Court Opinion

ID: 30801
Source: CourtListenerOpinion
Date Created: 2010-04-25 10:06:13+00
Date Added: 2024-06-11T09:35:10.229876
License: Public Domain

United States Court of Appeals
                                                                 Fifth Circuit
                                                              F I L E D
                                                               April 14, 2003
                        REVISED APRIL 28, 2003
                                                          Charles R. Fulbruge III
              IN THE UNITED STATES COURT OF APPEALS               Clerk

                        FOR THE FIFTH CIRCUIT

                             No. 02-60285

     UNITED STATES OF AMERICA,

                                            Plaintiff-Appellee,

          versus

     JAMES ORIN OGLE,

                                            Defendant-Appellant.

          Appeal from the United States District Court
            for the Southern District of Mississippi

Before GARWOOD, SMITH and BARKSDALE, Circuit Judges.

GARWOOD, Circuit Judge:

     James Ogle appeals his conviction and sentence for conspiring

to launder monetary instruments and laundering monetary instruments

in violation of 18 U.S.C. §§ 1956(h) and 1956(a)(3)(B), (C).        Ogle

was charged in a two-count indictment arising from an agreement to
launder money represented to be the proceeds of drug smuggling.       He

was subsequently convicted by a jury on both counts and sentenced

to concurrent terms of 121 months’ imprisonment followed by three

years’ supervised release.     For the reasons set forth below, we

affirm the conviction, vacate the sentence, and remand for re-

sentencing.

                              Background

     Ogle, an Atlanta businessman, was arrested as part of a

reverse-sting   operation   conceived   and   orchestrated   by   Wendell

Blount, a confidential informant for the United States Customs

Service acting under the direction of Customs Service Special Agent

Michael Tyson. The sting operation began after Blount was directed

by acquaintances to Casey Hemmings as someone “could get some money

cleaned up” for him.

     Based on that referral, Blount and Special Agent Tyson agreed

to contact Hemmings with a proposal to launder a fictitious twelve

million dollars in cash that Blount decided to describe to Hemmings

as the proceeds of illegal narcotics smuggling.      Upon returning to

Mississippi, Blount contacted Hemmings and arranged to meet him in

a Biloxi hotel room to discuss the proposed transaction.           After

arranging for Customs Service surveillance of the meeting, Blount

met Hemmings on March 3, 2001.          During that meeting, Blount

revealed the fictitious details of the source of the cash, and

Hemmings, although initially apprehensive about the matter, agreed

                                  2
to handle the proposed money laundering transaction for Blount.1

At   their      meeting,    Hemmings      also    informed       Blount    that   the

transaction      would     be   handled   in     part   by    Hemmings’s    business

partner, James Ogle. Hemmings subsequently told Blount that he had

explained the matter to Ogle and that Ogle was entirely receptive

to it.

     Following their first meeting, Hemmings continued to contact

Blount to arrange the details of the transaction, and on March 28,

2001, Hemmings introduced Ogle to Blount.                    At a meeting on March

28th,    Ogle    presented      Blount    with    a   number    of   proposals    for

laundering      the   fictitious      cash,      despite      only   thinly   veiled

indications from Blount that the cash represented the proceeds of

narcotics smuggling.            Later, when Hemmings, initially a central

figure in the scheme, assumed a less active role following his

arrest on an unrelated matter in Florida, Ogle took over the

planning of the transaction.

     After some delay during which Ogle repeatedly telephoned

Blount, pressuring Blount to complete the deal, Ogle and Blount

eventually agreed that Ogle would pick up the cash in the parking

     1
        Any reluctance to participate in the transaction on
Hemmings’s part appeared to be driven less by an unwillingness to
engage in illegal activity, and more by a fear of law enforcement
and of other risks related to becoming involved, even
tangentially, with large-scale narcotics smuggling. Hemmings
repeatedly referred to the risk of “being set up,” and at one
point during their initial meeting, even insisted on searching
Blount; at another point, Hemmings expressed concern that a third
party might come looking for the laundered money.

                                          3
lot of a Biloxi, Mississippi, casino.        When Ogle arrived in Biloxi

on May 30, 2001, accompanied by an armed escort, to take possession

of the fictitious twelve million dollars, he not only found that

the cash did not actually exist, but also found himself facing

arrest at the hands of a team of Customs agents.

                                Discussion

     Ogle assigns as error three rulings of the district court: the

district court’s refusal to instruct the jury on the defense of

entrapment; the exclusion of the proffered testimony of Ogle’s

expert witness; and the district court’s refusal to consider a

three-level   reduction    of   Ogle’s   sentence   under   the   general

conspiracy provision of the sentencing guidelines. We address each

point of error in turn and conclude that only the third, the

calculation of Ogle’s sentence under the guidelines, has merit.

A.   Entrapment

     Where there is an evidentiary foundation for a theory of

defense that, if credited by the jury, “would be legally sufficient

to render the accused innocent,” it is reversible error to refuse

a charge on that theory.     United States v. Schmick, 904 F.2d 936,

943 (5th Cir. 1990).   Thus, “when a defendant’s properly requested

entrapment instruction is undergirded by evidence sufficient to

support a reasonable jury’s finding of entrapment, the district

court errs reversibly by not adequately charging the jury on the

theory of entrapment.”     United States v. Bradfield, 113 F.3d 515,

                                    4
521 (5th Cir. 1997).     Accordingly, we review de novo the refusal to

instruct the jury on the defense of entrapment.                Id.

      “The   critical   determination      in    an    entrapment     defense     is

whether criminal intent originated with the defendant or with the

government agents.”     Id. at 521.       That the Government provided the

opportunity for Olge to commit the offense of money laundering by

employing a confidential informant and fabricating the existence of

the money to be laundered does not, in itself, entitle Ogle to an

entrapment instruction.          “[T]he Government may use undercover

agents to enforce the law,” and “artifice and stratagem may be

employed to catch those engaged in criminal enterprises.” Jacobson

v. United States, 112 S.Ct. 1535, 1540 (1992).                 Entrapment only

arises, rather, where the Government, in its “zeal to enforce the

law,” “implant[s] in an innocent person’s mind the disposition to

commit a criminal act, and then induce[s] commission of the crime

so that the Government may prosecute.”                Id.    Before he will be

entitled to an entrapment defense, therefore, the defendant bears

the   burden   of   presenting    evidence      of    both   “(1)    his   lack   of

predisposition to commit the offense and (2) some governmental

involvement and inducement more substantial that simply providing

an opportunity or facilities to commit the offense.”                   Bradfield,

113 F.3d at 521.

      After reviewing the record, we conclude that the district

court did not err in refusing an entrapment instruction.                   We find

                                      5
that       Ogle   failed   to    satisfy   his   initial    evidentiary    burden,

producing substantial evidence neither of a lack of predisposition

to commit the offense of money laundering, nor of government

actions that amounted to more than simply providing him with the

occasion to launder money.

       Ogle does not point to any evidence in the record indicating

a lack of predisposition to engage in money laundering, nor does a

review of the record indicate that Ogle established that he lacked

the necessary predisposition to commit the offense.2                        On the

contrary, the uncontradicted record reflects that Ogle, far from

being a reluctant party to the proposed transaction, was a keen

participant        in   the     conspiracy,    eager   to   see   the   transaction

consummated.3           Ogle arrived at his first meeting with Blount

       2
        Neither Ogle nor Hemmings testified. Ogle did attempt to
introduce the testimony of a financial expert who was prepared to
testify that Ogle lacked the positional predisposition to engage
in money laundering. As discussed infra, however, the district
court properly excluded that testimony and it cannot, therefore,
be relied upon to satisfy Ogle’s burden of producing evidence
establishing a lack of predisposition.
       3
        In his brief, Ogle places great weight on the assertion
that the Government presented no evidence to show that he knew of
the illegal nature of the proposed transaction before meeting
Blount in Mississippi. That assertion, even if true, however,
does not establish a lack of predisposition. Rather, it merely
indicates the extent to which Ogle misapprehends his burden of
producing evidence of a lack of predisposition. To say that the
Government failed to show that Ogle knew of the putatively
illegal source of the funds before meeting with Blount does not
demonstrate that Ogle satisfied his initial burden of producing
more than a scintilla of evidence of a lack of predisposition.
Ogle’s predisposition is a question independent of the question
of when he learned that the fictional cash represented the
proceeds of unlawful activity.

                                           6
prepared to offer a number of options for laundering the fictional

cash, including a proposal to pay a Turkish diplomat ten percent of

the funds to transport the cash out of the United States and

deposit it in Turkey, and a proposal to pay a development company

that routinely deposited large sums of cash to deposit and then

transfer the illicit funds.4   Such demonstrated knowledge of the

details of international money laundering alone is enough to

establish predisposition.   See Reyes, 239 F.3d at 739 (listing a

“demonstrated knowledge or experience with the criminal activity

     Moreover, Ogle’s argument that he did not know that the
funds were the proceeds of narcotics smuggling evinces a
misunderstanding of the mens rea necessary for a conviction under
§ 1956. A conviction for money laundering does not require that
the defendant know the precise source of the illegal funds, but
only that the defendant know that the funds are “proceeds of some
form of illegal activity.” 18 U.S.C. § 1956(a)(1) (emphasis
added); see also § 1956(c)(1) (must know that “the property
involved . . . represented proceeds from some form, though not
necessarily which form, of activity that constitutes a felony
under State, Federal, or foreign law, regardless of whether or
not such activity is specified in paragraph (7)”); S.Rep. No. 99-
433, at 12 (1986) (“[T]he defendant need not know exactly what
crime generated the funds involved in a transaction, only that
the funds are the proceeds of some kind of crime that is a felony
under Federal or State law. This will eviscerate the defense
that a defendant knew the funds came from a crime, but thought
the crime involved was a crime not on the list of ‘specified’
crimes in section (c)(7).”).
     4
        Ogle’s apparent ease in discussing these various
proposals indicates a degree of familiarity with money laundering
sufficient to support the conclusion that he was predisposed to
engage in money laundering. His reference to the Turkish
diplomat’s prior smuggling efforts, for example, suggests that
Ogle, even if not having previously engaged directly in the
smuggling of currency, was, at a minimum, familiar with the
process.

                                7
under investigation” as one of a number of factors tending to prove

predisposition).      The suspect nature of these proposals reflects

that Ogle prepared in advance for the meeting despite at least some

awareness of the nature of the proposed transaction.                       Moreover,

there is absolutely no evidence that Ogle did not know of the

illegal nature of the proposed transaction before his initial

meeting with Blount.       Because, “a defendant’s ready and willing

participation in government-solicited criminal activity, standing

alone, is sufficient to prove predisposition,” this uncontradicted,

unimpeached evidence also provided an adequate basis for the

district court to deny an entrapment instruction.                Id.   At no point

did Ogle display any hint of hesitation or unwillingness to enter

into the conspiracy. See, e.g., United States v. Fischel, 686 F.2d

1082, 1086 (5th Cir. 1982) (noting that a single act of hesitation,

easily overcome, is insufficient to establish inducement). Rather,

the uncontradicted evidence reflects that Ogle continued to plan

and to pursue aggressively the proposed transaction even after

learning of the illegal source of the cash.                      Thus, when the

transaction appeared on the verge of foundering, Ogle repeatedly

contacted Blount seeking to revive the deal, calling as often as

six times in as many days.            Cf. Bradfield, 113 F.3d at 522–23

(finding   that   a   defendant   had       made   a   showing    of   a    lack   of

predisposition     where   it   was     the    government        agent,     not    the

defendant, who called repeatedly seeking to consummate the criminal

                                        8
transaction).

     Not only is it clear that Ogle failed to produce evidence of

a lack of predisposition, but he also failed to establish that his

involvement in the proposed money laundering transaction was the

product of government inducement.    “The conduct with which the

defense of entrapment is concerned is the manufacturing of crime by

law enforcement officials and their agents.”       United States v.

Garcia, 546 F.2d 613, 615 (5th Cir. 1977) (quoting Lopez v. United

States, 83 S.Ct. 1381, 1385 (1963)).        Although the Government

initiated contact with Hemmings and may, therefore, be considered

the immediate cause of the conspiracy, there is no substantial

evidence that it was the Government that implanted in Ogle’s mind

the disposition to commit a criminal act.    See Jacobson, 112 S.Ct.

at 1540 (1992).

     In denying Ogle’s request for an entrapment instruction, the

district court, relying on United States v. Sarmiento, 786 F.2d

665, 667 (5th Cir. 1986), found that Ogle could not, as a matter of

law, have been entrapped, as any inducement to commit the offense

came not from a government actor, but from Ogle’s co-conspirator,

Hemmings.   According to the district court, that Ogle “initially

entered into the conspiracy to launder money at the encouragement

of Hemmings and not a government agent effectively barred [Ogle]

                                9
from raising the entrapment defense.”5       Ogle consequently focuses

his efforts on appeal on refuting the Government’s assertion that

Ogle’s inducement to enter into the conspiracy came from Hemmings

and not from the Government’s informant.

     Those efforts, however, are of insufficient effect.           Even if

Ogle is correct in his highly questionable assertion that there is

no evidence that he was made aware that the fictitious funds had

some illegal source until he met Blount, that fact, standing alone,

does not suffice to raise entrapment. Hemmings was made aware that

the funds had an illegal source, he thereafter brought Ogle into

the matter, and there is no evidence that Ogle, just before his

initial   meeting   with   Blount,   at   which   Ogle   arrived   full   of

suggestions, was unaware that the funds had an illegal source.            It

is Ogle’s burden to raise the entrapment defense.          Moreover, even

if there had been evidence that Ogle first learned there was an

illegal source and the purpose of the proposed transaction from the

confidential informant, such evidence would do nothing more than

establish that the Government afforded Ogle with the facilities for

the commission of a crime, a fact that, by itself, does not entitle

Ogle to an entrapment instruction.          More is required before a

     5
         See United States v. Sarmiento, 786 F.2d 665, 668 (5th
Cir. 1986) (recognizing that “[t]his circuit has not adopted the
‘unsuspecting middleman’ theory of entrapment” ); United States
v. Garcia, 546 F.2d 613, 615 (5th Cir. 1977) (“Entrapment cannot
result from the inducements of a private citizen but must be the
product of conduct by governmental agents.”).

                                     10
defendant is entitled to an entrapment instruction.

     To satisfy his burden of producing evidence of government

inducement, Ogle was required to present not just a smattering or

a scintilla of evidence of government inducement, but substantial

evidence that it was the Government that was responsible for the

formation of Ogle’s intent to join the conspiracy.              See Bradfield,

113 F.3d at 521.     Ogle points to no such evidence of inducement on

appeal, and an independent review of the record reveals none.

     Because we find that Ogle failed to produce substantial

evidence   of   either     government        inducement    or    a    lack    of

predisposition to commit the crime of money laundering, we find no

error in the district court’s refusal to instruct the jury on the

entrapment defense.

B.   Expert Testimony

     In his second point of error, Ogle maintains that the district

court erred in excluding both evidence of his general financial

condition as well as the proffered testimony of a defense expert on

the nature of Ogle’s financial position.          “[T]he admissibility of

expert   testimony    is   a   matter    which   rests    within     the   broad

discretion of the trial judge and his decision is not to be

disturbed unless it is manifestly erroneous.”              United States v.

Lopez, 543 F.2d 1156, 1158 (5th Cir. 1976).          We therefore review a

district court’s decision to exclude expert testimony only for an

abuse of discretion.       United States v. Triplett, 922 F.2d 1174,

                                        11
1182 (5th Cir. 1991).

       At trial, Ogle sought to offer the expert testimony of Shirley

Lindsay, a former IRS Special Agent and fraud examiner.         At a

hearing conducted outside the presence of the jury, Lindsay opined

on Ogle’s deteriorating financial situation as it related to his

ability to engage in a large-scale money laundering transaction,

and concluded that, in her estimation, Ogle lacked the “positional

predisposition to commit any crime, let alone money laundering.”

The district court, however, found that the proffered expert

testimony would be of little assistance to the jury, and excluded

it.6       We find no abuse of discretion in that decision.7

       6
        After listening to Lindsay’s proposed testimony, the
district court concluded, “[T]he basis of [Lindsay’s] testimony .
. . is rather simplistic. She is saying that [Ogle] could not
commit the crime because he was in a financial dilemma.
Essentially . . . that’s what Ms. Lindsay is saying. I don’t
think that would be of any assistance to the jury.”
       7
        Ogle also characterizes, for the first time on appeal,
the district court’s decision to exclude Lindsay’s testimony as a
general prohibition of the introduction of any evidence of Ogle’s
financial position. Having set up such a straw man, Ogle then
proceeds to tear it down. Specifically, Ogle argues that because
it demonstrates that his involvement in the conspiracy was driven
not by a predisposition to engage in crime, but by financial
pressure, evidence of his deteriorating financial position was
relevant to the defense of entrapment and its exclusion was
error.
     A fatal flaw in Ogle’s argument is that the district court
never prevented Ogle from introducing general evidence of his
financial condition. Ogle offered Lindsay as an expert on the
question of positional predisposition, and the court’s ruling was
limited accordingly, excluding only Lindsay’s conclusion that
Ogle lacked the positional predisposition to commit the offense
of money laundering. At no point did Ogle seek to introduce
other evidence of his financial straits, as motive for his
joining the conspiracy or otherwise, and the district court never

                                     12
     The concept of positional predisposition has its origins in

the Seventh Circuit’s opinion in United States v. Hollingsworth, in

which that circuit concluded that the concept of predisposition has

both a positional and a dispositional element.            27 F.3d 1196, 1200

(7th Cir. 1994). To be positionally predisposed to commit a crime,

“[t]he defendant must be so situated by reason of previous training

or experience or occupation or acquaintances that it is likely that

if the Government had not induced him to commit the crime some

criminal would have done so.”          Id.     The doctrine, however, is a

controversial one, see, e.g., United States v. Thickstun, 110 F.3d

1394, 1398 (9th Cir. 1997) (rejecting the concept of positional

predisposition), and one that we have, thus far, declined to

recognize.    See United States v. Reyes, 239 F.3d 722, 742 (5th Cir.

2001); United States v. Wise, 221 F.3d 140, 155–56 (5th Cir. 2000).

     As we did in Reyes and in Wise we also find it unnecessary

here to recognize the doctrine of positional predisposition.              Even

had Lindsay’s expert opinion testimony been admitted into evidence,

Ogle could still not have established that he was not positionally

predisposed to engage either in a conspiracy to commit money

laundering    or   to   commit   the        substantive   offense   of   money

laundering.

clearly ruled that it would have excluded such evidence. Thus,
Ogle waived any complaint as to exclusion of evidence of his
financial condition when he failed to offer any evidence of his
financial situation apart from his general tender of Lindsey’s
testimony as a whole. See FED. R. EVID. 103(a)(2).

                                       13
      It   will    be    the   rare   case    indeed    where     a    defendant      can

establish    a    lack    of   positional      predisposition         to    join    in    a

conspiracy, and we can conclude that Ogle’s is not such a case.

Ogle failed to offer any evidence that he was not positionally

predisposed to join in a conspiracy.                The gravamen of a conspiracy

is the agreement to engage in unlawful activity, see United States

v. Holcomb, 797 F.2d 1320, 1327 (5th Cir. 1986).                      Ogle’s supposed

inability actually to himself launder money has little bearing on

his ability to agree to assist in that endeavor.                        That Ogle by

himself    could    not     personally       have    laundered        the   money     is,

therefore, no defense to a charge that Ogle conspired with others

to have the money laundered.

      Similarly, Lindsay’s testimony would not have been sufficient

to establish that Ogle was not positionally predisposed to commit

the substantive offense of laundering money.                 Whether Ogle had the

personal financial resources to by himself conduct a large-scale

money laundering transaction is not determinative of the issue of

his positional predisposition to engage in actual money laundering.

      Ogle’s positional predisposition to launder money is perhaps

best illustrated by contrasting his situation to that of the

defendants in Hollingsworth. In Hollingsworth, the Seventh Circuit

concluded that the defendants, newcomers to the banking business,

did   lack   the        positional    predisposition         to       launder      money.

Hollingsworth,      27    F.3d   at    1202.        Unlike   the       defendants        in

                                         14
Hollingsworth, a farmer and an orthodontist who were relative

novices         in   the    financial   world,8   Ogle    was    a   sophisticated

businessman who, despite having fallen on difficult times, was well

versed in complex financial transactions and was in a position to

take advantage of both his personal experience and the experience

of his business contacts.           And although, like Hollingsworth, Ogle

did    not      have   an   “up-and-running    bank”     and   may   not   have   had

sufficient assets with which to accomplish the laundering money, he

did have the necessary financial connections and business acumen to

get the money laundered.          See, e.g., Hollingsworth, 27 F.3d at 1200

(describing one who is positionally predisposed as one who has the

necessary occupation or acquaintances to make the commission of the

crime possible). Accordingly, Ogle’s proposed plans to launder the

money involved the use not of his own financial resources, but of

those of a third party or parties, and his role in the proposed

money laundering transaction was that of a broker, one responsible

for the picking up and transportation of the cash in order to take

advantage of the assets of a third party or parties.

       The defense presented no evidence establishing that Ogle’s

lack       of   financial     resources   would    have    prevented       him    from

laundering the money by transferring it to a third party or parties

       8
        See Hollingsworth, 27 F.3d at 1200 (describing the
defendants’ misguided attempts “to become international
financiers—a vocation for which neither had any training,
contacts, aptitude, or experience”).

                                          15
who did have the necessary assets to deposit twelve million dollars

in cash without unduly arousing suspicion, and there is no evidence

Ogle lacked information concerning or access to such parties (as he

maintained to Blount that he had).     We conclude, therefore, that

Ogle’s proposed expert testimony could not have established a lack

of positional predisposition, and that its exclusion, therefore,

was not an abuse of discretion.

     C.   Sentencing

     In his final point of error, Ogle challenges his sentence,

arguing that the district court erred in not considering a three-

level reduction of his guideline offense level under section

2X1.1(b) of the sentencing guidelines.

     Following Ogle’s conviction, the district court declined to

consider granting Ogle a requested three-level reduction, reasoning

only that section 2X1.1 did not apply to offenses under section

1956, as the commentary included with section 2X1.1 listed only

offenses under 18 U.S.C. §§ 371, 372, and 2271.      However, upon

reviewing the district court’s interpretation of the sentencing

guidelines de novo, see United States v. Heffron, 314 F.3d 211, 224

(5th Cir. 2002), we agree with Ogle’s conclusion that the district

court erred in not considering the availability of a three-level

reduction under section 2X1.1(b).

     Sections 1B1.2(a) and 2X1.1 clearly direct that section 2X1.1

shall be applied to attempts, conspiracies, and solicitation unless

                                  16
the specific attempt, conspiracy, or solicitation is expressly

covered by the guideline for the substantive offense.   See U.S.S.G

§§ 1B1.2(a), 2X1.1(c)(1) (2000); United States v. Villafranca, 260

F.3d 374, 381 (5th Cir. 2001).         The Government, however, now

maintains that section 2X1.1 was inapplicable for two reasons.

First, the Government argues that the jury found Ogle guilty not of

attempting to launder money, but of the completed offense of money

laundering.   Second, the Government maintains, in a position

advanced for the first time at oral argument, that section 2X1.1

does not apply to offenses under section 1956, since the offense

guideline for money laundering, section 2S1.1, expressly covers

attempts and conspiracies to commit money laundering. We find both

arguments unpersuasive.    We initially note that neither contention

was addressed below by either party, or by the Presentence Report

or the district court.     The Presentence Report simply took the

position, with which the Government and the district court agreed,

and to which Ogle objected, that section 2X1.1 did not apply to any

section 1956 conviction.    That position is erroneous as reflected

by our opinion in Villafranca.

     The Government first argues that Count Two of the indictment

and the instructions to the jury authorized conviction on that

count for both the attempt to complete and the actual completion of

a money laundering transaction.    The general verdict of guilty on

that count does not reveal which the jury found.      Moreover, the

                                  17
record   also   indicates,    and    the       Government   conceded   at   oral

argument, that the Government largely argued its case to the jury

as an attempt case.     Had the jury clearly convicted Ogle only of

the completed offense of money laundering, then guideline section

2S1.1 would have properly applied.             Given the manner in which the

Government presented its case, and in the absence of any finding

from either the jury or from the district judge at sentencing that

Ogle’s conviction     was    based   on    a    completed   offense    of   money

laundering, we decline to now hold that section 2S1.1 was properly

applied.

     The Government’s second argument, that section 2S1.1 expressly

covers attempts and conspiracies, is not only tardy,9 but is also

wholly without merit.       The Government’s position at oral argument

that section 2S1.1 expressly covers attempts and conspiracies was

based on reference to subsections of section 2S1.1 not in existence

at the time Ogle was sentenced.            Specifically, the Government’s

entire argument before the panel on this point was based on an

amended version of section 2S1.1 that did not become effective

     9
        We will generally not consider points raised for the
first time at oral argument. United States v. Ulloa, 94 F.3d
949, 952 (5th Cir. 1996). The Government raised this position
neither at sentencing nor in its brief. The Government, however,
attempted at oral argument to characterize this contention as a
mere “expansion” of a position advanced in its brief. This
effort, however, is somewhat disingenuous. Nowhere in its brief
does the Government advance the argument that § 2S1.1 expressly
covers attempts and conspiracies. The closest the Government
comes to advancing this position is a statement that the district
court was permitted, but was not required, to apply § 2X1.1.

                                      18
until November of 2002, nine months after Ogle’s sentencing.                     The

version of section 2S1.1 in effect at the time of Ogle’s sentencing

contains     no     reference        whatsoever     to     either     attempts    or

conspiracies. Accordingly, the district court should have referred

to section 2X1.1 in computing Ogle’s sentence.                 See United States

v. Villafranca, 260 F.3d 374, 381 (5th Cir. 2001).

     Finally, the Government argues that any error in not applying

guideline section 2X1.1 was harmless as Ogle had completed all acts

he believed necessary to consummate the money laundering conspiracy

at the time of his arrest.              Guideline section 2X1.1(b)(1) does

provide that a three-level reduction is not available where, “but

for apprehension and interruption by some . . . event beyond the

defendant’s       control,”    the    defendant     would    have    completed   the

substantive offense.          U.S.S.G. § 2X1.1(b)(1).         The Government is,

therefore,     correct    that    “there      is   no    difference    between   the

Guidelines calculation for conspiracy [to launder money] and [money

laundering] when the evidence accepted by the sentencing court

shows   that      the    conspiracy’s      objectives       were      actually   [or

substantially] completed.”            Villafranca at 381.           This contention

was not made below, and neither the Presentence Report nor the

district court concluded that the money laundering scheme was (or

was not) substantially completed at the time of Ogle’s arrest, nor

did either party present any evidence at sentencing to establish

that the offense was, in fact, substantially complete. Under these

                                         19
circumstances, we cannot on this appeal accept the Government’s

position that any error in refusing to apply section 2X1.1 was

harmless.

     Accordingly, Ogle’s case must be remanded to the district

court to address, consistently with this opinion, the applicability

and effect of section 2X1.1.

                            Conclusion

     For the reasons assigned, the judgment of conviction is

AFFIRMED, the sentence is VACATED, and the case is REMANDED for

resentencing.

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