines that the enhancement for use of special skills be used only for complex
tasks. See Noah, 130 F.3d at 500. Since Covey's special skills assisted him in

                                           -9-
conspiring with the Harts and in aiding and abetting money laundering, we affirm the
application of the special skills enhancement in this case.

                                           IV.

       Covey's other arguments do not require much discussion. He asserts that the
district court should have granted his motions for judgment of acquittal or for a new
trial on the grounds that there was insufficient evidence to convict him on any of the
three counts. A denial of a motion for acquittal based on insufficiency of evidence is
reversed only if the evidence, viewed in the light most favorable to the government, is
such that a reasonable jury must harbor a reasonable doubt that the defendant was
guilty of the crime charged. See United States v. Martinez, 168 F.3d 1043, 1047 (8th
Cir. 1999). The denial of a new trial is reviewed for clear and manifest abuse of
discretion. See United States v. Lacey, 219 F.3d 779, 783-84 (8th Cir. 2000). Covey's
claims of insufficiency are without merit since there was ample evidence to support the
verdicts and no showing that a new trial was needed.

       Covey claims that the district court erred when it failed to give certain jury
instructions at trial, but he did not raise these claims at trial so they are reviewed for
plain error. See United States v. Jorgensen, 144 F.3d 550, 560 (8th Cir. 1998). Covey
argues that the district court should have given the jury an instruction on willfulness in
conjunction with Count I, an instruction defining "attempt" in conjunction with Counts
I and II, an instruction that a guilty verdict on each count of the indictment must be
supported by unanimity, a good faith instruction, and an instruction that an overt act
was an essential element of Count I. The district court did not err in omitting any of
these instructions. No willfulness instruction was required because the requisite state
of mind for both conspiracy and money laundering is knowledge. See, e.g., United
States v. Madrid, No. 99-4060NI, 2000 WL 1294323, at *3 (8th Cir. Sept. 14, 2000);
United States v. Jensen, 69 F.3d 906, 911 (8th Cir. 1995). Covey was not charged with
attempt to commit money laundering so it was not necessary to instruct on attempt. A

                                          -10-
general unanimity instruction is usually sufficient to protect a defendant's right to a
unanimous verdict, see United States v. Davis, 154 F.3d 772, 783 (8th Cir. 1998), and
we find no plain error in the lack of a specific unanimity instruction in this case. As the
appellant concedes, good faith instructions generally are not given in money laundering
cases. Finally, a sufficient instruction on an overt act requirement was given.

       Covey argues that his Fifth Amendment rights were violated when the district
court allowed the government to use documents that he had produced. It has long been
established that it is generally not unconstitutional to use the contents of documents
prepared and produced by a criminal defendant. See United States v. Doe, 465 U.S.
605, 611-12 (1984).

       Covey also claims that the district court erred in denying his motion for an
evidentiary hearing to determine whether he was deprived of his Sixth Amendment
right to effective counsel. A claim of ineffective assistance usually requires the
examination of facts outside the original record so it is more appropriately raised in a
collateral proceeding under 28 U.S.C. § 2255. See, e.g., United States v. Martin, 59
F.3d 767, 771 (8th Cir. 1995); Kelly v. Crunk, 713 F.2d 426, 427 (8th Cir. 1983) (per
curiam).

                                            V.

       Covey has not shown that he is entitled to a judgment of acquittal, a new trial,
or resentencing. We affirm the judgment of the district court and dismiss the appeal of
the preliminary forfeiture order as premature.

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

                                           -11-
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 p. 9. 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 347,
359-60 (5th Cir. 1998); United States v. Foster, 876 F.2d 377, 378 (5th Cir. 1989).

                                          -12-
       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),

                                           -13-
cert. denied, 120 S. Ct. 1417 (2000); contra United States v. Christunas, 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 appealable.

       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 challenge 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 fine
under Austin v. United States, 509 U.S. 602, 621-22 (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

                                            -14-
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

      5
        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 (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).

                                           -15-
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.

      A true copy.

             Attest:

                 CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.

                                           -16-