U.S. v. Corona

Decision Date29 September 1989
Docket NumberNo. 87-5952,87-5952
Citation885 F.2d 766
PartiesUNITED STATES of America, Plaintiff-Appellee, v. Rafael L. CORONA, Ray L. Corona, Defendants-Appellants.
CourtU.S. Court of Appeals — Eleventh Circuit

John W. Nields, Jr., Howrey & Simon, W. Neil Eggleston, Washington, D.C., for defendants-appellants.

Dexter W. Lehtinen, U.S. Atty., Linda Collins Hertz, Tom Blair, Asst. U.S. Attys., Miami, Fla., for plaintiff-appellee.

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

Before RONEY, Chief Judge, VANCE, Circuit Judge, and EVANS *, District Judge.

RONEY, Chief Judge:

Defendants Ray Corona and his father, Rafael Corona, were convicted of Travel Act, mail fraud, and racketeering (RICO) charges. Ray Corona was also convicted of RICO conspiracy. Two days after the verdicts, the Supreme Court decided McNally v. United States, 483 U.S. 350, 107 S.Ct. 2875, 97 L.Ed.2d 292 (1987). Pursuant to McNally 's limitations on the applicability of the mail fraud statutes, the district court dismissed the mail fraud counts and the mail fraud predicate acts in the RICO count, which resulted in dismissal of the RICO count as to Rafael, but not as to Ray. Rafael then stood convicted of only a Travel Act violation. The defendants appeal the remaining convictions, raising claims of insufficiency of evidence, double jeopardy, and "spill-over" effect from the dismissed mail fraud charges. We reverse as to Rafael Corona on the ground there was insufficient evidence to support the Travel Act violation. Although the court is divided in two respects, we affirm in part and reverse in part as to Ray Corona.

Background

The Coronas' initial trial ended in a mistrial after the jury was unable to reach a verdict as to either of them. The Government obtained a superseding indictment, which the defendants sought to have dismissed on double jeopardy grounds. The district court denied the motion to dismiss, and this Court affirmed the denial in an interlocutory appeal. United States v. Corona, 804 F.2d 1568 (11th Cir.1986), cert. denied, 481 U.S. 1017, 107 S.Ct. 1896, 95 L.Ed.2d 503 (1987).

On retrial, the Government's evidence showed that Jose Antonio Fernandez, a Cuban-born United States resident, initially became involved in the marijuana "brokerage" business as a low level employee of Jose Alvaro-Cruz. A "broker" in the drug trade is a middle-man who for a fee will take on a consignment basis large shipments of drugs smuggled into this country to find a buyer for them.

In 1976 Ray Corona was Senior Vice President of the Total Bank in Miami. Rafael Corona was President of the bank. Fernandez and Ray Corona met through Alvaro-Cruz. At that time, Fernandez was starting a boutique and had virtually no source of legitimate income since the business was barely meeting operating expenses. Ray became banker for Fernandez, as well as for several of Fernandez's associates in the marijuana trade. Fernandez wanted Visa and American Express gold cards. Since he had no credit history, Ray required him to deposit $20,000. Fernandez delivered the money in cash wrapped in a paper bag.

According to Fernandez, he and his associates in the drug trade, who also banked at the Total Bank, would visit Ray and discuss "what they were doing. * * * They would joke about it. * * * [They would discuss] how much money they made. * * * [Fernandez] thought Ray came to look at [him] like part of the group." Steve Samos and Ivan Robles were Fernandez's money launderers, working out of Panama. Fernandez owned several off-shore "shell companies" in Panama and the Grand Cayman Islands through which his money was laundered.

In 1977 Fernandez, who the previous year had virtually no legitimate income and no credit history, began discussing with Ray the possibility of buying a bank. Fernandez, Alvaro-Cruz, and Ray discussed the matter at Ray's office. Initially, Alvaro-Cruz, and Fernandez proposed that each of them would contribute half the money necessary, but Alvaro-Cruz withdrew from the plan when Ray wanted a 15% share without contributing any money.

Ray Corona, Samos, and Fernandez were aware that Fernandez could not buy a bank under his own name due to the close scrutiny that the Comptroller of Currency would give to the proposed purchaser. Therefore, they agreed to use Alma Robles, Samos's ex-wife who was from an influential family in Panama, as the nominee or "figurehead" buyer. Ray located a bank and told Fernandez that he would need to produce $500,000 as earnest money. Fernandez gave Ray $500,000 cash. The first attempt to buy a bank was unsuccessful. Ray later told Fernandez that he could probably purchase a majority interest in the Sunshine State Bank in Miami for about $2,000,000.

Ray quit his job at the Total Bank before the Sunshine State Bank purchase was complete. Fernandez gave him a $200,000 personal loan to buy a new house and car. Fernandez, Samos, and Ray Corona were at Fernandez's Ocala horse ranch when they learned that the Sunshine State Bank purchase had been approved. After celebrating, Fernandez took $1,000,000 cash out of his safe and gave it to Ray and Samos, who took it with them back to Miami. Samos then took the money to Panama and laundered it by transferring it through numerous accounts to disguise its source. Finally, he disbursed it from Alma Robles' account and wired it back to Ray to make the purchase.

Ray Corona was made President and Chairman of the Board of the bank. Later, Rafael Corona left the Total Bank and became Chairman of the Board at the Sunshine State Bank. Ray continued as President.

Fernandez treated the bank as an investment. Although he purchased it with laundered drug proceeds, he did not launder money through it after the purchase. On Ray's recommendation Fernandez started the Cumberland Management Company as a "front" for investment purposes and established his office near the bank. Bank employees had a rubber stamp of Fernandez's signature and covered several substantial overdrafts which occurred when he was out of town.

Fernandez gave numerous presents to bank employees, including gifts to Ray Corona of two large-screen televisions valued at between three and five thousand dollars. Ray and Fernandez were social friends as well as business associates. Ray visited Fernandez's home several times, dined with him and his wife occasionally, borrowed his boat often, and sponsored him for membership in a yacht club. Eventually the friendship soured as Fernandez perceived a threat to his bank investment in Ray's erratic, extravagant lifestyle (driving a Rolls Royce, purchasing mink coats, and getting in fights at a night club).

Fernandez had stepped into the leadership void in the drug business left when Alvaro-Cruz moved to Spain due to "tax problems." Within about two years Fernandez owned a 50-acre Ocala, Florida horse ranch worth $1,000,000, seven beach-front acres including three buildings at Vero Beach, several other properties, and a $90,000 boat, all bought with his drug earnings.

Tino Guevara was Fernandez's brother-in-law and partner in the marijuana trade. In late 1979 and early 1980, after Guevara's arrest, Fernandez, already having accumulated great wealth, began to consider retiring from the drug "brokering" business. He told Ray of his thoughts of selling the bank. Ray wanted time to arrange for him and his father to buy it themselves.

Between 1976 and 1981 Fernandez made approximately five to seven million dollars "brokering" 43 shipments of marijuana totalling 1.3 million pounds worth about $200,000,000. In March 1981, soon after "brokering" what turned out to be his last shipment of marijuana, Fernandez was arrested on a federal indictment in New Orleans. Ray flew to New Orleans to visit Fernandez, ostensibly to assist with bail. Fernandez sent Ray away for fear that federal prosecutors might figure out Fernandez's relationship to the Sunshine State Bank. Back in Miami, however, Ray contacted Guido Eschevarria, a bank customer who had never met Fernandez, and persuaded him to withdraw a $100,000 certificate of deposit (even though the bank held it as collateral for an $89,000 loan) and fly to New Orleans to help Fernandez make bail.

After Fernandez's release on bail, he and his family were kidnapped by Colombian marijuana suppliers and taken to Colombia until he repaid several million dollars owed for prior drug shipments which had been taken on consignment and for which his associates had failed to pay the Colombians while Fernandez was in jail. The Colombians forced Fernandez to liquidate most of his holdings through Samos, as they essentially stripped Fernandez of his wealth.

During his captivity Fernandez was repeatedly in contact with Samos and Ray. They were negotiating for Ray and Rafael to buy Fernandez's 49,900 shares of bank stock. For the first 20,000 they sent $200,000 and a promissory note for $420,000. Ray also gave Fernandez's wife $50,000 and a car when the Colombians released her for a short time and allowed her to travel to Miami. In August 1981 Fernandez managed to escape first to Costa Rica, then to Spain, and finally to Brazil.

He continued through Samos and Ivan Robles trying to sell his remaining interest in the bank and succeeded in getting an additional $200,000 from the Coronas for 9,900 shares. In their negotiations the Coronas deducted amounts for expenses related to the New Orleans bail matter and the $50,000 previously given to Mrs. Fernandez.

Samos provided Fernandez a fake name and counterfeit documents while he was a fugitive. Ray provided Visa and American Express gold cards issued in the false name. Ray also provided Fernandez an additional $50,000 in December 1981. Ultimately, after nearly two years as a fugitive, Fernandez was apprehended in Brazil in March 1983 and extradited to the United States the following year.

In October 1983, while Fernandez was in custody in Brazil, Rafael Corona arranged to have the...

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