U.S. v. Starke

• Decision Date: 07 September 1995
• Docket Number: No. 93-2444,93-2444
• Citation: 62 F.3d 1374
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Evans H. STARKE, Jr., Defendant-Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1374

62 F.3d 1374

UNITED STATES of America, Plaintiff-Appellee, v. Evans H. STARKE, Jr., Defendant-Appellant.

No. 93-2444.

United States Court of Appeals, Eleventh Circuit.

Sept. 7, 1995.

Robert Augustus Harper, Tallahassee, FL, for appellant.

R. Jerome Sanford, Asst. U.S. Atty., Gainesville, FL, for appellee.

Appeal from the United States District Court for the Northern District of Florida.

Before COX, BLACK and BARKETT, Circuit Judges.

COX, Circuit Judge:

I. INTRODUCTION

Evans H. Starke, Jr. was convicted of 12 counts of money laundering in violation of 18 U.S.C. Sec. 1956(a)(3)(B), sentenced to 57 months imprisonment, and fined $30,000. ¹ On appeal, Starke challenges the district court's jury instructions, contending that the court's deliberate ignorance instruction was erroneous. Starke also challenges the sufficiency of the evidence, contending that the evidence does not support a finding that Government agents represented to him that the money was proceeds from narcotics trafficking. Starke also contends that there is insufficient evidence that he believed the money was proceeds from narcotics trafficking. Finally, Starke contends there is insufficient evidence to support a finding that he concealed or disguised his monetary transactions, as required for a money laundering conviction under Sec. 1956(a)(3)(B). We affirm.

II. BACKGROUND

Starke owned and operated a motel and restaurant in Waldo, Florida. The Florida Department of Law Enforcement began investigating Starke after being informed that drugs were being sold from Starke's establishment. ² The Government set up a reverse sting operation in which Leroy Ellis, a confidential informant, introduced Starke to agent James Lockley, who posed as James Ellis, Leroy's brother. ³ Lockley told Starke that he was a trucker, and arranged a deal in which he sold some meat to Starke. At the time of delivery, Lockley allegedly told Starke that the meat had been stolen. ⁴ Later, Starke arranged a purchase of stolen beer from Lockley and Ellis.

Soon thereafter, Lockley and another undercover agent, Michael Palmer, met with Starke in an effort to get Starke to launder money for them. At first, Palmer asked Starke if he would be interested in selling the restaurant to Palmer. Starke responded During these discussions, the agents never explicitly told Starke that the money they were exchanging for cashier's checks came from drug transactions. Agent Lockley testified at trial that in the real world, a narcotics trafficker would not directly tell someone that he or she was in the narcotics business. Therefore, Lockley maintained that the agents had to represent themselves to Starke as narcotics traffickers through their actions, speech, and demeanor without directly telling him they were involved with drugs.

                that he might be interested in selling when the business started to make a profit.  Palmer indicated that they had "accumulated a large amount of currency and need[ed] to see about investing it."  (Gov't Ex. 3-T at 43.)   Palmer asked Starke if Starke could help them "clean[ ] up some money and open[ ] up ... a business or whatever."  (Id. at 47.)   Starke told them that opening up a business was a good idea because it would give them a legitimate explanation for having large amounts of cash.  Noting that opening up a business was long term, Palmer asked Starke if he could help them "get some clean checks" in the short term.  (Id. at 65.)   After a number of discussions, Starke took $25,000 in cash from the agents and gave the agents two cashier's checks totalling $25,000, which Starke had obtained from his bank.  Starke had the agents wait in the car while he conducted the transaction with the bank.  Starke informed the agents that he would charge at least a ten percent fee for his services because of the risk involved.  He received $2,500 from the agents for this first transaction.  Over the next several months, Starke engaged in a substantial number of similar transactions, taking cash from the agents, giving them cashier's checks in return, and charging a ten percent fee for his services.  Starke often deposited the agents' money in his bank accounts in various increments under $10,000 to avoid the filing of transaction reports as required by 31 U.S.C. Sec. 5313. 5
                

At trial, the agents insisted that Starke had believed they were narcotics traffickers. Agent Lockley asserted that he had represented himself as a drug trafficker to Starke by "the demeanor in which [Lockley] presented [him]self, the vehicle that [he] drove, [and] the way [he] conducted [him]self." (R. 12 at 69.) Lockley claimed that several factors had contributed to his representation to Starke that he was a drug trafficker. Lockley testified that the hours he kept were indicative of a drug trafficker because he was not "strictly an eight-to-five individual." (Id.) He drove a late model Jaguar, trimmed in gold, which he asserted was indicative of a narcotics trafficker. In addition, another agent wore a Rolex watch. One of the agents had joked in Starke's presence that when people asked him what he did for a living, he told them, "I buy and sell property." (Gov't Ex. 27-T at 39.) Agent Lockley testified that he was convinced, personally, "in talking to Mr. Starke, ... looking at the demeanor, looking at eye contact; gestures that were made--that he was aware of the line of work that we were in and what we were talking about." (R. 12 at 90.)

Starke testified, however, that the agents held themselves out to be truckers. He stated that he had no idea the undercover agents were drug dealers until March 17, 1992, after all the alleged money-laundering transactions had taken place. Starke testified that he thought the money "came from the trucking business" and was a "by-product[ ] of, at most, stolen goods that were sold and turned into cash." (R. 18 at 44.) Starke admitted that he never asked the agents any questions about their business. Starke also admitted that he knew the money had been derived from illegal activity and that he helped "legitimize" the cash. Starke testified that at the time he was dealing with the agents he had thought that the transactions enabled the agents "[t]o take unreported monies from their trucking business and to get checks; whereby, they could utilize that money, without suspicion." (Id. at 93.) At trial, he Despite Starke's claim of ignorance, the transcripts of Starke's conversations with the agents indicate that Starke had told them that their car was too flashy and would draw attention to them. He also told the agents many stories about drug dealers who were apprehended or whose assets were seized. He relayed stories about both successful and unsuccessful narcotics dealers. Starke offered the agents much advice, counseling them to set up a corporation to help legitimatize their business. He also offered to sell his restaurant, motel, and home to the agents so they would have legitimate assets and income.

stated that he had thought this would also assist "them in avoiding paying taxes on monies that they had--or their ill gotten gains." (Id. at 94.)

After Starke had conducted all of the alleged money-laundering transactions, the agents specifically indicated that they were dealing in cocaine by trying to involve Starke in a cocaine transaction which was to take place either at his house or his business. Although Starke claims he did not know the agents were involved in drug transactions prior to this occasion, he did not express surprise when the agents approached him about the cocaine deal. Starke initially expressed interest in the deal, and asked how much he would be paid; however, he ultimately declined to participate.

Starke was arrested and charged, among other things, with laundering money represented to be the proceeds from the distribution of a controlled substance in violation of 18 U.S.C. Secs. 1956(a)(3)(A), (B). The indictment for the money laundering charge reads as follows:

COUNTS III THROUGH XV

[The Grand Jury charges that] on or about the dates set forth below, in the Northern District of Florida, the defendant,

EVANS H. STARKE, JR.,

knowing that the transactions were designed in whole and in part to conceal and disguise the nature, the location, the source, the ownership, and the control of certain proceeds and that the property involved in the transactions was represented by a law enforcement officer to be the proceeds of some form of unlawful activity, did knowingly and willfully conduct and attempt to conduct financial transactions, to-wit: the transfer of funds by delivery of checks drawn upon financial institutions, which transactions affected interstate commerce and involved funds which were represented to be the proceeds of a specified unlawful activity, that is, the distribution of a controlled substance, punishable under the laws of the United States, and which transactions are more particularly described below:

....

All in violation of Title 18, Unites States Code, Section 1956(a)(3)(A) and (a)(3)(B).

(R. 1-1 at 5-7) (emphasis added). At trial, the court instructed the jury only on section 1956(a)(3)(B). The court instructed that in order for the jury to find Starke guilty of violating section 1956(a)(3)(B), the Government must have proven each of the following elements beyond a reasonable doubt:

First: The defendant must knowingly conduct or attempt to conduct a financial transaction;

Second: The financial transaction or attempted financial transaction must involve property represented by a law enforcement officer to be the proceeds of specified unlawful activity, that is, buying, selling, receiving, concealing and otherwise dealing in a controlled substance; and

Third: The defendant must engage in the financial transaction with the intent to conceal or disguise the nature, location, source, ownership, or control of property believed to be proceeds of specified unlawful activity.

(R. 3-144 at 9) (...