[PUBLISH]


              IN THE UNITED STATES COURT OF APPEALS

                       FOR THE ELEVENTH CIRCUIT

                       ________________________

                              No. 96-3556
                       ________________________

                   D.C. Docket No. 94-CR-03138-1 LAC


UNITED STATES OF AMERICA,

                                           Plaintiff-Appellee,

                            versus

KENNETH D. ROSS,
JAMES H. ADAMS,

                                           Defendants-Appellants.

                      __________________________

      Appeals from the United States District Court for the
                   Northern District of Florida
                    __________________________
                          (December 19, 1997)

Before ANDERSON and COX, Circuit Judges, and ALARCÓN*, Senior
Circuit Judge.




____________________
*Honorable Arthur L. Alarcon, Senior U.S. Circuit Judge for the
Ninth Circuit, sitting by designation.




                                 -1-
ALARCÓN, Senior Circuit Judge:

     Kenneth D. Ross and James H. Adams    appeal from the judgment

entered following their conviction for wire fraud, interstate

transportation of money taken by fraud, and conspiracy to commit

mail fraud, wire fraud, interstate transportation of money

obtained by fraud, and money laundering.   The Government

persuaded the jury that Ross and Adams conspired to obtain money

for their personal use and benefit from two financially troubled

insurance companies by falsely representing that the loans were

to be used solely for business purposes.   To disguise their

intent to channel part of the funds for their personal use and

benefit, and to escape detection by state insurance regulators,

Ross and Adams and their co-conspirators created shell

corporations and contrived deceptive paper transactions that had

no economic substance.

     Ross and Adams contend that the evidence presented to the

jury is insufficient to sustain a conviction.   They also argue

that the court erred in its rulings on the admissibility of

evidence and in rejecting certain jury instructions.   Finally,

they assert that the district court miscalculated their sentence

and applied a sentencing guideline that is unconstitutional.    We

discuss each of these contentions, and the facts pertinent

thereto, under separate headings.

     We affirm the judgment of conviction because we conclude the

evidence is sufficient to persuade a rational trier of fact of


                                 -2-
the guilt of the accused of each crime, and we hold that the

court's rulings on the admissibility of evidence and its decision

to reject defense instructions were free from error.

     We vacate the sentence imposed on each defendant and remand

for resentencing because the district court failed to make an

independent finding that it was persuaded beyond a reasonable

doubt that Ross and Adams conspired to commit the offense of

money laundering.
                                 I

                    SUFFICIENCY OF THE EVIDENCE
                          A.   Background

     Ross and Adams contend that the Government failed to present

sufficient evidence that they committed any crime.   They argue

that the Government failed to demonstrate that they defrauded the

policy holders of Midwest Life Insurance Co. ("MWL") Gulf

National Life Insurance Co. ("GNL"), and state insurance

regulators by concealing their intent to divert money for their

personal use that had been loaned to corporations controlled by

them, in reliance on false representations that it would be used

solely for legitimate business purposes -- the purchase of real

property and a merchant vessel suitable for conversion into a

gambling casino.

     The evidence is sufficient to support a conviction if,

"after reviewing the evidence in the light most favorable to the

prosecution, any rational trier of fact could have found the


                                -3-
essential elements of the crime beyond a reasonable doubt."

Jackson v. Virginia, 

, 319 (1979) (emphasis in the

original).   "[A]ll reasonable inferences must be drawn in favor

of supporting the jury's verdict."    United States v. Sawyer, 

, 1501 (11th Cir. 1986) (citing Glasser v. United

States, 

, 80 (1942)).

     Ross began his involvement with GNL in 1989.    At that time,

Ross was the chief executive officer of Charter Bank, a

Mississippi savings and loan association.    GNL was experiencing

financial difficulties because of prior bad investments.    GNL had

a $1,000,000 unsecured note in its loan portfolio issued to it by

a failing savings and loan institution.    GNL had a serious

financial problem:   if the note was not paid, GNL would become

insolvent.   GNL concluded that it should dispose of the unsecured

note by using it to purchase real property.    In December 1989,

GNL purchased the Ensley Shopping Center in Pensacola, Florida

from Charter Bank for $4,000,000.    As payment for the shopping

center, GNL assigned the unsecured $1,000,000 note to Charter

Bank, made a cash payment of $1,000,000, and executed a

$2,000,000 promissory note secured by a mortgage on the shopping

center.   The Ensley Shopping Center was operating at a loss prior

to this transaction.   Ross was forced to resign from Charter Bank

when it was taken over by the Resolution Trust Company in March

1990.

     On March 13, 1990, Bobby Shamburger and Gary Jackson, the

                               -4-
controlling stockholders and officers of Southshore Holding

Company, ("Southshore") opened a bank account in the name of On

Line Investment Company and wired $900,345.33 to that account.

MWL was a subsidiary of Southshore.    On March 30, 1990,

Shamburger and Jackson filed articles of incorporation in Nevada

for On Line Investment, Inc. ("On Line").    Ross was designated

president, secretary, and treasurer of On Line.    He was also the

only person who had the right to withdraw from the On Line

Investment bank account.

     On Line was originally created as a straw party to conceal

the transfer of first mortgage loans worth $875,000 from Public

Investors Life Insurance Co. ("PILICO"), one of the insurance

companies owned by SouthShore to MWL, another SouthShore

subsidiary.     PILICO was insolvent at this time and could not

make payments to its policy holders without an infusion of new

funds.   MWL had been prohibited from purchasing notes from a

related company without the consent of the Nebraska Insurance

Commissioner.    On Line was used to circumvent this restriction.

Ross purchased the notes from PILICO with the money on deposit in

the On Line Investment bank account.    Upon receipt of the notes,

Ross assigned them to MWL.    Ross was paid $20,000 for

participating in this scheme.

     Ross's next transaction with MWL involved the Tops'l Beach

and Racquet Club ("the Club"), which was located in Sandestin,

Florida.   The Club cost $25,000,000 to develop, but it failed to


                                -5-
produce sufficient funds to repay the development loan.    The Club

was taken over by the NCNB Texas National Bank, which first

attempted to sell it for $18,000,000.    After several years

without attracting a purchaser, the bank reduced the asking price

to $5,450,000.

     The Sandestin Golf Resort ("Sandestin") was located next to

the Club.   The Bos Holding Company owned Sandestin.   Peter Bos

was its largest stockholder.   Sandestin went into bankruptcy on

February 7, 1990.   Bos decided that the acquisition of the Club

by the Bos Holding Company would create an attractive golf,

tennis, and beach resort, and reduce overhead and administration

costs through combined management.    An added incentive was the

fact that the Club's property included two undeveloped parcels

that would be suitable for the construction of a hotel or

condominium.   Bos persuaded the Birmingham-Destin Investment

Partners ("BDIP") to join him in negotiating for the purchase of

the Club.   On May 4, 1990, Bos and BDIP formed the Tops'l Holding

Co. Inc. ("THI") for the purpose of purchasing the Club.

     On the same date, THI signed an agreement to purchase the

Club.   THI was required to make an initial payment of $200,000 as

"earnest money."    The purchase and sale agreement provided that,

upon consummation of the sale, the earnest money would be applied

to the purchase price.

     THI was unable to raise the balance of the purchase price

from its investors.   Meanwhile, the BDIP partners concluded that


                                -6-
they did not wish to participate in the purchase of the Club.

Tom Underwood, a partner in BDIP contacted Ronald Dunston, a

Florida real estate broker to seek his assistance in locating

someone who would be interested in purchasing the Club.    Dunston

informed Underwood that Ross was interested in building a

beach-front hotel.   Ross met with Underwood in the spring of 1990

to discuss the proposed purchase of the Club.   Underwood told

Ross the purchase price would be $5,500,000.

     Ross contacted Shamburger, Jackson, and Jeremiah O'Keefe,

the president of GNL and owner of GNL's parent company, to see if

MWL or GNL would lend him the money to purchase the Club.   Each

company expressed an interest in making the loan.   On May 1,

1990, Ross presented MWL with a written request for a commitment

to loan the money required for the purchase of the Club.    On the

same date, MWL issued a commitment letter in which it indicated

it would provide the entire $5,500,000.   Jerry Palmer, MWL's

attorney, testified that MWL did not perform any due diligence to

determine whether the investment was sound prior to issuing the

commitment letter.

     Over the next few months, MWL, Ross, Oscar Jordan, a former

member of the board of directors of Charter Bank and Ross's

attorney, and representatives of Bos and Sandestin conducted

negotiations regarding the structure for the purchase of the

Club.   On June 29, 1990, THI assigned its right to purchase the




                               -7-
Club to On Line1 in exchange for a payment of $200,000 to

reimburse THI for the earnest money it had paid to the owner of

the Club.    At this point in time, Ross was in a position to

purchase the Club because of the $5,500,000 loan commitment he

had received from MWL.

     In the early part of July 1990, Dennis LaFont, MWL's

treasurer, informed Shamburger and Jackson that MWL was going to

have to report a loss of $2,300,000 on its second quarterly

report to the state insurance regulators in Florida and Louisiana

for the period ending June 30, 1990.    LaFont was concerned that a

loss of this magnitude would subject the company to regulatory

action.

     Shamburger and Jackson told LaFont that MWL was going to

sell an "option" and realize a $5,000,000 gain.    The term

"option" was apparently used to refer to the purchase and sale

agreement for the Club that THI had previously assigned to On

Line.    Because On Line did not assign its rights under the

purchase and sale agreement to MWL prior to June 30, 1990, MWL

could not accurately or legally report that it owned the right to

purchase the Club prior to June 30, 1990 and that this interest

was worth $5,000,000.

     To manufacture a paper record that would reflect that MWL

     1
          While Ross was originally the sole stockholder of On
Line, Gerald Taylor, Ross's accountant, testified that Adams
acquired fifty percent of the stock in On Line prior to the end
of July 1990.


                                -8-
had a $5,000,000 asset prior to June 30, 1990, a letter was

prepared on MWL letterhead which stated that MWL and Ross agreed

to the termination of MWL's commitment to lend Ross $5,500,000.

On August 6, 1990, Ross, acting as president of On Line, assigned

its rights under the purchase and sale agreement to MWL.   No

consideration was paid by MWL for the assignment.   On the same

date, MWL assigned its rights under the purchase and sales

agreement to L'Spot for $5,000,000. Ross was president and

director of L'Spot.   Adams was also a director.   Ross executed a

promissory note on behalf of L'Spot in the amount of $5,000,000

to MWL in exchange for MWL's rights under the purchase and sale

agreement.   In short, Ross, acting as the president of On Line,

assigned its right to purchase the Club to MWL for no

consideration and then bought it back, as president of L'Spot,

for $5,000,000.   Shamburger and Jackson instructed LaFont to

reflect the $5,000,000 promissory note MWL received from L'Spot

on August 6, 1990 as a corporate asset in its second quarter

report for the period ending June 30, 1990.

     Meanwhile, on July 19, 1990, Adams obtained a commitment for

a loan of $1,700,000 from MWL for the purchase of a merchant

vessel large enough to serve as a floating gambling casino.     Also

in July 1990, Dunston, Ross, Adams, and O'Keefe incorporated a

company named Casino Beach for the purpose of developing a casino

at Diamond Head, Mississippi.

     On July 31, 1990, Ross, Adams, Dunston, Shamburger, Jackson


                                -9-
Bos, and others met at Sandestin to determine how to accomplish

the sale of the Club to Ross and Adams.   In preparation for the

closing of the sale of the Club, Ross and Jordan created a number

of corporations to receive title to specific portions of the Club

property.   These corporations included Over Look Corp. ("Over

Look"), Technology Building, Inc. ("Technology Building"), Sand

Tops'l Corp. ("Sand Tops'l"), Tops'l Management, Inc. ("TMI"),

and Tops'l Beach Property, Inc. ("Tops'l Beach").   Ross served as

president and director for TMI and Over Look, secretary and

director for Technology Building, and director for Sand Tops'l.

Adams was named as a director of TMI.   Because the structure of

the purchase and sale proved to be more difficult than

anticipated, the closing of the transaction did not occur until

August 6 and 7.

     The final agreement was complicated.   Pursuant to an

agreement titled Partial Assignment of Contract Rights ("Partial

Assignment"), the Club property was divided into four general

classes of property:   (1) condominiums; (2) the amenities

including inter alia a retail/office building, restaurant, tennis

courts, pool house, and all personal property located in or used

in connection with the various facilities, and all attendant

contract rights, licenses and permits; (3) the developer rights;

and (4) the undeveloped parcels 628 and 630.   L'Spot transferred

its right to acquire the condominium property to Over Look,

Technology Building, and Sand Tops'l.   L'Spot transferred its


                               -10-
right to acquire, the amenities, the developer rights, and the

undeveloped parcels 628 and 630 to TMI.

     In exchange for the transfer of the acquisition rights, Over

Look, Technology Building, and Sand Tops'l each agreed to pay

approximately one third of the purchase price for the Club.     MWL

loaned $2,000,000 to each of the three corporations so that they

could purchase their share of the Club pursuant to the Partial

Assignment and use the balance for working capital.   The terms of

the three loans were identical.   They were secured by a mortgage

on the portion of the property purchased by each corporation.

Each loan also had as collateral a portion of the property rights

transferred to TMI under the Partial Assignment.2

     Thus, payment for the $6,000,000 loaned by MWL for the

acquisition of the Club was assumed by Over Look, Technology

Building, and Sand Tops'l.   TMI assumed L'Spot's responsibility

to pay $5,000,000 to MWL for the right to purchase the Club.    As

further consideration, TMI granted MWL a seven year option to

acquire a two-thirds interest in parcels 628 and 630 for one

dollar.   The Partial Assignment states: "The . . . Option may be


     2
          For example, L'Spot's assignment to Technology Building
set forth in the Partial Assignment provides in relevant part as
follows:
     Collateral - first mortgage lien on the Technology Assets as
     well as a lien to be granted by [TMI] on [TMI's] development
     rights, general intangibles and management agreement
     relating to income properties constituting Technology
     Assets.
(Emphasis added).


                               -11-
exercised at any time by providing written notice thereof to

[TMI] within seven (7) years from the date hereof and by paying,

at the closing of such exercise, the sum of One Dollar ($1.00) as

the option price thereof."   L'Spot received a similar seven year

option to purchase a one third interest in parcels 628 and 630.

TMI executed a mortgage and security agreement to secure payment

of the $5,000,000 promissory note, which included property that

was already pledged as security for the loans totaling $6,000,000

for the purchase of the Club.3 Parcels 628 and 630 were not

included in the mortgage agreements.

     As a result of these negotiations, the Club property, which

was purchased for $5,450,000, was divided into several portions

and used to secure promissory notes totaling $11,000,000.

Parcels 628 and 630, however, were not included in the property

subject to foreclosure upon default.   In addition, these valuable

properties could be purchased by MWL and L'Spot for an option

price that totalled two dollars.   Furthermore, notwithstanding

the fact that the purchase for the Club was $5,450,000, the four

corporations signed promissory notes and mortgage agreements

totaling $11,000,000:   $6,000,000 for the purchase money for the

Club and working capital, and $5,000,000 for the assignment of


     3
          L'Spot's assignment to TMI set forth in the Partial
Assignment provides in relevant part, "[TMI] shall grant to
Lender a first mortgage lien upon and a security interest in all
of the operating properties, the General Intangibles and
Developer's Rights." (Emphasis added).


                               -12-
MWL's right to purchase the Club.     As discussed above, the

acquisition and contemporaneous sale by MWL of On Line's right to

purchase the Club was done for the sole purpose of making it

appear that MWL had an asset worth $5,000,000 on its June 30,

1990 statement to the regulators.

     Immediately following the sale, Ross opened a bank account

for TMI in the AmSouth Bank of Florida ("the TMI account"). He

also created a cash management account for L'Spot with Merrill

Lynch Gulfpost/Biloxi ("the L'Spot account").     After the purchase

of the Club, and the payment of closing costs, $205,000 remained

from the money MWL loaned to the three corporations.     Shamburger,

acting on behalf of MWL, agreed to deposit the $205,000 in the

TMI account for "operating expenses."

     On August 31, 1990, a condominium owned by the Club was sold

by TMI for $250,844.77.   The condominium was part of the security

for the purchase price loan.   Instead of using the proceeds of

the sale to reduce the outstanding balance on the purchase price

loan, Ross, with the consent of Shamburger and Jackson, deposited

the money in the TMI account as "operating expenses."     Later that

day, Ross transferred $200,000 from the TMI account to the L'Spot

account.   On September 1, 1990, Ross transferred an additional

$245,000 to the L'Spot account.

     On September 26, 1990, Ross withdrew $150,000 from the

L'Spot account and deposited it in his separate personal account

at Merrill Lynch.   On the same date, Ross executed six checks on


                               -13-
his personal Merrill Lynch account payable to himself for a total

of $119,000.   Two of these checks totalling $96,500 were endorsed

by Ross and deposited in Adams' account at Merchants and Marine

Bank.   On October 2 and October 19, 1990, Ross drew two more

checks totaling $32,600 on his personal Merrill Lynch account and

deposited them into his account at Jefferson Bank.

     In early October 1990, Ross, acting on behalf of TMI, asked

GNL to approve a $3,000,000 "construction/operating" loan for the

Club.   GNL was in serious financial trouble at this time.    It was

desirous of disposing of the Ensley Shopping Center.   O'Keefe,

president of GNL, informed Ross and Adams that he would approve a

loan to TMI of $3,000,000 if they would purchase the Ensley

Shopping Center from GNL.   To satisfy O'Keefe's counter proposal,

Adams caused articles of incorporation to be filed for the

Northgate Corporation of Sandestin ("Northgate").    Adams was the

only director of Northgate.   Dunston was designated its president

and secretary.   Its sole purpose was to acquire the shopping

center.

     GNL retained Florida attorneys Richard Powell and Fred

Estergren to handle the loan to TMI and the sale of the Ensley

Shopping Center to Northgate.   By this time, the Resolution Trust

Corporation had taken control of Charter Bank.   Charter Bank held

a mortgage on the Ensley Shopping Center as security for its

$2,000,000 loan to MWL.   Powell became concerned regarding

whether it was necessary to inform Charter Bank that GNL was


                                -14-
planning to sell the Ensley Shopping Center to another party

because Charter Bank held the mortgage on this property.    Michael

Cavanaugh, GNL's attorney, sent a facsimile to Estergren on

October 19, 1990, informing him that the mortgage did not contain

a due-on-sale clause.   Accordingly, Estergren did not notify the

Resolution Trust Corporation or Charter Bank of the proposed sale

of the Ensley Shopping Center to Northgate.

     Dunston, Ross, Cavanaugh, Jordan, Estergren, and Powell met

on October 30, 1990 to consummate GNL's loan of $3,000,000 to

TMI, and the sale of the Ensley Shopping Center by GNL to

Northgate.    GNL sold the Ensley Shopping Center to Northgate for

$4,100,000.   As payment to GNL for the acquisition of the Ensley

Shopping Center, Northgate assumed GNL's obligation to pay

Charter Bank $1,972,650.29, which was owing on the promissory

note executed by GNL in favor of Charter Bank.   Northgate also

executed a promissory note for $1,127,349.31, secured by all of

Northgate's outstanding stock,4 and a second purchase money

mortgage.    In addition, Northgate promised to pay GNL $1,000,000

in cash, no later than October 30, 1990.   The agreement to

purchase the Ensley Shopping Center was signed by Adams on behalf

of Northgate.

     On the same date, GNL agreed to loan TMI $3,000,000 based on

Ross's representation that the money would be used for the Club's

     4
          The record shows that Northgate's stock had no value at
this time.


                                -15-
operating and maintenance expenses.      One million five hundred

thousand dollars of the loan was secured by mortgages on parcels

628 and 630, which had been previously left free of debt.        The

money was disbursed as follows:    First, GNL set up a reserve fund

for TMI of $1,000,000.    Second, GNL endorsed five checks to TMI

from different sources totalling $1,040,000.      These checks were

deposited in the TMI account.    Third, GNL also delivered a check

for $1,000,000 to TMI drawn on its account at the People's Bank

in Biloxi, Mississippi.    On October 30, 1990, the date this check

was issued by GNL, GNL had a total of $41,500.64 in its account

at the People's Bank.    On the same date, TMI endorsed the

$1,000.000 check to Northgate.    Northgate then endorsed the same

check back to GNL.   Thus, Northgate ostensibly met its obligation

to pay $1,000,000 in cash to GNL as partial payment for the

purchase of the Ensley Shopping Center by presenting to GNL the

same check that GNL had issued to TMI with insufficient funds.

As a result of this sleight of hand, GNL's bank account showed a

credit of $1,000,000 on November 1, 1990.

     On October 30, 1990, $1,000,000 was transferred by wire from

TMI account to the L'Spot account.      Immediately after this

transfer, Ross issued several checks on the L'Spot account.        A

check in the amount of $499,999.99 was issued to Adams.

Shamburger received a check for $333,333.33.      Ross also made out

a check in the amount of $166,666.66 to himself.      Adams,

Shamburger and Ross deposited the checks into their personal bank


                                 -16-
accounts.   Jane Masholie, a GNL employee, testified that she

typed these checks at Ross's direction during the closing of

GNL's loan to TMI.

     Ross became a consultant for GNL in January, 1991.    On

January 18 and January 22, 1991, Ross issued four checks to TMI

totaling $550,000 from the $1,000,000 TMI reserve fund, which was

created as part of GNL's loan to TMI.    Ross then endorsed each of

the checks as president of TMI for deposit in the L'Spot account.

On January 22, Ross issued a check to L'Spot in the amount of

$100,000, a check for $183,333.33 to Jackson, $183,333.33 to

Shamburger, $41,666.50 to Adams, and $41,666.50 to himself.     The

$100,000 check payable to L'Spot was used to acquire a

certificate of deposit.   It was redeemed, endorsed by Ross, and

deposited in a bank account opened in the name of Casino Beach.

     In late January, 1991, Ross instructed Ms. Masholie to draft

several promissory notes payable to the order of L'Spot and to

back date them so as to make it appear that they were executed on

the dates that checks had been issued on the L'Spot account.     A

$150,000 promissory note dated September 26, 1990 was signed by

Ross, which provided that he would pay L'Spot interest at a rate

of prime rate floating per annum until paid and payable on

demand.   A promissory note for $166,666.66, dated October 10,

1990, was also signed by Ross.    Ms. Masholie testified that she

made a typographical error in using October 10, 1990 as the date

the note was executed; Ross had instructed her to use October 30,


                                 -17-
1990.   Another note dated October 10, 1990 in the amount of

$166,666.66 was signed by Adams.    Shamburger signed a promissory

note for $333,333.33, which was backdated to October 30, 1990.       A

note for the same amount, also backdated to October 30, 1990, was

prepared for Jackson, however, it was not signed.

     Ms. Masholie prepared a second set of promissory notes at

Ross's direction in late January 1991 .    Each was dated January

24, 1991.    She was told that the amounts should match earlier

disbursements from the L'Spot account.    Jackson and Shamburger

each signed notes in the amount of $183,333.33.    Ross and Adams

each signed notes in the amount of $41,666.50.

     Ms. Masholie also testified that she drafted a promissory

note from Northgate to L'Spot in the amount of $1,000,000.     The

note bears the date October 30, 1990.    It was not prepared by Ms.

Masholie until approximately one year after October 30, 1990.

     On May 14, 1991, Dunston, acting on behalf of TMI, requested

that MWL waive the restrictions on the use of the money loaned to

TMI on August 6, 1990 for the purchase of the Club.    The letter

reads as follows:

            Please accept this letter as a request for
            written waiver of the loan covenants
            specified below which are contained in the
            loan agreement between TOPS'L Management,
            Inc. and Midwest Life Insurance Company dated
            August 6, 1990. This waiver will serve to




                                -18-
          document your prior verbal waiver of these
          covenants.

          Section IV, Negative Covenants, Item E,
          "Loans to Others and Investments" prohibits
          transaction with affiliates unless approved
          in advance by the Payee (Midwest Life). At
          December 31, 1990, TOPS'L Management has
          outstanding advances to L'Spot Corporation,
          its parent company, of $2,195,000. In
          addition, TOPS'L Management has obligations
          totaling approximately $802,222 due to Sand
          TOPS'L Corp, Overlook Corporation and
          Technology Building, Inc., affiliates,
          resulting from the purchase of TOPS'L Beach
          and Racquet Club. These transactions appear
          to be violations of the above covenants.

          Please indicate your acceptance of the waiver
          request by signing below. Thank you for your
          cooperation and assistance.


The waiver request was granted on June 3, 1991.

     Ross received a total of $240,933.16 for his personal

benefit from the money loaned to TMI by MWL and GNL for the

purchase and operation of the Club.     Adams received $660,666.49.

As of the time of trial, neither of them had paid any taxes on

these amounts, nor had they repaid the amounts reflected on the

backdated promissory notes.

     Ross and Adams assert that the Government failed to prove

that they committed any crime.    They argue that the evidence

shows, instead, that they were involved in complex, but lawful

financial transactions.




                                 -19-
                           B.   Analysis

                       COUNT I -- CONSPIRACY

     We begin our analysis of the sufficiency of the evidence in

the conspiracy count ("Count I") by examining the theory of the

prosecution in alleging that Ross and Adams were guilty of

conspiracy.   "This Court cannot affirm a criminal conviction

based on a theory not contained in the indictment or not

presented to the jury."   United States v. Elkins, 

,

782 (11th Cir. 1989), cert. denied, 

(1990)
(citation omitted).

     Count I alleged a conspiracy among Ross, Adams, Jordan,

Dunston, and others to commit the substantive offenses of mail

fraud, wire fraud, interstate transportation of property taken by

fraud, and money laundering in order to further a scheme to

defraud MWL, GNL, Charter Bank, and the states of Mississippi,

Florida, and Louisiana.   The indictment alleged that the

defendants' fraudulent scheme included the following objects:

     It was the defendants' objective to fraudulently divert loan
     funds from their intended purposes and thereafter convert
     these stolen funds to the use and benefit of the defendants,
     to include an investment in a Mississippi project to develop
     a gambling casino, without disclosing to the regulatory
     agencies the fact that the funds had been diverted.

     It was further the defendants' objective to create a scheme
     to defraud the people of the States of Florida, Louisiana,
     and Mississippi, and Charter Bank, by using the funds
     illegally obtained from Midwest Life Insurance Company
     (Midwest) and Gulf National Life Insurance Company (Gulf
     National Life) to invest in speculative investments which
     normally would not have been approved as admissible assets
     for these companies by the Insurance Commissions of these

                                -20-
     various states without properly disclosing the close and
     affiliated relationships between the true borrowers and the
     principal lending officials for these companies.


     Thus, the Government's theory of prosecution was that Ross

and Adams conspired to induce two state regulated insurance

companies to loan money by fraudulently representing that it was

solely to be used for a legitimate business purpose, without

disclosing their intent to divert some of these funds for their

personal use and benefit.   The indictment also alleges that a

further object of the conspirators was to falsify insurance

company records to cover up their fraud so as to avoid detection

by state insurance regulators.

     Having identified the government's theory of prosecution,

we must next discuss the sufficiency of the evidence of a

conspiracy.   Participation in a conspiracy to commit a crime may

be inferred from circumstantial evidence.   See United States v.

Delgado, 

, 1500 (11th Cir. 1990) cert. denied, 

(1991).   "[C]onspiracy to commit a particular

substantive offense cannot exist without at least the degree of
criminal intent necessary for the substantive offense itself."

Ingram v. United States, 

, 678 (1959) (internal

quotation marks and citation omitted) (alteration in original).

To establish a conspiracy to commit wire fraud, the government

must prove (1) an agreement between two or more persons (2) to

execute a scheme to defraud and (3) the use of either the mails



                                 -21-
or wire service in furtherance of the scheme.     See United States

v. Simon, 

, 1469 (11th Cir. 1988).   Proof of

specific intent to use the mails or wire service is not required

to show conspiracy to commit mail or wire fraud.    See United

States v. Massey, 

, 1001-02 (5th Cir. 1987).       Rather,

"[t]he government's burden . . . is to demonstrate beyond a

reasonable doubt that [the defendants] agreed to engage in a

scheme to defraud in which they contemplated that the mails [or

wire service] would likely be used."   

     There is no dispute regarding the fact that Ross and Adams

entered into an agreement with MWL and GNL through their

corporate alter egos to obtain loans for business purposes that

were subsequently diverted to their personal use and benefit.

Ross and Adams argue that they committed no crime because there

was no restriction on the use of the GNL loan and MWL expressly

waived all earlier violations of the loan agreement on June 3,

1991.

     In his opening brief, Adams argues that the Government's

assertion that there were "intended purposes" for the loans made

by GNL and MWL to the corporations controlled by Ross and Adams

is inaccurate.   The record is to the contrary.

     The Government presented evidence that TMI obtained a

$3,000,000 loan from GNL on October 30, 1990 for the specific

purpose of paying for the cost of repairs and the operation of

the Club.   The purpose of MWL's loan to L'Spot is clearly

                               -22-
reflected in the commitment letter executed by Jackson on May 1,

1990, as chairman of the board of MWL.   The commitment letter

states in pertinent part: "Midwest Life shall lend Five Million

Five Hundred Thousand ($5,500,000.00) Dollars to be used to

purchase Tops'l Beach and Racquet Club residential/recreational

development."   The record shows that on August 6, 1990, Over

Look, Technology Building, and Sand Tops'L received loans from

MWL totalling $6,000,000 for the purchase of the Club and working

capital.

     Alternatively, Adams maintains that, "even if there was an

agreement about the `intended purposes' of the loan that was

breached by Adams or others, the remedy is civil litigation.

Adams asserts that [t]here is nothing in the law stating that

this sort of thing would be a criminal felony."   Adams Br. at 16.

To support this proposition, Adams refers us to United States v.

Kristofic, 

(7th Cir. 1988).

     A careful reading of the Kristofic decision will readily

demonstrate that Adams's reliance on it in his challenge to the

sufficiency of the evidence is misplaced.   Kristofic was

convicted of converting to her use "a thing of value of the

United States" in violation of 18 U.S.C. § 641.   

The evidence produced at Kristofic's trial demonstrated that she

received a loan of $60,000 from the Small Business Administration

for leasehold improvements, new equipment, and capital for a

restaurant she had opened the previous year in Chicago.


                               -23-
Kristofic certified that she would use the loan proceeds

according to the provisions of the loan agreement.    See 

  Less than a month after she received the loan, Kristofic

closed the restaurant.   None of the funds were put to their

intended use.    Instead, she paid pre-existing debts, made a down

payment on a car, made a personal loan of $12,000 to a friend,

invested money in a bar in Texas, and kept $3,000 in cash.       See

Circuit reversed the judgment in Kristofic.      The

court held that the Government failed to prove that the defendant

converted a thing of value of the United States.     The court

reasoned that "loan proceeds do not remain the property of the

lender."   

misapplication of the funds

was not a conversion because the government no longer held a

property interest in them."   

  The Seventh Circuit's

opinion in Kristofic is not applicable to any of the issues in

this case because Ross and Adams were not prosecuted for

conversion.   They were prosecuted for fraudulently representing

to MWL and GNL that their corporations intended to use the loan

proceeds for specific business purposes without disclosing their

intention to divert some of the money for their personal benefit.

Thus, unlike the situation in Kristofic, the crimes committed by
Ross and Adams were completed at the time they made fraudulent

representations and failed to disclose material facts in order to

induce MWL and GNL to make the loans.

      Following oral argument, Adams filed a letter with the clerk


                                -24-
of this court in which he advances an additional argument based

on his reading of the Fifth Circuit's opinion in United States v.

Grossman, 

(5th Cir. 1997).    In Grossman, the

defendant was convicted of conspiracy to commit wire fraud and

eleven counts of wire fraud.    Grossman obtained several loans

from a savings and loan association in order to purchase a real

estate development known as "the Oaks."    The loans contained the

following language:   "Borrower represents and warrants lender

that the loan will be used by borrower for its business and

commercial purposes and not for personal, family, household or

agricultural use."    

      The Government contended at trial that Grossman violated

this clause because he used the loan proceeds for business

purposes unrelated to the business entity named on the loan.      See

that he was not guilty of fraudulently using

the loan proceeds because the language in the clause allowed him

to use it for business purposes related to any of his real estate

holdings.   See 

   The Fifth Circuit held that

Grossman's interpretation of the clause was reasonable, although

not the only possible interpretation, and stated that "the

alleged breach of this clause does not support a finding of

fraudulent intent on the part of Michael Grossman."    

that appellants' interpretation of the loan

agreements that they could use the loan proceeds for their

personal benefit was a reasonable interpretation of the loan

                                 -25-
agreements.   This argument finds no support in the record.    The

intended purpose for the loans made by MWL and GNL is free from

any ambiguity.   MWL loaned three corporations $6,000,000 for the

purchase of the Club and working capital.   GNL loaned TMI

$3,000,000 to pay for repairs and operating expenses of the Club.

MWL and GNL did not loan any money to Ross or Adams, nor did

either company authorize the three corporations or TMI to make a

personal loan to Ross or Adams.

     Appellants appear to argue that the failure of GNL expressly

to prohibit the diversion of loan funds obtained for enumerated

business purposes justifies their failure to disclose that they

intended to use the money for their personal benefit.   Appellants

have not cited any authority for this bold proposition.   We

reject it as frivolous.

     Appellants concede that the diversion for their personal

benefit of money loaned by MWL for the purchase of the Club

violated restrictions contained in the written loan agreement.

They maintain, however, that the subsequent waiver of the

violation of the loan agreement immunizes them from prosecution

for their conduct and the failure to disclose their fraudulent

intent in applying for the loan.   This argument ignores the fact

that the fraud was accomplished and the money was diverted

approximately eight months before the waiver was obtained.

Ratification or condonation is not a defense for past criminal

behavior.   See Gilbert v. United States, 

, 287 (9th


                               -26-
Cir. 1966); 1 Charles E. Torcia, Wharton's Criminal Law § 45

(15th ed. 1993).

       The evidence, viewed in the light most favorable to the

Government, was sufficient to persuade a rational juror beyond a

reasonable doubt that Ross and Adams conspired to induce GNL and

MWL to loan money for business investments without disclosing

their intent to divert funds for their personal use and benefit.

This conduct threatened the interests of the policy holders and

deliberately interfered with the ability of the state insurance

commissioners to regulate the activities of these companies and

deter a use of their assets that would jeopardize their solvency.

       The record shows that in March 1990 Ross entered into an

agreement with Shamburger and Jackson to disguise from insurance

regulators the purchase by MWL of first mortgage loans from a

related company.    To carry out this deception, On Line, a shell

corporation, was created.    Ross, as the president of On Line,

purchased the first mortgage loans from a bank account opened and

funded by Shamburger and Jackson, and then assigned the loans to

MWL.    Ross was paid $20,000 for writing a check, in his capacity

as the president of On Line, to purchase the loans and executing

an assignment of the loans to MWL.

       A rational juror could also infer from the evidence that

Ross and Adams conspired with Shamburger and Jackson to conceal

from state insurance regulators the fact that MWL had a deficit

of $2,300,000 for the second quarter of 1990.    This deception was

                                -27-
accomplished by using On Line as a conduit to effect transfer of

THI's right to purchase the Club to MWL.    First, THI assigned the

Club purchase agreement to On Line.    Then, Ross, as president of

On Line, assigned the Club purchase agreement to MWL for no

consideration.   MWL, in turn, assigned the Club purchase

agreement to L'Spot.   Ross, as president of L'Spot, executed a

$5,000,000 promissory note in exchange for MWL's interest in the

Club purchase agreement.   L'Spot's promissory note was entered as

a $5,000,000 asset in MWL's second quarterly report even though

it was not executed until August 6, 1990, approximately five

weeks after the second quarter had ended.   Thus, instead of

reporting a $2,300,000 loss, this sham transaction permitted MWL

to report a profit of $2,700,000.

     Ross and Adams participated in similar trickery to disguise

GNL's fragile financial condition while at the same time

negotiating a $3,000,000 loan for the Club's construction and

operating expenses.    As discussed above, GNL promised to loan TMI

$3,000,000 if Ross and Adams would purchase the Ensley Shopping

Center for $4,100,000.   Ross and Adams created Northgate for this

purpose.   Adams was its sole director.   In payment for the Ensley

Shopping Center, Northgate assumed GNL's obligation to pay the

remaining balance of $1,972,650.69 owed by GNL to Charter Bank

for its 1989 acquisition of the Ensley Shopping Center, executed

a promissory note for $1,127,349.31 in favor of GNL, and endorsed

and handed to GNL's representative the same $1,000,000 check that


                                -28-
GNL had issued to TMI as part of GNL's $3,000,000 loan to TMI.

This transaction created the illusion that GNL sold a shopping

center for $4,100,000 that it had purchased the previous year for

$4,000,000 from Charter Bank.   In fact, GNL received a worthless

check with a face value of $1,000,000; a promissory note for

$1,127,349.31 secured by all of Northgate's outstanding stock,

which had no value on October 30, 1990; and a second mortgage on

the Ensley Shopping Center.   Based on all the evidence presented

by the Government concerning the conduct of Ross and Adams, a

rational juror could be persuaded beyond a reasonable doubt that

Ross and Adams agreed to the purchase of Ensley Shopping Center

to assist O'Keefe in his efforts to mask GNL's perilous financial

condition from policy holders and insurance company regulators

and to strip GNL of approximately $1,000,000 for their personal

use and benefit.

     The evidence outlined above demonstrates that Ross and Adams

perpetrated a fraud by withholding material facts regarding their

intention to use for their personal use and benefit money loaned

for business purposes.   The evidence is also sufficient to

demonstrate that a wire transmission was used to accomplish their

fraudulent scheme to withhold from the Charter Bank and the

Resolution Trust Corporation material facts that may have alerted

them to take action to prevent use of the Ensley Shopping Center

as a pawn in their scheme to obtain $1,000,000 from GNL for their

personal use and benefit.   We later discuss the sufficiency of


                                -29-
the evidence to commit the substantive offense of wire fraud.

     Ross and Adams also contend that the evidence is

insufficient to persuade a rational juror that the defendants

conspired to commit the offense of interstate transportation of

money taken by fraud.    We discuss below appellants' challenge to

the sufficiency of the evidence to support their conviction of

the substantive offense of interstate transportation of money

taken by fraud.    Our determination that the evidence was

sufficient to satisfy a rational juror beyond a reasonable doubt

that Ross and Adams committed the crime of interstate

transportation of money by fraud answers their contention that

the evidence was insufficient that this crime was an object of

their conspiracy.

     We are persuaded that the evidence was sufficient to

persuade a rational trier of fact beyond a reasonable doubt that

Ross and Adams conspired to commit the crimes of wire fraud and

interstate transportation of money taken by fraud.    We need not

consider whether the evidence is sufficient to support a judgment

of conviction for conspiring to commit the crime of money

laundering.    A guilty verdict in a multi-object conspiracy will

be upheld if    the evidence is sufficient to support a conviction

of any of the alleged objects.    See Griffin v. United States, 

, 56-60 (1991).




                                 -30-
                     COUNT VI -- WIRE FRAUD

     Ross and Adams also challenge the sufficiency of the

evidence that they committed the crime of wire fraud as alleged

in Count VI of the indictment.    They argue that the facsimile

from Michael Cavanaugh, GNL's legal counsel, to Fred Estergren,

who represented GNL in closing the Ensley Shopping Center sale to

Northgate, is insufficient to constitute wire fraud because there

is no evidence in the record that it was sent in furtherance of a

fraudulent scheme.

     Count VI reads as follows:

     1. From on or about November 1, 1989 and continuously
     thereafter up to and including the date of this indictment,
     the defendants, KENNETH D. ROSS, JAMES H. ADAMS, OSCAR
     JORDAN, and RONALD DUNSTON, along with others, knowingly and
     willfully devised a scheme to defraud, or for obtaining
     money or property by means of false pretenses and
representations or promises well knowing at the time that the
pretenses, representations, and promises would be and were false
when made, and which scheme and artifice so devised and intended
to be devised by the defendants was in substance as described in
Count I of this indictment, which description is expressly
     incorporated herein and made a part hereof as if set forth
     word by word, line by line.

     2. On or about October 19, 1990, in the Northern District
     of Florida and elsewhere, the defendants, KENNETH D.
     ROSS, JAMES H. ADAMS, OSCAR JORDAN, and RONALD DUNSTON,
     for the purpose of execution of the aforementioned
     scheme and attempting to do so, in furtherance thereof,
     did knowingly transport and cause to be transmitted by
     wire in interstate commerce between the State of
     Mississippi and Destin, Florida, a letter from Michael
     Cavanaugh to Fred Estergren regarding the Due on sale
     clause contained in the Charter Bank mortgage,
     along with this mortgage and promissory note.


     In order to establish a violation of § 1343, the government



                                 -31-
must prove beyond a reasonable doubt that a defendant "(1)

intentionally participated in a scheme to defraud; and (2) used

wire communications to further that scheme."    United States v.

Brown, 

, 1221 (11th Cir. 1994).    Further, "[e]ach

party to a continuing conspiracy may be vicariously liable for

substantive criminal offenses committed by a co-conspirator

during the course and in furtherance of the conspiracy,

notwithstanding the party's non-participation in the offense or

lack of knowledge thereof."   United States v. Mothersill, 

, 1218 (11th Cir.), cert. denied sub nom.     ___ U.S. ___, 

, 

. 416 (1996).   "[A] court need not

assess the individual culpability of a particular conspirator

provided the `substantive crime was a reasonably foreseeable

consequence of the conspiracy.'"   

States v.

Alvarez, 

, 849-50 (11th Cir. 1985).

     A rational juror could infer beyond a reasonable doubt that

Ross and Adams intentionally participated in a scheme to defraud

the policy holders of GNL by falsely representing that TMI

required a loan of $3,000,000 to fund operational expenses

without disclosing that their true intent was to divert

approximately $1,000,000 for their personal use and benefit on

the same date the business loan to TMI was consummated.    To carry

out their scheme, Ross and Adams agreed to purchase the Ensley

Shopping Center from GNL.   Because Ross was the chief executive

officer of Charter Bank in 1989 when GNL purchased the Ensley

                               -32-
Shopping Center from Charter Bank, he was aware that Charter Bank

held a mortgage on that property.       Ross was also aware that

Charter Bank had failed in March 1990 and had been taken over by

the Resolution Trust Company.    Nevertheless, he and Adams did not

notify Charter Bank or the Resolution Trust Corporation that GNL

intended to convey the Ensley Shopping Center to Northgate,

Adams's alter ego corporation.

     Ross retained Florida attorneys Richard Powell and Fred

Estergren to close the loan to TMI.       Powell and Estergren

discovered in their title search that Charter Bank held a

mortgage on the Ensley Shopping Center.       Estergren drafted a

document entitled "Consent to Sale" for Charter Bank's signature.

It provided that for a consideration of $10, Charter Bank

consented to the sale of the Ensley Shopping Center to Northgate.

The proposed agreement also noted that GNL would remain liable to

Charter Bank pursuant to its promissory note and the mortgage.

Estergren consulted with Michael F. Cavanaugh, a GNL board member

and its chief counsel, for his opinion regarding whether Charter

Bank should be notified of the proposed sale of the Ensley

Shopping Center because of the fact that it held the first

mortgage on that property.   Cavanaugh sent a facsimile memorandum

from his Mississippi office, which stated:       "I am forwarding the

current Mortgage on the Ensley Property.       I do not find a `due on

sale provision'.   Under Florida law could we sell the property as

an Assumption and not trigger the due on sale."


                                 -33-
     Estergren testified that Cavanaugh's memorandum persuaded

him that he should "forget" about providing Charter Bank or the

Resolution Trust Corporation with notice of the proposed sale of

the Ensley Shopping Center.    Accordingly, the Consent to Sale

document was not sent to Charter Bank.

     Ross and Adams argue that Cavanaugh's fax cannot be the

basis for a conviction under § 1343 because its contents were not

fraudulent or untrue.    The Supreme Court, however, has rejected

an identical argument in the mail fraud context.     In Schmuck v.

United States, 

(1989), the Court stated that even

"`innocent' mailings--ones that contain no false information--may

supply the mailing element."    

(quoting Parr v. United

States, 

, 390 (1960)).     The defendants' conviction

under the wire fraud statute is subject to the same analysis.

See Carpenter v. United States, 

, 25 n.6 (1987) ("The

mail and wire fraud statutes share the same language in relevant

part, and accordingly we apply the same analysis to both sets of

offenses here.").    Therefore, the fact that the facsimile

memorandum may have been correct that the Charter Bank mortgage

did not have a due-on-sale clause did not prevent the jury from

concluding that Cavanaugh's fax to Estergren furthered the

fraudulent scheme.     Had Charter Bank or the Resolution Trust

Corporation been notified of the proposed sale of Ensley Shopping

Center, they may have been able to take action to prevent it.

     Ross and Adams also argue that they were not aware that

                                -34-
Cavanaugh had wired the memorandum to Powell and Estergren.

"Where one does an act with knowledge that the use of the

[interstate wires] will follow in the ordinary course of

business, or where such use can reasonably be foreseen, even

though not actually intended, then he `causes' the [interstate

wires] to be used."     Pereira v. United States, 

, 8-9

(1954).   Ross and Adams incorporated Northgate in Florida.         GNL

was a Mississippi corporation.    It was clearly foreseeable that a

transaction between corporations in two states would involve

interstate wire transfers.

     Finally, Ross urges us to reverse his wire fraud conviction

because "the government failed to prove that the actions of Mr.

Ross and the other named defendants caused any defrauding in that

a victim lost any money or property."      Ross Br. at 19.   He

further states there was "absolutely no evidence that Charter

Bank lost anything as a result of the wire fraud or the `Ensley'

real estate transaction between Gulf National Life Ins. Co. and

Northgate Corporation of Sandestin, Inc."      

   This

argument lacks merit.    Punishment under the wire fraud statute is

not limited to successful schemes.      "A scheme to defraud need not

be carried out to constitute a violation of the mail and wire

fraud statutes.   These statutes punish unexecuted, as well as

executed, schemes."   Pelletier v. Zweifel, 

, 1498

(11th Cir. 1991); see United States v. Patterson, 

,
1041 (5th Cir. 1976) ("[t]here is no necessity for the government


                                 -35-
to prove actual financial loss").       The Government merely needs to

show that the accused intended to defraud his victim and that his

or her communications were "`reasonably calculated to deceive

persons of ordinary prudence and comprehension.'"      

(quoting United States v. Bruce, 

,

1229 (5th Cir. 1973)).   The record demonstrates that the

Government satisfied this burden as to both defendants.

     We conclude from our review of the evidence that it is

sufficient to persuade a rational juror beyond a reasonable doubt

that Ross and Adams knowingly caused a facsimile memorandum to be

transmitted by wire between the states of Mississippi and Florida

to further their scheme to defraud GNL's policy holders by

diverting money loaned for business purposes for their personal

use without alerting the Resolution Trust Corporation that the

Ensley Shopping Center was being sold to a straw corporation

controlled by Adams.

    COUNT VII -- INTERSTATE TRANSPORTATION OF STOLEN PROPERTY

     Ross and Adams also challenge the sufficiency of the

evidence to support their conviction of transferring more than

$5,000 in interstate commerce.    Count VII states:

     On or about October 30, 1990, in the Northern District of
     Florida and elsewhere, the defendants, KENNETH D. ROSS,
     JAMES H. ADAMS, OSCAR JORDAN, and RONALD DUNSTON, did
     knowingly and willfully transport and cause to be
     transported in interstate commerce between Destin,
     Florida, and the State of Mississippi, goods,
     securities, or money, to-wit: funds in
     the amount of One Million dollars ($1,000,000.00), knowing
     the same to have been stolen, converted and taken by fraud.

                                 -36-
"A conviction under 18 U.S.C. § 2314 requires `(1) knowledge that

certain property has been stolen or obtained by fraud, and (2)

transporting it, or causing it to be transported, in interstate

commerce."   United States v. Hartley, 

, 986 (11th

Cir. 1982) (quoting Pereira v. United States, 

, 9

(1953)).

     Ross and Adams assert that this count was impermissibly

vague because there were two separate transfers between Florida

and Mississippi on October 30, 1990 involving funds in the amount

of $1,000,000.   They contend that it is unclear whether Count VII

referred to the unfunded check for $1,000,000 provided by GNL to

TMI and endorsed back to GNL or the $1,000,000 TMI received from

GNL at the loan closing.   The defendants did not object to the

vagueness of Count VII at trial.   When there has not been a prior

objection to the form of the indictment, we will review a

challenge to the indictment only for clear and prejudicial error.

See United States v. Harrell, 

, 981-82 (11th Cir.
1984).

     After reviewing the record, we conclude that Count VII was

not impermissibly vague and that its general description of the

crime did not cause any prejudice to the defendants.   During

closing arguments, the Government stated that the basis for the

interstate transportation of stolen property charge was the money

that GNL deposited in the TMI account following the loan closing


                               -37-
on October 30, 1990.   The Government argued:

     The funds are put in the Tops'l Management account for
     Tops'l's operating purposes - for Tops'l's operating
     purposes. They're immediately transferred from the AmSouth
     Florida bank account, Tops'l, to the L'Spot account in
     Mississippi. That's one of the crimes, interstate
     transportation and money laundering.


Ross's counsel agreed with the Government that the basis for

Count VII was the $1,000,000 TMI received at the loan closing.

During Ross's closing argument, he stated:

     Count VII charges that the defendants moved in interstate
     commerce $1,000,000 to Tops'l Management. . . . . That
     when this money from Gulf National as a result of that
     October 30      closing - you remember, there were five
     checks that Mr.
     Cavanaugh from Gulf National brought to the closing at Fort
     Walton, and he gave those five checks to Mr. Ross and they
     were deposited in the Tops'l Management account in Destin.
     And the government alleges that right there, that was stolen
     property - that was stolen property. And I believed I
     understood that the government's theory for taking that
     position that this was stolen property was because
     representations apparently were made that the purpose of the
     loan was supposed to be to make improvement, but that, they
     used the money for different purposes.


This is the only logical interpretation of Count VII.    Count VII

clearly identifies "funds in the amount of One Million Dollars"

as the property transported through interstate commerce by the

Ross and Adams.   The defense did not have any difficulty at trial

discerning the nature of the allegations in Count VII.   It is

clear that Count VII referred to the $1,040,000 deposited in




                               -38-
TMI's account and not to the insufficient funds check that was

endorsed back to GNL.

     Having concluded that Count VII is not impermissibly vague

or ambiguous, we must also consider whether the evidence

presented to the jury was sufficient to persuade a rational jury

beyond a reasonable doubt that Ross and Adams violated § 2314 by

causing the $1,000,000 in loan funds to be transported from

Florida to Mississippi.   As discussed above in our analysis of

the sufficiency of the evidence to support the conspiracy count,

the Government demonstrated that Ross knew these funds were

obtained by fraud.   There was testimony that Ross represented

that the $3,000,000 was for the Club's operating expenses.    Ross

transferred $1,000,000 to himself, Adams, and Shamburger on the

same date that they were deposited by GNL into TMI's account in

Florida.   Ross's act of diverting the GNL loan funds from their

intended purpose clearly furthered the conspiracy.    As a

co-conspirator, Adams was liable for any substantive offense

committed by Ross in furtherance of the conspiracy to defraud the

insurance companies, its policy holders, and the state insurance

regulators.   See United States v. Mothersill, 

, 1218

(11th Cir.) cert. denied sub nom.     ___ U.S. ___, 

,

416 (1996).




                               -39-
                                 II

               EXCLUSION OF EVIDENCE OFFERED BY ADAMS

     Adams maintains that the district court erred in excluding

three defense exhibits designated as "Adams 7," "Adams 11," and

"Adams 12," which were offered to prove that MWL and GNL did not

lose any money as a result of the loans they made to the

corporations controlled by Ross and Adams.    This court reviews a

district court's evidentiary rulings for "a clear abuse of

discretion."   United States v. Sellers, 

, 601 (11th

Cir. 1990).

     Adams 7 included all records of the sales of the Club

property.   It showed that MWL received $8,700,000 from the sale

of property that served as security for the money loaned to

Overlook, Technology Building, and Sand Tops'l for the purchase

and operation of the Club.    Adams 11 contained an appraisal of

the Ensley Shopping Center.    Adams 12 showed that GNL sold

parcels 628 and 630 for $3,700,000 on September 30, 1994.      Adams

contends that these exhibits tend to prove that he did not intend

to steal, convert, or take any money by fraud.

     The district court did not abuse its discretion in denying

admission of these exhibits into evidence.    Ross and Adams

committed fraud by diverting for their personal use and benefit

money that was loaned for business purposes to TMI, Overlook,

Technology Building, and Sand Tops'l.    MWL and GNL did not loan

any money to Ross and Adams.    Ross and Adams did not furnish any

                                -40-
security for the money they obtained by diverting funds loaned to

the corporations for business purposes.   The fact that the

property that was used to secure payment of the $3,700,000

business loan may have subsequently appreciated in value is not

relevant to the questions whether Ross and Adams falsely

represented that the money was to be used for business purposes

and whether they failed to disclose that their true intent was to

divert the loan proceeds for their personal use and benefit.

                                III

                    ALLEGED INSTRUCTIONAL ERROR

          A.   Failure to Inform the Jury of the Factual
                   Allegations in the Indictment


     Ross and Adams assert that the district court erred in

failing to inform the jury of the factual allegations of each

count of the indictment.   Adams's counsel requested a theory of

defense instruction to the jury.   Counsel explained that the

proposed instruction was necessary because the jury would receive

the prosecution's theory of the case from the indictment.     When

informed by the court that it did not intend to give the

indictment to the jury, Adams's counsel stated that "if the jury

did not get the indictment, I would withdraw the theory of

defense instruction."   The prosecutor informed the court that

without receiving a copy of the indictment, the jury would not be

able to agree unanimously on which overt act had been proved

without being informed about each of the 206 overt acts listed in


                               -41-
the indictment.   Adams's attorney then suggested that the defense

could stipulate that the jury should be instructed that "the

parties have agreed that at least one overt act has been proven."

After conferring with the prosecutor, Adams's counsel made the

following statement:

           Here's what we propose, Judge, that the
           indictment not be given to the jury, that the
           theory of defense instruction be withdrawn,
           and that we amend the jury instructions under
           your 4.1 general conspiracy continued, and
           I've got language written out that Mr. Beard
           and I and the other defense lawyers have
           agreed on, if I could come up and show you.


     The prosecutor and defense counsel agreed that the court

should inform the jury that "the parties agree that an event or

transaction occurred which may be considered an overt act, but

the defendants disagree that a conspiracy existed."   The district

court accepted the agreement.   In accordance with this

stipulation, the court did not give the indictment to the jury.

     The court's decision to deny the prosecutor's request that

the indictment be given to the jury was based on the stipulation

of counsel that the indictment should not be given to the jury.

Thus, any error in failing to give the indictment to the jury was

invited.   It is "a cardinal rule of appellate review that a party

may not challenge as error a ruling or other trial proceeding

invited by that party."   Crockett v. Uniroyal, Inc., 

, 1530 n.4 (11th Cir. 1985) (citing United States v. Males,

, 571 (11th Cir. 1983)).


                                -42-
                 B.   Denial of Proposed Instructions

       Ross argues that the court erred in refusing his request

that the court instruct the jury that the loan agreement was

valid although it was not in writing and that a borrower does not

commit a crime if he or she uses the proceeds of a loan for

purposes that vary from the terms of the loan agreement.      This

court reviews a district court's rejection of a proposed jury

instruction for abuse of discretion.      See United States v.

Gonzalez, 

, 1571 (11th Cir. 1992).

       Ross requested that the court instruct the jury as follows:

            The Court instructs the jury that in order to
            constitute a loan, there must be a contract
            whereby, in substance one party transfers to
            the other a sum of money which that other
            agrees to repay absolutely, together with
            such additional sums as may be agreed upon
            for its use. If such be the intent of the
            parties, the transaction will be considered a
            loan without regard to its form. While a
            note would certainly be evidence of a loan,
            it is not a prerequisite for the transaction
            to be a loan.

       No issue was raised at trial or in argument that required

the court to give this instruction.      It was undisputed at trial

that MWL and GNL loaned money to four corporations and that the

loan    agreements were in writing.     There was no evidence that any

money was loaned to Ross and Adams for their personal use and

benefit.    The factual question presented to the jury was whether

the loans were obtained by fraud.



                                 -43-
-44-
     Ross also requested the following instruction:     "The court

instructs the jury that it is not unlawful for a borrower to use

loan proceeds for other purposes than those specific purposes

expressly made to the lender in order to originally secure the

loan."     This instruction was patterned after the holding in

United States v. Kristofic.     As discussed above, the rule

announced in Kristofic is not applicable to a case such as this

one where the loan was obtained by fraudulent misrepresentations

and the withholding of material facts.     The district court did

not abuse its discretion in rejecting each of these instructions.

                    IV.   ALLEGED SENTENCING ERRORS

             Ross and Adams also challenge the legality of the

district court's sentencing decision.     They contend that the

district court erred as a matter of law in its interpretation and

application of the sentencing guidelines.     "The question about

whether a particular guideline applies to a given set of facts is

a question of law, and thus this issue is subject to de novo
review."     United States v. Shriver, 

, 574 (11th Cir.

1992) (citation omitted).

     The conspiracy charged in Count I of the indictment

contained multiple objects.     Each object was also alleged as a

substantive offense in separate counts.     The jury found Ross and

Adams guilty of conspiracy to commit mail fraud, wire fraud,

interstate transportation of money obtained by fraud, and money

laundering.     Ross and Adams contend that the district court erred


                                 -45-
in applying the money laundering guidelines in view of the fact

that the jury found them not guilty of the substantive money

laundering count.    They assert that "[g]iven the jury's finding

of a substantive offense of wire fraud and of interstate

transportation, but not of money laundering, it stands to reason

that the conspiracy verdict likely was for conspiring to commit

fraud and/or interstate transportation and not for conspiracy to

launder money."    Adams Br. at 40.    It is not surprising that Ross

and Adams did not cite any authority for this proposition.      It is

contrary to well established law.      This argument fails to

recognize the distinction between the existence of proof

necessary to demonstrate a conspiracy to commit a criminal act,

such as money laundering, and the evidence that must be produced

to sustain a conviction for the substantive offense of money

laundering.   In United States v. Griffin, 

(11th

Cir. 1983), this court held that because the crime of conspiracy

is a separate offense, a conviction for conspiracy will stand

even if the evidence is insufficient to support a conviction for

the substantive offense also pled as an object of the conspiracy.

See 

   Thus, the fact that the jury acquitted Ross and

Adams of money laundering does not demonstrate, as argued by

Adams, that "the acquittal here on money laundering charges and

the conviction for fraud and interstate transportation of stolen

property established that the object of the conspiracy was not




                                -46-
money laundering but fraud and interstate transportation."    Adams

Reply Br. at 19.

     Unfortunately, Ross and Adams did not request that the jury

be provided with a special verdict that would have required the

jury to specify the objects of the conspiracy Ross and Adams

conspired to commit.    For that reason, we have no way of

determining whether the jury was unanimously persuaded beyond a

reasonable doubt that Ross and Adams conspired to commit money

laundering.

     The jury was properly instructed that the Government was not

required to prove that Ross and Adams committed each of the

crimes charged as objects of the conspiracy, provided that the

jury unanimously agreed on which of the offenses they conspired

to commit.    The Supreme Court instructed in Griffin v. United

States, 

(1991), that a general guilty verdict in a

multi-object conspiracy will stand even if the evidence is

insufficient that the accused conspired to commit one of the

objects.   See 

  Because we have concluded that the

evidence is sufficient to demonstrate that Ross and Adams

conspired to commit wire fraud, we have affirmed the judgment

regarding the conspiracy charge pursuant to Griffin.    Griffin

does not, however, provide any guidance concerning the applicable

sentencing guideline that must be applied in a multi-object

conspiracy where the jury's verdict does not specify which

offense the defendants conspired to commit.    That precise


                                -47-
question was addressed by this court in United States v.

McKinley, 

(11th Cir. 1993).       In McKinley, the court

framed the issue as follows:        "When defendants are convicted on a

count charging a conspiracy to commit more than one offense, but

the jury's verdict does not specify which of those offenses the

defendants conspired to commit, which offense guideline applies

at sentencing?"      

   This court held that "[t]he

Sentencing Guidelines answer this question in § 1B1.2(d), its

accompanying commentary and the grouping rules of Chapter 3, Part

D."     

provides:      "A conviction on a count

charging a conspiracy to commit more than one offense shall be

treated as if the defendant has been convicted on a separate

count of conspiracy for each offense the defendant conspired to

commit."      U.S.S.G.§ 1B1.2(d).   Application Note Five sets forth

the sentencing procedure that should be followed when a general

verdict is tendered by the jury in a multi-object conspiracy

case:

              Particular care must be taken in applying
              subsection (d) because there are cases in
              which the verdict or plea does not establish
              which offense(s) was the object of the
              conspiracy. In such cases, subsection (d)
              should only be applied with respect to an
              object offense alleged in the conspiracy
              count if the court, were it sitting as a
              trier of fact, would convict the defendant of
              conspiring to commit the object offense.

                                    -48-
     In McKinley, this court interpreted the words "were it

sitting as a trier of fact" in Application Note 5 to mean "that

the court must find beyond a reasonable doubt that the defendant

conspired to commit the particular object 

.     Ross and Adams argue that we should not follow this

court's holding in McKinley that a trial judge should apply

§ 1B1.1(d) and Application Note 5 under these circumstances

because this court did not consider the constitutionality of

§ 1B1.2(d) and Application Note 5 in that decision.     Here, Ross

and Adams first presented their constitutional challenge to

§ 151.2(d) and Application Note 5 during the sentencing

proceedings.     Ross and Adams's argument can be summarized as

follows:

     1.     Proof that the accused conspired with others to commit

an offense is an element of the crime of conspiracy.

     2.     An accused has a constitutional right to have a jury

determine whether the Government has presented sufficient

evidence of each element of the crime alleged in the indictment.

     3.     Where, as here, it is unclear whether the jury was

persuaded beyond a reasonable doubt that the accused conspired to

commit the crime of money laundering, the Fifth and Sixth

Amendments preclude the trial judge from punishing the accused

for conspiracy to commit money laundering.

     While this court has not previously addressed the question

whether § 1B1.2(d) and Application Note 5 deprive a defendant of

                                 -49-
rights protected by the Fifth and Sixth Amendments, five circuits

have discussed this issue.    We conclude that the reasoning of

those circuits that have determined that § 1B1.2(d) and

Application Note 5 do not violate the Constitution is more

persuasive.

     Citing only United States v. Owens, 

(8th Cir.

1990), United States v. Garcia, 

(9th Cir. 1994),

cert. denied, 

(1995), United States v. Pace, 

(10th Cir. 1992), cert. denied sub nom, 

(1993), and United States v. Bush, 

(10th Cir. 1995),

cert. denied, ___ U.S. ___, 

(1996), Ross and Adams

argue that "the holdings of several circuits, applying the Fifth

and Sixth Amendments, would require that the defendant be

sentenced on the basis of the conspiracy objective yielding the

lowest base offense level."    Adams Br. at 41.

     None of the cases cited by Ross and Adams holds that

§ 1B1.2(d) and Application Note 5 violate the Fifth and Sixth




                                -50-
Amendment.   Two of them do not discuss § 1B1.2(d) and Application

Note 5.   A third decision involves a pre-guidelines sentence.

The fourth decision contains dictum concerning § 1B1.2(d) that

relies on the dictum in the pre-guidelines case.

     In United States v. Owens, the appellant was charged in one

count with conspiracy to distribute and possess with intent to

distribute and attempt to manufacture

"methamphetamine/amphetamine."       

  The jury was

instructed that "[y]ou must ascertain whether or not the

substance in question in this case was in fact

methamphetamine/amphetamine."       

   "The jury returned a

general verdict of guilty."     

  In the presentence

report, the probation officer recommended that "the court

determine Owens's offense level on the assumption that the

conspiracy's purpose had been to manufacture and distribute

methamphetamine."    

   A calculation of the sentence

based on an assumption that the controlled substance was

amphetamine would have resulted in a sentencing range of 41-51

months.   The range for an equivalent amount of methamphetamine

was 63-78 months.   The court found that the conspiracy invoked

methamphetamine.    See 

Circuit held that "[b]y instructing the jury on

an `either/or' basis with respect to the two substances and by

failing to enable the jury to indicate which of the substances it

found the conspiracy to have involved, the district court


                                   -51-
elicited an ambiguous verdict of guilty with two possible

alternative interpretations."         

   The court held that

"[u]nder the circumstances of this case, the district court erred

in sentencing Owens based on the alternative which yielded a

higher sentencing range."      

Circuit did not discuss the constitutionality of

§ 1B1.2(d) or Application Note 5.           Furthermore, there is no

indication in the Owens opinion that the district court

determined that the evidence was sufficient to persuade it beyond

a reasonable doubt that the controlled substance was

methamphetamine.    In this matter, unlike the situation in Owens,
the district court did not give an ambiguous "either/or"

instruction to the jury.

     In United States v. Garcia, the defendant was charged with

conspiracy.    The charge alleged five objects of the conspiracy.

.     Four of the objects involved possession

with the intent to distribute cocaine and heroin.           In the fifth

object of the conspiracy, the indictment alleged that the

defendant used a communications facility in committing drug

offenses.     See 

returned a general verdict of

guilty.   See 

defendant was found guilty of

conspiracy to possess heroin and cocaine.           The district court

imposed a maximum fifteen year sentence on the conspiracy charge

based on the allegations that the object of the conspiracy was

the possession of heroin and cocaine.           See 

Circuit


                                     -52-
reversed holding that "[i]n the absence of a special verdict,

there was no way for the sentencing judge to know which object

was the necessary element to constitute the crime."   

In a footnote, the Ninth Circuit stated as follows:

               We note that the sentencing guidelines
          in section 1B1.2(d) (n.5) state that when the
          verdict in a multi-object conspiracy does not
          establish which offense was the object of the
          conspiracy, the court is to decide the object
          of the conspiracy. The note specifies that
          the court can do so "if the court, were it
          sitting as a trier of fact, would convict the
          defendant of conspiring to commit that object
          offense."

               The case at hand is a pre-guidelines
          case, but we acknowledge that the rationale
          of this holding casts doubt on the
          constitutionality of the provision of the
          sentencing guidelines, because that provision
          permits a judge rather than the jury to find
          the facts necessary to establish an element
          of the crime. The submission of a special
          verdict form would forestall any such issue.

n.4.
     The Ninth Circuit's comment in Garcia is clearly obiter

dictum since the Sentencing Guidelines were not applicable

because the alleged criminal conduct occurred prior to the

effective date of the statute.    More importantly, the holding in

Garcia, that a special verdict is required in a multi-object
conspiracy so that the district court can determine which object

was the necessary element to constitute the crime, is contrary to

the law of this circuit.   In McKinley, the district court denied

the defendant's motion that the jury be provided with a special


                                 -53-
verdict form.   

.    In framing the issue

regarding the validity of the sentence, this court stated that it

would address "the appropriate method for determining the

applicable offense guideline for a conviction on a count charging

a conspiracy to commit more than one offense when the jury's

verdict does not establish which of these offenses were objects

of the conspiracy."   

     As discussed above, this court held in McKinley that where a

jury has returned a general verdict on a multi-object conspiracy

charge, the district court may treat the conviction as a

determination that the defendant was convicted on a separate

count of conspiracy for each offense the defendant conspired to

commit only if the court finds beyond a reasonable doubt that the

defendant conspired to commit that offense.    See 

     In United States v. Pace, the defendants were charged with a

conspiracy with two objects:   (1) possession with intent to

distribute "methamphetamine/amphetamine" and (2) an attempt to

manufacture methamphetamine.   

.    The district

court submitted a general verdict form to the jury without

objection from defense counsel.   See 

    The jury

convicted the defendants of conspiracy and the Tenth Circuit

affirmed the conspiracy conviction.     See 

  The court

also held, however, that the sentence on the conspiracy count

could not stand because "the jury might have convicted defendants



                               -54-
based on conspiracy to possess with intent to distribute

amphetamine . . . ."   

Circuit did not discuss whether § 1B1.2(d) or

Application Note 5 violated the Fifth or Sixth Amendments.      More

recently, in United States v. Bush, the Tenth Circuit quoted from

the Ninth Circuit's dictum in United States v. Garcia regarding

the Ninth Circuit's "doubt" about the constitutionality of

§ 1B1.2(d) and Application Note 5.     See 

.

The Tenth Circuit's comment was also dictum because the issue

before it did not concern a general verdict in a multi-object

conspiracy.   Section 1B1.2(d) and Application Note 5 only apply

to general verdicts tendered in multi-object conspiracy cases.

Instead, the question presented to the Tenth Circuit was whether

the appellant intended to plead guilty to conspiracy to

distribute cocaine base, conspiracy to distribute cocaine powder,

or both.   See 

  The indictment alleged that the

defendant had conspired to distribute "cocaine (powder) and/or

cocaine base (crack)."   

   The district court

calculated the offense based on the assumption that the object of

the conspiracy was to distribute cocaine base.    See 

The Tenth Circuit affirmed the sentence despite the ambiguity in

the indictment because it determined that the evidence in the

record was sufficient to show that the defendant intended to

plead guilty to conspiracy to distribute cocaine base.       See 

                                -55-
     The question whether a sentencing decision made pursuant to

§ 1B1.2(d) and Application Note 5 violates the Fifth and Sixth

Amendments was squarely addressed by the Third Circuit in United

States v. Conley, 

(3rd Cir. 1996), cert denied, ___

U.S. ___, 

(1997).     In Conley, the Third Circuit

held that a sentence imposed following a general verdict of

guilty on a multi-object conspiracy charge does not violate the

Fifth and Sixth Amendments if the court, in formulating its

sentencing decision, finds beyond a reasonable doubt that the

defendant committed each object of the conspiracy.    See 

  The court reasoned as follows:

               We start our analysis of this Sixth
          Amendment argument with McMillan v.
          Pennsylvania, 

, 

, 

(1986). There the Supreme Court
          permitted a state to treat conduct which
          arguably was an element of a criminal
          offense, the visible possession of a weapon
          during certain offenses, as a sentencing
          factor. As a result, the trial court rather
          than the jury would determine whether the
          sentencing factor was present and would do so
          by the preponderance of the evidence. The
          Court in reaching its result explained:

               While `there are obviously
               constitutional limits beyond which the
               States may not go in this regard,'
               ibid., `[t]he applicability of the
               reasonable-doubt standard . . . has
               always been dependent on how a State
               defines the offense that is charged in
               any given case.'

          

106 S.Ct. at 2415 (quoting
          Patterson v. New York, 

, 211 n.
          12, 

, 2327 n. 12, 

                               -56-
(1977)). The Court analyzed the Sixth
Amendment claim tersely:

     Having concluded that Pennsylvania may
     properly treat visible possession as a
     sentencing consideration and not an
     element of any offense, we need only
     note that there is no Sixth Amendment
     right to jury sentencing, even where the
     sentence turns on specific findings of
     fact.

106 S.Ct. at 2419 (citing Spaziano
v. Florida, 

, 459, 

, 3161, 

(1984)).

     It is clear from McMillan, that if
section 1B1.2(d) is, in the words of
McMillan, properly a "sentencing
consideration," then the section does not
infringe the Sixth Amendment right to jury
trial. The Chief Justice's concurring
opinion in United States v. Gaudin, ___ U.S.
___, ___, 

, 2321, 

(1995), is in harmony with McMillan.
There the Chief Justice noted that:

     Nothing in the Court's decision stands
     as a barrier to legislatures that wish
     to define--or that have defined--the
     elements of their criminal laws in such
     a way as to remove issues such as
     materiality from the jury's
     consideration. We have noted that the
     definition of the elements of a criminal
     offense is entrusted to the legislature,
     particularly in the case of federal
     crimes which are solely creatures of
     statute.

concurring) (internal
quotation marks omitted). We must decide,
therefore, whether the determination of the
object of a multi-object conspiracy following
a general verdict of guilty properly can be
deemed the ascertaining of a sentencing
consideration or whether such a determination
is beyond the "constitutional limits"
referred to in 

, 106


                    -57-
S.Ct. at 2415, and Patterson v. New York, 

, 210, 

, 2327, 

(1977).

     This issue is controlled by the Court's
holding in Griffin v. United States, 

, 

, 

, where
the Court rejected the due process argument
that a general verdict of guilty in a
multi-object conspiracy verdict could not
stand if the evidence to support a conviction
for conspiracy to commit one of the objects
was insufficient. The Court reached that
result notwithstanding its almost
contemporaneous holding in Sullivan v.
Louisiana that the prosecution "must persuade
the factfinder `beyond a reasonable doubt' of
the facts necessary to establish each of
[the] elements" of the crime. 

,
278, 

, 2080, 

(1993). As the Court explained in Sullivan,
"the jury verdict required by the Sixth
Amendment is a jury verdict of guilty beyond
a reasonable doubt." 

113 S.Ct.
at 2081.

     If, as Conley asserts, it were
constitutionally impermissible to treat the
object of a multi-object conspiracy
indictment as a sentencing factor rather than
as an element of the crime, then it is
difficult to understand how the Griffin
Court, consistently with Sullivan, could have
permitted a conspiracy conviction to stand
when there was insufficient evidence to
support a conviction for one of the objects.
After all, if each object of the conspiracy
had been an element of the crime then under
well-established law the defendant in Griffin
would have been entitled to an acquittal
since the proofs could not support the charge
that she conspired with respect to one
object. Thus, while Conley argues that
violation of each object of the conspiracy
must be considered a separate element of the
offense for the purpose of his Sixth
Amendment right to a jury trial, it is clear
from Griffin that making the object of a
conspiracy charged under 18 U.S.C. § 371 a


                    -58-
           matter for the sentencer rather than an
           element of the crime does not violate the
           Sixth Amendment."

     In addressing the Fifth Amendment, the court stated:

                As we have indicated, Conley also argues
           that his sentence violates the Due Process
           Clause of the Fifth Amendment because the
           district court's power to make the crucial
           finding that an object of the conspiracy was
           money laundering. Here we are guided by the
           Court's holding in McMillan. There the Court
           considered a Pennsylvania statute which
           subjected defendants convicted of certain
           felonies to a mandatory minimum sentence of
           five years imprisonment if the sentencing
           judge found, by a preponderance of the
           evidence, that the person "visibly possessed
           a firearm" during the commission of the
           offense. The Court found that the
           preponderance of the evidence standard was
           constitutional but explained that "in certain
           limited circumstances Winship's
           reasonable-doubt requirement applies to facts
           not formally identified as elements of the
           offense charged." 

,
           106 S.Ct. at 2416 (citing In re Winship, 

, 

, 

           (1970)).

     In United States v. Manges, 

(5th Cir. 1997),

relying on Conley, the Fifth Circuit rejected a claim that

§ 1B1.2(d) and Application Note 5 are unconstitutional.    See 

  The Second Circuit has also held that § 1B1.2(d) and

Application Note 5 involve "valid sentencing considerations and

not the violation of any Sixth Amendment guarantee."   United




                               -59-
States v. Malpeso, 

, 168 (2d Cir. 1997) (citing

United States v. Conley, 

, 168 (3rd Cir. 1996), cert.

denied, ___ U.S. ___, 

(1997)).

        We also agree with the Third Circuit's analysis in Conley.

Accordingly, we hold that § 1B1.2(d) and Application Note 5 do

not violate the Fifth and Sixth Amendments.

     We next turn to the question whether the district court's

determination that money laundering was an object of the

conspiracy was consistent with McKinley's interpretation of
§ 1B1.2(d) and Application Note 5.      To comply with § 1B1.2(d) and

Application Note 5, where the jury's verdict does not establish

which offense was the object of the conspiracy, "the court must

find beyond a reasonable doubt that the defendant conspired to

commit the particular object offense."     

.

     The district court did not make an express finding that Ross

and Adams conspired to commit the offense of money laundering.

The court explained its decision to apply the money laundry

guideline as follows:

            And under the evidence as I heard it,
            accepting the jury's verdict of conspiracy,
            they would have a basis in the facts to
            determine that they had conspired to commit
            money laundering. And, therefore, that is an
            appropriate guideline if for no other reason
            my factual determination that there is
            sufficient evidence in the record that the
            jury made that finding as well as the others.
            I might add, just to cover the record. So I


                                 -60-
          do find that it's appropriately scored under
          the money laundering guideline.


     The district court did not state that it had determined that

the evidence was sufficient to persuade it beyond a reasonable

doubt that Ross and Adams conspired to commit the offense of

money laundering.   Because of the court's comment that the

evidence was sufficient for the jury to determine that Ross and

Adams conspired to commit money laundering, we cannot say with

any degree of certainty that the court made an independent

determination of this fact.   McKinley compels us to vacate the

sentencing decision and remand for appropriate factual findings.

See 

     Ross and Adams also contend that the district court selected

the wrong subsection of U.S.S.G. § 2S1.1(a) as a standing point

for the calculation of their sentence.   The Government argues

that this issue was waived because it was not raised properly.

In view of our conclusion that we must vacate the sentence, we

decline to resolve this dispute.   Upon remand, both sides will

have an opportunity to present their conflicting views to the

district court in a timely manner.

     Adams asserts that the district court erred in concluding

that he is liable for a total of $1,702,599.64 laundered by all

the conspirators without supporting this conclusion with

appropriate findings.   We decline to consider this question in

view of the fact that we have concluded that this matter must be

                               -61-
remanded for appropriate findings regarding whether the money

laundering guidelines are applicable.

                V.   ASSIGNMENT TO A DIFFERENT JUDGE

     Ross and Adams request that we order this matter assigned to

a different judge upon remand.    They argue that in denying their

motion for bail on appeal, the district court stated that even if

it had sentenced the defendants under a fraud guideline, "this

range of loss would lead to a guidelines calculation resulting in

a term of imprisonment longer than the likely duration of their

appeal."   Adams Br. at 53.   Ross and Adams argue that

reassignment is required because the district court's comment

demonstrates that the district court has prejudged what it would

do in the event this court vacated its sentence.    We disagree.

The district court judge's comments at the bail hearing do not

support an inference that he will fail to consider the evidence

presented at the sentencing hearing upon remand or that he will

refuse to follow the law.

                              CONCLUSION

     We AFFIRM the judgment of conviction on each count.    We

VACATE the sentences and REMAND for resentencing.




                                 -62-