In the
United States Court of Appeals
For the Seventh Circuit
No. 10-2577
U NITED S TATES OF A MERICA,
Plaintiff-Appellee,
v.
B RIAN W ASSON,
Defendant-Appellant.
Appeal from the United States District Court
for the Central District of Illinois.
No. 06 CR 20055—Michael P. McCuskey, Judge.
A RGUED M AY 3, 2011—D ECIDED M AY 21, 2012
Before R OVNER and W ILLIAMS, Circuit Judges, and
Y OUNG, District Judge.
R OVNER, Circuit Judge. Brian K. Wasson was convicted
after a bench trial of one count of conspiracy to defraud
the United States, see 18 U.S.C. § 371, and six counts of
The Honorable Richard L. Young, Chief District Judge for
the United States District Court for the Southern District of
Indiana, sitting by designation.
2 No. 10-2577
aiding in the filing of a false tax return, see 26 U.S.C.
§ 7206(2). He was sentenced to a total of 180 months’
imprisonment to be followed by three years of super-
vised release. Wasson appeals, arguing that the district
court erred by denying his motion to dismiss the indict-
ment because he did not receive a speedy trial. He
also challenges the sufficiency of the evidence and claims
that his sentence violates the ex post facto clause of
the Constitution.
I.
Wasson’s conviction stems from his involvement with
a more extensive tax fraud conspiracy involving the
now defunct The Aegis Company.1 The Aegis Company
was founded in Palos Hills, Illinois. Aegis promoted
and sold “trusts” to wealthy taxpayer clients, promising
them asset protection and reduced tax liability. These
trusts, which were essentially shams, were used to
divert the clients’ taxable income, thereby reducing or
eliminating liability for the taxpayer client. Sometime
in 1997, Wasson and his codefendant Joseph Starns
1
In addition to Wasson and his codefendant Starns, a number
of other Aegis officials were convicted of tax fraud in the
Northern District of Illinois. Their criminal appeals are
currently pending before this court. United States v. Vallone, et
al., No. 08-3690; see also “Six Principals of Former Aegis Com-
pany Convicted of $60 million tax fraud conspiracy following
three-month federal trial,” U.S. Dep’t of Justice, May 19, 2008
available at www.usdoj.gov/usao/iln.
No. 10-2577 3
founded “Midwest Alternative Planning” in Danville,
Illinois. They used this business to market the Aegis trust
scheme. Starns introduced the Aegis system to the third
codefendant, John Wolgamot, who was an attorney in
Danville. Wolgamot assisted by preparing the trust
entities for Wasson and Starns’s clients.
Generally clients paid between $20,000 and $40,000 to
set up the trusts under the Aegis system and an addi-
tional annual “financial planning” or “management” fee
of between $3,000 and $7,000. For example, one Aegis
client, Dennis Frichtl, paid approximately $20,000 to set
up a domestic and two “offshore charitable” trusts
into which he transferred his business profits. Frichtl
owned his own welding business and made between
$3 and $4 million annually in gross sales. He was told
to transfer the money from the first to the second trust
and finally to the third, offshore trust, which he was
told had no IRS reporting requirements. Using this
method, he went from paying between $20,000 and
$25,000 annually in taxes to paying no income tax. He
later sold his business for $5.2 million, and Wasson
assisted him in wiring the profit from the sale overseas
into an account that could still be accessed by Frichtl’s
personal credit card.
In March 2000, the Internal Revenue Service Criminal
Investigation Division executed a search warrant on the
Aegis offices in Palos Hills. Subsequently, Wasson and
others continued marketing the Aegis trusts, despite
ongoing investigation by the IRS and the fact that
multiple Aegis participants had by this time begun re-
4 No. 10-2577
ceiving requests for audits. In May 2003, the FBI
executed search warrants on the Aegis offices and the
residence of top Aegis official Michael Vallone. All told
Wasson, Starns, and Wolgamot assisted at least twelve
taxpayers using the Aegis system to conceal millions of
dollars in income from the IRS. They received over
$350,000 in fees and commissions and caused a tax loss
to the United States of approximately $6 million.
As we will discuss in more detail below, the path to
trial for Wasson was a long one. It began in Septem-
ber 2006, when he was charged in an initial indictment
with aiding in the filing of a false tax return in viola-
tion of 26 U.S.C. § 7206(2). The grand jury then twice
superseded the indictment in order to add Starns
and Wolgamot as defendants, include additional counts
under § 7206(2), and charge all three defendants with
conspiracy to defraud the IRS in violation of 18 U.S.C.
§ 371. The third superseding indictment was returned
on May 2, 2007.
In the interim between the first and third indict-
ments, the district court granted a motion by Wasson to
continue and also entered a finding in January 2007
that the case was complex. In so finding, the court
granted the government’s unopposed request for a finding
of complexity. The parties and the court acknowledged
the “paper-intensive” nature of tax cases generally and
the complex nature of this case specifically: the court
noted in particular that the charges involved a con-
spiracy with multiple defendants as well as multiple
taxpayers’ returns. Accordingly, the court concluded
No. 10-2577 5
that the ends of justice warranted excluding time until
May 1, 2007. See 18 U.S.C. § 3161(h)(7)(A). At the status
hearing on May 1, Starns moved to appoint counsel, and
the government informed the court that it would be
returning a third superseding indictment the following
day and adding a third defendant (Wolgamot). To accom-
modate Starns’s new counsel and Wolgamot’s future
counsel’s need to familiarize him or herself with the
case, the court made another ends-of-justice finding
and excluded time until a scheduled hearing on July 17,
2007.
Following the return of the third superseding indict-
ment, Wasson moved on June 8, 2007 to continue trial.
On June 28, the court ruled on Wasson’s motion and
continued trial until March 31, 2008. At that time, the
court “reaffirmed” its previous finding that the case
was complex and again excluded time under the ends-of-
justice exception, see 18 U.S.C. § 3161(h)(7)(A). Starns’s
counsel also informed the court that Starns had been
diagnosed with cancer. Starns subsequently passed away
in August 2007.
On January 14, 2008, Wasson—joined by Wolgamot—
again moved to continue the trial. On February 7, the
court granted Wasson’s motion, vacated the March trial
date, and reset the trial to September 22, 2008. The
court repeated its ends-of-justice finding, see 18 U.S.C.
§ 3161(h)(7)(A), and excluded time until the Septem-
ber trial date.
Before the September date arrived, the government
moved to continue. This time the motion was based on
6 No. 10-2577
Wolgamot’s guilty plea, which the government sug-
gested changed the landscape of the case such that
more preparation time was necessary. Government
counsel also requested the continuance to ensure “con-
tinuity of government counsel” because he was partic-
ipating for up to six months in a detail in Washington,
D.C. related to the Guatanamo Bay detainee litigation.
After noting the likelihood that Wasson would have
himself been seeking a continuance due to the “changing
complexity” of the case, the court continued the trial
until March 2, 2009.
Before trial commenced on March 2, Wasson moved
to dismiss the indictment for failure to comply with
the Speedy Trial Act. See 18 U.S.C. §§ 3161-74. The
district court denied Wasson’s motion, noting that there
had been specific reasons supporting each continuance
and that in each instance it had balanced the ends of
justice against the interests of the parties and the public.
The court also observed that the parties had agreed
from the beginning that it was a complex case, and that
Wasson had either requested or agreed to every con-
tinuance between his indictment and the scheduled trial
on March 2, 2009.
During the 12-day bench trial, the government
presented numerous witnesses and close to 1,000 docu-
mentary and summary exhibits. Wolgamot testified
pursuant to his guilty plea about his involvement in
preparing the trust documents for Aegis clients. Eleven
taxpayers who had purchased the Aegis system
testified, and the court also heard from four IRS agents
No. 10-2577 7
who had worked on the case. Wasson maintained
throughout trial that he had a good-faith belief in the
legality of the Aegis system, and elicited testimony from
various government witnesses that he had consistently
defended its legality in his interactions with both the
government and his clients. The district court denied
Wasson’s oral motion for a judgment of acquittal on
March 17, 2009.
The district court found Wasson guilty on all charges
in December 2009. Between the conclusion of trial and
the court’s verdict, the parties obtained and reviewed
trial transcripts and presented written closing argu-
ments to the court. The court rejected Wasson’s good-
faith defense and concluded that the evidence of
Wasson’s guilt was “overwhelming.” The court also
denied Wasson’s renewed motion (filed pro se) to
dismiss the indictment based on the alleged speedy
trial violation.
Wasson then renewed his motion for acquittal and
moved for a new trial, arguing that the court had erred
with its preliminary finding (before trial) that a con-
spiracy existed, thereby allowing inadmissible hearsay
into evidence at trial that prejudiced him. The court
denied both motions. Specifically, the court rejected
Wasson’s contention that he lacked the intent to defraud
the United States. It also concluded that the evidence
presented at trial was “more than sufficient to establish
the existence of a conspiracy.”
Over Wasson’s objection, the district court calculated
his advisory guideline range using the 2008 Sentencing
8 No. 10-2577
Guidelines Manual instead of the manual in existence
when Wasson committed his crimes. The court then
sentenced Wasson to 180 months—a term of imprison-
ment in the middle of the 168- to 210-month advisory
guideline range. The court believed such a lengthy term
of imprisonment appropriate in light of the “extensive,
orchestrated” nature of the Aegis scheme and the need
“to deter others from violating the tax laws.”
After the district court imposed its sentence, Wasson
twice moved for bond pending appeal, arguing that the
alleged violation of the Speedy Trial Act constituted a
substantial question of law warranting his release. The
district court denied his motion, reiterating for the
third time its belief that the periods of delay were
excludable and that the question was not a close one.
This court, too, denied Wasson’s motion for bond.
II.
On appeal, Wasson argues primarily that the district
court erred by denying his motions to dismiss the in-
dictment under the Speedy Trial Act. See 18 U.S.C. §§ 3161-
74. We review the district court’s legal interpretations
of the Act de novo, and its decisions to exclude time for
an abuse of discretion. See, e.g., United States v. Hills,
618 F.3d 619, 625 (7th Cir. 2010). Unless the defendant
shows legal error, we will reverse the district court’s
decision to exclude time only where the defendant can
show both an abuse of discretion and actual prejudice.
Id.; see also United States v. Broadnax, 536 F.3d 695, 698
(7th Cir. 2008) (“[E]xclusions of time cannot be reversed
No. 10-2577 9
except when there is an abuse of discretion by the court
and a showing of actual prejudice.”).
Generally speaking, the Act requires a federal criminal
trial to commence within 70 days after the defendant is
charged or makes an initial appearance, whichever
occurs later. 18 U.S.C. § 3161(c)(1). However, in recogni-
tion of the realities of widely varying and potentially
complex criminal trials, the Act sets forth a number of
allowable delays that may be excluded from the seventy-
day clock. 18 U.S.C. § 3161(h); see also United States v.
Zedner, 547 U.S. 489, 497-98 (2006).
The one exclusion relevant to Wasson’s appeal is
§ 3161(h)(7)(A), which provides that the following
periods of delay should be excluded:
Any period of delay resulting from a continuance . . .
if the judge granted such continuance on the basis
of his findings that the ends of justice served by
taking such action outweigh the best interest of the
public and the defendant in a speedy trial. No
such period of delay resulting from a continuance
granted by the court in accordance with this para-
graph shall be excludable under this subsection
unless the court sets forth, in the record of the case,
either orally or in writing, its reasons for finding that
the ends of justice served by the granting of such
continuance outweigh the best interests of the public
and the defendant in a speedy trial.
18 U.S.C. § 3161(h)(7)(A).
Section 3161(h)(7)(B) also sets forth four nonexhaustive
factors which the court “shall consider” in determining
10 No. 10-2577
whether to grant an ends-of-justice continuance. In par-
ticular, subsection (7)(B)(ii) directs the judge to consider
“[w]hether the case is so unusual or so complex, due
to the number of defendants, the nature of the prosecu-
tion, or the existence of novel questions of fact or law, that
it is unreasonable to expect adequate preparation for
pretrial proceedings or for the trial itself within the
time limits established by this section.” As detailed
above, the district court relied on the ends of justice
and the complex nature of the case when it repeatedly
continued Wasson’s trial date.
The parties agree that the speedy trial clock began
running when Wolgamot was arraigned on May 11, 2007.
It is also undisputed that between that date and the
commencement of trial on March 2, 2009, 224 days
were automatically excluded for the handling of the
defendants’ fourteen pretrial motions. See 18 U.S.C.
§ 3161(h)(1)(D) (excluding delay “resulting from any
pretrial motion” from its filing through its disposition);
Hills, 618 F.3d at 626-27 (upholding automatic exclud-
ability of time between filing and resolution of pretrial
motions). That leaves the continuances granted by the
district court, which resulted in a total of 437 remaining
days between the commencement of the speedy trial
clock and Wasson’s trial.
Although Wasson’s opening brief singles out three
continuances granted by the district court, his reply brief
makes clear that he is ultimately challenging only the
two granted on February 7, 2008 (excluding time between
No. 10-2577 11
February 7 and September 22, 2008) and August 22, 2008 2
(excluding time between August 22, 2008 and March 2,
2009). The district court granted the February 7 contin-
uance in response to Wasson’s motion, where he
cited the complex nature of the case and the voluminous
government disclosure to be reviewed—specifically
75,000 pages in paper documents, a computer hard
drive containing over one million documents, and dozens
of hours of recordings. He represented that given the
state of discovery he could not be adequately prepared
for trial. The government did not oppose Wasson’s
motion. In a minute entry for the proceedings
on Wasson’s motion, the court grants it with the
unelaborated conclusion that “the ends of justice have
been met” pursuant to 18 U.S.C. § 3161(h)(7)(A). The
August 22, 2008 continuance was granted in response
to the government’s oral motion, made the day after
Wolgamot pleaded guilty. In support of its motion, the
government cited the complexity of the case and the
desire to ensure continuity of government counsel in
light of the impending six-month detail in Washington,
D.C. Wasson’s counsel added that Wolgamot’s plea
“profoundly affects our case” and that going to trial
in several weeks would be “very difficult.” After
ensuring that Wasson himself had no objection to the
continuance and remarking that a long trial in January
2
Wasson’s reply brief actually refers to a continuance
granted August 28, 2008, but it is clear from the context of
his argument and the district court’s docket sheet that he
intended to reference August 22.
12 No. 10-2577
or February would be problematic on account of the
weather, the court granted the continuance and set trial
for March 2, 2009. The court found the period of delay
to be excludable based on its previous finding that the
case was complex and stated that “the ends of justice
are served by taking this action which outweighs the
best interests of the public and the defendant.”
As detailed above, there are two statutory prerequisites
for excluding a continuance from the Act’s 70-day time
limit. First, the court must find that the ends of justice
served by granting the continuance “outweigh the best
interest of the public and the defendant in a speedy trial.”
18 U.S.C. § 3161(h)(7). Second, time “shall” not be
excludable unless the court “sets forth, in the record . . .
its reasons for finding that the ends of justice” outweigh
the interest of the public and the defendant in a
speedy trial. Id. In light of these statutory requirements,
Wasson argues that the delays may not be excluded
under the Act because the district court failed to
make explicit contemporaneous findings on the
record justifying the continuances. The government
responds that, taken together with the sequence of events
culminating in the continuances, the district court’s
findings accompanying each continuance suffice under
the Act. The requirement of express findings is the “proce-
dural strictness” that counteracts the “substantive open-
endedness” of the ends-of-justice provision. Zedner, 547
U.S. at 509.
Wasson’s argument boils down to his insistence that
to satisfy the Act, the district court’s findings must
No. 10-2577 13
be both explicit and contemporaneous with the granting
of an excludable continuance. But although the Act speci-
fies the need to make findings “in the record,” it does
not spell out precisely how the court must effectuate
this. Wasson relies heavily on Zedner to support his
claim that neither implicit nor after-the-fact findings
will support an ends-of-justice continuance. But Wasson
overreads Zedner. In Zedner, the Supreme Court con-
cluded that the Act does not permit a defendant to pro-
spectively waive its application. At the district court’s
urging, the defendant in Zedner had signed a preprinted
waiver form purporting to waive his speedy trial rights
“for all time.” Zedner, 547 U.S. at 493-94. In rejecting
the efficacy of the defendant’s waiver, the Court
clarified the Act’s requirement for express findings to
support a § 3161(h)(7) continuance.
Specifically, the government in Zedner had argued
that although the district court had never entered an
express finding on the record, such a finding could
be entered on remand because the circumstances at the
time in fact supported the continuance under the ends-of-
justice factors. Zedner, 547 U.S. at 506. The Court
rejected that argument, pointing out that “[i]n the first
place, the Act requires express findings, and in the
second place, it does not permit those findings to be
made on remand as the Government proposes.” Id. The
Court noted the ambiguity that exists between (1) the
Act’s clear requirement that the court must make
findings “if only in the judge’s mind,” before granting
the continuance, and (2) its duty to set those findings
forth “in the record of the case.” Id. at 506-07 (citing
14 No. 10-2577
what is now codified as 18 U.S.C. § 3161(h)(7)(A)). With-
out conclusively resolving the ambiguity, the Court noted
that “at the very least the Act implies that those
findings must be put on the record by the time a district
court rules on a defendant’s motion to dismiss under
§ 3162(a)(2).” Id. at 507.
Wasson seizes on this passage to support his
claim that the district court must consider the ends-of-
justice factors contemporaneously with each continuance
granted. Zedner certainly supports his claim that the
court must balance the factors at the time it grants the
continuance; but Zedner does not go so far as to say
this balancing must be memorialized at that time. It
recognizes that “[t]he best practice, of course, is for a
district court to put its findings on the record at or near
the time when it grants the continuance.” 547 U.S. at
507 n.7. Although this is undoubtedly the “best practice,”
it is not the only permissible practice. Zedner and its
progeny support our interpretation that a court’s ends-of-
justice findings need not be articulated contempora-
neously on the record. See Hills, 618 F.3d at 628 (court
need not articulate its findings contemporaneously
with exclusion of time).
Instead we must assure ourselves that the court’s
reasons have been articulated by the time it rules on a
defendant’s motion to dismiss and that those reasons
satisfy § 3161(h)(7). Id. “ ‘The requirement that the
district court make clear on the record its reasons for
granting an ends-of-justice continuance serves two
core purposes. It both ensures the district court considers
No. 10-2577 15
the relevant factors and provides this court with an
adequate record to review.’ ” United States v. Napadow,
596 F.3d 398, 405 (7th Cir. 2010) (quoting United States
v. Toombs, 574 F.3d 1262, 1269 (10th Cir. 2009)).
In Napadow, we concluded that despite minute entries
that were “clearly unsatisfactory explanations of the
district court’s ends-of-justice determinations,” 596 F.3d
at 406, the “sequence of events” leading up to the con-
tinuance “followed by the court’s later explanation”
sufficed to support an ends-of-justice continuance, id.
at 405-06. Specifically, the record in Napadow reflected
that the defendant’s counsel had requested more time
to prepare for trial and that government counsel had
requested more time to coordinate certain witnesses’
schedules. The court had then granted the continu-
ance with a perfunctory minute entry referencing an
“excludable delay in the interest of justice.” Id. at 400.
The court later recalled that it had “probably” excluded
the time to ensure continuity of counsel and because it
was the first date the attorneys were available. Id. at 405.
In concluding that the sequence of events coupled with
the later explanation sufficed, we noted that “[w]hen
facts have been presented to the court and the court
has acted on them, it is not necessary to articulate
those same facts in a continuance order.” Id. (internal
quotations and citation omitted).
The record of the two hearings in question coupled
with the district court’s written denial of Wasson’s
motions to dismiss certainly satisfy this standard. The
February continuance, recall, was requested by Wasson.
16 No. 10-2577
Wasson’s motion, joined by Wolgamot and by the gov-
ernment, spelled out for the district court precisely why
the ends of justice supported a continuance: (1) the com-
plexity of the case (a matter which had already been
agreed to by both the court and the parties); (2) the exten-
sive discovery; and (3) the death of one co-defendant
(Starns) and the addition of another (Wolgamot). Counsel
represented that given the state of discovery he could
not be prepared to adequately represent Wasson with-
out a continuance. Faced with this motion and the
parties’ unanimous position that more time was needed
to prepare for trial, the court’s granting of the motion
with its unadorned conclusion that the ends of justice
were satisfied lets us know the court considered the
§ 3161(h)(7)(A) factors. In its ruling on Wasson’s motion
to dismiss, the court elaborated, noting that Wasson
had requested several of the continuances and that in
each instance it had made findings supporting its con-
clusion that the ends of justice outweighed the best in-
terests of the defendant and the public in a speedy trial.
Although it may have been better for the district court
to spell out its agreement with Wasson’s motion when
granting it, the fact that Wasson’s motion laid out
the reasons supporting the continuance and the court
subsequently granted the motion satisfies us the court
considered the appropriate factors. Napadow, 596 F.3d
at 405; United States v. Pakala, 568 F.3d 47, 60 (1st Cir.
2009) (rejecting defendant’s challenges to Speedy Trial
Act continuances where defendant moved for continu-
ances and it was “clearly obvious” the district court
adopted the grounds given in the motion).
No. 10-2577 17
Likewise, the colloquy on August 22, 2008 provides
ample evidence that the court considered and balanced
the ends of justice against the competing interests in a
speedy trial. When the government explained the impact
of Wolgamot’s plea on its case, the court specifically
inquired whether the plea changed the complexity of
the case or simply the length of trial. The court verified
that the case remained complex on account of the many
taxpayer witnesses and the complexity of the trusts,
and also asked Wasson’s counsel if he continued to
believe the case was complex. And the district judge
learned that Wolgamot’s plea would likely lead to ad-
ditional discovery in terms of a proffer statement.
Notably, Wasson’s counsel then explained to the court
that because of the discovery and Wolgamot’s plea,
which he represented “profoundly affect[ed]” Wasson’s
case, “[i]t would be very difficult for us to go to trial in
just a few weeks.” Given the many issues (including
another “minor but key witness” for the government
contemplating a guilty plea), the court expressed its
understanding as to why Wasson was “about ready to
come before the Court” himself to request a continuance.
The court then assured itself that if the case were set
in March, neither party anticipated requesting another
continuance. Finally, the court asked Wasson directly
if he had any objection to the motion to continue,
stating that it “just wanted to make sure that you under-
stand that the Court was willing to listen to your situa-
tion.” Wasson stated that if his attorney—who had essen-
tially joined the government’s motion at this point—had
no objection, neither did he. The court then sum-
18 No. 10-2577
marized the changing landscape of the case and noted
that if the defense had moved to continue, it would
have been “compelled” to grant the defense motion. This
extensive colloquy more than satisfies us that the
court balanced the factors and that the time
between August 22 and the trial’s commencement was
excludable.
Wasson suggests that the court simply relied on its
previous finding of complexity, but as the synopsis
above makes clear, the court assured itself not only
that the case remained complex, but that the complexity
and the changing nature of the case warranted the con-
tinuance. See 18 U.S.C. § 3161(h)(7)(B)(ii). The court
also took into account Wasson’s need to prepare ade-
quately for trial, id. § 3161(h)(7)(B)(iv), and the
continuity of government counsel, id. And it is ap-
parent that the court balanced the interest of the
public, id. § 3161(h)(7)(A), when it assured itself that
this would be the final continuance in the already long-
delayed case (prompting government counsel’s hyper-
bolic promise that nothing short of his “death” would
prompt another continuance). With this background,
the court’s finding on the docket sheet that the ends of
justice supported the continuance suffices, particularly
when taken together with its later written explanation
when ruling on Wasson’s motion to dismiss. And
although the court commented on the weather in
January and February, it is clear from the colloquy
above that the weather was not the basis for the con-
tinuance. See Hills, 618 F.3d at 629 (noting that court’s
comment about its time and schedule did not detract
from primary reasons for ends-of-justice finding).
No. 10-2577 19
Because we are satisfied with the court’s findings
under § 3161, we need not reach the government’s argu-
ment that because Wasson either requested or agreed to
each continuance he is estopped from challenging them
on appeal. We note, however, that Wasson’s stance in the
district court is at the very least inconsistent with his
later challenges to the continuances. Although Wasson
claims in his reply brief that Zedner precludes the gov-
ernment from making an argument based on judicial
estoppel, that is not so. Zedner simply concluded that
judicial estoppel did not apply when, among other
reasons, the district court, not the defendant, had
proposed that the defendant prospectively waive his
rights under the Speedy Trial Act. Zedner, 547 U.S. at
505. Indeed, the court in Zedner noted that “[t]his
would be a different case if petitioner had succeeded in
persuading the District Court . . . that the factual predicate
for a statutorily authorized exclusion of delay could be
established.” Id. As the detailed description above makes
clear, Wasson did in fact succeed in persuading the
district court that the factual predicates for an ends-of-
justice continuance existed. Unlike the defendant in
Zedner, of the two continuances in question, Wasson
requested one and essentially joined the government in
requesting the second. We thus reject Wasson’s sugges-
tion that estoppel would not apply here simply because
he made a timely motion to dismiss under the Act. See
Pakala, 568 F.3d at 60 (concluding that judicial estoppel
barred defendant’s Speedy Trial Act argument when he
moved for continuances in question and “each time
asserted statutorily authorized exclusions of delay”); cf.
20 No. 10-2577
United States v. Larson, 417 F.3d 741, 746 (7th Cir. 2005)
(noting that defendant pressing Speedy Trial Act claim
was “hardly in a position to complain about the delay
because he was the one who asked for it”); United States
v. Baskin-Bey, 45 F.3d 200, 204 (7th Cir. 1995) (pointing
out that it was “unfair” for defendant “to ask that the
trial be delayed to suit her, implicitly agree to the gov-
ernment’s request that time be excluded because of her
request, and then try to sandbag the government by
insisting that the time be counted against the speedy trial
clock”). So although we reserve judgment on the question
of when estoppel prevents a plaintiff from challenging
continuances under the Act, we note that Wasson’s
support for the continuances certainly does little to en-
hance his position on appeal. Finally, we are hard-pressed
in any event to see how Wasson was prejudiced by the
continuances. “Prejudice is caused by delays intended to
hamper defendant’s ability to present his defense,” Larson,
417 F.3d at 746 (citation and internal quotations omit-
ted), and the delays here had the opposite effect: they
ensured Wasson and his counsel adequate time to
deal with the complex and voluminous discovery and
to adjust his defense in light of Starns’s death and
Wolgamot’s plea.
Wasson next argues that there was insufficient evidence
to sustain his convictions for conspiring to defraud the
IRS or aiding in the filing of false tax returns. We review
challenges to the sufficiency of the evidence at a bench
trial under the same demanding standard applied to a
jury trial. United States v. Doody, 600 F.3d 752, 754 (7th
Cir. 2010). Thus, we will overturn the verdict only if
No. 10-2577 21
we conclude, after viewing the evidence in the light
most favorable to the prosecution, that no rational trier
of fact could have found the defendant guilty beyond
a reasonable doubt. Id. We neither reweigh the evidence
nor assess witness credibility, and may uphold even
a verdict based entirely on circumstantial evidence.
United States v. Kruse, 606 F.3d 404, 408 (7th Cir. 2010).
To prove that Wasson violated 18 U.S.C. § 371 by con-
spiring to defraud the IRS, the government must demon-
strate “(1) an agreement to accomplish an illegal objec-
tive against the United States; (2) one or more overt acts
in furtherance of the illegal purpose; and (3) the intent
to commit the substantive offense, i.e., to defraud the
United States.” United States v. Furkin, 119 F.3d 1276, 1279
(7th Cir. 1997) (citation and internal quotations omitted).
The government’s obligation to prove “intent to defraud”
refers to evidence showing the defendant knew of his
tax liability, not that he knew “of the criminality of the
objective.” Id. (quoting United States v. Cyprian, 23 F.3d
1189, 1201 (7th Cir. 1994)). As relevant here, a conviction
for aiding in the filing of a false tax return under 18
U.S.C. § 7206(2) requires proof that the defendant
willfully assisted in the preparation of a false or
fraudulent tax return. See United States v. Powell, 576
F.3d 482, 495 (7th Cir. 2009).
Wasson continues to press his claim that he sincerely
believed in the legality of the Aegis system, and thus
the government failed to prove that he willfully violated
the tax laws. To prove willfulness in a criminal tax case,
the government must show that “the law imposed a duty
22 No. 10-2577
on the defendant, that the defendant knew of this duty,
and that he voluntarily and intentionally violated that
duty.” Cheek v. United States, 498 U.S. 192, 201 (1991).
Making this showing requires the government to negate
“a defendant’s claim of ignorance of the law or a claim
that because of a misunderstanding of the law, he had
a good-faith belief that he was not violating any of
the provisions of the tax laws.” Id. at 202.
Wasson would have us reweigh the evidence on
appeal and credit his assertions that because multiple
individuals involved in the marketing and promoting
of the Aegis system vouched for its legality, he
subjectively believed it to be so. But in contrast to
the testimony of Aegis promoters and participants
who believed it to be legal, the government presented
ample evidence to support the district court’s finding
that Wasson had no such good-faith belief in the trust
system. Most damning is Wasson’s use of the so-called
“audit arsenal” to respond to IRS inquiries and requests
for audits directed to Aegis participants. As several
individuals who purchased and used the Aegis system
testified, after using the system to vastly reduce their tax
liability, they received letters from the IRS requesting
a meeting and informing them that they were being
audited. In each instance, Wasson instructed these indi-
viduals not to respond to the communications from
the IRS. Instead, Wasson sent the IRS a series of
letters, signed by his clients, refusing to acknowledge
the authority of the IRS, disavowing control or authority
over the trust assets (which were at all times accessible
to these individuals), questioning the “jurisdiction” of
No. 10-2577 23
the IRS, threatening the IRS agents with lawsuits if
they pursued audits, and falsely denying United States
citizenship.
Take, for example, Everett Alan Bugg, who had worked
as a bank president and acquired $400,000 to $500,000
of stock in that position. Wasson marketed the trust to
Bugg as a means whereby he could sell his stock and
avoid tax liability by wiping out the gains on the sale.
After Bugg set up three trusts using the Aegis system,
he sold his bank stock for an approximately $500,000
gain but reported a loss on his income taxes for that
year. Predictably, he received an audit letter from the
IRS for that tax year. Bugg testified that Wasson told
him to ignore the audit letter and tell the IRS that he
was not willing to cooperate. Wasson also told Bugg
that he had the right to “protect” himself by not “incrimi-
nating” himself. This response to the audit request is not
consistent with a good-faith belief that the Aegis trusts
and the tax returns utilizing them were lawful.
Other Aegis users testified to similar experiences
with requests for audits and Wasson’s urging them to
use the “audit arsenal” to respond. Brian Scott Brooks,
who owned a Dairy Queen and essentially eliminated
his entire tax liability in 1997 and 1998 with claimed
contributions of nearly $100,000 to charity, also received
audit requests from the IRS. He testified that after
Wasson advised him to avoid the IRS, he eventually
decided to work with the IRS and correct his past
returns and pay any back taxes and penalties. At that
point Wasson advised Brooks to “be careful” getting out
24 No. 10-2577
of the Aegis system. He also responded very negatively
to Brooks’s intention to cooperate, telling Brooks that he
could “provide problems to others” using the Aegis
system who were being advised by Wasson not to co-
operate with the IRS.
We cannot square Wasson’s avoidance of the IRS with
his stated belief that the Aegis trusts were legal.
Wolgamot testified as follows when asked how he per-
ceived his codefendants’ use of the audit letters: “I
thought they were nuts, that they should be—if they
thought this system was legal, they should get a lawyer
and go to court and have a judge tell them whether
it’s legal or not and not be fighting with these stupid
audit arsenal letters.” Indeed, if Wasson did actually
think the system was legal, it strains reason to believe
that instead of cooperating with the IRS, he would en-
courage clients to challenge its authority and avoid it
at all costs—particularly when this ill-conceived advice
resulted in his former clients ultimately paying hundreds
of thousands of dollars in back taxes and penalties. This
evidence certainly supports the district court’s conclusion
that Wasson did not in fact subjectively believe in the
legality of the trust system.
The court also heard evidence that Wasson was on
notice that the trusts were not legitimate. In 1999, Wasson
showed Wolgamot a document from the IRS entitled
“New Tax Snake Oil—Abusive Trusts.” This document
set forth what Wasson certainly should have known
by then—that if a tax-free trust system seemed too
good to be true, it probably was. Wasson also received
No. 10-2577 25
a copy of a letter from Merrill Lynch that alerted him
to the likelihood that the Aegis trusts were not lawful.
David Kindred, an obstetrician/gynecologist who had
purchased Aegis trusts, received a letter from Merrill
Lynch in response to an inquiry about setting up a trust.
The letter stated that Merrill Lynch could not set up
the requested trusts because such trusts could be used
to illegally shelter assets from the IRS and the trusts
were the subject of an ongoing IRS investigation.
Wasson faxed the letter to Mike Vallone with the subject
heading: “Merrill Lynch account for Dr. Kindred.”
Wolgamot also testified that in 1999 Wasson faxed him
a copy of an article discussing an IRS revenue ruling
describing trusts similar to the Aegis trusts and
identifying them as illegal sham transactions. Given
Wasson’s awareness from multiple sources that the
trust system or systems like it were considered abusive
and illegal by the IRS, the district court had ample evi-
dence to discredit his claim that he subjectively be-
lieved what he was doing was legal.
The trial evidence to the contrary does not undercut
the sufficiency of the evidence. Wasson points out that
Aegis officials repeatedly assured him that the trusts
were legal. He also makes much of his own unwavering
position to clients that the Aegis system was lawful
and legitimate. But as the trier of fact, the district court
was free to infer from the extensive evidence to the con-
trary that Wasson did not in fact have a subjective good-
faith belief in the legality of the system. We are in
no position to second-guess that decision, nor does
the evidence Wasson presents “compel” us to conclude
26 No. 10-2577
the evidence fell short of demonstrating willful viola-
tions of the tax laws. Indeed, the evidence of Wasson’s
good-faith belief in the system amounts primarily
to generalized assertions about the system’s legality
with the very people with whom he conspired to violate
the tax laws. We are thus satisfied that the evidence
was sufficient to prove both the conspiracy charge and
the charges for assisting in the filing of a false income
tax return.
Lastly, Wasson renews his claim that by sentencing
him under the 2008 sentencing guidelines rather than
those in effect when he committed his crimes, the district
court violated the ex post facto clause of the Constitu-
tion. Under U.S.S.G. § 2T4.1(K), the 2008 guidelines
caused Wasson’s offense level to increase by four levels.
Wasson acknowledges our holding in United States v.
Demaree, 459 F.3d 791, 795 (7th Cir. 2006), that the advisory
nature of the guidelines eliminates any ex post facto
problem with changes that retroactively increase
the sentencing range for a crime. Although he urges us
to reconsider our holding and reminds us that ours is a
minority view among the circuits, see, e.g., United States
v. Wetherald, 636 F.3d 1315, 1321 (11th Cir. 2011); United
States v. Lanham, 617 F.3d 873, 889-90 (6th Cir. 2010);
United States v. Ortiz, 621 F.3d 82, 86-87 (2d Cir. 2010), he
offers nothing new to convince us that we should change
course on this issue now, see, e.g., United States v. Peugh,
675 F.3d 736, 741 (7th Cir. 2012) (“We . . . stand by
Demaree’s reasoning . . . and again decline the invitation
to overrule it.”); United States v. Sandoval, 668 F.3d 865,
870 (7th Cir. 2011) (same).
No. 10-2577 27
III.
For the foregoing reasons, we A FFIRM Wasson’s con-
victions and sentence in all respects.
5-21-12