U.S. v. Homa Intern. Trading Corp.

Decision Date22 October 2004
Docket NumberNo. 03-1375.,03-1375.
PartiesUNITED STATES of America, Appellee, v. HOMA INTERNATIONAL TRADING CORP., Defendant, Mazyar Gavidel, Defendant-Appellant.
CourtU.S. Court of Appeals — Second Circuit

Appeal from the United States District Court for the Southern District of New York, Thomas P. Griesa, J.

James E. Neuman, Mischel Neuman & Horn, P.C., New York, NY, for Defendant-Appellant.

Peter B. Sobol, Assistant United States Attorney (David N. Kelley, United States Attorney for the Southern District of New York, Peter G. Neiman, Assistant United States Attorney, on the brief), New York, NY, for Appellee.

Before: WALKER, Chief Judge, B.D. PARKER and WESLEY, Circuit Judges.

PER CURIAM.

Defendant-appellant Mazyar Gavidel appeals from the district court's judgment of conviction, dated May 30, 2003, following a jury trial in which Gavidel and Homa International Trading Corp. ("Homa"), a Manhattan business owned and operated by Gavidel, were found guilty of the following crimes: conspiring to commit money laundering, in violation of 18 U.S.C. § 1956(h); laundering purported narcotics proceeds, in violation of 18 U.S.C. § 1956(a)(3)(B); and violating a trade embargo against Iran (the "Embargo") by transferring $277,045 from the United States to Iran, in violation of 50 U.S.C. §§ 1702, 1705(b), Executive Order 12959, and 31 C.F.R. §§ 560.203, 560.204, and 560.406(b). Gavidel was also convicted of structuring cash transactions (totaling $614,806) to avoid reporting requirements, in violation of 31 U.S.C. § 5324(a)(1) and (c)(2).1 Although he claimed entrapment, Gavidel did not call witnesses or submit evidence in his defense. At sentencing, Judge Griesa ordered Gavidel to forfeit $614,000 and sentenced him to seventy months' imprisonment, followed by three years' supervised release, and a mandatory $800 special assessment.

The Government launched its investigation of Gavidel and his company in the fall of 1999, after agents of the U.S. Customs Service received a tip that Gavidel was laundering drug money. The investigation included a sting operation, during which a confidential informant (the "C.I.") hired Gavidel to help him launder funds, purportedly from the sale of illegal narcotics, through Homa. At trial, the Government established that from November 1999 through August 2000, Gavidel laundered the C.I.'s money by wiring hundreds of thousands of dollars he believed were the C.I.'s narcotics proceeds to bank accounts in London.

Before wiring the money overseas, Gavidel made cash purchases of small-denomination money orders and then deposited those money orders in a Homa bank account. Testimony at trial established that postal officials must record purchases of money orders in excess of $3,000, and that it is illegal to purchase money orders in amounts less than $3,000 to evade reporting requirements. During an eighteen-month period, Gavidel deposited 882 postal money orders, each valued at less than $3,000, with a total value of $614,459 into a Homa bank account in the United States. Gavidel's girlfriend testified that she purchased numerous money orders several times per week at Gavidel's direction. On a number of occasions, Gavidel accompanied her and purchased money orders also.

In addition to these illicit activities, Gavidel violated the Embargo in the summer of 2000 by indirectly transferring money into bank accounts in Iran. The Government established its case in this regard by offering as evidence Gavidel's faxes. The faxes indicated correspondence between Gavidel, his brother in Iran, and third parties planning and implementing the transfer of funds from the United States to bank accounts in Iran via Dubai, U.A.E. They also depicted copies of deposit tickets and statements from Iranian banks. On two occasions, Gavidel's bank declined transfer requests involving Gavidel's account when the bank suspected that Gavidel was attempting to funnel money to Iran. On both occasions, the Treasury Department's Office of Foreign Assets Control ("OFAC") issued a letter to Gavidel inquiring of his business relations with Iran and referencing Treasury Department regulations relating to the Embargo.

On appeal, Gavidel argues that (1) the district court erred in admitting as hearsay evidence an informant's assertion that Gavidel had been involved in laundering narcotics money; (2) the district court's curative instruction, to the effect that no attempt had been made to present to the jury all of the information the Government had obtained in its initial investigation of Gavidel, impermissibly bolstered the Government's case and undermined Gavidel's entrapment defense; (3) the district court erred by not sua sponte charging the jury on the possibility of multiple conspiracies; (4) there was insufficient evidence to demonstrate that Gavidel's money-transfer services were "services" prohibited by the specific Embargo regulations cited in the indictment; and (5) the district court's instruction to the jury on the element of willfulness, as it relates to Gavidel's breach of the Embargo, was erroneous. The district court's proper resolution of Gavidel's first three arguments does not necessitate further comment by this Court. We disagree with Gavidel's latter two arguments for the reasons stated in the following discussion.

DISCUSSION

The Embargo prohibits the "exportation,... directly or indirectly, from the United States ... of any goods, technology, or services to...

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