United States v. Talebnejad, 04-4841.
| Decision Date | 21 August 2006 |
| Docket Number | No. 04-4873.,No. 04-4841.,04-4841.,04-4873. |
| Citation | 460 F.3d 563 |
| Parties | UNITED STATES of America, Plaintiff-Appellant, v. Farhad TALEBNEJAD, a/k/a Fran T. Nejad, a/k/a Fran T. Nejad Shirazi, a/k/a Farhad Talebnehad Shirazi; Fatameh Talebnejad, a/k/a Fatemeh Talebnejad, a/k/a Fatameh Talebnejao; Abdolrahman Talebnejad, a/k/a Abdol Rahman Talebnejad, a/k/a Abdol Talebnejad, a/k/a Abdol R. Talebnejad, Defendants-Appellees, and Foad Talebnejad, a/k/a Foad Talebnejad Shirazi, a/k/a Foad Shirazi, Defendant. United States of America, Plaintiff-Appellee, v. Farhad Talebnejad, a/k/a Fran T. Nejad, a/k/a Fran T. Nejad Shirazi, a/k/a Farhad Talebnehad Shirazi; Fatameh Talebnejad, a/k/a Fatemeh Talebnejad, a/k/a Fatameh Talebnejao; Abdolrahman Talebnejad, a/k/a Abdol Rahman Talebnejad, a/k/a Abdol Talebnejad, a/k/a Abdol R. Talebnejad, Defendants-Appellants, and Foad Talebnejad, a/k/a Foad Talebnejad Shirazi, a/k/a Foad Shirazi, Defendant. |
| Court | U.S. Court of Appeals — Fourth Circuit |
David Ira Salem, Assistant United States Attorney, Office of the United States Attorney, Greenbelt, Maryland, for Appellant/Cross-Appellee. Dale Preston Kelberman, Miles & Stockbridge, P.C., Baltimore, Maryland, for Appellees/Cross-Appellants.
ON BRIEF:
Allen F. Loucks, United States Attorney, Chan Park, Assistant United States Attorney, Office of the United States Attorney, Greenbelt, Maryland, for Appellant/Cross-Appellee. Todd M. Reinecker, Miles & Stock-Bridge, P.C., Baltimore, Maryland, for Appellee/Cross-Appellant Fatameh Talebnejad; Christopher B. Mead, London & Mead, Washington, D.C., for Appellee/Cross-Appellant Farhad Talebnejad; Timothy J. Sullivan, College Park, Maryland, for Appellee/Cross-Appellant Abdolrahman Talebnejad.
Before WILKINS, Chief Judge, GREGORY, Circuit Judge, and JOSEPH F. ANDERSON, JR., Chief United States District Judge for the District of South Carolina, sitting by designation.
Reversed in part, dismissed in part, and remanded by published opinion. Chief Judge WILKINS wrote the majority opinion, in which Judge ANDERSON joined. Judge GREGORY wrote an opinion concurring in part and dissenting in part.
The United States appeals an order of the district court dismissing the indictment against Farhad Talebnejad and his parents (collectively, "the Talebnejads"). The Talebnejads were charged with conducting an unlicensed money transmitting business, see 18 U.S.C.A. § 1960 (West Supp.2006). The district court dismissed the indictment on the basis that its allegations were insufficient in numerous respects. See United States v. Talebnejad, 342 F.Supp.2d 346, 353-61 (D.Md.2004). The court declined to address the Talebnejads' Eighth Amendment challenge to the forfeiture allegations of the indictment on the basis that the claim was premature. See id. at 361. For the reasons set forth below, we reverse the dismissal of the indictment and dismiss the Talebnejads' cross-appeal of the refusal to consider the Eighth Amendment claim.
1. 18 U.S.C.A. § 1960
A money transmitting business is one that, for a fee, accepts currency for transfer within or outside the United States through foreign currency exchanges and financial institutions. See 18 U.S.C.A. § 1960(b)(2); United States v. Velastegui, 199 F.3d 590, 592 (2d Cir.1999). Many of these businesses are operated informally, by immigrants for fellow immigrants from their home countries. In 1992, Congress sought "to combat the growing use of money transmitting businesses to transfer large amounts of the monetary proceeds of unlawful enterprises" by enacting § 1960. Velastegui, 199 F.3d at 593. Prior to 2001, the statute provided, in pertinent part:
(a) Whoever conducts, controls, manages, supervises, directs, or owns all or part of a business, knowing the business is an illegal money transmitting business, shall be fined in accordance with this title or imprisoned not more than 5 years, or both.
(b) As used in this section —
(1) the term "illegal money transmitting business" means a money transmitting business which affects interstate or foreign commerce in any manner or degree and —
operation is punishable as a misdemeanor or a felony under State law; or
18 U.S.C.A. § 1960, historical & statutory notes (West Supp.2006) (emphasis added) (internal quotation marks omitted).
On October 26, 2001, Congress amended the statute to provide, in relevant part, as follows:
(a) Whoever knowingly conducts, controls, manages, supervises, directs, or owns all or part of an unlicensed money transmitting business, shall be fined in accordance with this title or imprisoned not more than 5 years, or both.
(b) As used in this section —
(A) is operated without an appropriate money transmitting license in a State where such operation is punishable as a misdemeanor or a felony under State law, whether or not the defendant knew that the operation was required to be licensed or that the operation was so punishable; [or]
(B) fails to comply with the money transmitting business registration requirements under section 5330 of title 31, United States Code, or regulations prescribed under such section. . . .
18 U.S.C.A. § 1960 (emphasis added). The purpose of the amendment was to eliminate a potentially available affirmative defense that the defendant was unaware of applicable state licensing requirements. See H.R.Rep. No. 107-250, pt. I, at 54 (2001) ).
Maryland law prohibits a person from engaging in "the business of money transmission" unless that person is a licensee, is a delegate of a licensee, or is exempt from the licensing requirement. Md.Code Ann., Fin. Inst. § 12-405 (LexisNexis 2003). "Money transmission" is defined as "the business of selling or issuing payment instruments or stored value devices, or receiving money or monetary value, for transmission to a location within or outside the United States" and includes "[a]ny informal money transfer system engaged in as a business for . . . facilitating the transfer of money outside the conventional financial institutions system to a location within or outside the United States." Md. Code Ann., Fin. Inst. § 12-401(l) (LexisNexis 2003). Maryland law sets forth criminal penalties for "[a]ny person who knowingly and willfully violates" the licensing requirement. Md.Code Ann., Fin. Inst. § 12-430 (LexisNexis 2003) (emphasis added).
Although § 1960 has made failure to comply with federal registration requirements punishable since 1994, see 18 U.S.C.A. § 1960, historical & statutory notes (West 2000), pertinent regulations were not promulgated until 1999 and did not become effective until December 31 2001. The actual content of applicable federal regulations is not pertinent to the issues before us.
The Talebnejads are Iranian immigrants. Farhad Talebnejad operated two money transmitting businesses—Shirazi Money Exchange, Inc., and Shirazi Arz, Inc.—out of his parents' home in Rockville, Maryland. The businesses were not licensed under Maryland law, nor were they registered pursuant to 31 U.S.C.A. § 5330 (West 2003). In late 1995, Talebnejad investigated the possibility of obtaining licenses, but decided not to do so because he could not afford the cost and he believed that the licensing statute did not apply to his businesses.
In November 2003, the Talebnejads were charged with one count of conspiring to conduct an unlicensed money transmitting business and with two substantive counts of conducting an unlicensed money transmitting business.1 All three counts alleged that the businesses were "unlicensed" within the meaning of § 1960(a) because (1) the businesses were required to be licensed under Maryland law, and were not, in violation of § 1960(b)(1)(A); and (2) the businesses were required to be registered with the federal government, and were not, in violation of § 1960(b)(1)(B).2 The indictment also sought forfeiture of approximately $18 million in property traceable to the charged offenses.
The Talebnejads moved to dismiss the indictment, asserting that (1) § 1960(b)(1)(A) violated the Equal Protection Clause because not all states require money transmitting businesses to be licensed; (2) § 1960(b)(1)(A) violated the Due Process Clause because it lacked a scienter requirement as to the applicability of state licensing laws; (3) § 1960(b)(1)(A) was unconstitutionally vague in several respects; and (4) the indictment failed to adequately inform the Talebnejads of the offenses charged.
The district court granted the motion.3 With respect to the due process challenge to the lack of a scienter requirement in § 1960(b)(1)(A), the court recognized that "Congress attempted to exclude any mens rea requirement when it amended § (b)(1)(A)." Talebnejad, 342 F.Supp.2d at 353. But, the court observed, § 1960(b)(1)(A) "still refers to the operation of such a...
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