United States v. Guillermo A. Schlaen

[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT FILED
________________________ U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
August 8, 2002
No. 01-10683
THOMAS K. KAHN
________________________ CLERK

D. C. Docket No. 99-00689 CR-ASG

UNITED STATES OF AMERICA,

Plaintiff-Appellee,
Cross-Appellant,

versus

GUILLERMO A. SCHLAEN,
MAURICIO S. SCHLAEN,

Defendants-Appellants,
Cross-Appellees.

________________________

Appeals from the United States District Court
for the Southern District of Florida
_________________________
(August 8, 2002)

Before EDMONDSON, Chief Judge, BLACK and COX, Circuit Judges.

COX, Circuit Judge:
 Guillermo A. and Mauricio S. Schlaen were charged with one count of

conspiracy to commit money laundering, multiple counts of money laundering, and

multiple counts of failing to file Form 8300 with the Internal Revenue Service (“IRS”)

for transactions involving the receipt of over $10,000 in cash. The jury acquitted them

of the conspiracy count and the failure-to-file counts but convicted them on most of

the money-laundering counts. The district court, after departing downward under

§5K2.0 of the Sentencing Guidelines, sentenced Guillermo to fourteen months in

prison and Mauricio to six months in prison. Guillermo and Mauricio appeal their

convictions. Guillermo argues, among other things, that his acquittal on the failure-to-

file counts requires an acquittal on the money-laundering counts. The Government

cross-appeals the district court’s downward departure. We affirm the convictions but

vacate the sentences and remand for resentencing.

I. BACKGROUND

A. THE SCHEME

Guillermo founded a company called AG-USA Corp in 1996, and his brother,

Mauricio, became a partner in the business soon thereafter. In the beginning, the

Schlaens sold computer parts, but they eventually graduated to assembling and

exporting computers.

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 A business acquaintance of the Schlaens, Carlos Bruyn, was a sales

representative for SED International, a publicly-traded company that exports computer

parts to Latin America. In early 1998, Bruyn received a call from Sergio Ramirez and

Tony Piazza, representatives of a company called OmegaTek. Ramirez and Piazza

told Bruyn that they wished to buy merchandise with over $10,000 cash but did not

want the transaction reported on IRS Form 8300, as required by law. Bruyn told

Ramirez and Piazza that SED had a policy of filing Form 8300 but that he would put

them in touch with other potential partners.

Bruyn called Guillermo and told him about OmegaTek’s request. Guillermo

asked Bruyn a couple of questions about the request and then asked Bruyn to contact

OmegaTek on his behalf.

On March 3, 1998, Mauricio was contacted by Anna Maria, a representative of

OmegaTek. She told Mauricio that she had a potential order for over $10,000 worth

of merchandise for which she would like to pay with cash. She asked Mauricio if he

could help her by not filing Form 8300. Mauricio said that he understood her request,

and, a few days later, Ramirez called to place the order. Ramirez told Mauricio that

he would pay $12,000 in cash for the order, and Mauricio told Ramirez that he would

not file Form 8300.

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 Ramirez and Piazza visited AG-USA’s office on March 27, 1998. They

brought $6,031 in cash and told Mauricio that their buyers were drug traffickers who

dealt primarily in cash. Mauricio told Ramirez and Piazza that he once worked for a

company that sold expensive housewares and that he, on one occasion, laundered

money by selling thousands of dollars of housewares to a Colombian couple who paid

in bundles of cash. Piazza again asked if Mauricio would file Form 8300 to report this

cash transaction, and Mauricio said he would not. In fact, said Mauricio, he would be

willing not to report a cash transaction of up to $500,000.

On August 28, 1998, Guillermo received $18,952 in cash from OmegaTek and

agreed to purchase $18,400 worth of computers from SED International on

OmegaTek’s behalf.1 While giving Guillermo the cash, Ramirez emphasized that the

cash came from the Colombian mafia and that the transaction could not be reported

on a Form 8300. Guillermo assured Ramirez that it would not be reported. To avoid

reporting the transaction, Bruyn, on SED’s behalf, split the purchase between two

invoices. One invoice was for $9,936, and the other was for $8,464. AG-USA paid

one invoice in cash; credit was extended on the other invoice. Because of the split

invoices, SED was not required to file Form 8300.

1
The $552 difference was compensation for the risk associated with not
filing Form 8300.
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 Guillermo received $36,364 in cash from OmegaTek on November 9, 1998, to

pay for two orders. When he gave Guillermo the cash, Ramirez again explained that

the cash came from the Colombian mafia and that the products he purchased would

be sent to Colombia and sold for Colombian pesos. Despite this explanation,

Guillermo and Mauricio engaged in six more transactions with OmegaTek and

continued to ask for more business. They never filed Form 8300 with the IRS.

The Schlaens did not know that, while it appeared to be a functioning business,

OmegaTek was actually a Government sting operation, intended to ferret out potential

money launderers in the United States. The Colombian mafia receives a great deal of

cash from its drug trafficking operations in the United States. These dollars are sent

to purchasing agents in the United States, who use them to purchase goods, which are

then exported to Colombia and sold for Colombian pesos. OmegaTek posed as a

purchasing agent. “Sergio Ramirez” was actually Sergio Ramil, an undercover agent

for the IRS; “Tony Piazza” and “Anna Maria” were confidential informants.

OmegaTek’s offices were outfitted with video cameras and audio-recording devices,

used to gather evidence on money launderers.

B. THE PROCEEDINGS

Based on the evidence gathered at OmegaTek’s offices, Guillermo, Mauricio,

and Bruyn were arrested and indicted in the Southern District of Florida. Count One

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of the indictment charged them with conspiracy to commit money laundering, in

violation of 18 U.S.C. §§ 1956(a)(3)(C) and 1956(h). Count Two charged only

Mauricio with money laundering, in violation of 18 U.S.C. § 1956(a)(3)(C). Counts

Three through Ten charged Guillermo and Mauricio with money laundering, in

violation of 18 U.S.C. § 1956(a)(3)(C). Counts Eleven through Eighteen charged

Guillermo and Mauricio with causing their company not to file IRS Form 8300, in

violation of 26 U.S.C. §§ 6050I(f)(1)(A) and (C). The indictment against Bruyn was

dismissed when he pleaded guilty in a related case. Guillermo and Mauricio

proceeded to trial.

The jury found Guillermo guilty on all of his money laundering counts, Counts

Three through Ten. The jury found Mauricio guilty on only six of his money

laundering counts, Counts Five through Ten. The jury acquitted Guillermo and

Mauricio on the conspiracy count and on all of the failure-to-file counts.

At sentencing, the district court calculated Guillermo and Mauricio’s sentences

pursuant to §2S1.1, the prescribed guideline for violations of 18 U.S.C. § 1956. The

total offense level, after appropriate adjustments, was twenty-one for Guillermo and

twenty for Mauricio. These levels yielded a sentencing range of thirty-seven to forty-

six months for Guillermo and thirty-three to forty-one months for Mauricio.

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 The district court, after a series of hearings, found that Guillermo and

Mauricio’s money laundering was incidental to their avoidance of the Form 8300

filing requirement. The incidentalness of their money laundering, according to the

district court, placed their conduct outside the heartland of cases contemplated in the

Guidelines. The district court therefore recalculated their sentences, adjusting

Guillermo’s total offense level to thirteen, resulting in a sentencing range of twelve

to eighteen months, and adjusting Mauricio’s total offense level to twelve, resulting

in a sentencing range of ten to sixteen months. The district court then sentenced

Guillermo to concurrent sentences of fourteen months in prison and three years of

supervised release on each count. It sentenced Mauricio to concurrent sentences of

six months in prison, six months of house arrest, and three years of supervised release

on each count.

Guillermo and Mauricio appeal their convictions, and the Government cross-

appeals the downward departure.

II. ISSUES ON APPEAL

On appeal, Guillermo and Mauricio both argue that: (1) the evidence was

insufficient to support their money laundering convictions; and (2) the district court

erred by giving Eleventh Circuit Criminal Pattern Jury Instruction 12.2 on entrapment

rather than Pattern Jury Instruction 12.1. Mauricio also contends that the Government

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failed to make a sufficient showing of a predisposition to commit money laundering,

thus requiring a finding of entrapment as a matter of law. These three arguments are

meritless, and we reject them without discussion. See 11th Cir. R. 36-1.

Guillermo also raises the following issue: Whether the district court should

have dismissed his money-laundering convictions because he was acquitted of the

failure-to-file charges, which, he contends, are lesser-included offenses of money

laundering. The Government, on cross-appeal, questions the legality of the district

court’s downward departure. We address each of these issues in turn.

III. STANDARDS OF REVIEW

Since Guillermo did not raise the lesser-included-offense issue in district court,

we review it for plain error. United States v. Thayer, 204 F.3d 1352, 1358 (11th Cir.

2000). We review the district court’s downward departure for an abuse of discretion.

United States v. Pickering, 178 F.3d 1168, 1171 (11th Cir. 1999).

IV. DISCUSSION

A. GUILLERMO’S CONVICTION

Guillermo was convicted of money laundering in violation of 18 U.S.C. §

1956(a)(3)(C), which requires the Government to prove the following: (1) that the

defendant conducted or attempted to conduct a financial transaction, (2) with the

intent to avoid a transaction reporting requirement, and (3) that the property involved

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in the transaction was represented by a law enforcement officer to be the proceeds of

narcotics trafficking. 18 U.S.C. § 1956(a)(3)(C), (c)(7)(B)(i) (2000); United States

v. Nelson, 66 F.3d 1036, 1040 (9th Cir. 1995); United States v. Breque, 964 F.2d 381,

386-87 (5th Cir. 1992). On the other hand, Guillermo was acquitted of failing to file

Form 8300 in violation of 26 U.S.C. §§ 6050I(f)(1)(A) and (C). Guillermo argues

that, because intent to avoid a reporting requirement is an element of money

laundering, and because failing to file Form 8300 is a means of avoiding a reporting

requirement, then failing to file is a lesser-included offense of money laundering.

Therefore, according to Guillermo, his acquittal on the lesser-included counts should

preclude his conviction on the money-laundering counts.

The lesser-included-offense inquiry typically arises in the double-jeopardy

context. See, e.g., United States v. Diaz, 190 F.3d 1247, 1262 (11th Cir. 1999).

However, the Double Jeopardy Clause, U.S. Const. amend. V, protects defendants

against successive prosecutions, not simultaneous ones, United States v. Farmer, 923

F.2d 1557, 1563 (11th Cir. 1991), and therefore does not apply to this case. The

lesser-included-offense inquiry is also triggered when a defendant requests a lesser-

included-offense instruction under Rule 31(c) of the Federal Rules of Criminal

procedure. Fed. R. Crim. P. 31(c); see, e.g., Schmuck v. United States, 489 U.S. 705,

109 S. Ct. 1443 (1989). Guillermo requested no such instruction in this case. Instead,

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Guillermo asserts that the verdicts are inconsistent and asks us to make the verdicts

consistent by acquitting him on the money-laundering charges.

It is well-settled in federal criminal law that “[c]onsistency in the verdict is not

necessary.” Dunn v. United States, 284 U.S. 390, 393, 52 S. Ct. 189, 190 (1932);

United States v. Powell, 469 U.S. 57, 62, 105 S. Ct. 471, 475 (1984). Even where

conviction on one count and acquittal on another count is a logical impossibility, the

conviction will stand, unless it was otherwise obtained in error. United States v.

Mitchell, 146 F.3d 1338, 1342-45 (11th Cir. 1998). Therefore, even if a violation of

26 U.S.C. §§ 6050I(f)(1)(A) or (C) is a lesser-included offense of a violation of 18

U.S.C. § 1956(a)(3)(C), a question that we need not decide, Guillermo’s money-

laundering convictions must stand, despite his acquittal on other counts.

B. THE SENTENCES

The district court granted a downward departure of six levels to Guillermo and

Mauricio under §5K2.0 of the Sentencing Guidelines. It found that Guillermo and

Mauricio’s money laundering was incidental to their avoidance of the transaction

reporting requirements and, thus, outside of the heartland of §2S1.1, the prescribed

guideline for money laundering. By departing six levels, the district court put

Guillermo and Mauricio in the sentencing range in which they would have been had

they been convicted for failure to file rather than money laundering. The Government

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objected to this downward departure and, on appeal, argues that the downward

departure was an abuse of discretion.

A court may grant a downward departure under §5K2.0 when “there exists an

aggravating or mitigating circumstance of a kind, or to a degree, not adequately taken

into consideration by the Sentencing Commission in formulating the guidelines.” 18

U.S.C. § 3553(b); United States Sentencing Commission, Guidelines Manual, §5K2.0

(Nov. 1998); United States v. Smith, 289 F.3d 696, 710 (11th Cir. 2002). In

determining whether to grant such a departure, the district court considers two

questions: (1) whether any circumstance makes the case atypical, meaning that it takes

the case out of the “heartland” of cases involving the conduct described in the

applicable guideline; and (2) whether that circumstance should result in a different

sentence. United States v. Regueiro, 240 F.3d 1321, 1324 (11th Cir. 2001).

When reviewing the district court’s grant of a departure, we engage in a three-

step process. United States v. Hoffer, 129 F.3d 1196, 1201 (11th Cir. 1997); see also

Koon v. United States, 518 U.S. 81, 98-100, 116 S. Ct. 2035, 2047 (1996). First, we

deferentially review the district court’s determination that the case falls outside of the

heartland. Second, we determine whether the district court relied on appropriate

circumstances in granting the departure. Finally, we review whether the

circumstances are present to such an extraordinary degree as to warrant a departure.

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 In this case, the district court determined that Guillermo and Mauricio’s money

laundering was incidental to their failure to file Form 8300 and, thus, fell outside of

the heartland of §2S1.1. The district court relied on five circumstances in making this

determination: (1) that the defendants did not find out that the cash was derived from

drug trafficking until after they made the first transaction; (2) that the defendants did

not know how much of the money was derived from drug trafficking; (3) that the

defendants were lured into the operation before they knew that the cash was derived

from drug trafficking; (4) that the defendants did not use the proceeds to further

criminal acts; and (5) that the defendants kept internal records regarding the cash

transactions. (R.14 at 26-27.)

The first three circumstances cited by the district court conflict with the jury’s

verdict. In articulating each of these circumstances, the district court indicated its

belief that the defendants were unaware that the money they were laundering was

derived from drug trafficking. Guillermo and Mauricio were charged and convicted

of engaging in financial transactions involving money that was represented to be the

proceeds of narcotics trafficking. As stated above, one of the elements of this crime

is that the property involved in the transaction was represented by a law enforcement

officer to be the proceeds of narcotics trafficking. 18 U.S.C. § 1956(a)(3)(C),

(c)(7)(B)(i) (2000); United States v. Nelson, 66 F.3d 1036, 1040 (9th Cir. 1995);

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United States v. Breque, 964 F.2d 381, 386-87 (5th Cir. 1992). If the court has doubts

regarding whether this element was proven, it may consider granting a new trial or

entering a judgment of acquittal. “But a district court cannot use the post-trial

sentencing process to call a jury’s verdict into question.” United States v. Costales,

5 F.3d 480, 488 (11th Cir. 1993). Therefore, the district court improperly relied on

the first three circumstances in granting a downward departure.

The district court also stated that its departure was partly based on a fourth

circumstance, the fact that the money laundering was not used to further criminal acts.

While the absence of an intent to further other criminal acts is not mentioned as a

basis for departure, the presence of such an intent, or what the Guidelines call

“criminal purpose,” is mentioned as a basis for upward departure. USSG §5K2.9.

The inclusion of criminal purpose as a circumstance warranting upward departure

indicates that the Sentencing Commission adequately considered the effect that a

criminal purpose had on a defendant’s culpability. In doing so, it concluded that,

while the presence of a criminal purpose might warrant an upward departure, the

absence of a criminal purpose does not warrant a downward departure. United States

v. Godfrey, 22 F.3d 1048, 1056 (11th Cir. 1994). The district court, then, could not

use this circumstance to justify a downward departure.

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 The only remaining circumstance is the fifth one, that the defendants kept

internal records of their transactions. The Government argues that this finding is

clearly erroneous, but we do not agree. During the course of their dealings with

OmegaTek, the defendants indicated that they would keep some sort of internal record

of the transactions, though the records differed somewhat from their usual records.

This evidence supports the district court’s finding. Nevertheless, we do not believe

that this difference justifies a downward departure.

Section 2S1.1 does not indicate how the presence of a paper trail should affect

a defendant’s sentence. However, the district court believed that the paper trail was

“inconsistent with planned concealment” (R.14 at 26) and made these defendants less

culpable. When a circumstance is unmentioned in a guideline, the district court must

consider “the ‘structure and theory of both the relevant individual guidelines and the

Guidelines taken as a whole’” in deciding whether to grant a downward departure.

Koon, 518 U.S. at 96, 116 S. Ct. at 2045 (quoting United States v. Rivera, 994 F.2d

942, 949 (1st. Cir. 1993)).

A review of the Guidelines indicates that the Sentencing Commission was not

unaware that efforts to conceal a crime could alter the sentencing equation. For

instance, the commentary to §2T1.1, the guideline for tax evasion, states that

“unusually sophisticated efforts to conceal the offense decrease the likelihood of

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detection and therefore warrant an additional sanction for deterrence purposes.”

USSG §2T1.1, comment. (backg’d.) In furtherance of this goal, §2T1.1(b)(2)

provides a two-level enhancement for sophisticated concealment. As in the criminal

purpose context, this enhancement indicates that a defendant who uses sophisticated

means receives additional punishment. But a defendant who uses unsophisticated

means is not rewarded for his use of unsophisticated means; rather, he avoids the

enhancement.

While §2S1.1 did not distinguish between sophisticated and unsophisticated

means when Guillermo and Mauricio were sentenced,2 the §2T1.1 example indicates

that it is the use of sophisticated means, not the use of unsophisticated means, that

warrants unusual treatment. Therefore, the district court was not justified in granting

a downward departure because the Schlaens used unsophisticated means.

Because it relied on improper circumstances in granting the downward

departures, the district court abused it discretion. See Koon, 518 U.S. at 100, 116 S.

Ct. at 2047.

2
The money-laundering guideline now provides for a two-level enhancement
if sophisticated means were used. United States Sentencing Commission,
Guidelines Manual, §2S1.1(b)(3) (Nov. 2001).
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 V. CONCLUSION

We affirm the convictions of Guillermo and Mauricio Schlaen. But, because

the district court did not articulate mitigating circumstances that would warrant a

downward departure, we vacate the district court’s downward departures and remand

for resentencing.

AFFIRMED IN PART; VACATED AND REMANDED IN PART.

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