61 F.3d 1181 (5th Cir. 1995), 93-2768, United States v. Leonard

Docket Nº:93-2768, 93-2769 and 93-2778.
Citation:61 F.3d 1181
Party Name:UNITED STATES of America, Plaintiff-Appellee, v. Richard LEONARD, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Rhonda KELLEY and Veronica McCracken, Defendants-Appellants. UNITED STATES of America, Plaintiff-Appellee, v. Alfred C. GREENE, Jr., Defendant-Appellant.
Case Date:August 14, 1995
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

Page 1181

61 F.3d 1181 (5th Cir. 1995)

UNITED STATES of America, Plaintiff-Appellee,

v.

Richard LEONARD, Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee,

v.

Rhonda KELLEY and Veronica McCracken, Defendants-Appellants.

UNITED STATES of America, Plaintiff-Appellee,

v.

Alfred C. GREENE, Jr., Defendant-Appellant.

Nos. 93-2768, 93-2769 and 93-2778.

United States Court of Appeals, Fifth Circuit

August 14, 1995

Page 1182

[Copyrighted Material Omitted]

Page 1183

Richard Leonard, Oakdale, LA, pro se.

George D. Murphy, Asst. Federal Public Defender, Roland E. Dahlin, II, Federal Public Defender, Thomas S. Berg, Asst. Federal Public Defender, Houston, TX, for Kelley.

Sylvia Yarborough (court-appointed), Houston, TX, for McCracken.

Frank E. Sheeder, III, Charles W. Blau, Meadows, Owens, Collier, Reed & Coggins, Dallas, TX, for Greene.

Alfred C. Greene, Jr., Spring, TX, pro se.

James L. Powers, Paula C. Offenhauser, Asst. U.S. Attys., Gaynell Griffin Jones, U.S. Atty., Houston, TX, for U.S.

Appeals from the United States District Court for the Southern District of Texas.

Before KING and EDITH H. JONES, Circuit Judges, and KAZEN, District Judge. [*]

EDITH H. JONES, Circuit Judge:

In this consolidated appeal, we reject challenges to the convictions and sentencing of four operators and employees of a Houston-based telemarketing scam. Alfred Greene, owner and operator of the business, and Richard Leonard, manager of the phone room, both entered pleas of guilty to wire and mail fraud, conspiracy, and using a false name to further a scheme to defraud. They waived their right to jury trial and contested the money laundering counts at a bench trial. Greene was convicted on several counts whereas Leonard was found not guilty on the sole money laundering offense with which he was charged. Employees of the operation, Kelley and McCracken, contested all the fraud and money laundering offenses with which they were charged and, therefore, obtained a severance from Greene and Leonard and were tried before a jury. They were both convicted of conspiracy as well as wire and mail fraud. Finding no error, we affirm the convictions and sentencing decisions in every aspect.

I.

BACKGROUND

The scheme itself was simple. Callers, hired by Greene and Leonard, used phone lines set up in a suite of small offices in the Houston area to contact elderly citizens located across the country and inform them that their names had been selected by a committee to receive one of four awards. These individuals, whose identities had been purchased from a mail order company, were read to from a pre-designed script and told

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that they had already been chosen to receive either first prize of $15,000.00 cash; second prize consisting of a diamond and sapphire pendant; third prize which was a large-screen Sony television; or, fourth prize consisting of $1,000.00 cash. The pendant, the only prize ever given out, was designated as second prize so that the victim would think it the second-most valuable item after the $15,000.00. In fact, a portion of the script anticipated questions as to the value of the pendant and was designed to mislead the person to believe that the jewelry, later appraised for $15.00, was worth between $2,000.00 and $2,500.00. To obtain the prize, the victim was informed that he or she had to pay $395.50. This money, the listeners were told, was for "promotional fees," "shipping and handling," "registration and processing," and "buying soap." 1 To reduce the chances of the victim's changing his or her mind, or a family member's coming home and extinguishing the deal, Federal Express was dispatched to pick up the $395.50 check shortly after the phone call.

In fact, there was no contest, there was no drawing, there was no committee, and the victims had not sent in entry cards to which the script referred. The scheme also included a follow-up letter to the victim referring to the phone call and repeating the "good news" that a prize had been won. This letter was designed to lull the victim into a sense of satisfaction with the contest. Later, a box of cheap cosmetics was delivered to the victim for the same purpose. No one ever received anything other than a $15.00 pendant. In effect, the victims each bought a $15.00 pendant for almost $400.00. By the time the FBI executed a search warrant at the office of Promotional Advertising Concepts, the business name of the operation, the scheme had reeled in 497 victims and grossed close to $200,000.00.

II.

DISCUSSION

A. Greene

Greene first contends that the district court violated his constitutional rights by considering evidence in his bench trial which was admitted during the jury trial of Kelley and McCracken. Greene suggests that the district judge promised he would not consider evidence that he had heard during the jury trial of the severed codefendants. A fair reading of the exchange between counsel and the court indicates, however, that what was really contemplated was a "divorce" between the trials on the merits and not a complete ban for sentencing purposes. Nothing in the record suggests that the district court considered any evidence from the first trial in its determination of Greene's guilt of money laundering.

Further, at sentencing, Greene did not object to the court's observations concerning the elderly victims who testified at the first trial, so he must now establish "plain error." United States v. Bullard, 13 F.3d 154, 159 (5th Cir.1994). This he cannot do. To resolve a dispute at sentencing, the district court may consider non-admissible "relevant information" provided that it "has sufficient indications of reliability." U.S.S.G. Sec. 6A1.3(a); United States v. Bermea, 30 F.3d 1539, 1576 (5th Cir.1994). Testimony under oath observed by the district court would qualify.

United States v. Smith, 13 F.3d 860 (5th Cir.1994), is not to the contrary. Although this court vacated a sentence where the court considered of factual matters contained in a co-defendant's pre-sentencing report...

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