Filed: Aug. 24, 2000
Latest Update: Feb. 21, 2020
Summary: [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FILED FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS ELEVENTH CIRCUIT AUGUST 24, 2000 _ THOMAS K. KAHN CLERK No. 99-14274 Non-Argument Calendar _ D.C. Docket 98-00567-CR-DTKH UNITED STATES OF AMERICA, Plaintiff-Appellee, versus JEFFREY C. NOLAN, Defendant-Appellant. _ Appeal from the United States District Court for the Southern District of Florida _ (August 24, 2000) Before DUBINA, CARNES and HULL, Circuit Judges. PER CURIAM: Defendant-Appellant J
Summary: [PUBLISH] IN THE UNITED STATES COURT OF APPEALS FILED FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS ELEVENTH CIRCUIT AUGUST 24, 2000 _ THOMAS K. KAHN CLERK No. 99-14274 Non-Argument Calendar _ D.C. Docket 98-00567-CR-DTKH UNITED STATES OF AMERICA, Plaintiff-Appellee, versus JEFFREY C. NOLAN, Defendant-Appellant. _ Appeal from the United States District Court for the Southern District of Florida _ (August 24, 2000) Before DUBINA, CARNES and HULL, Circuit Judges. PER CURIAM: Defendant-Appellant Je..
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[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FILED
FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
AUGUST 24, 2000
________________________
THOMAS K. KAHN
CLERK
No. 99-14274
Non-Argument Calendar
________________________
D.C. Docket 98-00567-CR-DTKH
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
JEFFREY C. NOLAN,
Defendant-Appellant.
__________________________
Appeal from the United States District Court for the
Southern District of Florida
_________________________
(August 24, 2000)
Before DUBINA, CARNES and HULL, Circuit Judges.
PER CURIAM:
Defendant-Appellant Jeffrey C. Nolan appeals his conviction after a jury
trial for major fraud against the United States, in violation of 18 U.S.C. §§ 1031 &
2, theft of public money, in violation of 18 U.S.C. § 641, and money laundering, in
violation of 18 U.S.C. §§ 641 & 1957. Nolan challenges the district court’s jury
instructions regarding the major fraud charges and argues that there was
insufficient evidence to convict him on the money laundering charge. After
review, we affirm Nolan’s convictions.
I. BACKGROUND
The charges against Nolan resulted from his and his codefendant James
Byrd’s diversion of $3,547,693.00 in government-contract proceeds for personal
use. Nolan was associated with PZ Construction Company, Inc. (“PZ”), which
entered into several contracts to remove debris remaining in the Miami area after
Hurricane Andrew. Nolan was involved with PZ’s contract with the Army Corps
of Engineers (the “ACOE”). PZ was to receive debris in a central location (the
“Three Lakes site”) from which it would transport the debris to various landfills.
Under the contract, PZ began accepting debris on January 4, 1993, and received
$31 to $33 per ton of debris it accepted for disposal. As a minority contractor, the
ACOE was required to pay PZ every week. Testimony at trial established that
instead of taking the debris directly to the landfills, PZ hired subcontractors to
separate the debris into either (1) material that could be recycled and sold or (2)
material that had to be taken to the landfills.
The “recycling” process took longer than simply taking the material to the
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landfills, and thus the debris began to pile up at the Three Lakes site.1 On March
10, 1993, the Florida Department of Environmental Regulation (the “FDER”)
ordered PZ to receive no additional debris at the Three Lakes site and to remove
the remaining debris because the piles of debris posed a health threat to the area.
By that time, the ACOE had paid PZ a total of $12,848,811.00. After the FDER
issued the cease-and-desist order, the ACOE notified PZ that it would not make
any additional payments on the contract until PZ made satisfactory progress in
removing the debris from the site. However, the ACOE resumed payment after PZ
made a request for additional payments, claiming that it needed to pay its
subcontractors. Yet by December 1993, there was still a large amount of debris
remaining at the Three Lakes site. On February 1, 1994, the ACOE terminated its
contract with PZ for non-performance. Eventually, the ACOE paid D & J
Construction $5 million to complete the removal of debris at the Three Lakes site.
A. The Major-Fraud Charges
The ACOE eventually discovered that instead of using the ACOE’s progress
1
Trial testimony indicated that the ACOE essentially acquiesced in PZ’s practice of
“recycling” the material from the site. The ACOE had a contracting officer on site who would
have known that PZ had been recycling since the beginning of the contract, and who did nothing
to cause PZ to change the practice. At trial, witnesses suggested that recycling was better for the
area, both environmentally and economically, and noted that the news media had commented
favorably on the practice of recycling the hurricane debris.
3
payments to PZ for the Three Lakes project, Nolan and his codefendant, James
Byrd, were shifting some of the funds for their own personal use. As a result, the
government charged Nolan with twenty-four counts of major fraud. The jury
convicted Nolan of three of those counts of major fraud, all involving the delivery
of checks. At trial, investigators testified that they had traced the money
transferred by the three checks back to ACOE contract proceeds that were
originally paid to PZ. Count Eleven involved a check for $150,000, dated March
4, 1993, that Nolan wrote to C.A. Killen, an accountant in Texas who performed
no work on the Three Lakes project. Count Fifteen involved check for $100,000,
dated April 5, 1993, also written to Killen. Killen eventually redirected to Nolan’s
real estate attorney, Joshua Manaster, a substantial portion of the $250,000 he had
received from Nolan. Manaster put the funds towards a down payment on Nolan’s
$1.15 million house. Count Seventeen involved a check for $132,000, dated May
20, 1993, written from Killen to Manaster.
B. The Money-Laundering Charge
On August 5, 1993, the ACOE sent PZ a check for $595,970, which
included $345,970 that was duplicated from a prior payment and was accidentally
paid to PZ a second time. At trial, Nolan’s administrative assistant, Sheila Carter,
testified that she detected the duplicate payment and notified Nolan. Nolan told
4
her to deposit the entire amount into the PZ account, and that they would take care
of it when the ACOE discovered the overpayment. Nolan’s computer assistant,
Miguel Michelena, testified that he also approached Nolan about the overpayment.
Nolan told Michelena that they would worry about it if the ACOE caught its
mistake.
Special Agent Edward Miller, of the Internal Revenue Service criminal
investigation division, testified that in early August 1993, Nolan completed a wire
transfer including the $345,970 duplicate payment. Nolan withdrew the money
from the PZ account and deposited it into an account belonging to Renaissance
Environmental Corporation (“Renaissance”). Renaissance was a “shell”
corporation acquired by Nolan that did no work on the Three Lakes project. The
jury convicted Nolan of money laundering as a result of the transfer of the
duplicate payment from the PZ account to the Renaissance account.
The jury convicted Nolan of five of the twenty-seven counts in the
indictment, including the three of the major fraud counts, one count of theft of
public money, and one count of money laundering. The district court sentenced
Nolan to a total of sixty-three months’ imprisonment, and imposed a $10,000
restitution payment. Nolan timely appealed.
II. STANDARD OF REVIEW
5
We review de novo “whether the district court misstated the law when
instructing the jury or misled the jury to the prejudice of the defendant.” United
States v. Deleveaux, 205 F.3d 1292, 1296 (11th Cir.) (citation omitted), cert.
denied sub nom, Deleveaux v. United States,
120 S. Ct. 2724 (2000). A district
court’s “refusal to give a requested jury instruction is reviewed for abuse of
discretion, because [a] defendant is entitled to have the court instruct the jury on
the theory of the defense, as long as it has some basis in the evidence and has legal
support.” United States v. Grigsby,
111 F.3d 806, 814 (11th Cir. 1997) (internal
quotations and citation omitted). “We reverse when we are left with a substantial
and ineradicable doubt as to whether the jury was properly guided in its
deliberations.”
Id. (internal quotations and citation omitted).
We review a claim of insufficient evidence to sustain a conviction de novo.
See United States v. Christo, 129 F.3d 578, 579 (11th Cir. 1997) (citation omitted).
“We, however, view the evidence in the light most favorable to the government,
with all reasonable inferences and credibility choices made in the government’s
favor.”
Id. (internal quotation and citation omitted). We must affirm the
conviction if we find that “any rational trier of fact could have found the essential
elements of the crime beyond a reasonable doubt.”
Id. (internal quotation and
citation omitted).
6
III. DISCUSSION
A. Major Theft Jury Instruction
The jury convicted Nolan of three counts of major fraud against the United
States, in violation of 18 U.S.C. § 1031. Section 1031 reads, in pertinent part, as
follows:
Whoever knowingly executes, or attempts to execute, any scheme or
artifice with the intent –
(1) to defraud the United States; or
(2) to obtain money or property by means of false or fraudulent
pretenses, representations, or promises,
in any procurement of property or services as a prime contractor with
the United States . . . if the value of the contract . . . for such property
or services is $1,000,000 or more, shall [be subject to fines and/or
imprisonment].
18 U.S.C. § 1031(a). Regarding the major fraud counts, the district court
instructed the jury, in part, as follows:
A defendant can be found guilty of a crime of committing major fraud
against the United States only if all of the following facts are proven
beyond a reasonable doubt.
Now, the elements of this crime are set forth on pages eight and nine
of the jury instructions.2 Let’s talk about them one by one.
Number one, that the Defendant knowingly executed or attempted to
2
The printed jury instructions are not part of the record on appeal.
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execute a scheme with the intent to defraud the United States, or to
obtain money by means of false or fraudulent pretenses,
representations and promises. Second, that the scheme took place as
part of the acquisition of money as a contractor with the United States
or as a subcontractor or a supplier on a contract with the United
States.
Third, that the value of the contract . . . that is the value of the amount
to be paid under the contract . . . was one million dollars or more.
R9 at 1662-1663 (emphasis supplied).
Nolan objected to the proposed jury instruction regarding the second
element of the major-fraud offense.3 Nolan requested that the district court replace
the following proposed language, “That the scheme took place as part of the
acquisition of money as a contractor with the United States [or as a
subcontractor],” with the following language drafted by Nolan: “That the scheme
or artifice to defraud occurred as part of any procurement of property or services as
a prime contractor with the United States, [or as a subcontractor].” R8 at 1573
(emphasis supplied). Nolan argued that the language he requested more accurately
tracked the language of the major-fraud statute, as § 1031 uses the word
“procurement” instead of the proposed instruction’s “acquisition.” Also, § 1031
uses the words “property or services” instead of the proposed instruction’s
3
There is no Eleventh Circuit pattern jury instruction addressing the 18 U.S.C. § 1031 major-
fraud offense. Additionally, this Court has never examined jury instructions regarding 18 U.S.C.
§ 1031.
8
“money.” Id. at 1574; 18 U.S.C. § 1031(a).4 The district court overruled Nolan’s
objection.
We have examined the jury instructions as a whole, and conclude that the
district court’s major-fraud jury instruction was a proper statement of the law, and
did not mislead the jury. See Deleveaux, 205 F.3d at 1296. Although the district
court’s instructions did not track exactly the language of § 1031, the substituted
words were similar in meaning to the words in the statute, and operated to clarify
the meaning of the statute in the context of this case. For example, “acquire” is a
generally accepted synonym of “procure.” Webster’s Third New International
Dictionary 1809 (unabridged ed. 1993). Additionally, “money” is simply the form
of “property or services” that Nolan received from the government under the
contract at issue in this case. Because we conclude that the jury was properly
guided by the instruction given by the district court, we also conclude that the
district court did not abuse its discretion by refusing to give Nolan’s requested
version of the major-fraud jury instruction.5 See
Grigsby, 111 F.3d at 814.
4
In the district court, Nolan also argued that the words “or artifice” should be included after
the word “scheme,” because the major fraud statute uses both terms. 18 U.S.C. § 1031(a). The
district court overruled this objection because the Eleventh Circuit pattern jury instructions
regarding mail fraud and wire fraud use only the word “scheme,” even though the statutes
governing mail fraud and wire fraud, like § 1031, use “scheme or artifice.” Nolan has not raised
this specific issue on appeal.
5
To the extent that Nolan argues that to violate 18 U.S.C. § 1031, the fraud must occur prior
to or contemporaneous with the creation of the contract, we find that argument to be without
9
B. Sufficiency of the Evidence on Money Laundering Conviction
Nolan was also convicted on one count of money laundering based on the
withdrawal of the $345,970 duplicate payment from the PZ account and the deposit
of that amount in the Renaissance account. On appeal, Nolan argues that there was
not sufficient evidence to sustain the money laundering conviction.
Money laundering occurs when one “knowingly engages or attempts to
engage in a monetary transaction in criminally derived property.” 18 U.S.C. §
1957. The withdrawal of money from a bank account is a “monetary transaction.”
18 U.S.C. § 1957(f)(1). Money laundering is an offense to be punished separately
from the underlying criminal offense, which in this case is the theft of the money
from the government. See United States v. Christo, 129 F.3d 578, 579 (11th Cir.
1997) (citation omitted). Therefore, the primary issue in a money laundering
charge involves “determining when the predicate crime becomes a ‘completed
offense’ after which money laundering can occur.”
Id. at 579-80 (citation
omitted).
merit. We believe that Congress intended § 1031 to sweep broadly to also cover fraud not only
in the making of the contract, but also in the execution of the contract. See United States v.
Brooks,
111 F.3d 365, 369 (4th Cir. 1997) (stating that the legislative history of § 1031 indicated
a wide range of concern not only with monetary loss resulting from fraud, but also with safety
concerns stemming from, e.g., the provision of defective parts for helicopters and weapons). We
conclude that the district court’s major-fraud jury instructions, considered in total, adequately
stated the law applicable to violations of 18 U.S.C. § 1031.
10
Nolan’s money laundering conviction was based on the transfer of the
$345,970 from the PZ account to the Renaissance account. The predicate criminal
offense was the initial theft of that money from the government. Therefore, to
support Nolan’s money laundering conviction, the government was required to
prove that the theft offense was a completed criminal offense before Nolan
withdrew the funds from the PZ account and deposited them into the Renaissance
account. 18 U.S.C. § 1957(f)(2); United States v. Gregg, 179 F.3d 1312, 1315
(11th Cir. 1999).
On appeal, Nolan argues that the theft offense was not completed when the
$345,970 was deposited in the PZ account, but only after Nolan transferred the
funds to the Renaissance account. Since this transfer was an element of the money
laundering offense, Nolan argues that he did not commit separate theft and money
laundering crimes. We conclude, however, that the theft was a completed crime
when Nolan ordered the deposit of the duplicate payment from the ACOE into the
PZ account.
The evidence, when viewed in the light most favorable to the government,
indicates that Nolan’s administrative assistant, Sheila Carter, notified Nolan of the
ACOE’s error in forwarding the duplicate payment. Shortly thereafter, Miguel
Michelena, the computer assistant, raised the issue again with Nolan. As he had
11
told Carter initially, Nolan told Michelena to deposit the money into the PZ
account and that they would worry about the error if the ACOE discovered it.
This evidence supports an inference that when the money was deposited in
the PZ account, Nolan had control over the money as if he had robbed the
government and “placed the proceeds of the robbery into his own account with the
intent to use the money for his own purposes.” Gregg, 179 F.3d at 1315 (holding
that a bank fraud was a completed crime when the defendant “fraudulently
obtained the deposit of the proceeds of [a] check into his account, with the intent at
that time to eventually withdraw the money from the account for his own use”).
Unlike the account in Gregg, the PZ account was not technically Nolan’s account.
However, we find this to be a distinction without a material difference. Nolan’s
ability to withdraw the money from the PZ account and deposit it in the
Renaissance account shows that he had control over the PZ account as if it was his
own. Because we conclude that the theft offense was complete when the $345,970
was deposited in the PZ account pursuant to Nolan’s command, we find that there
was sufficient evidence to support Nolan’s conviction for the separate money
laundering offense when Nolan withdrew the money from the PZ account and
deposited it into the Renaissance account.
IV. CONCLUSION
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We conclude that the district court did not err in instructing the jury on the
major fraud charges. Also, there was sufficient evidence presented to support
Nolan’s conviction for money laundering.
AFFIRMED.
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