U.S. v. Citro

• Decision Date: 09 February 1988
• Docket Number: No. 87-1249,87-1249
• Citation: 842 F.2d 1149
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Frank CITRO, Defendant-Appellant. . Submission Deferred
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1149

842 F.2d 1149

UNITED STATES of America, Plaintiff-Appellee, v. Frank CITRO, Defendant-Appellant.

No. 87-1249.

United States Court of Appeals Ninth Circuit.

Submission Deferred Feb. 9, 1988.

Argued and Submitted March 1, 1988.

Decided March 28, 1988.

Robert W. Lueck, Las Vegas, Nev., for defendant-appellant.

Paul E. Wommer, Asst. U.S. Atty., Las Vegas, Nev., for plaintiff-appellee.

Appeal from the United States District Court for the State of Nevada.

Before FARRIS, BRUNETTI and THOMPSON, Circuit Judges.

FARRIS, Circuit Judge:

Visa International, Mastercard International, and Bank of America's Office of Corporate Security discovered an inordinate amount of counterfeit credit card use in the Las Vegas area and worked out an agreement with the Las Vegas Metropolitan Police Department to investigate local merchants for possible collusion in a counterfeit credit card scheme. The police department hired Michael Milano to act as a liaison in introducing undercover officers to merchants willing to accept counterfeit cards. Milano had a prior conviction for operating a counterfeit credit card scheme, but was working as a police informant.

Milano began frequenting a particular lounge where he met the defendant, Frank Citro, and the two became good friends. Milano eventually raised the idea of a scheme involving counterfeit credit cards and collusive merchants and explained to Citro how the credit card scheme might operate. There was evidence at trial that Citro suggested he might know of some merchants who would be willing to accept counterfeit credit cards. Milano told Citro that he had a partner, "Troy Hill" (who was in reality undercover police officer Edward Schaub), who actually possessed the counterfeit cards.

Milano arranged a dinner meeting at an expensive restaurant between himself, Citro, and Schaub, who was posing as Hill. During the dinner, Schaub described to Citro how the counterfeit credit card scheme could work with collusive merchants. Schaub told Citro that he was going to use a counterfeit card to pay for dinner, but Citro was not present at the table when Schaub used the card.

About a week later Milano and Schaub hosted Citro and their respective dates at another expensive restaurant. When the bill came, Schaub told the party that he was posing as Vernon Brown for the night and paid for the dinner using a counterfeit card bearing that name. Schaub testified that after dinner he met privately with Citro who agreed to introduce him to some possible collusive merchants. Schaub also testified that during this conversation, he agreed to pay Citro $200 for each introduction plus a percentage of the purchased merchandise.

A few days later, Citro called Milano and said he had a clothing store lined up to take the credit cards. Citro, Milano, and Schaub met outside the store. Citro patted down Schaub to check for a wire. Schaub explained that he wanted to do a cash deal with the merchant pursuant to which Schaub and the merchant would split fifty/fifty the amount of money charged to a counterfeit credit card. Citro went into the store and spoke briefly with the owners. Citro came out and told Schaub and Milano that the merchant would not do a "cash deal," but that he would accept the counterfeit cards for the purchase of merchandise. The three men all selected suits, and Schaub paid for them using counterfeit cards.

After a few days, Citro called Milano and said that Milano and Schaub should meet him at a jewelry store. When Schaub arrived, Milano was waiting outside, but Citro was inside talking to the owner. Citro came outside and again patted down Schaub. Citro told Schaub that the owner was willing to do a cash deal and that he had negotiated a two-thirds/one-third split between Schaub and the merchant in favor of Schaub. This was better than the fifty/fifty split Schaub had previously requested. Schaub handed the owner two white plastic cards with only names and numbers embossed on them. The owner processed them as legitimate cards: one for $793.13, and the other for $800.00. After the cards were processed the owner gave Schaub $550 in cash and eighty ounces of silver (worth approximately $260). Once outside the store, Citro accepted $200 from Schaub.

A jury found Citro guilty of conspiracy to use counterfeit access devices in violation of 18 U.S.C. Sec. 1029(b) and attempt to use counterfeit access devices in violation of 18 U.S.C. Sec. 1029(a)(1), (b)(1), and (c)(2). Citro appeals the trial court's denial of his pretrial motion to dismiss based on outrageous government conduct. Citro also appeals the denial of his motions to acquit, as well as his motion for a new trial based on the defense of entrapment as a matter of law. Finally, Citro appeals the trial court's imposition of sentence as an abuse of discretion.

I. Entrapment

In reviewing the denial of a motion for acquittal based on entrapment as a matter of law, the court must view the evidence in the light most favorable to the government, and decide whether any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt. United States v. Hsieh Hui Mei Chen, 754 F.2d 817, 821 (9th Cir.1985), cert. denied, 471 U.S. 1139, 105 S.Ct. 2684, 86 L.Ed.2d 701 (1985).

Abuse of discretion is the standard of review governing Citro's appeal of the denial of his motion for a new trial based on the same grounds. Id. The court will only grant the motion in exceptional circumstances where the evidence weighs heavily against the verdict. Id.

In order to prove entrapment as a matter of law, there must be undisputed evidence that a government agent induced an otherwise innocent person to commit the alleged crime by trickery, persuasion, or fraud. Id. "The controlling question on review is whether the defendant lack[ed] the predisposition to commit the act." Id.

Citro argues that the Supreme Court's decisions in Sherman v. United States, 356 U.S. 369, 78 S.Ct. 819, 2 L.Ed.2d 848 (1958) and Sorrells v. United States, 287 U.S. 435, 53 S.Ct. 210, 77 L.Ed. 413 (1932) are controlling. Based on the facts in these two decisions the Ninth Circuit has developed five factors to consider when determining the predisposition of the defendant: (1) the character or reputation of the defendant; (2) whether the government made the initial suggestion of criminal activity; (3) whether the defendant engaged in the activity for profit; (4) whether the defendant showed any reluctance; and (5) the nature of the government's inducement. United States v. So, 755 F.2d 1350, 1354 (9th Cir.1985); United States v. Reynoso-Ulloa, 548 F.2d 1329, 1336 (9th Cir.1977), cert. denied, 436 U.S. 926, 98 S.Ct. 2820, 56 L.Ed.2d 769 (1978). None of these factors alone indicates either the presence or absence of predisposition, however the most important factor is whether the defendant demonstrated reluctance to engage in the crime which was overcome by repeated Government inducement. Reynoso-Ulloa, 548 F.2d at 1336.

Citro points to several pieces of evidence which indicate he was not predisposed to commit the charged offense. It was the government's agent, Milano, who initially suggested the criminal activity, and the government which supplied all the counterfeit credit cards. Furthermore, Citro was initially reluctant to engage in the activity and only agreed after repeated suggestions by Milano, and two expensive dinners paid for by an undercover police officer using counterfeit cards.

Nevertheless, there is substantial evidence which weighs in favor of finding predisposition. Although Milano initiated discussion of the credit card scheme, Citro told Milano that he might know of some merchants who would be willing to accept counterfeit cards. This revelation occurred prior to the two expensive dinners with Schaub. On his own initiative, Citro negotiated a better cut for Schaub on the cash deal with the merchant than Schaub had originally suggested. Citro was obviously savvy enough to insist on patting Schaub down to check for a wire prior to each transaction. Citro engaged in the activity for profit, and the government's inducement of two expensive dinners and a $200.00 fee for each introduction was not overwhelming.

In United States v. Esquer-Gamez, 550 F.2d 1231, 1234 (9th Cir.1977), the court rejected the defendant's argument that he was not predisposed to supply cocaine despite his initial reluctance and the fact that he cooperated only after repeated inducements, numbering approximately twenty. The court noted that the only inducement offered the defendant was money. Id. Citro's position is very similar to that of the defendant in Esquer-Gamez. Although it is true that he did not initiate the idea of a credit card fraud scheme and did not immediately agree to participate, Citro eventually engaged in the scheme fully, and the only inducements offered were money and two expensive dinners.

Viewed in the light most favorable to the government, there was sufficient evidence for a rational trier of fact to conclude that Citro was predisposed to commit the crime. Therefore, the district court did not err in denying Citro's motions for acquittal based on the entrapment defense. Neither was it an abuse of discretion for the trial judge to deny Citro's motion for a new trial based on the same grounds.

II. Outrageous Government Conduct

A motion to dismiss an indictment based on outrageous government conduct is a question of law reviewed de novo. United States v. Williams, 791 F.2d 1383, 1386 (9th Cir.), cert. denied, 479 U.S. 869, 107 S.Ct. 233, 93 L.Ed.2d 159 (1986); United States v. Ramirez, 710 F.2d 535, 539 (9th Cir.1...