United States v. Mbaye, No. 14-3348 (7th Cir. 2016)
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Mbaye and three co‐defendants ran a mortgage‐fraud scheme that involved “straw buyers” who purchased homes at inflated prices using borrowed funds and then defaulted. Their “take” was about $600,000. Mbaye admitted to all of his conduct and that the scheme was fraudulent, but argued that his co‐defendants duped him into helping them without knowing they were committing fraud. The jury convicted him. At sentencing, the judge found that Mbaye had obstructed justice by lying about material facts. The enhancement increased Mbaye’s offense level so that the Guidelines recommended a sentence of 70 to 87 months. The judge imposed a sentence of 35 months. The Seventh Circuit affirmed, holding that the underlying findings were adequately explained and were supported by the evidence.
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In the United States Court of Appeals For the Seventh Circuit ____________________ No. 14 3348 UNITED STATES OF AMERICA, Plaintiff Appellee, v. SALIOU MBAYE, Defendant Appellant. ____________________ Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 11 CR 800 — Milton I. Shadur, Judge. ____________________ ARGUED DECEMBER 7, 2015 — DECIDED JUNE 28, 2016 ____________________ Before FLAUM, WILLIAMS, and SYKES, Circuit Judges. WILLIAMS, Circuit Judge. Saliou Mbaye was charged with bank fraud and mail fraud. The government alleged that he and three co defendants ran a mortgage fraud scheme that “earned” them $600,000. At trial, Mbaye testified and admit ted to his conduct and to the existence of a scheme, but claimed that he lacked the requisite guilty state of mind. He 2 No. 14 3348 said that he was duped into helping out his co defendants, who were the only true fraudsters. The jury didn’t believe him, so he was convicted. Mbaye contends on appeal that the evidence of his guilty mind was legally insufficient, but we disagree. The adverse testimony of two of his co defendants, along with circumstan tial evidence that Mbaye was a knowing participant in the scheme, was enough to support his conviction. He also chal lenges the sentencing judge’s finding that he obstructed jus tice by lying under oath about material facts. But the judge’s finding was adequately explained and is supported by the record. Finally, Mbaye argues that his sentence is substan tively unreasonable, but again we disagree. We affirm his con viction and sentence. I. BACKGROUND The government contended that Mbaye and his three co defendants ran a mortgage fraud scheme. The general struc ture of the scheme can be explained by example: a home owner wants to sell her house for $250,000 but has difficulty selling at that price. A fraudster agrees to buy the house for $400,000 if the seller gives the extra $150,000 right back to the fraudster. The fraudster borrows the purchase money from a bank by lying—he convinces the bank both that the property is actually worth $400,000 and that he has the ability to pay back that amount. The bank has been defrauded. It was con vinced by lies to hand out $400,000 and in return it received a security interest worth only $250,000 (or less, since the seller initially had trouble selling at that price). An additional wrin kle: the fraudster doesn’t take out loans in his own name—he finds “straw” purchasers willing to let their names be used, for a small fee. No. 14 3348 3 That example roughly describes the transactions in Mbaye’s case. The exact details are unnecessary because Mbaye admits to all of his conduct and admits that the scheme was fraudulent. He contends only that his co defendants were the fraudsters and he was duped into helping them without knowing they were committing fraud. Because fraud requires a culpable state of mind, he argued at trial that he was inno cent and he argues on appeal that the evidence of his guilt was insufficient. The jury rejected his story and convicted him. At sentenc ing, the judge found that Mbaye had obstructed justice by ly ing about material facts. That finding increased Mbaye’s of fense level and accordingly his Guidelines recommended sentence. He argues on appeal that the judge’s finding was er roneous and insufficiently explained. With the obstruction of justice enhancement, the Guide lines recommended a sentence between 70 and 87 months. The judge imposed one of 35 months, which Mbaye argues is substantively unreasonable because it is too long. II. ANALYSIS A. Evidence Sufficient to Convict In analyzing Mbaye’s challenge to the sufficiency of the ev idence, we view the evidence “in the light most favorable to the government” and we will “overturn the verdict only when the record contains no evidence, regardless of how it is weighed, from which the jury could find guilt beyond a rea sonable doubt.” United States v. Morales, 655 F.3d 608, 634 (7th Cir. 2011) (internal citation and quotation marks omitted). We 4 No. 14 3348 do not reweigh the evidence or second guess the jury’s credi bility determinations. United States v. Williams, 553 F.3d 1073, 1080 (7th Cir. 2009) (internal citation omitted). The government contended that Mbaye’s role in the mort gage fraud scheme was to launder the money. Mbaye created a shell company named Veracity Enterprises Corporation and opened a corporate bank account. Mbaye deposited the prof its from the scheme into that account and then promptly paid that money out to himself and his co defendants, writing “ad ministrative duties” on the memo line of the corporate checks. Mbaye, as “CEO” of Veracity, signed false documents used to obtain loans and close sales, and his phone number was on some of those documents, suggesting he stood ready to verify the false information. His share of the proceeds was more than $80,000. Mbaye admits all those facts but says he didn’t know anything untoward was afoot. He testified that he was merely helping a childhood friend. The friend was going through a divorce and didn’t want to put his money in the bank account he shared with his soon to be ex wife, so Mbaye handled the friend’s money as a favor, and the friend paid Mbaye $80,000 as a “thank you”. The jury rejected this story. Mbaye says the evidence was insufficient to allow that. We have described an appellant’s challenge to the suffi ciency of the evidence as “a nearly insurmountable hurdle,” United States v. Taylor, 637 F.3d 812, 815 (7th Cir. 2011), and Mbaye does not come close to clearing it. For starters, his story was implausible, which the jury could weigh against him. United States v. Jocic, 207 F.3d 889, 893 (7th Cir. 2000) (if the “defendant decides to testify and deny the charges against him and the finder of fact thinks he is lying, his untruthful No. 14 3348 5 testimony becomes evidence of guilt to add to the other evi dence”); United States v. Williams, 136 F.3d 1166, 1168 (7th Cir. 1998) (rejecting sufficiency challenge in part because defend ant’s testimony “reek[ed] of implausibility”). The government presented further evidence of Mbaye’s guilt. For example, he didn’t report the $80,000 on his tax re turns, and when he was interviewed by investigators, he lied. See United States v. Whiteagle, 759 F.3d 734, 757–58 (7th Cir. 2014) (false statements to law enforcement can be probative of guilt). Most incriminating of all, two of his co defendants tes tified against him, saying he was a knowing participant in the scheme. Mbaye says those witnesses were biased because they testified in exchange for the government’s agreement to recommend they receive lenient sentences. But that’s an argu ment for the jury, not this court. United States v. Harris, 791 F.3d 772, 779 (7th Cir. 2015); United States v. Bailey, 510 F.3d 726, 734 (7th Cir. 2007). Indeed, the argument was made to the jury and the jury rejected it, as it was entitled to do. The evidence— including the co defendants’ testimony, the circumstantial ev idence, and Mbaye’s implausible story—sufficiently sup ported the jury’s verdict. B. No Error in Finding Mbaye Obstructed Justice Mbaye argues that the sentencing judge erred by applying U.S.S.G. § 3C1.1, which adds two points to the offense level if “the defendant willfully obstructed or impeded, or attempted to obstruct or impede, the administration of justice with re spect to the … prosecution … of the instant offense of convic tion.” We review de novo the adequacy of the sentencing judge’s factual findings. United States v. Chychula, 757 F.3d 615, 619 (7th Cir. 2014). We review the correctness of those findings for clear error and the determination that the facts support the 6 No. 14 3348 enhancement de novo. United States v. Pellmann, 668 F.3d 918, 926 (7th Cir. 2012). The enhancement applies if a defendant takes the stand and “gives false testimony concerning a material matter with the willful intent to provide false testimony, rather than as a result of confusion, mistake, or faulty memory.” United States v. Dunnigan, 507 U.S. 87, 94 (1993). Because “inaccurate testi mony … may result from confusion, mistake, or faulty memory, … not all inaccurate testimony” warrants the en hancement. U.S.S.G. § 3C1.1, App. Note 2. So when a defend ant objects to the enhancement, the “district court must re view the evidence and make independent findings necessary to establish” perjury. Dunnigan, 507 U.S. at 95. “[T]he district court should make a finding as to all the factual predicates nec essary for a finding of perjury: false testimony, materiality, and willful intent,” but explicit findings on each element “are not necessary if the court makes a finding that encompasses all of the factual predicates ….” Chychula, 757 F.3d at 619 (empha sis added) (internal citation and quotation marks omitted); Dunnigan, 507 U.S. at 95. Mbaye argues that he did not commit perjury because he told the truth. We easily reject that argument because it asks us to reweigh the evidence and overturn both the judge’s and the jury’s credibility determinations, which we do not do. United States v. Taylor, 701 F.3d 1166, 1173 (7th Cir. 2012). Mbaye next argues that the judge inadequately discussed whether the false testimony was willful. Not so. The judge ex plicitly found that Mbaye lied—he didn’t testify inaccurately due to confusion, mistake, or faulty memory. See Chychula, 757 F.3d at 620–61 (willfulness finding adequate if judge finds the defendant “lied”); United States v. Johnson, 680 F.3d 966, 982 No. 14 3348 7 (7th Cir. 2012) (same). The judge repeatedly stated that Mbaye “chose” to testify the way that he did, and doing so revealed “a deep character flaw.” The judge stated that Mbaye “de part[ed] sharply from the truth, depart[ed] so sharply that to characterize it as perjury would not be a mislabel.” The judge gave a specific example: Mbaye wrote “administrative duties” on the memo line of corporate checks used to pay himself and his co defendants. He testified that he did so to reflect his own “administrative” task of writing the check, as opposed to the more common (if not universal) use of a memo line—to say why the recipient is being paid. The judge found that story to be willfully false, calling it “nonsense.” There is no doubt that the judge found Mbaye’s testimony was willfully false, not a mistake. A finding of willfulness makes sense in this case because there is no reasonable likelihood that Mbaye’s far fetched story was the result of “confusion, mistake, or faulty memory.” Dunnigan, 507 U.S. at 94; see United States v. Ander son, 580 F.3d 639, 648–49 (7th Cir. 2009) (affirming enhance ment where the defendant “willfully obstructed justice by falsely denying any knowledge of the criminal nature of the enterprise”). The judge made an explicit finding of willfulness and did not clearly err in doing so. Strangely, Mbaye does not raise the third factual predicate of perjury: materiality. That’s strange because materiality is the one predicate that the judge did not explicitly address. The judge’s error is harmless if the record would clearly have sup ported a finding of materiality. Chychula, 757 F.3d at 621. “[A] matter is material if it concerns information that, if believed, would tend to influence or affect the issue under determina tion.” United States v. Riney, 742 F.3d 785, 790 (7th Cir. 2014) 8 No. 14 3348 (quoting U.S.S.G. § 3C1.1, App. Note. 6). Mbaye has not made a materiality argument and in any event his testimony was material. For example, the government argued that Veracity Enterprises Corporation had no operations, so the fact that Mbaye held himself out as the “CEO” and wrote “administra tive duties” on the corporate checks showed that he was try ing to disguise the source and nature of the payments. If the jury believed Mbaye’s testimony—that “administrative du ties” was not active concealment, but an accurate description of Mbaye’s act in writing the check—it would have weakened the government’s case. In sum, we find no reversible error concerning the obstruction of justice enhancement. C. No Error in Mbaye’s Sentence Mbaye’s final challenge is to his sentence. “We review a district court’s choice of sentence in two steps. First, we assess de novo whether the court followed proper procedures. If the decision below is procedurally sound, then we ask whether the resulting sentence is substantively reasonable.” United States v. Warner, 792 F.3d 847, 855 (7th Cir. 2015) (internal cita tions omitted); see also United States v. Gall, 552 U.S. 38, 51 (2008). In reviewing for substantive reasonableness, we apply “a deferential abuse of discretion standard.” Warner, 792 F.3d at 856. “A below guidelines sentence, like a within guidelines one, is presumed reasonable against a defendant’s challenge that it is too high.” United States v. Poetz, 582 F.3d 835, 837 (7th Cir. 2009). Mbaye argues that his sentence should have been lower because, though he was convicted of both mail fraud and bank fraud, the government could have chosen to prosecute him only for mail fraud, in which case no mandatory mini mum would have applied. The argument is factually wrong No. 14 3348 9 and legally frivolous. Factually, no minimum applied and there is no indication that the judge thought otherwise. Le gally, a defendant has no right to be charged with only the least serious crime that fits his conduct. A defendant who beats someone to death has no right to be charged with only simple battery, rather than homicide. We do not suggest Mbaye did anything that serious, but his argument is of the same form and is no less misguided. Finally, Mbaye argues that his positive contributions to his community—which the record reveals were substantial— warranted a non custodial sentence. But the judge took those contributions into account and sentenced Mbaye to half of the low end of the Guidelines range. That sentence is presump tively reasonable on appeal and Mbaye has not overcome the presumption. III. CONCLUSION We AFFIRM Mbaye’s conviction and sentence.
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