918 F.3d 808
10th Cir.2019Background
- Darren Michael Gonzales, owner of a concrete business in Wyoming, sold cocaine and methamphetamine and used personal and business accounts to launder proceeds.
- A federal grand jury indicted him on multiple counts; he pleaded guilty to ten counts including Counts 50 and 52 (both concealment money laundering under 18 U.S.C. § 1956(a)(1)(B)(i)).
- Count 50: on Feb 17, 2016 Gonzales transferred $79,836 between Meridian Trust FCU accounts (one in his name, one in his daughter M.G.’s name); he admitted those funds included drug proceeds and that the transfer was at least partly to conceal the proceeds.
- Count 52: on Dec 21, 2015 Gonzales accessed safety deposit box 42N at Meridian Trust FCU and admitted he used the box to hold cash from drug sales and did so at least partly to conceal the proceeds.
- At plea hearing Gonzales adopted the plea-agreement factual bases and stipulated Meridian Trust is a financial institution affecting interstate commerce.
- On appeal Gonzales argued (for the first time) Rule 11(b)(3) error: his guilty pleas to Counts 50 and 52 lacked a sufficient factual basis; the Tenth Circuit affirmed.
Issues
| Issue | Plaintiff's Argument (Gonzales) | Defendant's Argument (Government) | Held |
|---|---|---|---|
| Sufficiency of factual basis for Count 50 (money transfer) | The admitted facts could describe a lawful transfer; plea lacked factual basis for concealment element | Plea admissions (transfer between credit-union accounts, admission funds were drug proceeds, intent to conceal) satisfy all §1956 elements | Court held plea admissions provided a sufficient factual basis; affirmed conviction |
| Sufficiency of factual basis for Count 52 (use of safe-deposit box) | Use of box did not necessarily conceal identity or convert funds to legitimate wealth; access alone is not a financial transaction | Statute defines use of a safe-deposit box as a transaction; Gonzales admitted the box held drug proceeds and that he used it to conceal them | Court held admissions and statutory definitions satisfy §1956 elements; affirmed conviction |
| Applicability of plain-error review | (implicit) challenge raised first on appeal; argues Rule 11(b)(3) violation | Government notes plain-error standard applies but argues Gonzales cannot meet it because no Rule 11 error occurred on the record | Court resolved appeal at first step: no error — factual basis adequate, so plain-error inquiry ends |
| Need for additional proof (e.g., conversion to legitimate wealth or identity concealment) | Argued government must show conversion or stronger concealment facts | Government and court: statute targets any transaction designed to conceal nature, source, location, ownership, or control — conversion not required | Court held conversion or identity-obfuscation is not required; admissions of intent to conceal suffice |
Key Cases Cited
- United States v. Carillo, 860 F.3d 1293 (10th Cir.) (plain-error standard for unobjected Rule 11(b) claims)
- United States v. Garcia-Emanuel, 14 F.3d 1469 (10th Cir.) (elements of concealment money laundering and evidence of intent to conceal)
- United States v. Roe, 913 F.3d 1285 (10th Cir.) (guilty plea is an admission of elements and relieves government of burden of proof)
- United States v. Lovett, 964 F.2d 1029 (10th Cir.) (money-laundering statute covers any transaction designed to conceal nature, location, source, ownership, or control)
- United States v. DeFusco, 949 F.2d 114 (4th Cir.) (admission of intent at plea supports factual basis)
- United States v. Guichard, 779 F.2d 1139 (5th Cir.) (plea admissions as to elements including intent provide factual basis)