United States v. Johana Leon

Case: 15-12578 Date Filed: 11/16/2016 Page: 1 of 19

[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT
________________________

No. 15-12578
________________________

D.C. Docket No. 1:13-cr-20063-DLG-3

UNITED STATES OF AMERICA,

Plaintiff - Appellee,

versus

JOHANA LEON,

Defendant - Appellant.

________________________

Appeal from the United States District Court
for the Southern District of Florida
________________________

(November 16, 2016)

Before JORDAN, ROSENBAUM, and SILER, * Circuit Judges.

JORDAN, Circuit Judge:

*
The Honorable Eugene E. Siler, United States Circuit Judge for the Sixth Circuit, sitting
by designation.
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A grand jury indicted Johana Leon on one count of conspiracy to commit

wire fraud, in violation of 18 U.S.C. § 1349, four counts of money laundering, in

violation of 18 U.S.C. § 1956(a)(1)(B)(i), and three counts of attempting to cause a

financial institution to not file a required currency transaction report (a CTR), in

violation of 31 U.S.C. § 5324(a)(1) & (d)(2). Following trial, a jury found Ms.

Leon guilty of the three § 5324(a)(1) charges but acquitted her of the conspiracy

and money laundering charges. The district court, varying downward from the

advisory guideline range, sentenced Ms. Leon to a term of imprisonment of 12

months and one day.

At no time during trial did Ms. Leon challenge the government’s theory of

prosecution or object to the jury instructions given by the district court on the §

5324(a)(1) charges. Now, on appeal, Ms. Leon contends for the first time that the

government and the district court constructively amended the indictment, allowing

her to be tried and convicted of violating § 5324(a)(3), and not § 5324(a)(1). She

further argues, on a theory also not presented to the district court, that the evidence

was insufficient to sustain her convictions. Reviewing for plain error, see United

States v. Holt, 777 F.3d 1234, 1261 (11th Cir. 2015), we reject Ms. Leon’s

constructive amendment claim. We also conclude, again under plain error review,

see United States v. Joseph, 709 F.3d 1082, 1103 (11th Cir. 2013), that Ms. Leon’s

§ 5324(a)(1) convictions were supported by sufficient evidence.

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Federal law allows the Secretary of the Treasury to require, by way of

regulations, that domestic financial institutions file reports of certain transactions.

See 31 U.S.C. § 3513(a). Under one such regulation, domestic financial

institutions have a legal obligation to report, through the filing of a CTR, “a

transaction in currency of more than $10,000.” 31 C.F.R. § 1010.311. Such a

report “shall be filed by the financial institution within 15 days following the day

on which the reportable transaction occurred.” 31 C.F.R. § 1010.306(a)(1).

A “financial institution includes all of its domestic branch offices . . . for

purposes of the transactions in currency reporting requirements[.]” 31 C.F.R. §

1010.313(a). The so-called “aggregation” rule provides that, in “the case of

financial institutions other than casinos, for purposes of the transactions in

currency reporting requirements . . . multiple currency transactions shall be treated

as a single transaction if the financial institution has knowledge that they are by or

on behalf of any person and result in either cash in or cash out totaling more than

$10,000 during any one business day[.]” 31 C.F.R. § 1010.313(b).

In relevant part, 31 U.S.C. § 5324(a) provides that “[n]o person shall, for the

purpose of evading the reporting requirements of section[s] 5313(a) or 5325 or any

regulation proscribed under any such section . . . (1) cause or attempt to cause a

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domestic financial institution to fail to file a report required under section[s]

5313(a) or 5325 or any regulation prescribed under any such section,” or “(3)

structure or assist in structuring, or attempt to structure or assist in structuring, any

transaction with one or more domestic financial institutions.” As noted, the grand

jury charged Ms. Leon with three violations of § 5324(a)(1).

We have explained that § 5324(a)(1) was “aimed at efforts to prevent a

required CTR from being filed,” while § 5324(a)(3) “was aimed at structuring

[transactions] to evade the CTR requirements.” United States v. Phipps, 81 F.3d

1056, 1060 (11th Cir. 1996). And we have held that “§ 5324(a)(1) is violated only

when an individual causes [or attempts to cause] a financial institution not to file a

CTR that it had a legal duty to file.” Id. at 1062 (holding that evidence was

insufficient as a matter of law to sustain a defendant’s convictions under §

5324(a)(1) because, as only checks were deposited, the bank was never required to

file a CTR). So a person violates § 5324(a)(1) if he arranges financial transactions

in an attempt to prevent a financial institution from complying with its duty to file

a CTR for those aggregated transactions. See id. at 1061. On the other hand, a

person violates § 5324(a)(3) if she structures financial transactions to evade

reporting requirements and those transactions, individually or collectively, do not

trigger the institution’s obligation to file a CTR. See id. See also Courtney Linn,

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Redefining the Bank Secrecy Act: Currency Reporting and the Crime of

Structuring, 50 Santa Clara L. Rev. 407, 449-52 (2010).

This case centers on Paradise Is Mine, a Florida corporation which purported

to offer investment opportunities in a residential real estate development project in

Rum Cay, located in the Bahamas. Ms. Leon served as the registered agent of

Paradise and was one of its corporate officers. She had sole signatory authority

over Paradise’s bank accounts. Lawrence Foster, Ms. Leon’s co-defendant, was

Paradise’s president.

According to the indictment, Mr. Foster, Ms. Leon, and Jordon McCarty (a

third co-defendant) made fraudulent misrepresentations and promises to investors

about the Rum Cay project (e.g., that Paradise was a successful real estate

company with large land holdings, that Paradise had been featured in hundreds of

international publications, that investors would receive above-market fixed rates of

return, and that investors would get back their full principal investments after a

certain period of time). Ms. Leon, the government claimed, withdrew investor

funds for herself and her co-defendants from accounts controlled by Paradise.

As pertinent here, the indictment alleged that Ms. Leon—knowingly,

willfully, and for the purpose of avoiding federal reporting requirements—

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attempted to cause Bank of America not to file required CTRs concerning currency

transactions exceeding $10,000, while violating another federal law and as part of

a pattern of illegal activity involving more than $100,000 in a 12-month period.

See § 5324(a)(1) & (d)(2). According to Count 12, on January 30, 2012, she made

five cash withdrawals in the amounts of $9,500, $5,500, $1,430, $1,000, and $400.

According to Count 13, on July 9, 2012, she made three cash withdrawals in the

amounts of $6,000, $3,995, and $500. And according to Count 14, on September

20, 2012, she made two cash withdrawals in the amounts of $9,846 and $300. As

the indictment was pled, the government essentially charged that these

withdrawals, when aggregated on a daily basis, see 31 C.F.R. § 1010.313(b),

triggered Bank of America’s obligation to file CTRs, and that Ms. Leon made the

withdrawals in amounts of less than $10,000 to try to cause Bank of America to

not file CTRs.

At trial, the government presented evidence that, pursuant to Treasury

regulations, a financial institution is required to file a CTR when there is a cash

transaction of over $10,000. See D.E. 456 at 841-42; D.E. 455 at 732-33. An FBI

forensic accountant explained that the chart contained in Government Exhibit 815

separated the cashed checks and withdrawals by date and, using Counts 13 and 14

as examples, testified that the currency transactions on the dates in question were

added together to exceed the $10,000 reporting threshold. See D.E. 457 at 1030-

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31, 1041-42, 1050-52. Both the government and Ms. Leon, in their opening

statements and closing arguments to the jury, understood that Counts 12-14 were

based on an “aggregation” theory, even though that word was not used in the

indictment. See D.E. 526 at 15-19 (government’s opening statement); D.E. 526 at

35, 38, 40 (Ms. Leon’s opening statement); D.E. 461 at 54-55 (government’s

closing argument); D.E. 528 at 25 (Ms. Leon’s closing argument).

With respect to Counts 12-14 themselves, the evidence at trial, viewed in the

light most favorable to the verdict, see, e.g., United States v. Wilson, 788 F.3d

1298, 1309 (11th Cir. 2015), allowed the jury to find that Ms. Leon, who was the

only signatory on Paradise’s four corporate bank accounts, had engaged in the

charged currency transactions at Bank of America in 2012. See, e.g., Gov’t Ex.

815; Gov’t Ex. 815c; D.E. 457 at 1032-36, 1050-51; D.E. 456 at 923-24. The

evidence also allowed the jury to find that Ms. Leon acted with the intent to evade

the reporting requirements because she arranged each of the charged transactions

to be below $10,000 in an attempt to cause Bank of America to not file required

CTRs. In addition to the charged withdrawals, the government presented evidence

that, in a separate transaction in March of 2011, Ms. Leon told a teller at JP

Morgan Chase that she was trying to avoid the filing of a CTR and asked the teller

to reverse a particular transaction so that she would receive less than $10,000 in

cash. See D.E. 456 at 845-849, 855. An internal JP Morgan Chase form filled out

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by that teller reported that Ms. Leon had “done this several times before and has

had similar transaction[s].” See D.E. 456 at 849, 855 (referring to Gov’t Ex. 701).

III

A constructive amendment to an indictment occurs when the theory or

evidence presented by the government, see, e.g., Holt, 777 F.3d at 1261-62, or the

jury instructions, see, e.g., United States v. Williams, 527 F.3d 1235, 1245-46 (11th

Cir. 2008), alter the “essential elements” of the offense contained in the indictment

to broaden the possible bases for conviction beyond what is charged. A

constructive amendment, when established, is reversible error if the claim has been

preserved. See, e.g., Stirone v. United States, 361 U.S. 212, 215-19 (1960).

Ms. Leon’s contention is that the government’s theory and evidence, as well

as the district court’s jury instructions, constructively amended the indictment by

allowing her to be convicted of violating § 5324(a)(3) instead of § 5324(a)(1).

Because Ms. Leon did not raise her constructive amendment argument in the

district court, our review is for plain error. See Holt, 777 F.3d at 1261; United

States v. Madden, 733 F.3d 1314, 1319-22 (11th Cir. 2013). That means that Ms.

Leon must show that there was error, that the error was plain, and that the error

affected her substantial rights. If she carries her burden, we may correct the error

if it seriously affects the fairness, integrity, or public reputation of judicial

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proceedings. See Madden, 777 F.3d at 1319-22 (discussing and applying United

States v. Olano, 507 U.S. 725, 732 (1993), to a forfeited constructive amendment

claim).

According to Ms. Leon, the offense of “structuring” is prohibited by §

5423(a)(3) but not by § 5423(a)(1). Building on this premise, Ms. Leon argues that

there was a constructive amendment—allowing her to be convicted of uncharged

§5342(a)(3) offenses—because the government repeatedly used the term

“structuring” when referring to Counts 12-14. We are not persuaded. Both parties

used the term “structuring” at trial, and the use of that term did not constructively

amend the indictment.

In its opening statement, the government twice referred to Ms. Leon’s

conduct as “structuring,” telling the jury that cash was withdrawn in amounts of

less than $10,000 in order to try to avoid Bank of America filing CTRs. See, e.g.,

D.E. 526 at 16 (“This is structuring. This is a design.”); id. at 19 (“Ms. Leon is

guilty of structuring, of withdrawing $9,985, $9,875, arranging those transactions

so that the banks don’t report it.”). But the government was not alone in the use of

the term “structuring.”

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In her opening statement, Ms. Leon told the jury that she was Mr. Foster’s

personal assistant, that she had been romantically involved with Mr. Foster, that

Paradise was in her name because Mr. Foster told her he had bad credit following a

divorce, that she did not profit from Paradise, and that she made withdrawals from

Paradise’s accounts based on instructions she received from Mr. Foster. See, e.g.,

id. at 33 (“She went to the bank as instructed. She made deposits and withdrawals

as instructed.”). Like the government, she referred several times to Counts 12-14

as “structuring charges.” See id. at 35 (“And that’s important because of those

structuring charges the government talked to you about.”); id. at 37 (“Because in

order to find Johana Leon guilty of what they say she did, each one of those

charges, each one, the wire fraud the government talked to you about, the money

laundering, the structuring, require her to have knowingly [ ] participat[ed] in a

fraud and acting to further it.”); id. at 38 (“The same thing with the structuring

counts: she didn’t write them [the checks].”); id. at 40 (“I think the most important

thing, going back to the structuring counts . . . the handwriting is not hers.”).

In its Rule 29 argument, and in its closing argument, the government again

referred to Counts 12-14 as “structuring.” See D.E. 461 at 22 (government’s Rule

29 argument: “she structured those transactions”); id. at 55 (government’s closing

argument: “And she’s charged with structuring, taking that money out in under

$10,000.”). But so too did Ms. Leon. See D.E. 461 at 24 (Ms. Leon’s Rule 29

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argument: “With regard to the structuring counts, I’ll focus particularly on Count

15[sic] . . . . So there’s just no evidence to suggest that this charge was structured

in a way to avoid a reporting requirement.”); D.E. 528 at 25 (Ms. Leon’s closing

argument: “The structuring counts are the other series of counts involving Ms.

Leon, and there are three of them, and in order . . . to find that Ms. Leon was

structuring, you have to find that she arranged these transactions, they were each

less than $10,000, but when you agglomerate them, they’re more than $10,000.”).

It is true that the word “structure” is contained in § 5324(a)(3) and not in §

5423(a)(1), and that courts sometimes refer to the offense set out in § 5324(a)(3) as

“structuring.” See, e.g., United States v. Lang, 732 F.3d 1246, 1247-48 (11th Cir.

2013). But we do not think that the parties’ joint use of the term “structuring” as

shorthand for arranging the withdrawals in question—the conduct charged in

Counts 12-14—constructively amended the indictment.

The title of § 5324 is “Structuring to evade reporting requirements

prohibited.” Given that subsection (a)(1) is a part of § 5324, generally

characterizing the conduct charged in Counts 12-14 as “structuring,” while maybe

a bit loose, see Phipps, 81 F.3d at 1060, is not reversible error. In fact, some courts

and commentators have referred to both § 5324(a)(1) and § 5324(a)(3) as

“structuring” offenses, leading us to conclude that the parties’ word choice did not

result in a constructive amendment. See United States v. Abdelbary, 496 F. App’x
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273, 276, 2012 WL 5352515, at *2 (4th Cir. Oct. 31, 2012) (“Federal law

criminalizes two types of structuring. The first type, imperfect structuring, is

prohibited by § 5423(a)(1) and proscribes conduct designed ‘to defeat the bank’s

responsibility to report.’ The second type, perfect structuring, is prohibited by §

5423(a)(3) and criminalizes conduct designed ‘to avoid triggering the bank’s duty

to report.’”) (quoting United States v. Peterson, 607 F.3d 975, 980 (4th Cir. 2010));

Linn, Currency Reporting and the Crime of Structuring, 50 Santa Clara L. Rev. at

451 (“‘Imperfect’ structuring, as defined under subsection 5324(a)(1), is similar [to

subsection 5324(a)(3)] . . . [and] occurs when a [person] attempts to defeat a

financial institution’s reporting or recordkeeping requirement in a transaction or

series of transactions that nonetheless implicate that duty.”); Steven Mark Levy,

Federal Money Laundering § 13.11[A] (CCH 2016) (“Conduct prohibited by

Section 5324(a)(1)—that [is] designed to defeat the financial institution’s

responsibility to report—is known as ‘imperfect structuring.’”). See also United

States v. Tobon-Builes, 706 F.2d 1092, 1098 (11th Cir. 1983) (referring, in case

decided prior to codification of § 5324(a)(1), to conduct similar to Ms. Leon’s as

“structuring”). Finally, a Treasury regulation defining the terms “structure” and

“structuring” contemplates that one can “structure” currency transactions by

splitting up withdrawals or deposits that together exceed the reporting threshold at

a single bank on a single day, and explains that “structuring” is not limited to that

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scenario. See 31 C.F.R. § 1010.100(xx) (“The transaction or transactions need not

exceed the $10,000 reporting threshold at any single financial institution on any

single day in order to constitute structuring within the meaning of this definition.”).

We turn next to the district court’s jury instructions for Counts 12-14, which

form the second ground for Ms. Leon’s constructive amendment claim. The

instructions were as follows:

. . . Counts 12 through 14 allege that defendant Johana Leon
attempted to cause a financial institution to not file a report required
by law.

I will explain the law governing those substantive offenses in a
moment . . . .

It’s a federal crime under certain circumstances for anyone to
knowingly evade a currency transaction reporting requirement.

Domestic financial institutions and banks (with specific
exceptions) must file currency transaction reports, that’s a Form 4789,
with the government. They must list all deposits, withdrawals,
transfers, or payments involving more than $10,000 in cash or
currency.

The defendant can be found guilty of this crime only if all the
following facts are proved beyond a reasonable doubt:

(1) the defendant knowingly attempted to structure the
transactions to cause a domestic financial institution to fail to file a
report;

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(2) the purpose of the transaction was to evade the transaction
reporting requirements;

(3) the transactions involved one or more domestic financial
institutions; and

(4) the currency transaction with the domestic financial
institutions furthered another federal crime as part of a pattern of
illegal activity involving more than $100,000 in a 12-month period.

To “structure” a transaction means to deposit, withdraw, or
otherwise participate in transferring a total of more than $10,000 in
cash or currency using a financial institution or bank by intentionally
setting up or arranging a series of separate transactions, each one
involving less than $10,000, in order to evade the currency reporting
requirement that would have applied if fewer transactions had been
made.

D.E. 528 at 40, 46-47. Ms. Leon did not object to these instructions at the charge

conference. See D.E. 527 at 5.

In support of her constructive amendment claim, Ms. Leon argues that the

instructions for the § 5324(a)(1) charges were the Eleventh Circuit “pattern

instruction[s] for § 5324(a)(3)[.]” Br. of Appellant at 48. But that is not

completely accurate. The instructions given by the district court were actually a

modified version of the pattern instructions for § 5324(a)(3). The two substantive

modifications from the pattern instructions were that element (1) was changed to

reflect that Ms. Leon was charged with knowingly attempting to cause a financial

institution to not file a CTR, and that the word “structured” was removed from

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element (3). Compare Eleventh Cir. Pattern Jury Inst., Offense Inst. No. 112

(West 2010).1

Nevertheless, the instructions given by the district court were not perfect.

They did not mention the Treasury’s “aggregation” regulation, under which the

government was proceeding, and which provides that multiple currency

transactions on the same day are treated a single transaction for CTR purposes if

“the financial institution has knowledge that they are by or on behalf of any person

and result, in either cash in or cash out totaling more than $10,000 during any one

business day[.]” 31 C.F.R. § 1010.313(b). And the instructions could have been

more clear that, as required by Phipps, 81 F.3d at 1062, a person cannot be

convicted of violating § 5324(a)(1) unless the financial institution’s obligation to

file a CTR has been triggered (through, for example, the application of the

“aggregation” regulation). But these deficiencies did not, under plain error

analysis, amount to a constructive amendment of the indictment.

First, the instructions set out a number of elements consistent with the

language of § 5324(a)(1). Those were that a person has to act with a purpose to

evade the reporting requirements (the language in (a) preceding (1)), and that a

1
The Eleventh Circuit does not have a pattern jury instruction for a § 5324(a)(1) offense.
Nor, apparently, do any of our sister circuits. Given the issues raised in this case, it might be a
good idea to create such a pattern jury instruction.
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person has to attempt to cause a financial institution to fail to file a report required

by law (the language in (1)).

Second, the use of the word “structure” in the instructions was prejudicial to

Ms. Leon only if the jury also knew that there was a separate provision—i.e., §

5324(a)(3)—that prohibited “structuring” in circumstances where the financial

institution’s duty to report was not triggered. The jury did not know that, so there

is no indication that the word “structure” was understood as anything other than

“arrange.” That is certainly the way the parties understood the instructions during

their closing arguments. See, e.g., D.E. 528 at 25 (Ms. Leon’s closing argument:

“The structuring counts are the other series of counts involving Ms. Leon, and in

order . . . to find that Ms. Leon was structuring, you have to find that she arranged

these transactions, they were each less than $10,000, but when you agglomerate

them, they’re more than $10,000.”) (emphasis added).

Third, although the Treasury’s “aggregation” regulation explains when and

how a financial institution’s obligation to file a CTR is triggered through multiple

daily transactions that are each individually below the reporting threshold, it is not

clear that “aggregation” is, in and of itself, a distinct element of an “attempt to

cause” charge under § 5324(a)(1). We have not issued any binding (or, for that

matter, non-binding) decisions to that effect. The same goes for the financial

institution’s knowledge that the separate transactions are by or on behalf of the
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same person. We have never held, in a published or non-published opinion, that

the financial institution’s knowledge, which allows for aggregation, is an element

of a § 5324(a)(1) “attempt to cause” offense. And, as far as we can tell, nor has

any other court. In this circuit, “[a] district court’s error is not ‘plain’ or ‘obvious’

if there is no precedent directly resolving the issue.” United States v. Magluta, 198

F.3d 1265, 1280 (11th Cir. 1999). 2

Fourth, even if we assume without deciding that the financial institution’s

knowledge (which permits “aggregation” of separate transactions under the

Treasury regulation) is an element of a § 5324(a)(1) offense, then the most that we

are presented with are jury instructions that omitted an element of the crimes

charged in Counts 12-14. Such a claim would also be reviewed for plain error

because it was not asserted in the district court. See Johnson v. United States, 520

U.S. 461, 466-70 (1997) (applying plain error review to forfeited claim that jury

instructions omitted an element of the offense). But Ms. Leon’s claim is not that

the instructions were missing a required element. It is, instead, a very different

claim—that the instructions constructively amended the indictment and allowed

2
Another problem for Ms. Leon in meeting the plain error standard is that we have also
never said anything about the temporal nature of a financial institution’s knowledge. Assuming
that such knowledge is an element of an “attempt to cause” charge under § 5324(a)(1), is the
institution required to have knowledge on the date of the multiple transactions in question? Can
it acquire the knowledge at any time before the CTR is due 15 days later? Or can it acquire the
requisite knowledge any time before trial even though the 15-day period has expired? We leave
these issues for another day.
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her to be convicted of a non-charged offense. And we do not think that happened

here.

Ms. Leon argues that there was no evidence “whatsoever” that she attempted

to cause Bank of America to not file any CTRs, see Br. for Appellant at 53, but

that one-sentence argument in her brief is devoid of any discussion of the record

and fails to cite any cases or authorities. Her main assertion, as gleaned from the

other parts of her brief, seems to be that the government failed to put on evidence

that her transactions triggered Bank of America’s obligation to file CTRs on the

dates in question.

Normally we exercise plenary review over sufficiency challenges, see

generally Jackson v. Virginia, 443 U.S. 307, 319 (1979), but Ms. Leon did not

make this particular aggregation argument when she moved for a Rule 29

judgment of acquittal in the district court, see D.E. 461 at 24-25, so we review for

plain error. See Joseph, 709 F.3d 1103. Based on our independent review of the

trial record, which we have summarized above, Ms. Leon has not met the plain

error standard with respect to her sufficiency claim.

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Under plain error review, the indictment as to Counts 12-14 was not

constructively amended and the evidence was sufficient to support Ms. Leon’s

convictions.

AFFIRMED.