United States v. Caputo

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT
_______________

No. 93-2757
Summary Calendar
_______________

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

VERSUS

GEORGE CAPUTO,
RENE MALDONADO, and
JAMES "SANCHEZ" BURNSIDE,

Defendants-Appellants.

_________________________

Appeal from the United States District Court
for the Southern District of Texas
(CR-H-91-59-24)
_________________________
April 16, 1996

Before KING, SMITH, and BENAVIDES, Circuit Judges.

PER CURIAM:*

George Caputo, Rene Maldonado, and James Burnside appeal

their convictions and sentences on various federal offenses. We

affirm as to Caputo and Maldonado and affirm in part and reverse in

part as to Burnside.

*
Pursuant to 5th Cir. R. 47.5, the court has determined that this
opinion should not be published except under the limited circumstances set forth
in 5th Cir. R. 47.5.4.
 I. Overview

A 110-count third superseding indictment charges these and

twenty-three other defendants with offenses arising from their

involvement with a major Houston-based marihuana ring headed by

Desi Guerra. The other defendants pleaded guilty, and several

testified at the appellants’ trial. The district court acquitted

Caputo of one count of conspiracy to travel in interstate commerce

to distribute marihuana, and the jury found Burnside not guilty of

six counts of money laundering and convicted the appellants of the

remaining charges.

The district court sentenced Caputo and Maldonado to concur-

rent terms of 168 months, followed by five-year concurrent terms of

supervised release. The court sentenced Burnside to concurrent

terms totaling 151 months, followed by two-year concurrent terms of

supervised release. The defendants appeal their convictions and

sentences; the government filed cross-appeals from the sentences

but subsequently dismissed those cross-appeals.

II. Sufficiency of the Evidence as to Caputo.

The jury convicted Caputo of conspiracy to possess with intent

to distribute more than 1000 kilograms of marihuana (count 1);

aiding and abetting the possession with intent to distribute more

than 50 kilograms of a controlled substance (count 4); aiding and

abetting the possession with intent to distribute more than 100

kilograms of marihuana (count 102); and three violations of the

Travel Act (counts 5, 6, and 103). Caputo argues that the evidence

2
is insufficient.

Caputo moved for judgment of acquittal at the end of the

government’s case-in-chief and again at the close of the evidence.

Therefore, the standard for evaluating sufficiency is whether,

viewing the evidence in the light most favorable to the government,

a rational trier of fact could have found the essential elements of

the offenses beyond a reasonable doubt. United States v. Bell, 678

F.2d 547, 549 (5th Cir. 1982) (en banc), aff’d, 462 U.S. 356

(1983). We view direct and circumstantial evidence adduced at

trial, as well as all inferences reasonably drawn from it, in the

light most favorable to the verdict. United States v. Sanchez, 961

F.2d 1169, 1173 (5th Cir.), cert. denied, 506 U.S. 918 (1992). We

look to whether the trier of fact made a rational decision, rather

than to whether it correctly determined the defendant’s guilt or

innocence. United States v. Jaramillo, 42 F.3d 920, 923 (5th

Cir.), cert. denied, 115 S. Ct. 2014 (1995). We will reverse a

conviction, however, “if the evidence construed in favor of the

verdict gives equal or nearly equal circumstantial support to a

theory of guilt and a theory of innocence of the crime charged.”

Id. (internal quotation and citations omitted).

A. Controlled Substance Offenses.

A conviction for conspiracy requires proof of “an agreement

between two or more persons to violate the narcotics laws, . . .

[and] that each alleged conspirator knew of the conspiracy and

intended to join it, and . . . participate[d] in the conspiracy.”

3
United States v. Puig-Infante, 19 F.3d 929, 936 (5th Cir.), cert.

denied, 115 S. Ct. 180 (1994); United States v. Sanchez-Sotelo, 8

F.2d 202, 208 (5th Cir. 1993), cert. denied, 114 S. Ct. 1410

(1994). “An agreement may be inferred from concert of action,

participation from a collocation of circumstances, and knowledge

from surrounding circumstances.” Sanchez, 961 F.2d at 1174

(internal quotation and citation omitted). Once the government

establishes an illegal conspiracy, “only slight evidence” is needed

to connect an individual defendant to the conspiracy.” United

States v. Thomas, 12 F.3d 1350, 1359 (5th Cir.) (internal quotation

and citation omitted), cert. denied, 114 S. Ct. 1861, 2119 (1994).

A conviction for possession of a controlled substance with

intent to distribute requires proof that the defendant knowingly

possessed the contraband and intended to distribute it. The

possession of a larger quantity of drugs than would ordinarily be

used for personal consumption can support a finding of intent to

distribute. United States v. Pineda-Ortuno, 952 F.2d 98, 102 (5th

Cir.), cert. denied, 504 U.S. 928 (1992). Possession of a

controlled substance may be either actual or constructive, may be

joint among several defendants, and may be proved by either direct

or circumstantial evidence. United States v. Rodriguez, 15 F.3d

408, 411 n.2 (5th Cir. 1994).

A conviction for aiding and abetting requires proof that the

defendant associated with and participated in a criminal venture

and sought to make it succeed. Jaramillo, 42 F.3d at 923; United

States v. Mergerson, 4 F.3d 337, 342 (5th Cir. 1993), cert. denied,

4
114 S. Ct. 1310 (1994). “Mere presence and association” are not

enough to sustain a conviction for aiding and abetting. Jaramillo,

42 F.3d at 923.

Count 1 alleged that between January 1986 and August 1991,

Caputo and others engaged in a conspiracy to possess with intent to

distribute more than 1000 kilograms of marihuana. Count 4 alleged

that on or about April 3, 1987, Caputo and others aided and abetted

the possession with intent to distribute more than fifty kilograms

of a Schedule I controlled substance. Count 102 alleged that on or

about December 15, 1989, Caputo and others aided and abetted the

possession with intent to distribute more than 100 kilograms of

marihuana.

Coconspirator Arnulfo Hernandez testified, pursuant to a plea

agreement, that from approximately mid-1985 until 1990, he arranged

for numerous loads of marihuana to be hauled from Houston to

Chicago for delivery to Caputo and other customers in Illinois.

Guerra “fronted” the marihuana to Hernandez’s customers. Hernandez

recruited drivers to transport the marihuana to Illinois, where

Hernandez would meet them, take possession of the vehicle, deliver

the marihuana to the customer, and return the load vehicle to the

driver to take back to Texas. The marihuana was hidden in fake

propane tanks attached to pickup trucks or false compartments under

the beds of pickup trucks; sometimes it was concealed in horse

trailers. Approximately 600 pounds of marihuana could be shipped

in a horse trailer.

Hernandez testified that Caputo lived on the second floor of

5
a two-story house that had an adjoining two-car garage. Caputo’s

apartment could be entered via an outside staircase. Hernandez

typically would park the loaded vehicle in the garage, close the

garage door, and unload the marihuana. He would then carry the

marihuana up the outside staircase to Caputo’s apartment and store

it in Caputo’s bedroom. It usually took Caputo three weeks to a

month to sell a load of marihuana.

Hernandez was stopped by state police in Arkansas in April

1987. He stated that “[j]ust before” he was stopped, he had

delivered two 200-pound loads of marihuana to Caputo. Hernandez

further testified that in “late ‘89, very early ‘90," he shipped

two 600-pound loads of marihuana in horse trailers for delivery to

Caputo and a man named Gilbert Torres. The second 600-pound load

likely was shipped in March 1990. One shipment was unloaded at

Caputo’s house and the other in Hammond, Indiana, at a house

belonging to Hernandez’s brother-in-law, Robert Martinez. Caputo

received approximately eighty percent of the marihuana from these

two loads. Hernandez conceded that he had “a bad memory” for

dates, but he averred that he could always remember the amounts of

marihuana involved in various transactions, because it was

important that he know exactly how much money he was responsible

for returning to Guerra.

When Caputo was arrested, his wallet contained a card bearing

Hernandez’s nickname and three telephone numbers; the same numbers

were discovered on Desi Guerra’s address directory in Houston. The

government introduced motel and telephone records indicating that

6
members of the Guerra organization had been in the Chicago area

near the times when Hernandez testified that drug transactions had

occurred.

The uncorroborated testimony of an accomplice or coconspirator

will support a conviction if the testimony is not incredible or

insubstantial on its face. United States v. Singer, 970 F.2d 1414,

1419 (5th Cir. 1992). The rule applies even if the accomplice or

coconspirator testified pursuant to a plea agreement. United

States v. Osum, 943 F.2d 1394, 1405 (5th Cir. 1991).

Caputo argues that Hernandez’s testimony is incredible as a

matter of law because his statements concerning dates were

inconsistent and because he stated on direct examination that he

delivered marihuana to Caputo eight times, but on cross-examination

he said ten. Caputo also suggests that Hernandez’s testimony

concerning how the marihuana was unloaded at Caputo’s house is not

believable and that it was incredible for the jury to find that

Caputo distributed marihuana, because Hernandez testified that

Caputo was a recluse.

“[T]estimony generally should not be declared incredible as a

matter of law unless it asserts facts that the witness physically

could not have observed or events that could not have occurred

under the laws of nature.” Osum, 943 F.2d at 1405. The fact that

Hernandez’s testimony contained inconsistencies does not make it

insubstantial or incredible as a matter of law. See United States

v. Greenwood, 974 F.2d 1449, 1458 (5th Cir. 1992), cert. denied,

113 S. Ct. 2354 (1993).

7
 The jury is solely responsible for determining the weight and

credibility of the evidence. United States v. Martinez, 975 F.2d

159, 161 (5th Cir. 1992), cert. denied, 507 U.S. 943 (1993). We

will not substitute our own credibility determination for that of

the jury. Id. The foregoing evidence was sufficient for the jury

to have found Caputo guilty of the controlled substance violations.

See Puig-Infante, 19 F.3d at 936; Pineda-Ortuno, 952 F.2d at 102;

see also United States v. Quiroz-Hernandez, 48 F.3d 858, 866-68

(5th Cir. 1995).

B. Travel Act Violations.

A conviction for violating the Travel Act requires, inter

alia, proof that the defendant traveled in interstate commerce or

used facilities of interstate commerce with the specific intent to

engage in, or facilitate activities involving, narcotics or

controlled substances in furtherance of a criminal business

enterprise. United States v. Roberson, 6 F.3d 1088, 1094 (5th Cir.

1993), cert. denied, 114 S. Ct. 1230, 1322, 1383 (1994).

Counts 5 and 6 alleged that Caputo and others had aided and

abetted other persons to engage in interstate travel to promote a

business enterprise involving the distribution of marihuana.

Caputo argues that his convictions for counts 5 and 6 should be

reversed because the jury’s guilty verdict is based solely upon

Hernandez’s testimony, which is unworthy of belief. As discussed

above, it was not error for the jury to rely upon Hernandez’s

testimony. See Osum, 943 F.2d at 1405.

8
 Count 103 charged that Caputo aided and abetted travel in

interstate commerce to distribute marihuana and “use[d] and

cause[d] to be used facilities in interstate commerce, including

the use of the telephone with the intent to” facilitate a business

enterprise involving the distribution of marihuana. The offense

allegedly occurred on or about December 15, 1989.

Caputo argues that this conviction must be reversed because it

is based solely upon evidence that telephone calls were made from

Caputo’s house to a telephone belonging to Hernandez’s girlfriend

in February 1990 and on March 26, 1990. The government responds

that the jury properly convicted Caputo on count 103 because the

evidence supported a finding that Caputo received a load of

marihuana in December 1989; the driver who brought the load to

Chicago stayed at the Fairfield Inn from December 16, 1989, to

December 19, 1989; and, during that period, the driver received

telephone calls from the person responsible for routing drivers for

the Guerra organization.

A rational jury could have concluded that, on or about

December 15, 1989, Caputo aided and abetted others to travel in

interstate commerce and caused the use of a telephone to facilitate

the distribution of marihuana. Jaramillo, 42 F.3d at 923. The

evidence is sufficient.

9
 III. Denial of a New Trial.

Caputo suggests that the district court abused its discretion

by refusing to order a new trial based upon newly discovered

evidence. At his sentencing hearing, Caputo told the district

court that he had met and talked with Guerra the week before.

Caputo stated that Guerra was willing to testify that Hernandez was

selling marihuana to Hernandez’s brother-in-law in Hammond,

Indiana.

Caputo argued that this was new evidence that undercut

Hernandez’s testimony that he sold marihuana to Caputo. The

district court explained that this evidence indicated only that it

was possible that both Caputo and Hernandez’s brother-in-law were

guilty. After he was sentenced, Caputo wrote a letter to the court

that indicated that Caputo thought that the court had not given

Caputo an adequate opportunity to speak at his sentencing hearing.

The court held a post-sentencing hearing to allow Caputo to explain

his position.

To obtain a new trial based upon newly discovered evidence, a

defendant must establish that “(1) the evidence is newly discovered

and was unknown to the defendant at the time of trial; (2) failure

to detect the evidence was not due to a lack of diligence by the

defendant; (3) the evidence is not merely cumulative or impeaching;

(4) the evidence is material; and (5) the evidence introduced at a

new trial would probably produce an acquittal.” Jaramillo, 42 F.3d

at 924; FED. R. CRIM. P. 33. A defendant is not entitled to a new

trial unless he satisfies all five prongs. Jaramillo, 42 F.3d at

10
924-25. We review for abuse of discretion the decision that a

defendant is not entitled to a new trial based upon newly discov-

ered evidence. Id. at 924.

Caputo has failed to show abuse of discretion. Guerra’s

alleged “newly-discovered evidence” is consistent with Hernandez’s

trial testimony that he shipped marihuana to his brother-in-law in

Hammond. The evidence would be unlikely to result in acquittal at

a new trial. As the district court explained to Caputo: (1) The

fact that Hernandez’s brother-in-law received marihuana from

Guerra’s organization does not establish that the organization did

not ship marihuana to Caputo, and (2) the fact that Guerra

allegedly did not know Caputo during the existence of the conspir-

acy does not mean that Caputo was not a member of his organization.

IV. Caputo’s Sentence.

Caputo argues that his sentence should be vacated. He argues

that the district court did not make specific factual findings

concerning (1) the amount of drugs attributable to Caputo and

(2) his role in the offense.

A. Drug Quantity.

The probation officer determined that Caputo’s offense level

was 32 because he had been convicted of conspiracy to possess more

than 1000 kilograms of marihuana.1 Caputo objected that the

1
Caputo was sentenced in September 1993; therefore, the 1992 version of
the Sentencing Guidelines applies.

11
offense conduct described in the presentence report (“PSR”) was

inconsistent and did not support a finding that his relevant

conduct involved more than 1000 kilograms. The district court

overruled the objection because, based upon the evidence at trial,

the jury found Caputo guilty of conspiring to distribute more than

1000 kilograms of marihuana.

We review the determination of relevant quantity for clear

error. Factual findings concerning relevant conduct for sentencing

purposes are not clearly erroneous if they are “plausible in light

of the record read as a whole.” Puig-Infante, 19 F.3d at 942. “If

the district court’s account of the evidence is plausible in light

of the record viewed in its entirety, the court of appeals may not

reverse it even though convinced that . . . it would have weighed

the evidence differently.” United States v. Bermea, 30 F.3d 1539,

1575 (5th Cir. 1994), cert. denied, 115 S. Ct. 1113, and cert.

denied, 115 S. Ct. 1825 (1995). Here, the determination of the

quantity of drugs is not clearly erroneous because it is plausible,

in light of the record as a whole, that Caputo’s relevant conduct

included over 1000 kilograms of marihuana.

B. Role in the Offense.

The probation officer recommended that Caputo be given a two-

level increase in offense level because of his role in the offense.

Caputo objected that there was no evidence that he was a manager

and that he should be given a four-level decrease in offense level

because he was only a minimal participant. The district court

12
overruled the objection, finding that the evidence showed that

Caputo was the “mid-level distributor” for the Guerra organization

in Chicago and the Midwest. This determination is plausible in

light of the record as a whole, so we affirm. See Bermea, 30 F.3d

at 1575.

IV. Evidentiary Rulings.

Maldonado argues that the district court erred by overruling

his hearsay objections to testimony concerning out-of-court

statements made by Dario Maldonado (“Dario”), Maldonado’s brother

and codefendant. Dario pleaded guilty but did not testify at

Maldonado’s trial.

The government alleged that Maldonado and Dario transported

marihuana for the Guerra organization. Dario’s ex-wife, Rhonda

Dobbs, testified that Dario bought a black pickup truck with funds

furnished by Guerra and installed a trailer hitch on the truck.

Rene and Dario used the truck to haul Dario’s Camaro to Atlanta.

Dario told Rhonda that they were going to Atlanta to race the car.

Rhonda testified that she objected, because Dario had never raced

the Camaro before, and she did not believe his explanation for the

trip. She stated that Dario responded that it would “look better”

if they took the Camaro.

Maldonado made a hearsay objection when the government asked

Rhonda who had told Dario that it would “look better” to take the

Camaro. The government argued that the evidence was admissible as

a co-conspirator’s statement in furtherance of the conspiracy. The

13
district court overruled the objection, and Rhonda identified

Maldonado as the person who advised Dario that it would look better

to take the Camaro to Atlanta.

Rhonda testified that, after Dario and Maldonado returned from

Atlanta, Dario explained the reason for the trip. The district

court overruled Maldonado’s hearsay objection to Rhonda’s evidence

concerning the purpose of the trip. Rhonda testified that Dario

told her that he and Rene had used the Camaro’s trailer to “pull[]

a load of marihuana to Atlanta.”

We review rulings on admission of evidence for abuse of

discretion. United States v. Triplett, 922 F.2d 1174, 1180 (5th

Cir.), cert. denied, 500 U.S. 945 (1991). In direct criminal

appeals, review of evidentiary rulings is “necessarily heightened.”

United States v. Hays, 872 F.2d 582, 587 (5th Cir. 1989).

Nevertheless, a conviction will not be reversed because of the

erroneous admission of hearsay evidence unless the inadmissible

evidence had a substantial impact on the jury’s verdict. United

States v. El-Zoubi, 993 F.2d 442, 446 (5th Cir. 1993).

“[A] statement made by a coconspirator of a party during the

course and in furtherance of the conspiracy” is not hearsay. FED.

R. EVID. 801(d)(2)(E); United States v. McConnell, 988 F.2d 530, 533

(5th Cir. 1993). “A statement is made in furtherance of the

conspiracy if it advances the ultimate objectives of the conspir-

acy.” United States v. Snyder, 930 F.2d 1090, 1095 (5th Cir.),

cert. denied, 502 U.S. 942 (1991).

Maldonado concedes that the statements attributed to Dario

14
were coconspirator statements made during the course of the

conspiracy. He argues, however, that the admission of the

statements was error because the statements were not made in

furtherance of the conspiracy.

The district court did not abuse its discretion by determining

that Dario’s statement that Rene thought it would “look better” if

he and Dario took the Camaro to Atlanta was made in furtherance of

the conspiracy. The purpose of the statement was to overcome

Rhonda’s objection to Dario’s plan to use the trailer to tow the

Camaro to Atlanta.

The admission of Dario’s statement that he and Maldonado

pulled a load of marihuana to Atlanta is affirmed as a statement in

furtherance of the conspiracy. Rhonda admitted that she had known

Dario was “dealing marihuana” and that she was testifying pursuant

to a promise of immunity. Thus, we can consider Rhonda to be an

unindicted coconspirator, and hence the statement can be deemed to

be in furtherance of the conspiracy, because it “inform[] [her] of

the progress of the conspiracy.” See United States v. Flores, 63

F.3d 1342, 1377 (5th Cir. 1995).

VI. Maldonado’s Sentence.

Maldonado argues that the district court erred at sentencing

by failing to make adequate factual findings concerning the

relevant quantity of marihuana. Maldonado suggests that the

district court violated FED. R. CRIM. P. 32 because it did not

resolve his objection to the PSR with a specific factual finding as

15
to the quantity of drugs for which Maldonado was responsible.

The probation officer determined that Maldonado’s base offense

level was 34 based upon a “conservative estimate” that he had

facilitated the distribution of 4,545 kilograms of marihuana.

Maldonado noted the probation officer’s report that, between

December 1990 and March 1991, Maldonado and his brother delivered

“most of” 6000 pounds of marihuana that the Guerra organization

shipped to defendant Jack Novoselsky “via U-Haul trailers and Wells

Cargo trailers.” Maldonado objected that he denied “ever

transporting marihuana in U-Haul trailers.” The district court

overruled the objection on the ground that the type of trailer used

to carry the marihuana was irrelevant.

Maldonado asked to be sentenced at offense level 30. He

posited that his base offense level was 32 because the trial

evidence supported a finding of between 1000 and 3000 kilograms of

marihuana, and he suggested that his offense level should be

reduced by two because he was a minor participant. At the

sentencing hearing, the district court questioned the nature of

Maldonado’s objection to the base offense level. Counsel explained

that it was “a general objection” to the quantity “attributed . . .

by the Presentence Report.”

The court overruled the objection, stating that it was “clear

by the level of participation of this defendant, reasonably

probable that he was aware of the scope of the enterprise of more

than 3,000 kilos.” The district court adopted the PSR “with the

16
addition of Mr. Maldonado’s explanations . . . .”2

“The defendant bears the burden of demonstrating that

information the district court relied on in sentencing is materi-

ally untrue.” United Sates v. Vela, 927 F.2d 197, 201 (5th Cir.),

cert. denied, 502 U.S. 875 (1991) (internal quotations and citation

omitted). The court must make specific findings to resolve

contested factual issues relevant to sentencing if it intends to

use those facts as a basis for its sentence. United States v.

Sherbak, 950 F.2d 1095, 1098 (5th Cir. 1992); see F ED. R. CRIM. P.

32(c)(3)(D). If, however, a defendant objects to the PSR but does

not present rebuttal evidence to refute the facts, the district

court may adopt the facts in the PSR without further inquiry.

Sherbak, 950 F.2d at 1099-1100.

Maldonado presented no rebuttal evidence to support his

objection to the quantity of drugs attributed to him by the PSR;

therefore, the district court did not clearly err by adopting the

PSR’s factual findings as to the quantity of drugs. See id.

Maldonado’s argument that the court failed to make a clear record

concerning relevant quantity of drugs is irrelevant. The court

found that the record showed that Maldonado was responsible for

more than 3000 kilograms of marihuana. Maldonado’s base offense

level is 34, regardless of whether he was responsible for 3000 or

4545 kilograms of marihuana. See U.S.S.G. § 2D1.1(c)(5).

2
The explanations are not relevant to the quantity of drugs involved in
the offense.

17
 VII. Sufficiency of the Indictment as to Burnside.

Burnside alleges that the district court lacked jurisdiction

to convict him of the transaction structuring offenses alleged in

counts 77, 79, 81, 87, and 88 because the indictment omitted an

essential element of the offense. Burnside points out that each of

these counts failed to allege that the structured transaction

involved a “domestic financial institution.” He does not suggest

that the indictment failed to allege any other element of the

offense.

Counts 77, 79, 81, 87, and 88 charged Burnside with

structuring currency transactions to evade currency reporting

requirements. A defendant is subject to criminal penalties if he

“structure[s] or assist[s] in structuring, or attempt[s] to

structure or assist in structuring, any transaction with one or

more domestic financial institutions” for the purpose of evading

the reporting requirements for cash transactions. See 31 U.S.C.

§ 5324(3)(a).

Each of the challenged counts alleged that the structuring

offense took place “in the Southern District of Texas and else-

where” and specified the financial institution or institutions

involved in the prohibited transaction, the date of the transac-

tion, and the amount of cash involved. Some of the financial

institutions have titles which strongly suggest that they are

“domestic” financial institutions, e.g., First City,

TexasSSNortheast Branch, 1st National Bank, NCNBSSTexas, and Lone

Star Bank.

18
 Burnside did not object to the sufficiency of the indictment

in the district court. Therefore, the court will “read the

indictment liberally to be sufficient, unless it is so defective

that by any reasonable construction, it fails to charge an offense

for which the defendant is convicted.” United States v. Alford,

999 F.2d 818, 823 (5th Cir. 1993) (quotation and citation omitted).

“An indictment is sufficient if (1) it contains the elements of the

offense charged, (2) it fairly informs the defendant of the charge

he must meet, and (3) there is no risk of future prosecutions for

the same offense.” Id. The court’s review of the sufficiency of

the indictment is de novo, but the court will not reverse a

conviction for “minor deficiencies in the indictment that cause no

prejudice.” United States v. Gaytan, No. 95-50055, 1996 WL 26787,

at *1 (5th Cir. Jan. 23, 1996).

Burnside does not suggest that the indictment did not fairly

inform him of the charges against him or that he is in jeopardy of

future prosecution for the offenses alleged therein. He concedes

that the district court instructed the jury that a conviction

required proof that the offense involved a “domestic financial

institution,” and he does not suggest that any of the named

institutions was not a “domestic” institution.

Counts 77, 79, 81, and 87 state that the charged conduct

occurred “in the Southern District of Texas and elsewhere,”

identify the relevant financial institutions, and refer to what was

then § 5324(3) (which details the elements required for a viola-

tion, including the requirement that the transaction involve a

19
“domestic financial institution.”). Under similar circumstances,

we have determined that an indictment adequately set forth the

elements of the alleged offenses. See United States v. Devoll, 39

F.3d 575, 578-79 (5th Cir. 1994), cert. denied, 115 S. Ct. 1701

(1995); see also United States v. Green, 964 F.2d 365, 373-75 (5th

Cir. 1992), cert. denied, 506 U.S. 1055 (1993).

Count 88 alleges that Burnside engaged in transactions for the

purposes of evading the currency reporting requirements of 31

U.S.C. § 5313(1).3 Unlike the other challenged counts, however,

count 8 fails to allege that Burnside violated § 5324.

An indictment must cite the “statute, rule, regulation or

other provision of law” that the defendant is alleged to have

violated; FED. R. CRIM. P. 7(c)(1). We are unaware of a case in

which the court has affirmed a challenge to an indictment under

similar circumstances. The only authority tending to support an

affirmance is United States v. Ellender, 947 F.2d 748, 755-56 (5th

Cir. 1991). There, we found that allegations that the offense

occurred “‘commencing in or about the month of July, 1982, and

continuing through the month of August, 1984' . . . ‘in the Western

District of Louisiana, and elsewhere’” sufficiently apprised the

defendant of the charged conduct to allow him to prepare a defense.

Id.

Ellender is distinguishable, however, as the defendant argued,

not that the indictment failed to allege the elements of the

offense, but that it was too vague to allow him to defend the

3
Section 5313 does not provide criminal penalties.

20
charges. See id. Therefore, we reverse Burnside’s conviction on

count 88. As discussed below, reversal of this count will not

affect Burnside’s sentence or jail term, but the total amount of

his special assessments will be reduced by fifty dollars. See

United States v. Pepper, 51 F.3d 469, 475 (5th Cir. 1995).

VIII. Burnside’s Sentence.

Burnside argues that the district court clearly erred in

determining the value of the laundered funds for sentencing

purposes and in increasing his offense level based upon its

determination that he knew that the laundered funds were the

proceeds of drug activity. Burnside suggests that the district

court committed an ex post facto violation by sentencing him under

the 1991 amendments to the Sentencing Guidelines.

Under the grouping provisions of the guidelines, Burnside’s

offense level was computed based upon his money laundering

convictions (counts 83-86 and 89).4 The probation officer in-

creased Burnside’s base offense level of 23 by three on the ground

that Burnside was aware that the laundered funds were derived from

the sale of narcotics and by an additional four on the ground that

the laundered funds exceeded $600,000. The probation officer

reported, based upon an analysis of Burnside’s records of Guerra’s

1987-91 income, that the total amount of funds laundered by

4
Because Burnside’s offense level was based upon the money laundering
rather than the structuring convictions, our disposition of count 88 does not
affect Burnside’s overall sentence. Burnside received concurrent terms of 151
months for money laundering (5 counts), 60 months for conspiracy (3 counts), and
36 months for transaction structuring offenses (6 counts besides count 88).

21
Burnside was $934,092. The probation officer documented numerous

highly unorthodox transactions that Burnside completed for Guerra.

Burnside objected in conclusional terms that he had not known that

the funds were drug proceeds and that he had laundered only

$178,000.

A. Value of Laundered Funds.

At sentencing, counsel conceded that Burnside had laundered

more than $178,000, but he argued without great specificity that

the amount laundered was less than $600,000. The district court

rejected his argument as follows:

The offense conduct . . . exceeded $600,000 on the counts
of conviction, and the related conduct was in the
neighborhood of a million dollars, and I’m not going to
consider even related conduct for which he was acquitted.
But for sentencing purposes, even some of the legitimate
things that were done for the Guerras could be considered
in the magnitude of the offense because in the absence of
some legitimate transactions, it’s real hard to launder
stuff sinceSSso you’ve got to set up legitimate things.

The district court adopted the PSR as proposed by the probation

officer. As Burnside did not present any evidence to refute the

probation officer’s report that the laundered funds totaled

$934,092, the court did not clearly err when it adopted the PSR’s

finding concerning the amount of funds laundered.

B. Nature of Laundered Funds.

Burnside did not present any evidence to support his

conclusional argument that he was unaware that the laundered funds

were drug proceeds. The district court held that a preponderance

22
of the evidence supported a finding that Burnside knew the funds

were derived from drugs rather than some other unlawful activity.

Burnside’s denial of knowledge of the nature of the funds fails to

establish that the district court’s determination is not plausible

in light of the record as a whole. See Bermea, 30 F.3d at 1575.

C. Ex Post Facto Argument.

Burnside was sentenced under the 1992 edition of the

Sentencing Guidelines. As discussed above, his offense level was

increased by three pursuant to U.S.S.G. § 2S1.1(b)(1), which

imposes an increase if the defendant “knew or believed” that the

laundered funds were the proceeds of certain illicit activities.

Prior to November 1991, § 2S1.1(b)(1) provided for an increase in

the offense level only if the defendant “knew” of the illicit

source of the funds. See United States v. Breque, 964 F.2d 381,

389 (5th Cir. 1992), cert. denied, 507 U.S. 909 (1993). Burnside

correctly points out that, because the offense conduct occurred

before November 1991, the use of the amended version of

§ 2S1.1(b)(1) violates ex post facto principles. See United States

v. Domino, 62 F.3d 716, 719-20 (5th Cir. 1995).

Because Burnside did not present his ex post facto argument to

the district court, our review is for plain error. Under FED. R.

CRIM. P. 52(b), we may correct forfeited errors only when the

appellant shows the following factors: (1) There is an error

(2) that is clear or obvious and (3) that affects his substantial

rights. United States v. Calverley, 37 F.3d 160, 162-64 (5th Cir.

23
1994) (en banc) (citing United States v. Olano, 113 S. Ct. 1770

(1993)), cert. denied, 115 S. Ct. 1266 (1995). If these factors

are established, the decision to correct the forfeited error is

within our sound discretion, and we will not exercise that

discretion unless the error seriously affects the fairness,

integrity, or public reputation of judicial proceedings. Olano,

113 S. Ct. at 1778.

Parties are required to challenge errors in the district

court. When a defendant in a criminal case has forfeited an error

by failing to object, we may remedy the error only in the most

exceptional case. Calverley, 37 F.3d at 162. The Supreme Court

has directed the courts of appeals to determine whether a case is

exceptional by using a two-part analysis. Olano, 113 S. Ct. at

1777-79.

First, the appellant has the burden to show that there is

actually an error, that it is plain, and that it affects

substantial rights. Id. at 1777-78; Rodriguez, 15 F.3d at 414-15;

FED. R. CRIM. P. 52(b). Plain error is one that is “clear or

obvious, and, at a minimum, contemplates an error which was clear

under current law at the time of trial.” Calverley, 37 F.3d at

162-63 (internal quotation and citation omitted). See United

States v. Dupaquier, No. 95-30068, slip op. 1706, 1710-11 (5th Cir.

Jan. 26, 1996). “[I]n most cases, the affecting of substantial

rights requires that the error be prejudicial; it must affect the

outcome of the proceeding.” Calverley, 37 F.3d at 164. We lack

the authority to relieve an appellant of this burden. Olano, 113

24
S. Ct. at 1781.

Second, the Supreme Court has directed that, even when the

appellant carries his burden, “Rule 52(b) is permissive, not

mandatory. If the forfeited error is `plain’ and `affect[s]

substantial rights,’ the Court of Appeals has authority to order

correction, but is not required to do so.” Olano, 113 S. Ct. at

1778 (quoting rule 52(b)). As the Court stated in Olano,

the standard that should guide the exercise of [this]
remedial discretion under Rule 52(b) was articulated in
United States v. Atkinson, 297 U.S. 157 . . . (1936).
The Court of Appeals should correct a plain forfeited
error affecting substantial rights if the error
“seriously affect[s] the fairness, integrity or public
reputation of judicial proceedings.”

Id. at 1779 (quoting Atkinson, 297 U.S. at 160). Thus, our

discretion to correct an error pursuant to rule 52(b) is narrow.

Rodriguez, 15 F.3d at 416-17.

The error in this case is clear and obvious, but Burnside has

not established that it affects his substantial rights. Although

the probation officer cited the “knew or believed” language, the

district court found that Burnside “reasonably [could] be concluded

to have known” that the funds were derived from “drugs and not some

other unlawful activity.” Burnside’s conclusional protestations

aside, the facts cited in the PSR indicate that Burnside “knew”

that Guerra was dealing drugs.

IX. Conclusion.

In summary, we AFFIRM as to Caputo and Maldonado. We AFFIRM

Burnside’s conviction except on count 88, as to which we REVERSE,

25
and we VACATE and REMAND Burnside’s sentence for resentencing to

reduce his special assessment by fifty dollars.

26