PER CURIAM.
Edward Hugh Okun operated a "Ponziesque" scheme, resulting in losses in excess of $125 million dollars. Following a jury trial, he was convicted on twenty-three counts arising from this scheme. He was sentenced to 1200 months' imprisonment, a sentence 3600 months below the advisory Guidelines sentence. Okun raises four issues on appeal: (1) whether the superseding indictment was legally sufficient; (2) whether the district court erred when it refused to grant an evidentiary hearing pursuant to Franks v. Delaware, 438 U.S. 154 (1978); (3) whether the district court erred when it denied his motion for continuance filed two weeks before trial; and (4) whether the district court abused its discretion in sentencing him. For the reasons stated below, we affirm.
In 2005, Okun was the sole owner of Investment Properties of America (IPofA), a Virginia limited liability company, with its principal place of business in Richmond, Virginia. IPofA was involved in the business of commercial real estate investment and management. In 2005, Okun formed 1031 Tax Group, a Delaware limited liability company with its principal place of business in Richmond.
In connection with 1031 Tax Group, Okun became involved in the business of operating qualified intermediary (QI) companies.
After acquiring his first QI company, Atlantic Exchange Company (AEC), Okun began to wire AEC client funds to his personal bank account and IPofA's bank account, with the assistance of Lara Coleman, IPofA's Chief Operating Officer. During the conspiracy, Coleman continued to assist Okun in the fraudulent scheme, which enabled Okun to use money held by the QI companies on behalf of the exchangers for personal use and for purposes related to IPofA's business. The uses of the funds held by the QI companies were not disclosed to the exchangers and were in violation of the agreements between the exchangers and the QI companies.
In 2007, Janet Dashiell, who had managed one of the QI companies acquired by Okun, began to work for 1031 Tax Group. Dashiell alerted the government to the manner in which the QI funds were being used by Okun and 1031 Tax Group.
In May 2007, 1031 Tax Group filed for bankruptcy. The collapse of 1031 Tax Group ultimately resulted in a loss in excess of $125 million dollars to exchangers who had deposited funds with the QI companies affiliated with 1031 Tax Group.
On March 17, 2008, a three-count indictment was filed in the United States District Court for the Eastern District of Virginia, charging Okun with the following offenses: one count of mail fraud, 18 U.S.C. § 1341; one count of bulk cash smuggling, 31 U.S.C. § 5332; and one count of making a false declaration, 18 U.S.C. § 1623(a).
On July 10, 2008, a twenty-seven count superseding indictment was filed in the district court. The superseding indictment charged Okun with the following offenses: one count of conspiracy to commit mail fraud and wire fraud, 18 U.S.C. §§ 1341, 1343, and 1349, one count of conspiracy to commit money laundering,
On February 27, 2009, the government filed a motion to dismiss one of the wire fraud and one of the mail fraud counts. On the same day, the district court granted the motion.
On March 3, 2009, the case proceeded to trial. After the government rested its case, Okun moved for a judgment of acquittal pursuant to Rule 29 of the Federal Rules of Criminal Procedure. The district court granted the motion with respect to the two remaining mail fraud counts, but denied the motion as to the other counts. Following Okun's presentation of his defense, closing arguments, and the district court's instructions, the case went to the jury. The jury found Okun guilty as to the remaining twenty-three counts of the superseding indictment.
The district court sentenced Okun to 1200 months' imprisonment, a downward variance from the advisory Guidelines sentence of 4800 months' imprisonment. Okun noted a timely appeal.
Okun first challenges the sufficiency of the indictment with respect to the mail fraud and wire fraud conspiracy count and the wire fraud counts. According to Okun, the indictment did not provide sufficient notice of the alleged misrepresentations made by Okun to complete the alleged frauds.
Whether an indictment properly charges an offense is a matter of law which we consider
In this case, the mail fraud and wire fraud conspiracy count and the wire fraud counts tracked the statutory language of the relevant statutes and contained the essential elements of both mail fraud and wire fraud, as well as conspiracy.
(J.A. 69).
The language used to describe the mail fraud and wire fraud conspiracy count directly tracks both the mail and wire fraud statutes, but adds in both instances that the "false and fraudulent pretenses" were "material." (J.A. 69). The introductory charging language tracks 18 U.S.C. § 1349, which criminalizes any attempt or conspiracy to violate, among other statutes, the mail fraud and wire fraud statutes. Numerous overt acts in furtherance of the conspiracy are set forth in the lengthy manner and means section of the mail fraud and wire fraud conspiracy count. Thus, the essential elements for this count are clearly specified.
The same can be said about the wire fraud counts. Those counts charge that Okun and others
(J.A. 83). This charging language is identical to § 1343, except that, like the language in the mail fraud and wire fraud conspiracy count, it adds the word "material" to describe the "false and fraudulent pretenses." (J.A. 83).
The mail fraud and wire fraud conspiracy count and the wire fraud counts also alleged the essential facts underlying each offense, allowing Okun to raise the defense of double jeopardy should the need arise in a successive prosecution. With respect to the mail fraud and wire fraud conspiracy count, the manner and means section of that count describes how Okun purchased QI companies, which used exchange agreements that required client exchange funds to be held for the purpose of funding client exchanges. Instead of abiding by the requirements set forth in the exchange agreements, Okun used the client exchange funds both to purchase other QI companies and for other purposes wholly unrelated to funding client exchanges.
The manner and means section of the mail fraud and wire fraud conspiracy count also describes how Okun and others hid from 1031 Tax Group clients the true and desperate financial condition of 1031 Tax Group by paying off earlier exchangers with the deposits of later exchangers. The count also describes how Okun and others lied to exchangers when the exchanges came due and how 1031 Tax Group was unable to fund the exchanges.
The manner and means section of the mail fraud and wire fraud conspiracy count also details how Okun and other conspirators concealed the theft of 1031 Tax Group client exchange funds from other executives both at IPofA and 1031 Tax Group. The count focuses on important aspects of Okun's scheme by highlighting three different sources of legal advice that Okun received in the late fall of 2006 regarding his misappropriation of 1031 Tax Group funds. The count also sets forth an approximate loss of $132 million dollars.
Like the mail fraud and wire fraud conspiracy count, the wire fraud counts also set forth the essential facts underlying each count. The superseding indictment provides a sufficient description of a scheme to defraud. The superseding indictment alleges that property had been misappropriated, the means by which Okun gained control over that property, and that he attempted to conceal material facts from the rightful owners of that property. Moreover, each count sets forth a date, an amount, and a description of the wire transaction.
In sum, the mail fraud and wire fraud conspiracy count sets forth the essential elements of the offense and the essential facts with more than sufficient specificity to put Okun and any future court on notice of the actions for which Okun was charged, and would allow Okun to properly raise a defense of double jeopardy in a future prosecution. The count included a date range for the conduct charged, identified the relevant companies, detailed the manner and means of the scheme, and included an approximate amount of total loss. The wire fraud counts contained the same necessary specificity. Thus, Okun's challenge to the sufficiency of the indictment must be rejected.
On April 26, 2007, a search warrant was issued by a United States Magistrate Judge pursuant to a sworn affidavit filed by United States Postal Inspector John Barrett, Jr. Inspector Barrett's affidavit set forth information and beliefs concerning the illegal activities of Okun and his related corporate entities. The primary source of the information in the affidavit was Dashiell. The information from Dashiell was corroborated by evidence produced by a confidential informant (CI). At issue here is Paragraph 18 of the affidavit, which states:
(J.A. 747-48).
The search warrant authorized the searching agents to retrieve: (1) all communications between and among 1031 Tax Group clients and officers and employees of IPofA and its subsidiaries and related companies; (2) all documents and data regarding the movement of money between Okun and other Okun-related companies and third parties; (3) all bank records of Okun and other Okun-related companies; and (4) any retained copies of tax returns filed by Okun and other Okun-related companies.
On April 27, 2007, federal law enforcement agents undertook a thorough search of the offices of various corporate entities associated with Okun and 1031 Tax Group. The product of that search was a large quantity of documentary evidence relating to Okun and his transactions with the various companies with which he was involved.
In the district court, Okun challenged the search on numerous grounds. On appeal, however, he presses only one claim. According to Okun, Paragraph 18 of Inspector Barrett's affidavit contained one material false statement, that is, that IPofA's Chief Financial Officer, David Field, "confirmed [with Dashiell] that 1031 Tax Group does not have sufficient funds to repay its clients." (J.A. 748). Okun posits the exact opposite is true—that Field "believed that sufficient assets were available to repay all investors." Appellant's Br. at 11.
The district court rejected this contention, concluding that Inspector Barrett's statement concerning Field's confirmation was not false. According to the district court, Inspector Barrett's statement was not false, because, in context, Inspector Barrett "is stating that he has been informed that 1031TG does not have the funds on hand to pay back those exchangers who are currently requesting the return of their funds, but that the corporation is investigating financing options that would allow for the exchangers to be paid." (J.A. 581). The district court noted that this reading of the affidavit was supported by other portions of the affidavit.
In general, a defendant is not entitled to challenge the veracity of a facially valid search warrant affidavit.
438 U.S. at 155-56. After making the essential preliminary showing, the defendant is entitled to an evidentiary hearing on the veracity of the statements in the affidavit. The purpose of a
In order for the
Okun's
We review the district court's denial of a motion for continuance for abuse of discretion.
In November 2008, Okun received a continuance of the trial until March 2, 2009. His January 16, 2009 request for a continuance was denied. Two weeks prior to trial, Okun again sought a continuance. This motion was premised on two theories. First, the government had provided a witness list in alphabetical order instead of listing the order in which it intended to call such witnesses. Second, Okun argued that he was uncertain as to whether the government would be permitted to proceed with a theory that Okun made misrepresentations to the prior owners of the QI companies he purchased, in addition to the clients of those QI companies.
The district court denied the motion though, in its order, the government was ordered to provide a list of witnesses in the order in which they would be called to testify. The district court found that Okun had adequate notice of the government's theory of the case and that a continuance would prejudice the government.
We find no abuse of discretion. The record reflects that the government discussed with Okun's counsel for many months its theory of misrepresentations to prior owners of the QI companies. Counsel for Okun was also on notice of such theory through a variety of district court filings and document production. Moreover, had a continuance been granted, the government would have suffered prejudice, as it had already arranged for over twenty-five witnesses to travel to Richmond from around the country.
We review a sentence imposed by the district court under the deferential abuse-of-discretion standard, regardless of whether the sentence imposed is inside, just outside, or significantly outside the Guidelines range.
In explaining the selected sentence, the district court is not required to "robotically tick through § 3553(a)'s every subsection."
In this case, the sentence imposed is both procedurally and substantively reasonable. First, the district court properly calculated the applicable Guidelines range. Okun was convicted of one count of conspiracy to commit mail fraud and wire fraud, one count of conspiracy to commit money laundering, twelve counts of wire fraud, seven counts involving money laundering, one count of bulk cash smuggling, and one count of making a false declaration. The convictions were grouped together for sentencing purposes and produced a single offense level of 53, ten levels above the highest offense level on the Sentencing Table. A total offense level of more than 43 is to be treated as an offense level of 43. U.S. Sentencing
Next, the district court considered the relevant § 3553(a) factors, emphasizing the extensive harm caused by Okun's conduct, and the need for adequate deterrence and to protect the public from further crimes by Okun. The district court also considered Okun's heart condition.
Okun's main challenge to his sentence is that the district court did not consider his age and lack of criminal history in imposing sentence. However, we have repeatedly emphasized that the district court is not required to apply § 3553(a) in a checklist fashion.
For the reasons stated herein, the judgment of the district court is affirmed.
