United States v. Garbacz

• Citation: 33 F.4th 459
• Decision Date: 27 April 2022
• Docket Number: 20-3559
• Parties: UNITED STATES of America, Plaintiff - Appellee v. Marcin Stanislaw GARBACZ, Defendant - Appellant
• Court: U.S. Court of Appeals — Eighth Circuit

33 F.4th 459

UNITED STATES of America, Plaintiff - Appellee

v.Marcin Stanislaw GARBACZ, Defendant - Appellant

No. 20-3559

United States Court of Appeals, Eighth Circuit.

Submitted: December 16, 2021

Filed: April 27, 2022

Kevin Koliner, Assistant U.S. Attorney, U.S. Attorney's Office, District of South Dakota, Sioux Falls, SD, Benjamin Patterson, Assistant U.S. Attorney, U.S. Attorney's Office, Rapid City, SD, for Plaintiff-Appellee.

Jennifer Albertson, Federal Public Defender's Office, Rapid City, SD, Bryan Dean, Federal Public Defender's Office, Bismarck, ND, for Defendant-Appellant.

Marcin Stanislaw Garbacz, Rapid City, SD, Pro Se.

Before SMITH, Chief Judge, GRUENDER and KOBES, Circuit Judges.

GRUENDER, Circuit Judge.

When he worked as a priest, Marcin Garbacz stole from the cash-offering collections of several parishes. After a jury trial, he was convicted of wire fraud, money laundering, transporting stolen money, and making and subscribing false tax returns. The district court sentenced him to 93 months’ imprisonment. Garbacz appeals his convictions, his sentence, and the district court's forfeiture order and restitution award. We reverse three of Garbacz's convictions and affirm his remaining convictions, the forfeiture order, and the restitution award. We affirm his sentence, except that we direct the district court to vacate the $100 special assessments associated with Counts 39, 41, and 44.

I.

Garbacz worked as a Catholic priest serving the Diocese of Rapid City, South Dakota as a school chaplain. Between 2012 and 2018, he resided at three parishes in Rapid City. During that time, Garbacz would enter the parishes during the night and steal cash that had been collected during Mass. As suspicions rose, the bookkeeper at St. Therese the Little Flower Catholic Church started using tamper-proof bags in early March 2018 and immediately noticed that the bags’ serial numbers changed without explanation after Sunday Masses, indicating that they had been replaced by someone. The bookkeeper and pastor installed security cameras, and on April 23, Garbacz was caught on video entering the parish between 1:00 a.m. and 1:30 a.m. and stealing cash. Garbacz brought tamper-proof bags with him, pocketed some of the offerings, and sealed the rest into the new tamper-proof bags so that it appeared as if nothing had been changed. Garbacz then would write information on the new bags to match the handwriting that appeared on the originals.

The day Garbacz was caught on video, the bishop of the diocese confronted him and suspended him after he admitted to stealing cash. On the same day, Garbacz withdrew $40,000 from his South Dakota credit-union account. In June, local police interviewed Garbacz, and he admitted to stealing from St. Therese and other parishes over two years, described his method for replacing the tamper-proof bags, and explained that he would deposit the stolen cash into his credit-union account. After he withdrew funds from his account, Garbacz opened an account with U.S. Bank in St. Louis, Missouri, and made a series of cash deposits totaling approximately $39,000 between July and October of 2018.

On May 6, 2019, IRS Special Agent Brian Pickens contacted Garbacz. Garbacz claimed that he had stolen only $600, but Special Agent Pickens told him that he was investigating a theft of more than $200,000. At that time, Garbacz lived in Kent, Washington and had an account there with J.P. Morgan Chase Bank. By May 10, Garbacz had withdrawn $50,500 from that account, leaving it with a balance of less than $300. Special Agent Pickens testified that the amount withdrawn was "primarily comprised of the $39,000 in cash he had deposited into his U.S. Bank account," which itself came from "the [$]40,000 he had withdrawn from his [credit union] account on April 23rd of 2018." Garbacz's internet search history around that time showed inquiries about moving to Poland, withdrawing cash "without triggering the IRS," and storing money in offshore accounts.

After speaking to Special Agent Pickens, Garbacz shipped eighteen boxes containing valuable statues to Josh VanBuskirk in Wyoming. Garbacz also bought a plane ticket for VanBuskirk to fly to Washington and instructed him to retrieve valuable items from a storage unit there. Garbacz told VanBuskirk to sell the valuables and wire half of the proceeds to him. The IRS eventually seized the items.

Garbacz booked a flight to Poland and sent a text message to VanBuskirk, saying that Garbacz would "start telling people [he] moved to England" and that he "d[id]n't want the feds to find out." Garbacz was arrested on May 10, 2019, at the airport. He had $10,500 in cash on his person and valuable items, including ornate chalices, in his luggage.

Garbacz was charged with forty-seven counts of wire fraud regarding cash deposits into his credit-union account and three counts of wire fraud regarding wire transfers from the credit-union account to pay balances on his credit card. He was also charged with nine counts of money laundering regarding cash withdrawals made over three days from his savings and checking accounts after learning he was under federal investigation and before his planned flight to Poland. Another count alleged that Garbacz transported stolen money in interstate commerce when he withdrew $40,000 from the South Dakota credit-union account and deposited $39,000 in his Missouri bank account. Five counts alleged that he willfully made and subscribed false tax returns from 2013 to 2017 by omitting money he had embezzled.

Garbacz pleaded not guilty, and the case proceeded to trial. At trial, Special Agent Pickens testified that Garbacz's after-tax earnings from 2012 to 2018 were approximately $93,000, yet he had paid $398,837.09 from his credit-union account to his credit card to cover purchases made during that time. Garbacz's annual pre-tax salary as a priest ranged from approximately $20,000 to $24,000. His salary was paid through electronic fund transfers and checks, but his "single greatest source of income" came from cash deposits into his credit-union account.

Testimony indicated that Garbacz engaged in "a consistent pattern of cash deposits" on a near-weekly basis until he was caught on video, after which the deposits stopped. He often made the deposits late at night, and "cash deposits tended to occur shortly after weekend masses." Special Agent Pickens testified that "[t]he denominations of cash" Garbacz deposited—including large amounts of five-dollar and ten-dollar bills—were "consistent with ... the collections at parishes in Rapid City."

Garbacz's colleagues testified that when asked about his expensive statues, Garbacz told them that his family in Poland regularly sent him cash. However, there was no evidence of wire transfers or incoming checks from Poland, and Garbacz's acquaintances who visited his family in Poland observed that they did not appear wealthy. Some of Garbacz's valuables were engraved with dates or names indicating that they were gifts, but there was evidence that Garbacz fabricated those engravings. For example, one chalice bore the name of Garbacz's colleague, Seth Thomas Smith, yet Smith testified that he had no knowledge of the item and had nothing to do with it. Evidence at trial showed that Garbacz had transferred money from his credit-union account to pay art dealers and manufacturers for expensive religious items, such as chalices. Special Agent Pickens testified that Garbacz could not have afforded these items on his legitimate salary.

The jury convicted Garbacz on all counts. The district court then held a forfeiture hearing, where Garbacz objected to the forfeiture of two statues because he claims he purchased them with legitimate funds. To show that Garbacz could not have afforded the items with legitimate funds, the Government introduced evidence of Garbacz's legitimate disposable income for each year at issue, calculated by subtracting tax and recurring payments from Garbacz's total reported income.

One of the objected-to forfeitures concerned the "Chroma" statue, which had a purchase price of $14,000 at the time Garbacz bought it in February 2018. His legitimate disposable income in the first half of that year was about $6,855.44, and it was $11,727.88 the previous year. The Chroma statue purchase coincided with transfers of funds from Garbacz's credit-union account to his credit card. Separate from the Chroma statue purchase, Garbacz had purchased more than $34,000 worth of religious items during the first two months of 2018.

Garbacz also objected to the forfeiture of the "Nureyev" statue, which he bought with his credit card for $12,500 in 2016. That purchase coincided with a payment from his credit-union account to the credit card. In 2016, Garbacz's legitimate disposable income was $5,671.84. He transferred at least $41,135 from his credit-union account to his credit card in that year. Special Agent Pickens testified that Garbacz could not have afforded either statue with legitimate income. The district court ordered forfeiture of the statues and other property.

Then the court held a restitution hearing. Special Agent Pickens testified that the cash deposits to the credit-union account involved stolen cash. The pastors of the three parishes requested that any restitution ordered be split evenly among the three parishes. The Government sought $259,696.19 in restitution to be divided among the parishes and $46,008 to go to the IRS, representing unpaid taxes. The district court ordered $46,008 in restitution to the IRS and $258,696.19 in restitution to the parishes, accounting for a possible $1,000 that Garbacz may have received in stipends for performing priestly services.

At sentencing, Garbacz objected to a two-level "sophisticated means" enhancement under U.S.S.G. § 2B1.1(b)(10). The district court concluded that the enhancement applied, reasoning that Garbacz's acquisition of the tamper-proof bags, altering their labels, and replacing cash in...