U.S. Court of Appeals, Third Circuit
filed: June 3, 1994; As Corrected June 9, 1994.
UNITED STATES OF AMERICA
ROBERT JOSEPH CARR, JR., APPELLANT IN NO. 93-1376; UNITED STATES OF AMERICA V. WALTER ORLANDO CARDONA-USQUIANO, APPELLANT IN NO. 93-1383
On Appeal from the United States District Court for the Eastern District of Pennsylvania. (D.C. Crim. Nos. 92-00102-08, 92-00102-09).
Before: Becker, Hutchinson and Cowen, Circuit Judges.
Opinion OF THE COURT
COWEN, Circuit Judge.
Along with numerous other co-defendants, Robert Joseph Carr, Jr. ("Carr") and Walter Orlando Cardona-Usquiano ("Cardona") were charged in a multi-count indictment with participating in a money laundering conspiracy. Carr was charged with and convicted of three counts: conspiracy to launder money in violation of 18 U.S.C. § 371 ("Count 1"); money laundering on July 11, 1990, in violation of 18 U.S.C. § 1956(a)(2), by attempting to transport $186,000 in cash outside of the United States ("Count 21"); and failure to file a Customs Service currency report, in violation of 31 U.S.C. §§ 5316 and 5322, for attempting to export more than $10,000 in currency on July 11, 1990 ("Count 22"). Cardona was charged with and convicted only of Count 1, the conspiracy count.
Both Carr and Cardona appeal their convictions on Count 1 by arguing the evidence was insufficient to prove beyond a reasonable doubt that they shared the knowledge and intent necessary to establish guilt of conspiracy. Carr also challenges the sufficiency of evidence to support his conviction on Count 21, the attempted money laundering count. Furthermore, both appellants take issue with the district court's denial of a downward adjustment in their respective sentences for being a minimal or minor participant in the offense of conviction.*fn1 We find no error in the orders of the district court and will affirm the convictions and sentences imposed.
We will limit our presentation of the factual background to evidence involving Carr and Cardona, as well as their interaction with Javier Gonzalez, the kingpin of the conspiracy, and several other co-defendants. The conspiracy was revealed to the government by a cooperating witness who engaged in numerous money laundering transactions with the conspirators beginning in February, 1989 and ending in January, 1991. Javier Gonzalez, the kingpin, and his wife Doris Gonzalez owned and operated two businesses in Philadelphia, Pennsylvania during the course of this conspiracy--a travel agency ("Jav G. Travel") and a beer distributorship. Their daughter Margareth Gonzalez, another co-defendant, worked at Jav G. Travel during this time period.
Carr had formerly been employed for approximately twelve years as a ticketing manager with an airline company that provided commercial flights to Colombia. He met Javier Gonzalez, who frequently travelled to South America for business purposes, while working at his former job. At trial Carr testified that he was friendly with Javier Gonzalez, he regularly flew with him as a travelling companion, and he had been employed as a tour coordinator for Jav G. Travel. Cardona, a Colombian national, was a tenant in a duplex house owned by Javier Gonzalez.
The United States Customs Service commenced an undercover investigation of Javier Gonzalez in early 1989. A cooperating witness represented himself to Javier Gonzalez as a money launderer of cocaine drug trafficking proceeds. Over the next two years, the cooperating witness provided Gonzalez with large quantities of cash to wire outside the country to the Cayman Islands and Colombia, as well as large quantities of fresh $100 bills which were exchanged for quantities of bills of smaller denomination plus a commission. All of the individual transactions involved sums well in excess of $10,000, and the total amount exchanged or wired out of the country over the two year period was in excess of $1,250,000. No Currency Transaction Reports ("CTR"), which are required to be filed with the government for any cash transaction of greater than $10,000, were prepared by Javier Gonzalez or Jav G. Travel for any of the transactions. Law enforcement canines trained to respond to drugs reacted positively to the bills provided by Gonzalez after all monetary exchanges for small denomination bills, except in one instance when a dog was not available.
A. Evidence Relating to Carr
Evidence introduced at trial established that on March 29, 1989 the cooperating witness brought $45,000 in $100 bills to Javier Gonzalez, represented the cash as illegal drug proceeds, and requested that it be deposited into a Cayman Islands bank account. The money could not be deposited in cash so it was divided into five checks, ranging from $8,500 to $9,500, the last two of which were deposited on May 19, 1989. Carr's passport showed that he traveled to the Cayman Islands on May 18, 1989 and departed on May 20, 1989. Carr's airline ticket was issued by Jav G. Travel and paid for by Javier Gonzalez.
On August 24, 1989 the cooperating witness exchanged $150,000 in $100 bills with Javier Gonzalez for bills of smaller denomination. Carr's passport reveals that he traveled from Philadelphia to Cali, Colombia on August 28, 1989 and returned on August 29, 1989. Javier Gonzalez paid for the trip and accompanied Carr.
The cooperating witness exchanged $100,000 in $100 bills on February 20, 1990 with Javier Gonzalez for bills of smaller denomination. Carr's passport stamps showed that he arrived in Cartagena, Colombia four days later on February 24, 1990 for a one-day stay. Again, Javier Gonzalez financed the trip and traveled with Carr to Colombia.
A similar exchange of $200,000 in $100 bills for bills of smaller denomination took place on April 24, 1990. Carr traveled from Philadelphia to Cali, Colombia the next day, April 25, 1990, with Javier Gonzalez. Carr's passport showed an exit stamp dated April 27, 1990 indicating his departure from Colombia. With respect to all these trips, Carr testified that he did not carry any money for Gonzalez out of the country and that he went along with Gonzalez only as a travelling companion.
The next exchange of $100 bills for bills of smaller denomination, totalling $90,000, took place between the cooperating witness and Doris Gonzalez on May 1, 1990. The next day, surveillance agents observed Carr visit Jav G. Travel. On May 3, 1990 Carr reported his passport lost or stolen at the passport agency in Philadelphia. The passport allegedly lost or stolen contained numerous stamps indicating trips of very short duration to Colombia, which might raise the suspicions of customs inspectors. At the same time, Carr applied for an emergency same-day replacement passport alleging that he was scheduled to travel to the United Kingdom the next day for a seven day trip. To support this allegation, Carr showed the passport agency an airline ticket issued through Jav G. Travel in his name. In fact, Carr traveled not to England but to Colombia on May 4, 1990, staying for only one day. Carr's "lost" passport was found in his residence on the date of his arrest.
In June and July, 1990, wiretaps were placed on telephone lines at Jav G. Travel and the beer distributorship. On July 9, 1990, the cooperating witness exchanged $190,000 in $100 bills with Doris Gonzalez at the travel agency for bills of smaller denomination. The following day, July 10, 1990, Margareth Gonzalez called Carr and told him that "tomorrow is the big day." Appendix ("App.") (Carr) at 178. On July 11, 1990, Javier Gonzalez, Carr, and a female companion departed Philadelphia International Airport en route to Cali, Colombia via Atlanta and Miami. In the airline departure area, Gonzalez was seen transferring a blue carry-on bag and a wad of bills to Carr.
Mr. Carr and his companion sat in coach, separated from Gonzalez who was in first class. At a layover in Miami, all passengers including Carr were stopped by U.S. Customs. Customs advised Carr that a Currency Monetary Instruments Report ("CMIR") must be filed to show the transportation of cash in excess of $10,000 out of the United States. In response to a declaration request, Carr told Customs that he was carrying only $4,000 in cash and that he did not possess cash in excess of $10,000.*fn2 During a lawful search, Customs found $180,000 in $100 bills with serial numbers matching those on bills provided by the cooperating witness on May 1, 1990 in two coffee mugs and a talcum container in Carr's blue carry-on bag. An additional sum of $6,000 in $100 bills was found on Carr. Javier Gonzalez was not detained.
Carr was not placed under arrest. When questioned about the money, Carr told U.S. Customs officials that he had picked up the bag from a train station locker in Philadelphia after an anonymous phone call. Carr stated that the bag was not his, that he did not know who owned the bag, and that he was expecting a call at a hotel in Cali, Colombia to instruct him where to deliver it. After several hours of questioning, Carr was released in Miami. Javier Gonzalez had continued on to Colombia.
After he was released, Carr called Jav G. Travel and spoke to Margareth and Doris Gonzalez. Carr told Doris Gonzalez that "I just got out of Customs," and that "if he calls you . . . it's all gone." App. (Carr) at 187-88. Doris Gonzalez became upset on the phone. Later that evening, Javier Gonzalez spoke to his wife Doris who told him that Carr had called from Miami and told her that "they took everything." Id. at 194. After a grand jury returned a sealed indictment naming him on the three money laundering counts, Carr was arrested at his mother's home in Philadelphia where he was living.
B. Evidence Relating to Cardona
Evidence introduced at trial showed that Cardona was born in Medellin, Colombia, arrived in the United States on May 31, 1989, and was a legal permanent resident. During the course of the money laundering conspiracy, Cardona was living in a duplex house in Philadelphia owned by Javier Gonzalez.
Completion of the April 20, 1990 exchange of bills between the cooperating witness and Javier Gonzalez was delayed for several hours because Gonzalez was short $14,500. After Gonzalez asked the cooperating witness to return in several hours, a call was placed from Jav G. Travel to a phone number registered to Cardona. Shortly thereafter, Cardona and a co-defendant, who was carrying a dark green shopping bag, arrived at Jav G. Travel, stayed a few minutes, and then departed. Company records showed no legitimate business transaction took place between Jav G. Travel and either of the visitors on that date. When the cooperating witness returned, he was provided with the $14,500 and his commission in $5, $10, and $20 bill denominations. Gonzalez told the cooperating witness that he had been short because he did not want to accept and exchange $1 bills. On this date, no drug-sniffing canine was available to ascertain whether any drugs had contaminated the particular bills.
Cardona was also observed entering Jav G. Travel on four other occasions around the time cash transfers were taking place between the cooperating witness and Javier Gonzalez. On March 8, 1990, Cardona entered Jav G. Travel carrying a box with a co-defendant. Cardona was also seen entering Jav G. Travel with a co-defendant on April 17, April 23, and April 26, 1990. On two of these occasions the co-defendant was carrying a bag, while on the third occasion Cardona was carrying a black bag. No evidence was presented concerning the contents of the box or the bags. Records seized from the travel agency reveal that no legitimate business transaction was consummated between the parties on any of these dates.
On May 28, 1992, a search warrant was executed at Cardona's residence in Philadelphia. Cardona and a co-defendant were arrested. Police found $22,900 in cash in small denominations hidden in various places in Cardona's master bedroom. Cash totalling approximately $10,500 in $1, $5, $10, and $20 denominations was found in several hiding places in the common basement of the duplex house. Also found in the basement were eleven boxes of glassine bags commonly used to package drugs for street sale. No evidence of drugs being found in the house was presented at the trial, but a narcotics dog did alert to the presence of drugs on the currency found in Cardona's bedroom and the basement.
When questioned by police, Cardona denied knowing Gonzalez even though Gonzalez owned the house in which Cardona was living. This statement was controverted by tape-recorded evidence indicating Gonzalez had introduced the cooperating witness to Cardona on July 5, 1990. Records seized from Jav G. Travel on May 28, 1992 contained money order receipts showing the transfer by Cardona and his wife from the United States to various individuals also named Cardona in Colombia of sums in the amount of $20,600 for 1989, $45,140 for 1990, $14,040 for 1991, and $15,700 for 1992. Cardona's 1990 federal tax return, which indicated that he was self-employed as a consultant, reported $18,364 in taxable income.
We have jurisdiction pursuant to 28 U.S.C. § 1291 and 18 U.S.C. § 3742(a) and (e) to consider these appeals of the defendants' convictions and sentences imposed. Both Carr and Cardona appeal their convictions on the conspiracy count, arguing that there was insufficient evidence presented at trial to prove beyond a reasonable doubt that they shared the knowledge and intent necessary to conspire to launder money. We employ the following standard of review when considering a sufficiency of evidence challenge after a conviction:
An appellate court must sustain the verdict of a jury if there is substantial evidence, viewed in the light most favorable to the Government, to uphold the jury's decision. In determining whether evidence is sufficient, we will not weigh evidence or determine the credibility of witnesses. Appellate reversal on the grounds of insufficient evidence should be confined to cases where the failure of the prosecution is clear. The evidence need not be inconsistent with every Conclusion save that of guilt, so long as it establishes a case from which a jury could find the defendant guilty beyond a reasonable doubt. A defendant challenging the sufficiency of the evidence bears a heavy burden.
United States v. Casper, 956 F.2d 416, 421 (3d Cir. 1992) (citations omitted).
The government must establish a unity of purpose, an intent to achieve a common goal, and an agreement to work together in order to convict a criminal defendant of conspiracy. United States v. McGlory, 968 F.2d 309, 321 (3d Cir. 1992), cert. denied, __ U.S. __, 113 S. Ct. 415 (1992), and __ U.S. __, 113 S. Ct. 627 (1992), and __ U.S. __, 113 S. Ct. 1388 (1993). However, a conviction for conspiracy does not require that every element of the crime be proven with direct evidence. See id. Rather, the government can rely entirely on circumstantial evidence to prove that an alleged conspirator had the knowledge and intent necessary to commit the crime. Id. ; United States v. Iafelice, 978 F.2d 92, 96-98 (3d Cir. 1992). When the government relies purely on circumstantial evidence, however, "the inferences drawn must have a logical and convincing connection to the facts established." Casper, 956 F.2d at 422 (citing United States v. McNeill, 887 F.2d 448, 450 (3d Cir. 1989), cert. denied, 493 U.S. 1087, 110 S. Ct. 1152, 107 L. Ed. 2d 1055 (1990)).
The conspiracy count of the indictment alleged that the co-defendants knowingly and intentionally engaged in three related criminal objectives: (1) impeding United States efforts to collect accurate reports and information relating to domestic currency transactions in excess of $10,000; (2) conducting financial transactions in violation of 18 U.S.C. § 1956(a)(1) designed to conceal and disguise the nature, source, location, ownership, and control of proceeds of specified unlawful activity, namely the felonious sale and distribution of illegal drugs; and (3) transporting and transferring money from Philadelphia outside the United States to the Cayman Islands and Colombia in violation of 18 U.S.C. § 1956(a)(2). The convictions can be upheld on appeal if there is sufficient circumstantial evidence to prove beyond a reasonable doubt that Carr and Cardona knowingly and intentionally committed acts furthering any of the three objects of the conspiracy. See Griffin v. United States, __ U.S. __, __, 116 L. Ed. 2d 371, 112 S. Ct. 466, 469-74 (1991) (guilty verdict in a multiple-object conspiracy need not be set aside even though the evidence is not adequate to support the conviction as to one of the objects); United States v. Vastola, 989 F.2d 1318, 1330-31 (3d Cir. 1993). Thus, viewed in hindsight the evidence need not prove that Carr and Cardona each committed acts furthering all three objectives of the conspiracy.
Without discussing all the evidence tending to prove Cardona's guilt, we conclude that a rational trier of fact could find beyond a reasonable doubt that Cardona engaged in at least the last two of the three criminal conspiracy objectives. With respect to the second conspiracy objective, engaging in domestic money laundering transactions, evidence showed that Cardona made numerous trips to Jav G. Travel immediately prior to an exchange of money between the cooperating witness and Javier or Doris Gonzalez. Evidence produced at trial conclusively established as fact that large money transfers took place, that no CTR's were filed, that over $33,000 in small denomination bills was found in Cardona's apartment on the date of his arrest, that drug packaging equipment was confiscated at his apartment, and that trained drug-sniffing canines reacted positively to the small denomination bills provided by the conspirators.*fn3 Although the visits made by Cardona to Jav G. Travel are only circumstantial evidence of guilt, the frequency and nature of the trips provide a "logical and convincing connection to the facts established" at trial, Casper, 956 F.2d at 422. The presence of such a large quantity of cash in Cardona's residence, which trained canines alerted to, along with the presence of drug packaging equipment, provides further circumstantial evidence directly linking Cardona to the money laundering conspiracy and indicating that he knew the money involved was derived from illegal drug trafficking. See United States v. Ramirez, 954 F.2d 1035, 1039-40 (5th Cir.) (jury could permissibly infer that money found at defendant's residence represented proceeds of illegal activity from evidence tending to show that defendant was a member of a drug trafficking ring), cert. denied, __ U.S. __, 112 S. Ct. 3010 (1992).
In reviewing the sufficiency of evidence, we also conclude that a rational trier of fact could find beyond a reasonable doubt that Cardona conspired to illegally transfer money outside of the United States to his native Colombia, the third objective of the conspiracy. Money order receipts obtained from Jav G. Travel revealed transfers totalling $45,140 from Cardona to people presumed to be members of his family in Colombia in 1990 alone. No CTR's or CMIR's were filed for any of those transactions. That same year, Cardona reported only $18,364 in income to the government on his tax return. When viewed in light of the totality of the evidence, including the confiscation of drug packaging equipment from his residence, such a large amount of money sent by a person with limited income to Colombia via wire transfers was sufficient evidence for a reasonable jury to convict Cardona of participating in the money laundering conspiracy. See United States v. Massac, 867 F.2d 174, 178 (3d Cir. 1989) (evidence of defendant's use of a wire service to transfer $22,000 in cash to Haiti over a five month period, combined with evidence of drug trafficking, was sufficient to convict on money laundering count); United States v. Blackman, 904 F.2d 1250, 1257 (8th Cir. 1990) (government's introduction into evidence that money laundering defendant had no legitimate source of income was proper, but not dispositive, to raise inference that funds came from illegal drug distribution activities).
Based on all of the circumstantial evidence, we believe that a rational juror could conclude beyond a reasonable doubt that Cardona intentionally agreed to work with the other conspirators towards a common goal--the laundering of illegal drug proceeds. Accordingly, we will uphold Cardona's conviction on the conspiracy count.
In addition to being convicted on the conspiracy count, Carr was also convicted of Count 21, attempted money laundering, and Count 22, failing to file an export currency transaction report. On appeal Carr challenges only his convictions on the conspiracy count and the attempted money laundering count.
We can sustain Carr's conviction on the conspiracy count if, in addition to determining that the government provided sufficient evidence to prove that he agreed with the conspirators to launder money, there was sufficient evidence for a jury to conclude beyond a reasonable doubt that he was guilty of attempted money laundering as charged in Count 21 because this count corresponds to the third object of the conspiracy. See Griffin, __ U.S. at __, 112 S. Ct. at 469-74. Hence, we will first turn to the evidence of guilt on that count.
In Count 21, the government charged Carr with attempting to transport $186,000 out of the country on July 11, 1990 in violation of the Anti-Money Laundering Act of 1986, 18 U.S.C. § 1956(a)(2)(B). This criminal statute provides in relevant part:
Whoever . . . attempts to transport . . . funds from a place in the United States to or through a place outside the United States . . .--
(B) knowing that the . . . funds involved in the transportation . . . represent the proceeds of some form of unlawful activity and knowing that such transportation is designed in whole or in part--
(i) to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity;
shall be sentenced to a fine . . . or imprisonment . . . or both.
Id. § 1956(a)(2)(B)(i). This criminal statute contains two scienter elements as reflected by Congress' use of the term "knowing" twice in the language of the section. See id. On appeal, Carr argues that the evidence was insufficient for a rational trier of fact to find beyond a reasonable doubt that he had either component of the scienter required for a conviction under the statute.
The first scienter element in the statute required proof that Carr knew the $186,000 in cash he was carrying on July 11, 1990 "represented the proceeds of some form of unlawful activity." Id. § 1956(a)(2)(B). This clause is not specifically defined in the statute, although an analogous clause from § 1956(a)(1), criminalizing the laundering of property representing the proceeds of unlawful activity, is defined in § 1956(c)(1):
The term "knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity" means that the person knew the property involved in the transaction represented proceeds of some form, though not necessarily which form, of activity that constitutes a felony under State, Federal, or foreign law.
18 U.S.C. § 1956(c)(1).
The only distinction between subsections 1956(a)(1) and 1956(a)(2)(B) is that the former criminalizes the laundering of property, rather than funds. Because we find this distinction so slight, we believe that Congress intended the definition of § 1956(c)(1), which is quoted above, to apply equally to violations of the money laundering statute which involve funds instead of property. Relying on this definition, we hold that the requisite scienter element is established in the present case if the evidence shows beyond a reasonable doubt that Carr knew the funds he was carrying represented the proceeds of any form of unlawful activity which is a felony under state, federal, or foreign law. See United States v. Isabel, 945 F.2d 1193, 1201 & n.13 (1st Cir. 1991);*fn4 see also United States v. Koller, 956 F.2d 1408, 1411 (7th Cir. 1992); United States v. Mickens, 926 F.2d 1323, 1330 (2d Cir. 1991), cert. denied, __ U.S. __, 112 S. Ct. 940 (1992).
The actual money Carr was carrying on July 11, 1990 was not directly derived from drug sales; it had been withdrawn from a U.S. government bank account and was provided to Javier Gonzalez by an agent of the government. However, the fact that the money Carr was transporting was not the actual proceeds of unlawful activity is made irrelevant by Congress' use of the word "represent" in the statute. After the exchange of money derived from illegal drug sales for fresh $100 bills provided by the cooperating witness, the $100 bills transported by Carr clearly represented the illegal drug money. Because the crime of money laundering by its very nature involves the change of criminal profits into other forms of currency or property, we believe Congress intended a criminal defendant to be convicted under this statute when the actual funds involved in the attempted transportation "represent" the proceeds of some unlawful activity. 18 U.S.C. § 1956(a)(2)(B); see also United States v. Jackson, 935 F.2d 832, 840 (7th Cir. 1991) (defendant need only know that the transaction "involved" the proceeds of unlawful activity). In order to convict a defendant for a violation of § 1956(a)(2)(B), it is sufficient that the government prove the defendant believed the money involved was derived from an illegal activity, even though, in fact, the funds came from a government source.
Carr argues that the government failed to prove beyond a reasonable doubt that he knew the money he was carrying represented proceeds of illegal activity. In reviewing the record, we find two appropriate and independent illegal activities that the jury could reasonably have relied on to conclude that Carr knew the funds represented some form of criminal proceeds. First, Javier Gonzalez engaged in an uncharged illegal domestic money laundering exchange of $190,000 with the cooperating witness two days before Carr was stopped in Miami. Although there is no evidence establishing Carr's presence at this exchange, circumstantial evidence including recorded phone conversations between Carr and other conspirators described at supra pp. 7-8, his travel with Javier Gonzalez on a scheduled flight to Colombia just two days later, and his possession of $186,000 in $100 bills with serial numbers matching those provided by the cooperating witness provided sufficient evidence for a rational jury to find beyond a reasonable doubt that Carr knew the cash represented proceeds derived from that illegal money laundering exchange.*fn5
Independent of this theory, there was also sufficient circumstantial evidence for a rational jury to find beyond a reasonable doubt that Carr knew the cash he was carrying represented proceeds from drug trafficking. We agree with the Court of Appeals for the Eighth Circuit that in order to convict a person for laundering or attempting to launder drug money, the government need not "trace the proceeds to a particular [drug] sale." United States v. Blackman, 904 F.2d 1250, 1257 (8th Cir. 1990). Thus, it was proper for the government to prove Carr's knowledge of the criminal nature of the cash proceeds entirely through circumstantial evidence.
Drawing all evidentiary inferences in favor of the government, we note that the jury heard testimony concerning Carr's numerous trips to the Cayman Islands and Colombia just after cash exchanges took place between Javier or Doris Gonzalez and the cooperating witness. Carr admitted to knowing and frequently travelling with Javier Gonzalez, the ringleader of this money laundering conspiracy.*fn6 The jury heard about an occasion when Carr lied to passport officials in order to obtain a new passport which would not contain numerous stamps showing visits of short duration to Colombia. Evidence also shows that Carr lied to Customs officials about how he obtained the blue bag containing the $180,000 in $100 bills that was confiscated in Miami on July 11, 1990.*fn7 Taped phone conversations from both before the flight and after the money was confiscated, described at supra pp. 7-8, provide incriminating evidence that Carr knew the money he was carrying had been derived from illegal transactions. Furthermore, positive alerts by trained drug sniffing dogs indicate that much of the money likely was used in drug transactions. Thus, we cannot say that a rational jury could not find beyond a reasonable doubt that Carr knew the money he was carrying represented proceeds of illegal drug trafficking.
The second disputed scienter element of the statute required proof that Carr knew that his act of transporting the funds was "designed in whole or in part to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity." 18 U.S.C. § 1956(a)(2)(B)(i). "Specified unlawful activity" is broadly defined in the statute as meaning any act or activity that is a specifically listed felony crime. Id. § 1956(c)(7). The listed felony offenses include drug trafficking. See id. § 1956(c)(7)(C).
In order to convict Carr under Count 21, the government was not required to prove that Carr knew the money he was carrying was "the proceeds of specified unlawful activity," id. § 1956(a)(2)(B)(i). Rather, the statute requires only that Carr knew his act of transporting the funds was designed to disguise or conceal its nature, source, ownership, or control. See United States v. Campbell, 977 F.2d 854, 857 (4th Cir. 1992) (interpreting the analogous property money laundering subsection, 18 U.S.C. § 1956(a)(1)(B)(i)), cert. denied, __ U.S. __, 113 S. Ct. 1331 (1993); United States v. Massac, 867 F.2d 174, 177-78 (3d Cir. 1989) (same).
We agree with one court of appeals which has interpreted this scienter element to allow for a conviction under the money laundering statute not only where the defendant has personally designed the transaction with intent to disguise the funds, but also where the defendant knows someone else designed the transaction intending to disguise the funds. See United States v. Awan, 966 F.2d 1415, 1424-25 (11th Cir. 1992) (quoting United States v. Ortiz, 738 F. Supp. 1394, 1401 (S.D. Fla. 1990)). Under such an interpretation, the government must prove that the defendant knew that the funds were derived from an unlawful activity and that the defendant knew the transportation was undertaken to disguise or conceal the money in some material fashion. See id. at 1424-25. In Awan, the court overturned the conviction of a money laundering defendant because there was insufficient evidence to prove that he knew that the other conspirators had designed complicated banking transactions to disguise or conceal the source of the money. Id. at 1433-35.
The evidence presented by the government was sufficient for a rational jury to find Carr guilty beyond a reasonable doubt under such a theory. Evidence was presented that on July 11, 1990 Carr received the blue carry-on bag at the Philadelphia International Airport from Javier Gonzalez. When asked to declare all monetary instruments in excess of $10,000 at the Miami Airport, Carr stated that he had only $4,000 in cash. A subsequent consensual search of Carr's blue carry-on bag revealed $180,000 in cash secreted in two coffee thermos mugs and a talcum powder container. In addition, Carr was carrying $6,000 in $100 bills on his person. When asked how he came to possess the bag, Carr told Customs officials a highly suspicious, if not incredible, story that he had received an anonymous phone call telling him to retrieve it from a train station locker and to transport it to Colombia. By returning a guilty verdict on this count, the jury obviously resolved a credibility issue in favor of the government. It is not our role to disturb that determination on appeal. In sum, we conclude that all of this evidence was sufficient for a jury to find beyond a reasonable doubt that Carr knew Gonzalez had designed this currency transportation scheme in a manner to conceal or disguise the nature, source, or ownership of the money.
Thus, we will affirm Carr's conviction on the money laundering count which arose from his attempted transportation of $186,000 to Colombia on July 11, 1990. We also conclude that the evidence presented to the jury was sufficient to prove beyond a reasonable doubt that Carr agreed with the other conspirators to participate in the money laundering conspiracy. Because there is ample evidence to support his conviction on Count 21, which corresponds to the third object of the money laundering conspiracy, we will also affirm his conviction on the conspiracy count. See Griffin, __ U.S. at __, 112 S. Ct. at 469-74.
Carr and Cardona appeal the sentences imposed by the district court. Both argue pursuant to United States Sentence Commission, Guidelines Manual, § 3B1.2 (1993) ("U.S.S.G.") that the district court erred in denying their request for a downward adjustment in the guideline offense level on the basis of playing a "mitigating role" in the money laundering conspiracy. This guideline states:
Based on the defendant's role in the offense, decrease the offense level as follows:
(a) If the defendant was a minimal participant in any criminal activity, decrease by 4 levels.
(b) If the defendant was a minor participant in any criminal activity, decrease by 2 levels.
In cases falling between (a) and (b), decrease by 3 levels.
U.S.S.G. § 3B1.2. Carr requested a 2 level reduction for being a minor participant. Cardona requested a 2, 3, or 4 level reduction for being a minimal or minor participant in the conspiracy. In each case, the district court rejected the requested base level reduction.
We employ a mixed standard of review when considering whether a defendant was entitled to a base level reduction for being a minimal or minor participant in the criminal activity. United States v. Bierley, 922 F.2d 1061, 1064 (3d Cir. 1990); United States v. Ortiz, 878 F.2d 125, 126-27 (3d Cir. 1989). When the district court's denial of a downward adjustment is based primarily on a legal interpretation of the Guidelines the defendant claims to be erroneous, we exercise plenary review. Bierley, 922 F.2d at 1064. By contrast, when the defendant takes issue with the district court's denial of a reduction for being a minimal or minor participant which was based primarily on factual determinations, we review only for clear error. United States v. Price, 13 F.3d 711, 735 (3d Cir. 1994), cert. denied, 62 USLW 3755 (U.S. May 16, 1994); Bierley, 922 F.2d at 1064; see also U.S.S.G. § 3B1.2, comment. (backg'd.) (the decision to adjust downward for minor or minimal participation, or the intermediate alternative, "involves a determination that is heavily dependent upon the facts of a particular case").
Carr argues that the district court erred for two independent reasons. First, he contends that his role in his "relevant conduct" was minor as defined in U.S.S.G. § 3B1.2. "[A] minor participant means any participant who is less culpable than most other participants, but whose role could not be described as minimal." U.S.S.G. § 3B1.2, comment. (n.3); see also United States v. Tsai, 954 F.2d 155, 166-67 (3d Cir.) (discussing definition of "minor participant"), cert. denied, __ U.S. __, 113 S. Ct. 93 (1992).
Assuming, arguendo, that the district court properly limited his relevant conduct to the activities surrounding his conviction on Count 21 (attempted money laundering), Carr argues that his role as a mere courier was minor as compared to the roles of the other conspirators involved who sold drugs and shared profits in either the trafficking or money laundering. Since the district court's determination that Carr's role as a courier was not minor in comparison to the other conspirators involved in the attempted money laundering activity is primarily factual in nature, we review it only for clear error.
In United States v. Headley, 923 F.2d 1079, 1084-85 (3d Cir. 1991), we recognized that defense counsel representing a defendant who served as a drug courier for a large conspiracy on only a few occasions was ineffective for failing to argue that the defendant was entitled to consideration for a base level adjustment for being a minor participant. In remanding the case for a consideration of this issue, we gave some guidance to the district court as to whether a courier should be considered a minor participant:
The culpability of a defendant courier must depend necessarily on such factors as the nature of the defendant's relationship to other participants, the importance of the defendant's actions to the success of the venture, and the defendant's awareness of the nature and scope of the criminal enterprise.
Id. at 1084 (quoting United States v. Garcia, 920 F.2d 153, 155 (2d Cir. 1990)). We noted that the ultimate Conclusion as to whether a courier is a minor participant involves making various factual findings, id., which we should review only for clear error on appeal.
Although the district court did not specifically follow the course set out in Headley, the record amply supports the district court's Conclusion that Carr was not a minor participant. Carr was stopped in Miami with cash of $186,000 in $100 bills. That attempted transportation to Colombia provided the basis for his conviction on Count 21. Evidence shows that Carr was travelling with Javier Gonzalez, the kingpin of the conspiracy, that Carr and Gonzalez were closely associated, and that Carr knew the funds represented proceeds of some criminal activity. In light of the fact that the particular money laundering transaction might not have taken place if Carr was not physically transporting the cash on his person and in his carry-on bag, Carr was certainly vital to its success. See United States v. Fuller, 974 F.2d 1474, 1479 (5th Cir. 1992) ("If [the defendant] had made delivery of the money the crime would have been perfected."), cert. denied, __ U.S. __, 114 S. Ct. 112 (1993). Furthermore, we acknowledged in Headley that "the fact that a defendant's participation in a [conspiracy] was limited to that of courier is not alone indicative of a minor or minimal role." 923 F.2d at 1084. Accordingly, on this record we conclude that the district court's determination that Carr was not a minor participant was not clearly erroneous.
Carr also submits that his sentence must be vacated pursuant to 18 U.S.C. § 3742(f)(1) because the district court misapplied the Guidelines by relying on a broader scope of relevant conduct than that contained in his Presentence Investigation Report ("PSR").*fn8 Carr argues that the district court misapplied the definition of "minor participant" by not limiting his relevant conduct to the attempted money laundering act that took place on July 11, 1990. In essence, on appeal Carr objects to the following statement made by the district court at the sentencing hearing:
In Mr. Carr's case, the Court thinks that he is absolutely in no way, shape or form, a minimal or a minor participant. He was a significant participant. This is a man who the testimony show [sic] made numerous trips to Colombia of one or two days in duration. This man was laundering money on a routine and regular basis with and for the kingpin of his [sic] money-laundering operation.
App. (Carr) at 223. According to Carr, this statement reflects the district court's reliance on all of his conduct with respect to the conspiracy, rather than just his limited relevant conduct with respect to his attempted money laundering conviction, in denying the mitigating role adjustment.
Carr, however, was given an immediate opportunity but did not object to the district court's statement. Nor has counsel for Carr otherwise brought to our attention that the record contains an objection made in the district court that it was impermissibly relying on relevant conduct other than that contained in the PSR. Thus, Carr failed to preserve the issue for appeal and we review only to ensure that "plain error" was not committed. United States v. Pollen, 978 F.2d 78, 88 (3d Cir. 1992) (citing Fed. R. Crim. P. 52(b)), cert. denied, __ U.S. __, 113 S. Ct. 2332 (1993).
Upon review of the entire sentence hearing record, we do not believe that the district court committed an error "seriously affecting substantial rights or compromising the fairness of the proceedings," United States v. Martinez-Zayas, 857 F.2d 122, 134 (3d Cir. 1988). Carr's relevant conduct for purposes of sentencing was only that which occurred on July 11, 1990 during his attempted transportation of $186,000 in cash to Colombia. Nevertheless, we have already concluded that there are ample facts tending to show that Carr was not a minor participant with respect to this particular transaction. In fact, the very success of the transportation of the $186,000 in $100 bills to Colombia was dependent upon Carr's role as the courier. Therefore, although the district court may have committed error in denying Carr's request for a mitigating adjustment based on relevant conduct that was not contained in the PSR, we cannot say that the district court's Conclusion in denying Carr a two base level reduction for being a minor participant was plain error.
Cardona maintains that he was entitled to as much as a four base level mitigating adjustment for being a minor participant in the overall conspiracy. Like Carr, he contends that the district court erred in taking into account a broader scope of relevant conduct than that contained in the PSR. With respect to Cardona's request for a mitigating adjustment, the district court stated:
Well, the Court's rather familiar with the testimony and the evidence that was educed in this case since there was a full blown trial that lasted almost a month. No, I don't think that one could find by a preponderance of the evidence that this gentleman was anything other than an average participant.
I don't think that his role in the overall conduct charged here was substantially less or even significantly less than that of most of his cohorts. . . .
I think the evidence shows that even being most generous of [sic] the defendant, he was an average run of the mill participant in this conspiracy and I think that accordingly he is not entitled to a two or a three or a four point adjustment for being a minor or minimal participant.
App. (Cardona) at 158-59. We disagree with Cardona's reading of this statement as indicating that the district court erroneously relied on conspiratorial conduct that was not part of Cardona's relevant conduct as contained in his PSR. Rather, we believe this statement reflects the district court's proper application of the mitigating adjustment guideline by comparing Cardona's culpability in his relevant conduct with other conspirators involved in those particular transactions.
Furthermore, in reviewing all of the evidence relating to Cardona's relevant conduct, we agree with the district court's Conclusion that he was at least an average participant. The district court did not commit clear error in concluding that Cardona was not entitled to any mitigating adjustment for his role in the conspiracy.
Cardona also argues that his sentence should be vacated because the district court improperly enhanced his base offense level by three levels pursuant to U.S.S.G. § 2S1.1(b)(1). This guideline provides for a three base level enhancement for defendants convicted of money laundering who "knew or believed that the funds were the proceeds of an unlawful activity involving the . . . distribution of narcotics or other controlled substances." Id. After considering Cardona's objection to this sentence enhancement, the district court stated:
The question is, is there enough from which one could find, that he knew the currency he was dealing in represented the proceeds of drug trafficking activity. It's the Court's view that there is.
In fact, I'm not going to go bit by bit and piece by piece [through the evidence], but the totality of the evidence is such as to suggest that not only did the defendant know that the proceeds that he was dealing were derived from drug trafficking activity. They were derived from drug trafficking activity in which he was engaged and I think that the probation officer correctly awarded the three points. I find by at least a preponderance of the evidence that this is a proper offense characteristic and a proper enhancement.
App. (Cardona) at 156. Cardona takes issue with the Conclusion of the district court that the totality of the evidence establishes that Cardona knew the money he was involved with constituted proceeds of drug dealing. Since in our view this Conclusion is primarily a factual determination, we review it only for clear error. See United States v. Cusumano, 943 F.2d 305, 313 (3d Cir. 1991), cert. denied, __ U.S. __, 112 S. Ct. 881 (1992).
The evidence shows that in 1990 Cardona wired significantly more money to Colombia than he reported on his federal tax return. He was seen entering Jav G. Travel several times during the time period in which cash exchanges were taking place between Javier Gonzalez and the cooperating witness, while business records reveal no legitimate reasons for the visits. Furthermore, large sums of small denomination bills were found in Cardona's residence, as well as drug packaging materials, on the date of his arrest. The confiscated cash was further revealed by trained dogs to contain traces of illegal narcotics. Considering all of this evidence, we conclude that the district court did not commit clear error in finding that Cardona knew the laundering proceeds came from illegal drug transactions. The district court properly enhanced Cardona's base offense level by three levels pursuant to U.S.S.G. § 2S1.1(b)(1).
Carr also challenges that portion of his sentence where the district court imposed a $10,000 fine. Carr was convicted of three counts which together called for a fine in the range of $10,000 to $1,000,000. Therefore, the fine actually imposed by the district court was the minimum amount called for by the Sentencing Guidelines. When assessing a fine, the district court is required to consider several factors which are specified by statute, see 18 U.S.C. §§ 3553(a) and 3572(a), as well as factors contained in the Sentencing Guidelines themselves, see U.S.S.G. § 5E1.2(d)(1)-(7). Nevertheless, the district court "shall impose a fine in all cases, except where the defendant establishes that he is unable to pay and is not likely to become able to pay any fine." U.S.S.G. § 5E1.2(a).
After receiving the PSR recommending a fine of $10,000, Carr filed a sentencing memorandum requesting that the fine be waived entirely pursuant to U.S.S.G. § 5E1.2(f). Central to Carr's argument before the district court, and on appeal, is that the PSR reflects that Carr had a negative net worth of about $20,000, and a negative net monthly cash flow because he was unemployed just prior to sentencing. At the sentencing hearing, the district court acknowledged that Carr did not presently have the means to pay the $10,000 minimum fine. Upon review of Carr's potential future resources, however, the district court imposed the fine because the Judge could not conclude that "there's no reasonable prospect in the foreseeable future that [Carr] could not pay at least the absolute minimum fine. So, I am going to impose the minimum fine that I'm required by law to impose." App. (Carr) at 239.
Carr filed a Motion for Correction of Sentence pursuant to Fed. R. Crim. P. 35(c) with the district court in which he argued that the fine should be waived because the government had not objected to the financial information contained in the PSR report which reflected Carr's negative net worth. In addition, Carr argued that a full consideration of all the relevant factors contained in the statute and Guidelines yields the Conclusion that the $10,000 fine was beyond his future means. Finally, Carr contended the installment period for payment of the fine was illegal and that interest should be waived because of Carr's present inability to pay.
The district court rejected most of these arguments in an order dated April 26, 1993 because "the court must impose a fine unless defendant establishes that he is not likely to become able to pay any fine," which Carr failed to do. District Court Order (Crim. No. 92-00102-08) (E.D. Pa. Apr. 26, 1993) (citing U.S.S.G. § 5E1.2(a) and (f)), reprinted in Brief for Appellant (Carr) at Addendum C. The district court also reviewed several relevant factors including Carr's responsibility for dependents, educational background, employment history, and net worth in concluding that Carr would likely have the means to pay the minimum fine of $10,000 in the future. The record reflects that Carr graduated from high school, attended college for three years, and had been employed in administrative positions in the airline industry for several years prior to the events which gave rise to his criminal conviction. In this review, the district court noted that Carr's net worth was approximately $10,000 when an undocumented, unsecured $30,000 loan payable to his mother was subtracted from his total liabilities. The district court did, nevertheless, waive interest on the fine.
Carr argues that this portion of his sentence must be vacated because the district court committed error by recalculating his net worth by adding back the uncorroborated $30,000 loan payable to his mother. Furthermore, Carr contends that the district court incorrectly placed the burden on the defendant to establish his inability to pay the fine where neither Carr nor the government objected to that portion of the PSR which revealed that Carr had a negative net worth of $20,000. We note, initially, that this is not a situation where we review the record de novo to ascertain whether the district court made any findings to show that it considered whether the defendant had the ability to pay the fine imposed. Cf. United States v. Demes, 941 F.2d 220, 223-24 (3d Cir.) (vacating sentence because the district court failed to make findings with respect to defendant's ability to pay fine), cert. denied, __ U.S. __, 112 S. Ct. 399 (1991); United States v. Cammisano, 917 F.2d 1057, 1064 (8th Cir. 1990) (same). Rather, we exercise plenary review over the alleged legal errors, but review Conclusions which are largely factual in nature only for clear error. The district court's ultimate Conclusion of whether to waive or reduce the fine is reviewed only for an abuse of discretion because the relevant Guideline indicates that the district court should retain discretion. See U.S.S.G. § 5E1.2(f).
The sentencing record in the present case plainly reveals that the district court considered those statutory and guideline factors that it found relevant in determining that Carr possessed the ability to pay the $10,000 minimum fine in the future. Imposing a fine based solely on future ability to pay is permissible. See United States v. Joshua, 976 F.2d 844, 856 (3d Cir. 1992) (sentence imposing a fine based on future ability to pay upheld on appeal where district court made a finding that defendant was a judgment creditor). Furthermore, we hold that it is permissible for a sentencing court sua sponte to recalculate a defendant's net worth in considering whether the defendant has the ability to pay a fine where the PSR actually recommends that a fine be imposed.
In the present case, although the PSR reported that Carr had a negative net worth, it still recommended that the district court impose a $10,000 fine. Thus, Carr was on notice before the sentencing hearing that the government was recommending that the court impose a fine of $10,000 despite the fact that his current financial position indicated he would be unable to make a lumpsum payment of the fine.*fn9 As the district court correctly stated, a defendant is only entitled to a reduction or waiver of the fine if he proves that he is unable to pay currently and is not likely to be able to pay in the future. U.S.S.G. § 5E1.2(f). Even then, the Guidelines leave discretion with the district court to decide whether the fine should be reduced or waived. Id. ("If the defendant establishes that . . . he is not able and . . . is not likely to become able to pay [the fine] . . ., the court may impose a lesser fine or waive the fine." (emphasis added)). Therefore, the district court made no legal error in recalculating Carr's net worth or in leaving with him the burden of proving he had no future ability to pay the minimum fine.
Although Carr naturally relied on the fact that the government did not object to this portion of the PSR, and thereby did not present any evidence tending to establish or corroborate the undocumented loan and negative net worth, he still retained the overall burden of proving that he did not possess the ability to pay the recommended fine in the future. See U.S.S.G. § 5E1.2(a); Joshua, 976 F.2d at 856; United States v. Preston, 910 F.2d 81, 89-90 (3d Cir. 1990), cert. denied, 498 U.S. 1103, 111 S. Ct. 1002, 112 L. Ed. 2d 1085 (1991). The district court concluded that Carr did not meet that burden even after considering Carr's motion for correction of sentence in which he argued that he did not have the means to pay the fine in the future in part because of his negative net worth.
Our review of the sentencing record reveals that the district court made no clearly erroneous factual findings in concluding that Carr had some future ability to pay the minimum fine. Given that the district court made no legal error and considered the relevant factors as to Carr's future capacity to pay the fine, which are reflected on the record, it certainly did not abuse its discretion in failing to waive the $10,000 fine altogether.*fn10
The convictions and sentences of both Carr and Cardona will be affirmed.
BECKER, Circuit Judge, Concurring in part and Dissenting in part.
I join in the majority's opinion except for its Discussion of the canine sniffing evidence and the portions of Part III and Part IV pertaining to the sufficiency of the evidence supporting Carr's conviction on Count 21. I write separately not only to explain why I believe the majority has construed 18 U.S.C.A. § 1956(a)(2)(B)(i) too broadly, but also to express my views on the general inadmissibility of canine sniffing evidence.
I. CONSTRUCTION OF 18 U.S.C.A. § 1956(A)(2)(B)(I)
A. The Plain Meaning of the Statute
Section 1956(a)(2)(B)(i) makes it a crime to transport money out of the United States "knowing that the . . . funds . . . represent the proceeds of some form of unlawful activity and knowing that such transportation . . . is designed . . . (i) to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity. . . ." 18 U.S.C.A. § 1956(a)(2)(B)(i) (emphasis supplied). Unfortunately, the language does not clearly convey whether the mens rea requirement of "knowing" applies solely to the fact that the transportation was "designed" to "conceal or disguise" attributes of what really is proceeds of specified unlawful activity -- rendering the "proceeds of specified unlawful activity" language a mere passing referent to which no mens rea requirement attaches -- or whether the scienter requirement extends also to the fact that the funds represented "the proceeds of specified unlawful activity." Although the drafting of the statute is opaque, and the question of the mens rea requirement a close one, I respectfully disagree with the majority's construction, see Maj. Op. at 23-24.
After careful meditation on the structure and wording of § 1956(a)(2)(B)(i), I am led to conclude in the end that the mens rea of "knowing" also applies to the fact that the funds represent the proceeds of "specified unlawful activity" and that the majority's reading cabining the mens rea requirement to the "conceal or disguise" element is less persuasive. I find guidance in the Model Penal Code's learned approach toward culpability. The Model Penal Code's rule of statutory construction provides that "when the law defining an offense prescribes the kind of culpability that is sufficient for the commission of an offense, without distinguishing among the material elements thereof, such provision shall apply to all the material elements of the offenses, unless a contrary purpose plainly appears." MODEL PENAL CODE § 2.02(4) (1965). "Knowing" applies to all material elements of subsection (i) under that rule, and because it identifies the essence of the offense the "proceeds of specified unlawful activity" (as defined by § 1956(c)(7)) element is a material term.*fn11
This construction does not read the phrase "some form of unlawful activity" in § 1956(a)(2)(B) out of the statute: that broader language applies to § 1956(c)(2)(B)(ii), which does not contain the language "proceeds of specified unlawful activity."*fn12 Had Congress meant to have the scienter requirement in § 1956(a)(2)(B)(i) apply only to proceeds of "some form of unlawful activity" and not to "proceeds of specified unlawful activity," it could (and should) have used the language "some form of unlawful activity" in § 1956(a)(2)(B)(i) instead of the language "proceeds of specified unlawful activity," or otherwise conveyed that meaning.
For example, in § 1956(a)(1), Congress partially drafted the statute the way the majority interprets § 1956(a)(2) to read. That section begins, "Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity. . . ." 18 U.S.C.A. § 1956(a)(1) (Supp. 1994) (emphasis supplied). The majority reads § 1956(a)(2)(B)(i) as if it similarly read "knowing that such transportation . . . is designed . . . to conceal or disguise the nature, the location, the source, the ownership, or the control of what in fact represents proceeds of specified unlawful activity," whereas the statute as written leaves out the emphasized words.
The case the majority relies upon to support its construction, United States v. Massac, 867 F.2d 174, 177-78 (3d Cir. 1989), did not decide the issue the majority cites it for. In that case there was no question that the defendant knew the proceeds derived from drug trafficking; the only question we confronted was whether the transaction was designed to conceal or disguise that fact.
B. Application of the Rule of Lenity
Even if ultimately I am wrong about the difficult question concerning the mens rea standard for the element "proceeds of specified unlawful activity" in § 1956(a)(2)(B)(i), it seems to me that at the very least the statute's mens rea requirement is ambiguous. Therefore the rule of lenity should come into play and require the same outcome I reach above.
The Supreme Court has held that the rule of lenity should be employed to "resolve any ambiguity in the ambit of [a criminal] statute's coverage." Crandon v. United States, 494 U.S. 152, 158, 110 S. Ct. 997, 1001, 108 L. Ed. 2d 132 (1990) (emphasis supplied).*fn13 An ambiguity exists for purposes of the rule in "those situations in which a reasonable doubt persists about a statute's intended scope even after resort to 'the language and structure, legislative history, and motivating policies' of the statute." Moskal v. United States, 498 U.S. 103, 108, 111 S. Ct. 461, 465, 112 L. Ed. 2d 449 (1990) (quoting Bifulco v. United States, 447 U.S. 381, 387, 100 S. Ct. 2247, 2252, 65 L. Ed. 2d 205 (1980)); see Crandon, 494 U.S. at 158, 110 S. Ct. at 1001-02.
Since there is no legislative history, and since neither the language, structure, nor the animating purposes of the statute provide sure direction, see supra Part, the statute is at best ambiguous. Therefore the rule of lenity mandates that the heightened scienter requirement, rather than no scienter requirement (as the majority would have it), applies to that element of the offense.
II. THE RELEVANCE OF CANINE-ALERT EVIDENCE
Although I believe that the introduction of the dog-sniffing evidence was error, it does not rise to the level of plain error, inasmuch as I also believe there was sufficient evidence to prove beyond a reasonable doubt that the cash involved represented the proceeds of drug trafficking even absent the canine-sniffing evidence, and hence that the evidence was not prejudicial.*fn14 Moreover, the question whether the currency in fact represented the proceeds of drug trafficking is not relevant to the question of whether Carr subjectively believed he was transporting currency derived from drug trafficking in order to launder it. Nevertheless, I feel obliged to comment on the nature of the evidence in light of what I believe to be its its highly prejudicial potential in future proceedings.*fn15
My concern stems from numerous studies and other evidence cited in United States v. Fifty-Three Thousand Eighty-Two Dollars in United States Currency, 985 F.2d 245, 250 n.5 (6th Cir. 1993), United States v. Six Hundred Thirty-Nine Thousand Five Hundred & Fifty-Eight Dollars ($639,558) in United States Currency, 293 U.S. App. D.C. 384, 955 F.2d 712, 714 n.2 (D.C. Cir. 1992), and elsewhere, which collectively persuade me that a substantial portion of United States currency now in circulation is tainted with sufficient traces of controlled substances to cause a trained canine to alert to their presence. Although the mounting evidence and studies were not made part of the record at trial and thus are not directly before us on review, I set them forth in the margin.*fn16
If any of the many studies cited above is valid, then the fact that a dog alerted to a large number of bills in United States currency which has circulated in a major metropolitan center (at which the studies are directed) is meaningless and likely quite unfairly prejudicial, see FED. R. EVID. 403, and evidence thereof should have been excluded. Although having been directed to many of the studies I have cited by Carr's brief, the government in its brief has not disputed the validity of any of the studies mentioned above. It has not pointed to any countervailing studies -- whether of record or otherwise -- which contradict them, or mustered any arguments pointing to the relevancy of its canine-alert evidence, despite shouldering the burden of establishing its relevancy.
It is thus my considered opinion that the fact that numerous studies by governmental and private agencies, studies which stand unrefuted, strongly suggest that a trained canine will alert to all bundles of used currency does not permit the jury to draw a reasonable inference that the person in prior possession of such currency was a drug trafficker or associated with one.*fn17 Indeed, I am inclined to the view that the information now available establishes a strong presumption against the admissibility of evidence of a canine's alert to currency, and that the government can rebut that presumption only if it first clearly and convincingly establishes, outside the presence of the jury, the relevance and non-prejudicial character of the offered evidence. Since the government has failed its burden of showing the relevance of its evidence, in order to protect the "public reputation of judicial proceedings," United States v. Young, 470 U.S. 1, 15-16, 105 S. Ct. 1038, 1046-47, 84 L. Ed. 2d 1 (1985), I would exclude that prejudicial and irrelevant evidence from our consideration of this case.*fn18
However, I think that the other evidence and the nature of Carr's conviction renders the admission of that evidence harmless error in this case. In particular, the canine-sniffing evidence appears to have been relevant only to the issue of whether the currency Gonzalez exchanged for the government's fresh $100 bills in fact represented the proceeds of drug trafficking.*fn19 I believe that the other evidence proffered by the government, including the fact that the money originated from Gonzalez, who was convicted of drug trafficking, sufficed to establish that the large amount of cash in fact represented the proceeds of drug trafficking.*fn20 In sum, although I think admission of the canine alert evidence was not plain error in this case under Federal Rule of Criminal Procedure 52(b), I think for purposes of appellants' sufficiency of the evidence challenge we should only give the evidence the weight due it -- absolutely none.
III. CARR'S GUILT UNDER THE PROPER READING OF § 1956(A)(2)(B)(I)
Under my reading of § 1956(a)(2)(B)(i), I think that even after drawing all reasonable inferences in favor of the government, the jury could not properly have found Carr guilty beyond a reasonable doubt on the charges contained in Count 21 of the indictment. I base my Conclusion on the relevant facts that are set forth in the majority's opinion at pages 4-7, 16-20 (that is, all the facts except the ones pertaining to canine alerts), which I will briefly repeat here.
There is evidence in the record of Carr's repeated other short trips to the Cayman Islands and Colombia, trips which he took in close proximity to the government's exchange of $100 bills for cash in smaller denominations and only after making a stop at the travel agency, and of the passport incident occurring on May 2, 1990. From this amalgamation of evidence, the jury could legitimately have inferred that on several other occasions Carr carried cash from the United States to a foreign country, including Colombia. The evidence also established that Carr was knowingly transporting a large amount of cash ($186,000), that Carr lied to the customs agent about the amount and source of the cash he was transporting, and that he phoned Mrs. Gonzalez after the government confiscated the money to report the loss. These facts allowed the jury to conclude, as it did, that Carr illegally, in violation of the currency reporting laws, knowingly transported cash out of the country.
But I think that all these facts in combination fall shy of establishing that Carr was knowingly a money launderer, as there is no evidence indicating that Carr knew the cash represented the proceeds of drug trafficking.*fn21 Although Carr obtained the cash from (subsequently convicted) drug trafficker Gonzalez, there is no evidence Carr was anything but a business acquaintance of Gonzalez's*fn22 or that he knew of Gonzalez's illicit activities. Specifically, the government introduced no evidence that Carr was aware that the money represented the proceeds of drug trafficking, as opposed to, for example, money illegally skimmed from Gonzalez's two legitimate businesses, or money that Gonzalez was attempting to smuggle to Colombia on behalf of his Colombian friends who were avoiding United States or Colombian taxes or on behalf of illegal immigrants sending their wages to their families in Colombia. None of the probative circumstantial evidence the majority cites -- the frequent trips, the passport incident, the phone conversations -- alone or in combination has the "logical and convincing connection," United States v. Casper, 956 F.2d 416, 422 (3d Cir. 1992), to drug trafficking needed to elevate the drug trafficking theory of what Carr knew over any other theory.
The majority today allows a jury to speculate on the mere basis of a short trip to Colombia with a large amount of cash not only that the carrier is a money launderer of drug trafficking proceeds, but that he knows he is. Especially in a criminal case, however, it is improper to speculate about what the defendant knew. The Constitution requires the government to prove each element of the offense beyond a reasonable doubt, not merely to a reasonable suspicion. In short, the evidence did not establish beyond a reasonable doubt that Carr knew the funds represented proceeds from drug trafficking.
The district Judge did give the jury a charge on willful blindness. See United States v. Caminos, 770 F.2d 361, 365 (3d Cir. 1985) (holding that willful blindness occurs when "the defendant himself was subjectively aware of the high probability of the fact in question"). But Caminos, in which we concluded that the willingness of two individuals to pay over $1,000 to have the defendant deliver a $60 Brazilian wood carving was sufficient to sustain a finding of defendant's willful blindness to the fact that there was something illicit hidden in the carving, is distinguishable. There the charge on willful blindness was quite broad, applying to "willful blindness to the existence of facts which indicated that there is a high probability that some forbidden or illegal substance may be contained therein," id. at 366 (emphasis supplied), whereas here I believe the government had to prove that Carr knew the money represented the proceeds of "specified unlawful activity," see supra part I. Carr could easily have believed merely that he was transporting the cash in violation of the currency reporting laws instead of laundering it, whereas (given the broad wording of the willful blindness charge) no such alternative explanation existed in Caminos.*fn23 Thus it has not been established beyond a reasonable doubt that Carr was subjectively aware of a high probability that the money he was transporting represented the proceeds of drug trafficking.
For the foregoing reasons, I respectfully Dissent from the judgment insofar as it affirms Carr's conviction on Count 21.