Court Opinion

ID: 2999271
Source: CourtListenerOpinion
Date Created: 2015-09-24 19:52:31.917206+00
Date Added: 2024-06-11T11:25:23.095363
License: Public Domain

In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 05-3056
UNITED STATES OF AMERICA,
                                                 Plaintiff-Appellee,
                                 v.

MORAD ABU SLIMAN,
                                            Defendant-Appellant.
                          ____________
            Appeal from the United States District Court
       for the Northern District of Illinois, Eastern Division.
               No. 03 CR 46-3—John Darrah, Judge.
                          ____________
      ARGUED APRIL 11, 2006—DECIDED JUNE 5, 2006
                     ____________

  Before FLAUM, Chief Judge, and WILLIAMS and SYKES,
Circuit Judges.
  FLAUM, Chief Judge. On June 10, 2003, a grand jury
returned an eleven count indictment naming Defendant-
Appellant Morad Abu Sliman (“Sliman”)—along with co-
defendants Badi Ahmed Salama, Rami Rabenu, and
Mohammed Dacca—of conspiring to negotiate and attempt-
ing to negotiate counterfeit and forged checks, in violation
of 18 U.S.C. §§ 2, 371, 513(a), and 1344. Sliman initially
pled not guilty, but subsequently withdrew his plea and
entered a “blind” plea of guilty to the seven counts of the
indictment in which he was named. On June 21, 2005, the
district court sentenced Sliman to 57 months’ imprisonment
and three years’ supervised release. The district court found
2                                                No. 05-3056

that Sliman could have foreseen that the conspiracy’s
intended loss was more than $20,000,000. Sliman appeals,
challenging his sentence. For the following reasons, we
affirm.

                      I. Background
   Sliman is a citizen of Israel and at the time of his offense
was 23 years old and living in Illinois. Sliman, his co-
defendants, and various uncharged parties attempted to
engage in a scheme that would enable them to receive cash
from financial institutions by depositing counterfeit checks.
The plan was as follows: Sliman and his co-defendants
would print counterfeit checks on a home computer. Salama
and another man would send the checks to two co-conspira-
tors in Israel, Rabenu and “Mr. Gilaadi.” Gilaadi would
deposit the checks at his bank in Israel in an account
opened in the name of RVAL, a company Gilaadi owned.
Gilaadi would then withdraw the money in the total
amount of the checks and share the cash with his co-
schemers, in predetermined amounts. Sliman and his co-
defendants also opened several bank accounts under
fictitious names, printed checks made out to themselves,
and attempted to negotiate counterfeit checks.
  In furtherance of their scheme, Sliman and co-defendants
Dacca and Salama operated a “counterfeit check factory”
out of an apartment in Cicero, Illinois. When police
searched the apartment, they found a computer and
numerous counterfeit checks. The apartment was essen-
tially empty except for these items. Police found a “check
register” on the computer, which indicated that counterfeit
checks worth $36,900,000 had been produced with and
printed from the computer. Approximately $9 million worth
of the checks listed on the register were found on the floor
of the apartment, torn into pieces. Of the remaining
approximately $28 million in checks, $2 million were
No. 05-3056                                                 3

printed before Sliman joined the conspiracy. Of the $26
million in intact checks printed during the time Sliman
participated in the conspiracy, approximately $16 million
worth were made payable to RVAL. The remaining checks,
totaling approximately $10 million, were made payable to
aliases of Sliman, Dacca, and Salama.
  The $16 million in checks made payable to RVAL con-
sisted of four “batches” of checks. The co-defendants tried to
send the first batch, worth approximately $4 million, to
Israel via Federal Express on or around December 23, 2002.
That batch was intercepted by customs. They then at-
tempted to send a second batch, also worth approximately
$4 million, to Israel via Federal Express on or around
January 15, 2003. This batch was also intercepted by
customs. At the time they sent the second batch, the co-
defendants did not know that the first batch had been
intercepted. The third batch, worth approximately $4
million as well, was printed on January 3, 2003 and
transported to Israel by Rabenu. At the time Rabenu
delivered the third batch, the co-defendants did not know
the first two batches had been intercepted. Customs
recovered approximately $1 million in checks from the third
batch, after Sliman’s co-conspirators presented the checks
for payment overseas and the checks were forwarded to a
bank in New York for processing. The fourth and final
batch, worth another $4 million, was recovered by FBI
agents on January 16, 2003, when they arrested Rabenu at
O’Hare Airport while he was waiting to board a flight to
Israel.
  Sliman was charged with and plead guilty to conspiracy
to make, utter, and possess counterfeit and forged securities
of an organization with the intent to deceive, in violation of
18 U.S.C. §§ 371 and 2 (Count 1); possession of counter-
feited and forged securities of an organization with the
intent to deceive, in violation of 18 U.S.C. §§ 513(a) and 2
(Counts 2, 5, and 6); and participation in a bank fraud
4                                                No. 05-3056

scheme, in violation of 18 U.S.C. §§ 1344 and 2 (Counts 7,
10, and 11).
  Sliman submitted a Plea Declaration stating the factual
basis for his guilty plea. The Declaration contained the
following relevant facts: During the summer of 2002 and
continuing until January 2003, Sliman, as part of a conspir-
acy to defraud certain financial institutions, opened various
bank accounts under false and fictitious names. On several
dates between August 19, 2002, and the end of 2003,
Sliman, Salama, and Rabenu “did knowingly make, utter
and possess . . . counterfeited and forged” checks, drawn on
various bank accounts, with intent to deceive others.
Sliman, along with Salama and Rabenu, participated “in a
scheme to send counterfeit checks to Israel, and . . . in
furtherance of such scheme, [Sliman] and his co-defendants
caused to be placed in certain express mail envelopes
approximately $4,000,000 of counterfeit checks, the first
mailing of which occurred on or about December 23, 200[2]
and a second delivery of which occurred on or about Janu-
ary 15, 2003.” Sliman’s Plea Declaration does not mention
the third and fourth batches of checks, which were worth
approximately $4 million each.
  At Sliman’s sentencing hearing, the parties disagreed
over whether Sliman’s intended loss under U.S.S.G.
§ 2B1.1(b)(1), was approximately $36 million or $4 million.
The parties also disagreed as to whether Sliman qualified
for the minor role reduction under § 3B1.2 of the United
States Sentencing Guidelines. The district court determined
that the conspiracy’s intended loss was over $20 million and
that this loss was foreseeable to Sliman. The district court
also denied Sliman’s request for a minor role reduction. The
district court found that Sliman qualified for a two-level
downward adjustment for acceptance of responsibility and
a one-level downward adjustment for timely notification of
his intent to plead guilty. See U.S.S.G. § 3E1.1. The district
court determined that Sliman’s criminal history category
No. 05-3056                                                 5

was a one and his total offense level was a 25. The Sentenc-
ing Guidelines provide for a sentencing range of 57 to 71
months. The district court sentenced Sliman to 57 months
on each count, to be served concurrently, followed by three
years’ supervised release. Sliman is subject to deportation
at the completion of his sentence.

                      II. Discussion
  All of the issues raised by Sliman on appeal center around
one question: whether the district court erred by determin-
ing that Sliman and his co-conspirators intended their
check counterfeiting scheme to result in a loss by its victims
of more than $20 million. Sliman maintains that the
intended loss was only $4 million, the amount Sliman
admitted to in his Plea Declaration.
  Under the Sentencing Guidelines, the “loss” caused by
Sliman’s fraudulent scheme is the “greater of actual loss or
intended loss.” U.S.S.G. § 2B1.1(b)(1), Application Note
3(A). If the loss exceeds $5,000, Sliman’s base level offense
increases incrementally, as follows:
    Loss Amount                      Increase in Level
    More than $2,500,000             add 18
    More than $7,000,000             add 20
    More than $20,000,000            add 22
    More than $50,000,000            add 24
U.S.S.G. § 2B1.1.
  We review the district court’s assessment of the amount
of loss for clear error. United States v. Berheide, 421 F.3d
538, 540 (7th Cir. 2005).
6                                                No. 05-3056

A. Standard of Proof
  Sliman acknowledges that the district court is to use the
preponderance of evidence standard of proof when finding
facts that affect a defendant’s sentence. See, e.g., United
States v. Belk, 435 F.3d 817, 819 (7th Cir. 2006). Sliman
asks, however, that we reconsider our holdings in pre-
vious cases, and find that proof beyond a reasonable doubt
is required. We decline to overturn our well established
precedent on this point. The district court correctly ap-
plied the preponderance of evidence standard in determin-
ing the intended loss amount. See, e.g., United States v.
Higgins, 270 F.3d 1070, 1075 (7th Cir. 2001).
  Additionally, the district court did not violate Sliman’s
right to due process by applying the preponderance of the
evidence standard. Sliman’s argument is the same one we
have rejected in prior cases; namely, that his sentence
violates due process because “the retroactive application of
the remedial portion of the Supreme Court’s decision in
United States v. Booker, 543 U.S. 220 (2005), which held
that the Sentencing Guidelines are merely advisory and
thus permits the district court to sentence a defendant on
the basis of facts neither found by the jury nor stipulated to
by the defendant, unconstitutionally exposes him to a
longer maximum sentence.” United States v. Cross, 430 F.3d
406, 409-10 (7th Cir. 2005). As Sliman has not given us any
reason why Cross and United States v. Jamison, 416 F.3d
538 (7th Cir. 2005), do not control the outcome of this case,
we reject his argument. Sliman had fair warning at the
time he was engaged in the check kiting scheme that his
actions were illegal. He also had fair warning of the maxi-
mum sentence he could receive under the Guidelines. Cf.
Cross, 430 F.3d at 410; Jamison, 416 F.3d at 539. His
sentence therefore complies with due process.
No. 05-3056                                                7

B. Legal Standard
  Sliman argues that the district court applied the wrong
legal standard in determining the intended loss amount
under section 2B1.1 of the Sentencing Guidelines. The
question of whether the district court applied the correct
legal standard to determine the amount of loss is reviewed
de novo.
  Sliman argues that the district court erroneously applied
the Guidelines’ standard for determining “actual loss” when
it should have used the standard for “intended loss.”
Application Note 3(A)(I) to section 2B1.1 defines “actual
loss” as the “reasonably foreseeable pecuniary harm that
resulted from the offense.” (Emphasis added.) Application
Note 3(A)(ii) defines “intended loss” as “(I) the pecuniary
harm that was intended to result from the offense; and (II)
includes intended pecuniary harm that would have been
impossible or unlikely to occur.” (Emphasis added.)
  Sliman claims that it was error for the court to inquire
whether the loss was “reasonably foreseeable” to him.
Instead, according to Sliman, the district court should have
looked at his intent. In the Plea Agreement, Sliman admit-
ted that he had the intent to complete a $4 million check
kiting scheme.
  At Sliman’s sentencing hearing, the district court ex-
plained that the “intended loss” was the amount of loss for
which it was reasonably foreseeable to Sliman that the
conspiracy was designed to cause. The district court
determined that it was reasonably foreseeable to Sliman
that the conspiracy’s intended loss was in excess of $20
million.
  We agree with the district court’s finding. Sliman was a
participant in a conspiracy, and thus his offense level is
determined by examining all reasonably foreseeable acts
and omissions of Sliman and his co-conspirators in further-
ance of the jointly undertaken criminal activity. Application
8                                               No. 05-3056

Note 2 to section 1B1.3 of the Sentencing Guidelines
provides that a defendant will be held accountable for the
relevant conduct of others when that conduct is (1) in
furtherance of a jointly undertaken criminal activity, and
(2) reasonably foreseeable in connection with that activity.
The district court therefore applied the correct legal
standard in determining the intended loss amount.

C. Check Register
  Sliman argues that the district court should not have
relied on the “check register,” which detectives found stored
in the computer at the Cicero apartment, because the
document does not have a sufficient indicia of reliability to
be admitted as evidence. According to Sliman, the check
register should have been excluded because it includes
“hearsay statements as to dates, amounts, payees, etc.
which the court relied on in making its factual determina-
tion.” Sliman also maintains that the document is unreli-
able because it is unknown what computer hardware or
software was used to generate the document; there was no
testimony by a forensic examiner or FBI agent as to how
the report was generated; there is no evidence as to how the
dates were inserted on the checks; there is no evidence as
to how the check numbers were inserted on the checks; and
there is no evidence as to whether the checks listed on the
register were “spoiled checks.”
  We find that the district court properly considered the
check register in determining the intended loss amount.
Sentencing Guideline 6A1.3(a) provides that, “[i]n resolving
any dispute concerning a factor important to the sentencing
determination, the court may consider relevant information
without regard to its admissibility under the rules of
evidence applicable at trial, provided that the information
has sufficient indicia of reliability to support its probable
accuracy.”
No. 05-3056                                                 9

  The district court did not err in finding that the check
register had a sufficient indicia of reliability. The govern-
ment presented evidence that in November 2002 and
January 2003, Sliman purchased a “versa check” 2002
Home & Business Program, MICR toner, and a “Versa
Check Rainbow (Economy) Pack 3000”—all items that can
be used to create counterfeit checks. The items were
shipped to Sliman’s home address. Fingerprint reports
showed that Sliman’s prints were found on blank and
printed check stock found at the Cicero apartment that the
co-defendants were using to print counterfeit checks. The
government recovered approximately $16 million in
checks that were intended to go to into the RVAL bank
account in Israel. Sliman’s fingerprints were found on some
of these checks, including on the fourth batch.
  The government found another $9 million in torn checks
on the floor of the apartment, and the district court properly
excluded these checks from the intended loss amount. The
district court also properly excluded the $2 million in checks
that were printed before Sliman joined the conspiracy. The
apartment contained a computer, check stock, torn checks,
and little or nothing else. It appeared that the co-conspira-
tors rented the apartment not to live in, but to use as a
secure place to produce counterfeit checks. It also appeared
that the co-conspirators did not throw away checks that
they did not intend to use. The checks that were not torn
were capable of entering the stream of commerce and being
negotiated, whether or not a financial institution would be
deceived by the counterfeits.
  Finally, two of Sliman’s co-conspirators admitted in their
plea agreements that the intended loss amount for the
conspiracy was greater than $20 million. We conclude that
the district court did not err by determining that the check
register contained a sufficient indicia of reliability.
10                                               No. 05-3056

D. Calculation of Intended Loss
  Sliman argues that the district court should have found
that the intended loss amount was around $4 million,
rather than the $26 million found by the district court. At
Sliman’s sentencing hearing, the district court determined
that the intended loss amount was greater than $20 million,
resulting in a 22-level increase from Sliman’s base level
offense of 6. The district court began its calculations by
determining that the co-conspirators printed $36.9 million
in counterfeit checks. This amount is equal to the total of
the checks listed on the “check register” that was found in
the apartment. From this amount, the district court
subtracted $9 million, the total of the checks found torn up
in the Cicero apartment. The district court also subtracted
another $2 million to account for checks that were printed
before Sliman began participating in the conspiracy in
August 2002. The district court concluded that the intended
loss amount was approximately $26 million.
  Sliman argues that the intended loss amount was only $4
million. In his version of events, the co-conspirators printed
and mailed one batch of checks, worth $4 million. When
that batch was confiscated, the co-conspirators printed and
mailed a replacement batch, worth $4 million. When the
second batch was confiscated, they printed another replace-
ment batch, which their Israeli co-schemers rejected
because the denominations of the checks were too large.
When the third batch was rejected, the co-conspirators
printed another $4 million batch of checks, which was
confiscated by FBI agents at O’Hare Airport. According to
Sliman, the intended loss from the beginning of the conspir-
acy was only $4 million. It just took the co-conspirators four
attempts to produce one batch of counterfeit checks.
  The district court properly rejected this argument.
Sliman’s version of events omits several important facts. At
the time the co-conspirators mailed the second batch of
No. 05-3056                                               11

checks, they were not aware that the first batch had already
been confiscated. Nor did the co-conspirators know at the
time they printed the third batch of checks that the second
batch had already been confiscated, possibly indicating that
the co-conspirators did not intend the later batches of
checks to be replacements. Additionally, although Sliman
argues that his co-conspirators in Israel rejected the third
batch of checks (because they were printed in large denomi-
nations and were likely to raise suspicion), this batch was
not destroyed. The co-schemers in Israel deposited some of
the checks from the third batch, and those checks were
confiscated when they were mailed to a New York bank for
processing. Each of the four batches of checks contained
different check numbers and denominations, also indicating
that each new batch was not a replacement for the previous
batch. Sliman’s fingerprints were found on the fourth batch
of checks.
  The remaining approximately $10 million in counter-
feit checks that were printed after Sliman joined the
conspiracy, which Sliman does not discuss, were made
payable to aliases of Sliman and his co-defendants Dacca
and Salama. There is evidence that the co-defendants
attempted to negotiate these checks. For instance, Sliman
admitted in his Plea Declaration that he, Salama, and
Dacca attempted to defraud financial institutions by
depositing a $12,860 counterfeit check in Dacca’s Bank One
account.
  Viewing the evidence as a whole, we find that the district
court did not commit clear error by finding that the conspir-
acy’s foreseeable intended loss was approximately $26
million.
12                                           No. 05-3056

                   III. Conclusion
For the foregoing reasons, we AFFIRM the district court’s
sentencing decision.

A true Copy:
      Teste:

                      ________________________________
                      Clerk of the United States Court of
                        Appeals for the Seventh Circuit

                  USCA-02-C-0072—6-5-06