Court Opinion

ID: 2670501
Source: CourtListenerOpinion
Date Created: 2014-04-19 00:00:05.86609+00
Date Added: 2024-06-11T09:18:41.944020
License: Public Domain

United States Court of Appeals
                      For the First Circuit

No. 12-1949

                     UNITED STATES OF AMERICA,

                             Appellee,

                                v.

                          RICHARD SOUZA,

                       Defendant, Appellant.

           APPEAL FROM THE UNITED STATES DISTRICT COURT

                 FOR THE DISTRICT OF MASSACHUSETTS

          [Hon. Richard G. Stearns, U.S. District Judge]

                              Before

                   Howard, Ripple,* and Thompson,
                          Circuit Judges.

     Rebecca A. Jacobstein, with whom Office of Appellate Advocacy
was on brief, for appellant.
     Randall E. Kromm, Assistant United States Attorney, with whom
Carmen M. Ortiz, United States Attorney was on brief, for appellee.

                          April 18, 2014

     *
         Of the Seventh Circuit, sitting by designation.
           HOWARD, Circuit Judge.             Richard Souza appeals from his

conviction and sentence for structuring financial transactions to

evade reporting requirements.           We affirm.

                                I.     Background

           In 2004, Souza was hired to repair the roof of Lawrence

Burtchaell,   an   elderly      widower.        The   two   developed     a   close

relationship and soon Souza was spending several days a week at

Burtchaell's home.

           During this time period, Burtchaell's acquaintances began

noticing   symptoms     of    mental    decline.       Usually     well   dressed,

Burtchaell began looking disheveled.                  He also had difficulty

remembering neighbors' names, he would get lost walking around the

neighborhood, and one time he flooded his house because he forgot

to turn off the bath. Burtchaell's diminishing mental capacity was

also   detected    by   his    investment       advisor,    Mark    Friese,     who

registered concern with his manager.

           In 2006, Souza persuaded Burtchaell to put up money to

purchase real estate in Maine.            Souza told Burtchaell and Friese

that Burtchaell was a partner in the investment, but revealed

neither that the other partners were Souza's sons, nor that

Burtchaell was providing all of the purchase money.                 Though Souza

promised that in a few weeks Burtchaell would recoup his money with

interest, Burtchaell never saw any return on the investment.

                                        -2-
             After closing the deal, Burtchaell took out an $89,000

loan on the property and wired almost all of the proceeds to

Souza's account with Sovereign Bank.                    In the following months,

Souza withdrew all of these funds, always in increments of less

than $10,000.      For instance, on June 15, 2006, within a period of

an   hour   and    a    half,     Souza     withdrew    $54,000    in   six    separate

installments of $9000 at five different Sovereign branches.

             Banks are required to file a report when an individual

withdraws    $10,000         or   more.      31    U.S.C.   §   5313(a);      31   C.F.R.

§    1010.311.         For   purposes       of    reporting,    banks   aggregate     an

individual's daily transactions across all branches.                          31 C.F.R.

§ 1010.313(b).           Thus, Sovereign treated Souza's six June 15

withdrawals as one $54,000 withdrawal and filed a report.

             Souza      was       charged    with     structuring       his    June   15

transactions for the purpose of evading the reporting requirements,

in violation of 31 U.S.C. § 5324(a)(3).                 Souza claimed that he had

been forced to make multiple withdrawals of $9000 because each

Sovereign branch ran out of money.                 To rebut this claim and to show

Souza's intent to evade the reporting requirements, the government

presented evidence of the Maine transaction, arguing that Souza

wished to avoid drawing attention to his withdrawals because they

were composed of ill-gotten funds.                      Souza was convicted and

sentenced.       He appeals.

                                             -3-
                                 II.   Discussion

             Souza claims violations of his rights to a speedy trial,

to effective assistance of counsel, and to due process.              He also

argues that the district court made erroneous evidentiary rulings

and sentencing errors.       None of these arguments is persuasive.

A.    Speedy Trial

             Souza contends that he was denied his speedy trial right.

That right derives from two sources:             the Speedy Trial Act (STA),

18 U.S.C. §§ 3161-74, and the Sixth Amendment.

             1.   STA

             The STA places time limits on two periods in criminal

proceedings:      the period between arrest and indictment, and the

period between indictment and trial.                Id. § 3161(b)-(c).    In

computing the amount of time that has elapsed during these periods,

the   STA   permits     courts    to   exclude    certain   intervals.   Id.

§ 3161(h).

             Souza alleges STA violations in both periods.         We review

STA challenges de novo as to legal rulings and for clear error as

to factual findings.       United States v. Valdivia, 680 F.3d 33, 38

(1st Cir.), cert. denied, 133 S. Ct. 565 (2012). Overall, however,

we review for abuse of discretion decisions to exclude intervals of

time from the STA count.         United States v. Gates, 709 F.3d 58, 64

(1st Cir.), cert. denied, 134 S. Ct. 264 (2013).

                                        -4-
                    a.   Between Arrest and Indictment

            The STA calls for indictment no later than thirty days

after arrest.    18 U.S.C. § 3161(b).      Souza was arrested on August

12, 2010 and was indicted on September 30.            He argues that only

fourteen of these forty-nine days are excludable, leaving thirty-

five days -- five more than the STA permits.              Although "delay

resulting    from     any   pretrial     motion"    is   excludable,   id.

§ 3161(h)(1)(D), including up to thirty days "during which any

proceeding concerning the defendant is actually under advisement by

the court," id. § 3161(h)(1)(H), Souza claims that no excludable

time resulted from a joint motion filed by the parties on August

20.   He makes three points, none of which is availing.

            First, Souza argues that the joint motion, which sought

"enlargement of time" to obtain an indictment, requested relief

that the court was incapable of granting.          Souza did not make this

argument to the district court.        Even if he had, while it is true

that courts cannot "enlarge" the time limits established by the

STA, courts can "exclude" certain periods in the interest of

justice, see    id.   § 3161(h)(7)(A), and the joint motion, was

functionally equivalent to an anticipatory motion to exclude time.

Souza does not and could not contend that the purely semantic

difference prejudiced the proceedings in any way.

            Second, Souza contends that the exclusion of time sought

by the joint motion was not in the interest of justice.          But it is

                                   -5-
irrelevant whether the motion's reasons for seeking exclusion had

merit: time was excludable not because the court granted the joint

motion, but because the court had the motion under advisement.

          Third, Souza asserts that the toll that stops the clock

while a court considers a pretrial motion should not apply when the

motion seeks a continuance.        Otherwise, says Souza, a party intent

on excluding time could obtain that result simply by filing a

motion.   But in United States v. Richardson, we rejected this

argument and held that a motion to continue can toll the speedy

trial clock.   421 F.3d 17, 31 (1st Cir. 2005).

          Of   course,   as   we    cautioned   in   Richardson,   "neither

counsel nor district courts may employ measures for excluding time

from the speedy trial clock that impermissibly frustrate the STA's

purpose of protecting the shared interest of criminal defendants

and the public in 'bringing criminal charges to the bar of justice

as promptly as practicable.'"        Id. at 29 (quoting United States v.

Hastings, 847 F.2d 920, 923 (1st Cir. 1988)).          As was true of the

motion to continue in Richardson, the joint motion here "was not

filed as a pretext to avoid the consequences of an STA violation,

but was filed for the legitimate purpose of seeking a continuance

in the interest of justice."        Id.    Counsel for both Souza and the

government sought the continuance to carry on preexisting plea

negotiations and because each had a long-standing vacation planned.

Since we have expressly left open the issue whether periods of plea

                                     -6-
negotiation   can    properly   be     excluded,    United   States   v.

Scantleberry-Frank, 158 F.3d 612, 615 (1st Cir. 1998), a motion to

continue made on that basis, while not guaranteed to succeed, will

not be deemed pretextual on that ground alone.       Similarly, because

we have held that "[a] reasonable vacation constitutes a plausible

basis for excluding a relatively brief period of time," Gates, 709
F.3d at 67, a motion to continue made on that basis is also not

necessarily pretextual.

          Nor does the fact that Souza objected to the joint motion

render it pretextual. After all, "defense counsel has the power to

seek an STA continuance without first informing his client or

obtaining his client's personal consent."          Id. at 66.   Souza's

objection is merely "a datum for the district court to consider in

its analysis of the ends of justice," and must be measured in light

of both attorneys' legitimate reasons for requesting a continuance.

Id.

          Because the STA permits a court to exclude up to thirty

days while a motion is under advisement, 18 U.S.C. § 3161(h)(1)(D),

(H), the joint motion tolled the speedy trial clock beginning on

August 20 and continuing through September 19.          This exclusion

reduces the counted number of days between the August 12 arrest and

the September 30 indictment below thirty, and therefore within the

limits of the STA.

                                 -7-
                      b.   Between Indictment and Trial

            The STA calls for trial no later than seventy days after

indictment.     18 U.S.C. § 3161(c)(1).                Souza was indicted on

September 30, 2010 and his trial began on February 27, 2012.                     He

argues that only 201 of these 515 days were excludable, leaving 314

days -- 244 more than the STA permits.

            "[E]xclusions of time not specifically challenged in a

motion to dismiss are deemed waived."                  Gates, 709 F.3d at 68

(emphasis   added).        Souza    did   not   file    a    motion   to     dismiss

challenging specific intervals in the pretrial period.                     Instead,

through pro se filings, he protested generally about delay.                      On

appeal, he avers that these general protestations were meant to

convey that there were no excludable intervals anywhere in the

pretrial    period.        This    mischaracterizes         his   filings,    which

comprised vague complaints of delay and accusations against the

court, the government, and his attorneys for colluding to impair

his speedy trial right. Even when viewed as charitably to Souza as

possible, his assertions did not in any event challenge exclusions

of time during the pretrial period, thus waiving such challenges on

appeal.1

     1
        Because we conclude that Souza's pro se filings failed to
preserve challenges to specific exclusions of time, we need not
address whether the district court authorized the type of "hybrid
representation" that would permit Souza to make a pro se filing
while represented by counsel.

                                       -8-
           2.    Sixth Amendment

           Souza also contends that the delay between his arrest and

trial violated the Sixth Amendment's guarantee of a speedy trial.

We review the district court's Sixth Amendment decision for abuse

of discretion. United States v. Santiago-Becerril, 130 F.3d 11, 21

(1st Cir. 1997).    To determine whether a Sixth Amendment violation

has occurred, a court balances four factors: "(1) the length of the

delay, (2) the reasons for the delay, (3) the defendant's assertion

of his right, and (4) prejudice to the defendant resulting from the

delay."   United States v. Dowdell, 595 F.3d 50, 60 (1st Cir. 2010)

(citing Barker v. Wingo, 407 U.S. 514, 530 (1972)).

                    a.     Length of Delay

           Length of delay, in addition to factoring into the

balance, serves as a triggering mechanism for review, since a court

will conduct a Sixth Amendment analysis only after a defendant has

shown that the period of time "has crossed the threshold dividing

ordinary from presumptively prejudicial delay."         Doggett v. United

States, 505 U.S. 647, 651-52 (1992) (internal quotation marks

omitted). Generally, delay becomes prejudicial around the one-year

mark.   See id. at 652 n.1; Dowdell, 595 F.3d at 61.

           Here, roughly eighteen months passed between Souza's

arrest in October 2010 and his trial in February 2012.                  For

purposes of analysis, we will assume, without deciding, that the

eighteen-month     delay    establishes    a   presumption   of   prejudice,

                                     -9-
triggering further Sixth Amendment review.         See, e.g., Santiago-

Becerril, 130 F.3d at 21 (assuming that fifteen-month delay was

presumptively prejudicial).

           As for its place in the balancing test, a lengthier delay

raises the likelihood that the defendant suffered prejudice.

Doggett, 505 U.S. at 652.      While the delay in Souza's case was not

at the extreme end of the spectrum, see Barker, 407 U.S. at 534

("It is clear that the length of delay between arrest and trial --

well over five years -- was extraordinary."); but see United States

v. Munoz-Franco, 487 F.3d 25, 61 (1st Cir. 2007) ("The five years

that elapsed between indictment and trial is a troublesome length

of time.   Nonetheless, our inquiry has revealed no constitutional

violation."),   we     have   held   that   a   fifteen-month   delay   is

"[a]rguably . . . long enough to tip the scales slightly in favor

of [the defendant's speedy trial] claim," Santiago-Becerril, 130
F.3d at 22.     We will assume for the sake of argument that the

eighteen-month delay in Souza's case weighs in his favor, but, as

we explain below, not heavily enough to overcome the countervailing

weights of the second and fourth factors.

                  b.    Reasons for Delay

           Of the four factors in the analysis, examination of the

reasons for delay is the "focal inquiry."         Munoz-Franco, 487 F.3d

at 60 (internal quotation marks omitted).        We must first determine

if the delays were attributable to Souza or to the government.

                                     -10-
"[D]elays sought by [defense] counsel are ordinarily attributable

to the defendants they represent."         Vermont v. Brillon, 556 U.S.
81, 85 (2009).    For those delays caused by the government, we must

evaluate the underlying reasons:

          A deliberate attempt to delay the trial in
          order to hamper the defense should be weighted
          heavily against the government.        A more
          neutral   reason   such   as   negligence   or
          overcrowded courts should be weighted less
          heavily but nevertheless should be considered
          since the ultimate responsibility for such
          circumstances must rest with the government
          rather than with the defendant.     Finally, a
          valid reason, such as a missing witness,
          should serve to justify appropriate delay.

Barker, 407 U.S. at 531 (footnote omitted).

          This factor weighs against Souza.              Much of the delay

resulted from his actions or those of his counsel.               Between his

arrest and the appointment of his ultimate trial counsel, Souza

twice violated the terms of his release, necessitating further

proceedings,     and   thrice   obtained     new      counsel,   who   sought

continuances on several occasions.         Additionally, Souza filed two

pretrial motions, which further delayed the proceedings.

          The    delays   attributable     to   the    government   were   not

motivated by a deliberate attempt to defer the trial.               Some were

traceable to the fact that replacement counsel for the government

needed time to gain familiarity with the case after the initial

counsel left the U.S. Attorney's Office.           Others resulted from the

medical leave of an IRS agent who was needed to produce certain

                                  -11-
documents.     These fall into the category of valid reasons that

justify an appropriate delay.     Further appropriate delay occurred

when the case was transferred to a new district court judge after

the initial judge retired.

             Once the trial date was set, it was continued twice.

First, the government moved for a continuance because counsel had

another trial and an appellate argument scheduled during the same

month as Souza's trial.        Thereafter, Souza's counsel moved to

continue because he had a conflict with the new trial date.    All in

all, the government, as compared to Souza and his counsel, played

a minimal role in delaying the trial.

                    c.   Defendant's Assertion of the Right

             From the outset, Souza made it clear that he wished to

proceed to trial as quickly as possible. This factor weighs in his

favor, but not enough to overcome the weight that the second and

fourth factors carry against him.

                    d.   Prejudice Resulting from the Delay

             Prejudice is assessed in light of the interests that the

speedy trial right was designed to protect: "(i) to prevent

oppressive pretrial incarceration; (ii) to minimize anxiety and

concern of the accused; and (iii) to limit the possibility that the

defense will be impaired."     Barker, 407 U.S. at 532.

             The last of these interests is the most serious, as it

implicates "the fairness of the entire system," and we begin with

                                  -12-
it here.    Id.    Souza argues that evidence and testimony of

witnesses was lost or hampered as a result of the delay between his

criminal conduct, which occurred in 2006, and his trial, which

occurred in 2012. But most of this period is irrelevant for speedy

trial purposes.    The speedy trial right "attaches upon arrest or

indictment, whichever occurs first," Santiago-Becerril, 130 F.3d at

21, and Souza was not arrested until August 12, 2010.   The delay in

obtaining the arrest following his criminal conduct implicates

separate rights, see Munoz-Franco, 487 F.3d at 58, not invoked by

Souza on appeal.     Though Souza speculates about prejudice, he

points to nothing in the eighteen-month period between his arrest

and trial that impaired his ability to mount a defense.

           As to pretrial incarceration, we cannot say that the

delay between Souza's arrest and trial caused him prejudice. Souza

was incarcerated while awaiting trial only because he failed to

abide by the conditions of his release.      And, as to anxiety and

concern,   since   "considerable   anxiety   normally   attends   the

initiation and pendency of criminal charges[,] . . . only undue

pressures are considered."   United States v. Henson, 945 F.2d 430,

438 (1st Cir. 1991) (internal quotation marks omitted). The record

does not suggest that Souza was subject to such undue pressures.

           Weighing all four factors, in light of the facts that

Souza and his counsel were largely responsible for the delay and

that Souza did not experience prejudice as a result, we discern no

                                -13-
abuse of discretion in the district court's determination that

Souza's Sixth Amendment right was respected.

B.   Ineffective Assistance of Counsel

            Souza   argues   that   his    counsel   provided     ineffective

assistance by filing the joint motion for enlargement of time.

Souza claims that his attorney agreed to this motion without

consulting Souza and that the motion ran counter to his interests.

            This is neither the time nor the place to first raise the

ineffective assistance claim.       Such claims "should ordinarily be

litigated in the first instance in district court. It is true that

we   make   an   exception   for    cases    in   which   trial     counsel's

ineffectiveness is manifestly apparent from the record, but this is

not such a case."     United States v. Wyatt, 561 F.3d 49, 52 (1st

Cir. 2009) (citations omitted).      Souza's ineffective assistance of

counsel claim requires further factual development, so he must wait

to raise it on collateral review.

C.   Due Process

            Souza   claims   that   his     conviction    under    31   U.S.C.

§ 5324(a)(3) violates due process because the statute fails to

provide fair notice that his conduct was criminal.                Because his

actions -- withdrawing $54,000 in $9000 increments from multiple

branches in one day -- in fact triggered the bank's reporting

requirements, he wonders how he can be punished for evading those

                                    -14-
requirements.    We review such a challenge de novo.     United States

v. Hussein, 351 F.3d 9, 14 (1st Cir. 2003).

            Souza's argument misses the point.      Section 5324(a)(3)

makes it a crime to structure transactions "for the purpose of

evading the reporting requirements."        31 U.S.C. § 5324(a)(3)

(emphasis added). The statute focuses on an individual's intent to

evade the reporting requirements, not on whether he succeeds in

doing so.    United States v. Sweeney, 611 F.3d 459, 471 (8th Cir.

2010)   ("[Section]    5324   prohibits   persons    from   conducting

transactions with the intent to evade the reporting requirement,

regardless of whether a plan to evade the reporting requirement

succeeds (by staying below the $10,000 threshold) or fails (by

exceeding the $10,000 threshold)."); United States v. Van Allen,

524 F.3d 814, 825 (7th Cir. 2008) ("Whether or not Van Allen

actually fooled Archer Bank has no bearing on the substantive

violation under 31 U.S.C. § 5324(a).").          Consistent with due

process, Souza could be convicted of structuring his transactions

in a way that demonstrates his intent to evade the reporting

requirements, even though he failed to actually evade them.

D.   Evidentiary Rulings

            According to Souza, the district court erred in admitting

evidence related to the source of the funds that were eventually

structured. This included evidence of Burtchaell's purchase of the

Maine property, the loan he took out on that property, and his

                                 -15-
transfer of the loan proceeds to Souza's account.   We review such

evidentiary rulings for abuse of discretion.      United States v.

Green, 698 F.3d 48, 55 (1st Cir. 2012).

            Souza first claims that evidence of fraudulent activity

related to the Maine transaction was not intrinsic to the charged

crime of structuring and, as extrinsic evidence, comprised prior

acts that were inadmissible under Federal Rule of Evidence 404(b).

Intrinsic evidence includes prior acts that are "part of [the]

necessary description of the events leading up to the crime[]" or

that go to "an element of the charged offense."    United States v.

Fazal-Ur-Raheman-Fazal, 355 F.3d 40, 50 (1st Cir. 2004).     Here,

evidence of the funds' source was part of the necessary description

of the events leading up to the structuring; that evidence, as it

suggested Souza knew he had obtained the funds in an illicit

manner, also went to the element of his intent to evade the

reporting requirements.     The district court did not abuse its

discretion in treating this evidence as intrinsic to the crime

charged.2

            Souza also argues that the evidence should have been

excluded under Rule 403 as unfairly prejudicial.    We reverse the

     2
        Because we conclude that the evidence was intrinsic to the
charged crime and went to the issue of Souza's intent, we need not
address his argument that the evidence was inadmissible under Rule
404(b). See United States v. Mare, 668 F.3d 35, 39 (1st Cir. 2012)
(citing Fazal-Ur-Raheman-Fazal for the proposition that "intrinsic
evidence that would satisfy the charged crime's specific intent
element is not governed by Rule 404(b)").

                                -16-
district court's judgment about the prejudicial effect of evidence

"[o]nly rarely -- and in extraordinarily compelling circumstances."

Freeman v. Package Mach. Co., 865 F.2d 1331, 1340 (1st Cir. 1988).

Souza avers that evidence of the funds' source lacked probative

value because the government could have proven its case exclusively

through the structure of the transactions. Of course, at trial the

government needed to overcome Souza's assertion that he was forced

to complete his withdrawals as he did because none of the bank

branches had enough cash on hand.               And while theoretically a jury

could       have   inferred    Souza's     intent    to   evade     the   reporting

requirements         simply   from   the    structure     of   the   transactions

themselves, evidence of how Souza obtained the funds provided

important additional information with which to evaluate his intent.

See United States v. Davenport, 929 F.2d 1169, 1174 (7th Cir. 1991)

("The Davenports say it is irrelevant to their guilt of the crime

of which they were charged where they got the money.                      It is not

irrelevant.        The shadier the source, the greater the Davenports'

motive to conceal the money from the authorities by taking measures

to thwart the reporting requirements."); see also Old Chief v.

United States, 519 U.S. 172, 188 (1997) ("[T]he prosecution may

fairly seek to place its evidence before the jurors, as much to

tell    a    story    of   guiltiness      as   to   support   an    inference   of

guilt . . . .").

                                         -17-
            We understand Souza's concern about the prejudicial

effect this evidence might have had on the jury.              The prosecution

devoted considerable time to the Maine transaction.             And Souza, in

turn, reasonably felt compelled to respond to allegations of fraud

in that transaction.      Evidence that Souza defrauded an elderly,

vulnerable man ran the risk of prejudicing the jury.              See United

States v. Gilbert, 229 F.3d 15, 24 (1st Cir. 2000) (noting the

prejudice that can attend a "mini-trial" on uncharged conduct).

But Rule 403 excludes evidence only when its prejudicial effect

substantially outweighs its probative value, and we cannot say that

the district court abused its discretion in refusing to find such

substantial   outweighing     here.         Moreover,   the   district    court

instructed the jury to focus on the charged conduct, as opposed to

any potential uncharged crime.        See United States v. Williams, 717
F.3d 35, 41-42 (1st Cir. 2013) (noting that limiting instruction

can help prevent unfair prejudice in these situations).

E.    Sentencing

            Souza   argues    that    the    district   court's    sentencing

guidelines calculation was erroneous in three respects.               We review

the   sentencing    court's   factfinding       for   clear   error    and   its

construction and application of the guidelines de novo.                  United

States v. Ihenacho, 716 F.3d 266, 276 (1st Cir. 2013).

                                     -18-
          1.    Amount of Structured Funds

          The   district   court   found   that   the   structured   funds

consisted of a June 8, 2006 withdrawal of $5000, a June 12

withdrawal of $5500, a June 13 withdrawal of $4976.26, a June 14

withdrawal of $3700, and the six June 15 withdrawals of $9000 each,

all totaling $73,176.26. Because the structured funds totaled more

than $70,000, the court applied an eight-level increase to Souza's

offense level under U.S.S.G. § 2B1.1(b)(1)(E).

          Souza argues that the structured funds consisted of only

the $54,000 withdrawn in six installments on June 15.         Therefore,

says Souza, the court should have applied only the six-level

increase that corresponds to structured funds totaling between

$30,000 and $70,000.   See id. § 2B1.1(b)(1)(D).        Souza points out

that, while a $9000 withdrawal is just under the $10,000 reporting

threshold, none of his other withdrawals came close to the limit.

He also argues that the June 13 withdrawal of $4976.26 is too

specific to show structuring, and likely was used to pay a bill.

          We see no clear error in the district court's calculation

of the structured funds.    There is no requirement that structuring

involve whole numbers or amounts just under $10,000.        Although the

withdrawals between June 8 and June 14 were not identical to those

of June 15, they share enough similarities that the court could

have reasonably concluded that all of the withdrawals were meant to

evade the reporting requirements. They all occurred within a short

                                   -19-
time period: no more than one business day elapsed between any of

the withdrawals.        They all involved several thousands of dollars.

And    they    all    closely    followed   the    deposit   of   the      bulk   of

Burtchaell's loan proceeds into Souza's account.

               2.    Proceeds of Unlawful Activity

               The district court found that Souza knew the structured

funds were the proceeds of unlawful activity, and thus applied a

two-level increase under U.S.S.G. § 2S1.3(b)(1)(A).

               Souza argues that there was no evidence that he acquired

the    funds     through   unlawful    activity.        According     to    Souza,

Burtchaell's consent to the Maine transaction was obtained neither

through fraud nor through misrepresentation.

               The record tells a different story. Souza misrepresented

the nature of the Maine transaction by failing to disclose to

Burtchaell and Friese that the other partners were Souza's sons or

that Burtchaell was providing all of the purchase money.                      Souza

also   promised       illusory    returns   on    the   investment,     and    then

convinced Burtchaell to take out a loan on the property and to

transfer the bulk of the loan proceeds to Souza's account.                  All of

this provides enough evidence to support the district court's

finding that Souza knew the structured funds derived from unlawful

activity.

                                      -20-
           3.    Vulnerable Victim

           The district court found that Souza knew or should have

known that Burtchaell was a vulnerable victim, and thus applied a

two-level increase under U.S.S.G. § 3A1.1(b)(1).              The guidelines

define a vulnerable victim as "a person (A) who is a victim of the

offense of conviction and any conduct for which the defendant is

accountable under § 1B1.3 (Relevant Conduct); and (B) who is

unusually vulnerable due to age, physical or mental condition, or

who is otherwise particularly susceptible to the criminal conduct."

Id. § 3A1.1 cmt. n.2.

           Souza challenges the vulnerable victim increase on two

grounds.   First, he says that even if he defrauded Burtchaell,

Burtchaell was not a victim of the charged crime of structuring.

Second, Souza says he did not know of and had no reason to know of

Burtchaell's vulnerability.

                    a.   "Victim"

           To come within the guidelines' definition, one need not

be a victim of the charged offense so long as one is a victim of

the defendant's other relevant conduct.              Id.    Relevant conduct

includes   all   acts    that   occurred    during    the   preparation   and

commission of the offense.          See id. § 1B1.3(a)(1).       And for an

offense like structuring, relevant conduct also includes acts that

were "part of the same course of conduct or common scheme or plan."

See id. §§ 1B1.3(a)(2), 3D1.2(d). A common scheme or plan involves

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acts connected "by at least one common factor, such as common

victims, common accomplices, common purpose, or similar modus

operandi."    Id. § 1B1.3 cmt. n.9(A).

             Souza argues that any fraud of which Burtchaell might

have been a victim was not relevant conduct with respect to the

charged offense of structuring.        We disagree.      The fraud and the

structuring were part of a common scheme: without the fraud, Souza

would not have acquired the funds that he went on to withdraw

through structured transactions, and the structuring was meant to

extract without detection his ill-gotten gains.                 This case is

similar to United States v. Johnson, in which fraud perpetrated

against telemarketing victims was deemed relevant to the charged

offense of money laundering, because the fraud "provided the

illicit funds necessary to finance additional criminal activity."

297 F.3d 845, 873 (9th Cir. 2002); see also United States v.

Firment, 296 F.3d 118, 120-21 (2d Cir. 2002) ("[W]e see no error in

the   district    court's   application     of   the     vulnerable    victim

enhancement to Firment on the basis of the vulnerability of the

victims of the telemarketing scheme that generated the taxable

revenues, despite the fact that his offense of conviction was a tax

offense.").      In   short,   the   district    court    did    not   err   in

determining that Burtchaell was a victim of conduct that was

relevant to the charged structuring.

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                      b.    "Vulnerable"

           The evidence of Burtchaell's diminished capacity was

considerable, consisting of testimony from his neighbors that he

began to look disheveled, that he had difficulty remembering their

names, that he would get lost walking around the neighborhood, and

that he once flooded his house by leaving the bath running, as well

as testimony that his financial advisor had reported to his manager

concern about Burtchaell's slipping mental faculties. Coupled with

evidence that Souza spent substantial time with Burtchaell during

this   period,   we    see   no   clear    error   in   the   district   court's

determination that Souza knew or had reason to know of Burtchaell's

vulnerability.

                               III.    Conclusion

           For   the       foregoing   reasons,     Souza's    conviction    and

sentence are affirmed.

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