Court Opinion

ID: 2803646
Source: CourtListenerOpinion
Date Created: 2015-05-27 15:13:35.793461+00
Date Added: 2024-06-11T11:29:49.242578
License: Public Domain

STATE OF MICHIGAN

                          COURT OF APPEALS

PEOPLE OF THE STATE OF MICHIGAN,                                  UNPUBLISHED
                                                                  May 26, 2015
              Plaintiff-Appellee,

v                                                                 No. 312070
                                                                  Wayne Circuit Court
SAMER NASSIB ZAHR,                                                LC No. 11-008606-FH

              Defendant-Appellant.

Before: MURPHY, P.J., and STEPHENS and GADOLA, JJ.

PER CURIAM.

        Defendant appeals as of right his bench trial convictions of seven counts of false
pretenses with intent to defraud involving a value of $20,000 to $50,000, MCL 750.218(5)(a),
and passing false title to a motor vehicle, MCL 257.254.1 For all eight of his convictions, the
trial court sentenced defendant to five years’ probation with 12 months to be served in the
Wayne County Jail. We affirm defendant’s convictions, but, under the authority of MCL
769.1k(1)(b)(iii), we remand for a determination of the factual basis for $600 in court costs
imposed by the trial court; defendant’s sentences are otherwise affirmed.

       This case arises from defendant’s involvement in a series of loan applications filed in
2005 and 2006. Between June and August of 2005, defendant sold four homes to his mother,
Rajaa Zahr.2 Rajaa applied for mortgages to purchase the homes through a “stated income” loan
program under which applicants were required to report their income, but did not have to provide
any independent proof of income. Mortgage broker Linda Khemmoro communicated with

1
  Defendant was also charged with, but acquitted of, second-degree money laundering, MCL
750.411n, conducting a criminal enterprise, MCL 750.159i(1), and conspiring to conduct a
criminal enterprise, MCL 750.159i(4).
2
  Rajaa and defendant’s wife, Chirine Ghandour, were charged and tried with defendant as
codefendants. The trial court acquitted Rajaa of conducting a criminal enterprise, conspiring
with defendant to conduct a criminal enterprise, and of four counts of false pretenses. Ghandour
was also acquitted of one count of false pretenses.

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defendant almost exclusively in completing the loan applications for Rajaa.               Defendant
represented to Khemmoro that Rajaa’s income was $9,550 a month.

      In August 2005, defendant applied for a business loan for his company, Flexible
Transport, which rents vehicles for special events under the name Luxury Limousine. The loan
was backed by the Small Business Administration (SBA). Although defendant is Flexible
Transport’s sole owner and corporate office holder, defendant identified his wife, Chirine
Ghandour, as the president and 90% owner of the company on the loan application.

        In May 2006, defendant applied for another SBA backed loan for his second business,
Zahr’s Real Estate Investments, which manages and leases residential properties. Defendant
stated on the loan application that he intended to use the loan as working capital for Zahr’s Real
Estate Investments. Upon receiving a $100,000 loan, however, defendant transferred $95,000 of
the loan proceeds to Luxury Limousine.

       Four of defendant’s seven false pretenses convictions arose from his misrepresentation of
Rajaa’s income during the mortgage application process, while another two were based on
defendant’s misstatements on the SBA loan applications. Defendant argues that the evidence
was insufficient to support these six convictions.3

       With respect to a claim that the evidence was insufficient to sustain a conviction, this
Court, addressing a sufficiency argument in the context of a bench trial, stated in People v
Kanaan, 278 Mich App 594, 618-619; 751 NW2d 57 (2008), as follows:

               We review claims of insufficient evidence de novo. When ascertaining
       whether sufficient evidence was presented in a bench trial to support a conviction,
       this Court must view the evidence in a light most favorable to the prosecution and
       determine whether a rational trier of fact could find that the essential elements of
       the crime were proven beyond a reasonable doubt. This Court will not interfere
       with the trier of fact's role of determining the weight of the evidence or the
       credibility of witnesses. Circumstantial evidence and reasonable inferences that
       arise from such evidence can constitute satisfactory proof of the elements of the
       crime. All conflicts in the evidence must be resolved in favor of the prosecution.
       [Citations omitted.]

        To establish false pretenses, in general, the prosecution must show: “(1) a false
representation as to an existing fact; (2) knowledge by [the defendant] of the falsity of the
representation; (3) use of the false representation with an intent to deceive; and (4) detrimental
reliance on the false representation by the victim.” People v Bearss, 463 Mich 623, 627; 625
NW2d 10 (2001) (citation omitted); see also MCL 750.218(1) (“A person who, with the intent to
defraud or cheat makes or uses a false pretense to . . . .”). Concerning the real property sales, the

3
 The seventh false pretenses conviction arose from defendant’s misrepresentation concerning his
ownership of a Hummer, which defendant used in his limousine business. Defendant does not
challenge this conviction, nor does he challenge the false title conviction under MCL 257.254.

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trial court found that defendant falsely reported Rajaa’s income to Khemmoro as $9,550 a month
“with the intent to deceive, to place Rajaa Zahr in a higher income level so that the loan was
virtually rubber stamped, [and] likely to be granted.” The trial court credited Rajaa’s 2005 tax
return as showing that her true annual income was $35,246 (roughly $2,937 per month).

        Defendant argues that there was insufficient evidence to prove that his statements
concerning Rajaa’s income were false. According to defendant, the trial court merely
“suppos[ed]” that the statements regarding income “had to be false at the time [they were] made,
given the ultimate discrepancy between stated income and actual income [as reflected on Rajaa’s
2005 tax return].” Defendant confuses sufficiency of the evidence with the concept of inferences
drawn from circumstantial evidence. Once again, “ ‘[c]ircumstantial evidence and reasonable
inferences arising from that evidence can constitute satisfactory proof of the elements of a
crime.’ ” People v Carines, 460 Mich 750, 757; 597 NW2d 130 (1999) (citation omitted).
Rajaa’s 2005 tax return showing an income of $35,246 was circumstantial proof that the $9,550
a month figure repeatedly offered by defendant was inaccurate, leading to a very reasonable
inference that defendant had stated Rajaa’s income falsely and did so with an intent to deceive
lenders into approving her for a mortgage. As the finder of fact, the trial court was free to
conclude that Rajaa’s tax return constituted reliable proof of her actual income. See People v
Unger, 278 Mich App 210, 228-229; 749 NW2d 272 (2008) (the factfinder is free to believe or
disbelieve any of the evidence and deference is afforded to the factfinder in weighing the
evidence). We agree with the trial court that the significant difference between the income
reported on the loan applications ($114,600 a year) and the income shown on the tax return
($35,246 a year) suggests more than “sloppy bookkeeping.”

         Other evidence also supported the trial court’s finding that defendant falsified his
mother’s income with deceptive intent. Michigan State Police Trooper Christopher Correveau
testified that when he attempted to interview Rajaa, defendant interrupted and “demanded to
know the nature of the interview,” seeking to keep his mother out of the loan discussions.
Defendant and Rajaa also initially confirmed that the reported income of $9,550 a month was
accurate when Correveau first presented them with one of the loan applications. Yet when
shown a copy of Rajaa’s 2005 tax return with an income of roughly $35,000, defendant and
Rajaa backtracked, claiming that the income on the tax return was accurate and that Rajaa had
never signed the loan application. The evidence was sufficient to support the trial court’s finding
that defendant had falsely reported Rajaa’s income.

        Next, defendant argues that even if the income statements were false, he should not be
responsible for them, because Rajaa was the loan borrower. Defendant overlooks his nearly
exclusive role in the deception. Khemmoro testified that she communicated only with defendant
in completing all of the loan applications and that he consistently reported Rajaa’s income as
$9,550 a month. It was defendant, not Rajaa, who gave Khemmoro a letter certifying that Rajaa
was employed and that her monthly earnings were $9,550. And as noted above, defendant
eventually told Correveau that his mother did not sign the loan application. In addition to the
significant discrepancy between the income defendant reported and Rajaa’s actual income, the
trial court could infer defendant’s intent to deceive and defraud because defendant benefitted
from the home sales. See People v Reigle, 223 Mich App 34, 39-40; 566 NW2d 21 (1997)
(“[The] [d]efendant’s knowledge and intent can be inferred from the entire evidence.”); see also
People v Guthrie, 262 Mich App 416, 419; 686 NW2d 767 (2004) (minimal circumstantial

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evidence is sufficient to prove a defendant’s intent). Shortly after defendant received a deposit
from the closing of a home sale, he would transfer a significant portion of the proceeds to
Flexible Transport’s bank account, thereby financing his limousine business. The evidence was
sufficient to support the trial court’s finding that defendant made the false representations with
deceptive intent. And defendant was not relieved of criminal liability simply because Rajaa was
the “borrower” with respect to the loans. Contrary to defendant’s argument, his guilt was not
based on him being Rajaa’s “legally bound agent,” in the sense that he was being held
responsible as an agent for Rajaa’s wrongdoing. Rather, it was defendant’s own self-serving
criminal acts, as clearly reflected in the evidence, that gave rise to the convictions. Finally, while
the element is not addressed by defendant, there was also sufficient evidence of detrimental
reliance.

        Defendant makes the same argument regarding the SBA loan application for Flexible
Transport, which identified Ghandour as the president and 90% owner of the company: “it was
Ms. Ghandour who applied, signed for[,] and personally guaranteed the loan[,] and it is only Ms.
Ghandour who can legally be held criminally responsible for her actions.” Defendant is
incorrect. Corporate filings and tax statements showed that defendant was the sole officer and
owner of Flexible Transport. The SBA loan application made clear that “each proprietor,
partner, office director, [or] holder of twenty percent or more” of the company applying had to
be identified on the 1919 SBA Form and had to act as an individual guarantor for the loan.
Business banking officer Jose Diaz recalled explaining these requirements to defendant and
Ghandour. And although Diaz was unsure whether it was defendant or his wife who identified
Ghandour as the president and 90% owner of Flexible Transport, he testified that defendant was
the main source of information during the loan discussions. Defendant also contacted Diaz once
the Flexible Transport loan was under investigation, and again reached out to Diaz “a couple of
times” within the three months of trial. Such conduct demonstrates defendant’s awareness of his
own wrongdoing. See, e.g., People v Roscoe, 303 Mich App 633, 642; 846 NW2d 402 (2014)
(the defendant’s request that his wife look into the victim’s medical records, along with his
Internet searches concerning the crime and review of local death notices, demonstrated
consciousness of guilt). Moreover, the false statements on the loan application were not limited
to the identification of Flexible Transport’s ownership and management. The trial court also
found that defendant “inflated the 2002 gross sales receipts,” by representing that Flexible
Transport had earned $335,000 in gross receipts when its tax return showed gross receipts of
only $194,665. Defendant does not challenge this finding. The evidence was sufficient to
sustain defendant’s conviction for false pretenses in connection with the SBA loan application
for Flexible Transport.

        Defendant also contends that the evidence was insufficient to support his conviction for
false pretenses in connection with the SBA loan for Zahr’s Real Estate Investments. The trial
court found that defendant committed false pretenses with regard to this loan by transferring the
loan proceeds to Luxury Limousine instead of using it for the purpose identified on the SBA loan
application. Defendant admits “that the majority of the funds from the Zahr Real Estate loan
went to the Luxury Limousine business,” but argues that this was not improper because “nothing
in the record [indicates] that [defendant] was told or had any personal knowledge that he could
not use the funds for another business.” This is untrue. Defendant signed a “Business Loan and
Security Agreement” as part of the SBA loan application, which specifically prohibited the
transfer of loan funds to another company, unless done in the ordinary course of business. In the

                                                 -4-
same month that the $100,000 loan was distributed to Zahr’s Real Estate Investments, the
company issued four checks worth a total of $95,000 to Luxury Limousine. The trial court could
reasonably infer that these transfers were not done in the ordinary course of business. Further,
defendant made a second misrepresentation on the loan application, claiming Zahr’s Real Estate
Investments grossed $890,000 in total sales receipts for 2004, when tax documentation from the
same year showed actual gross sales receipts of only $35,240. Defendant does not dispute the
finding that his report of the gross sales receipts was false. The evidence was sufficient to
support defendant’s conviction of false pretenses in connection with the SBA loan application
for Zahr’s Real Estate Investments.

        Finally, defendant argues that the trial court lacked authority under MCL 769.1k to
impose $600 in court costs as part of his sentence. Given the Legislature’s amendment of MCL
769.1k, which now authorizes the imposition of “any cost reasonably related to the actual costs
incurred by the trial court[,]” §§ 1k(1)(b)(iii), and considering the amendment’s valid retroactive
effect encompassing the date of defendant’s sentencing, People v Konopka, __ Mich App __; __
NW2d __, issued March 3, 2015 (Docket No. 319913), there is general authority to impose court
costs in this case. However, remand is necessary “for determination of the factual basis for the
costs imposed pursuant to MCL 769.1k(1)(b)(iii).” Konopka, slip op at 16.

        Affirmed with respect to defendant’s convictions, but remanded for a determination of
the factual basis for the $600 in court costs imposed by the trial court; defendant’s sentences are
otherwise affirmed. We do not retain jurisdiction.

                                                            /s/ William B. Murphy
                                                            /s/ Cynthia Diane Stephens
                                                            /s/ Michael F. Gadola

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