USA v. Mazza-alaluf

• Decision Date: 22 September 2010
• Docket Number: Docket No. 09-3940-cr.
• Citation: 621 F.3d 205
• Parties: UNITED STATES of America, Appellee, v. Mauricio Alfonso MAZZA-ALALUF, Defendant-Appellant.
• Court: U.S. Court of Appeals — Second Circuit

621 F.3d 205

UNITED STATES of America, Appellee,

v.Mauricio Alfonso MAZZA-ALALUF, Defendant-Appellant.

Docket No. 09-3940-cr.

United States Court of Appeals,Second Circuit.

Submitted: Aug. 3, 2010.

Decided: Sept. 22, 2010.

Arza Feldman, Feldman and Feldman, Uniondale, NY, for Appellant.

Sarah Y. Lai, Michael A. Levy, Assistant United States Attorneys, for Preet Bharara, United States Attorney for the Southern District of New York, New York, NY, for Appellee.

Before: SACK, RAGGI, and LYNCH, Circuit Judges.

REENA RAGGI, Circuit Judge:

DefendantMauricio Alfonso Mazza-Alaluf appeals from a judgment of conviction entered after a bench trial in the United States District Court for the Southern District of New York(P. Kevin Castel, Judge ).The district court found Mazza-Alaluf guilty of conspiring to operate and actually operating an unlicensed money transmitting business, see18 U.S.C. §§ 371,1960(b)(1)(A), based on evidence that his company, Turismo Costa Brava, S.A.(“Turismo”), transmitted more than $200 million in New York, Illinois, and Michigan without obtaining appropriate state licenses.Mazza-Alaluf submits that the trial evidence was insufficient to support his conviction because, as a Chilean company whose office and employees were located in Chile, Turismo was neither (1) a United States “domestic financial institution” within the meaning of 31 U.S.C. § 5312; nor (2) required to obtain money transmitting licenses in any of the three states through which it transmitted millions of dollars.He further contends that his forty-two-month, below-Guidelines sentence was procedurally and substantively unreasonable.

We reject these arguments as without merit.Title 18 U.S.C. § 1960(b)(1)(A), under which Mazza-Alaluf was convicted for operating Turismo without appropriate state licenses, does not require the government to prove that the charged money transmitting business was a “domestic financial institution.”Further, the trial evidence was sufficient to permit a finding that Mazza-Alaluf operated a money transmitting business in New York, Illinois, and Michigan that required appropriate state licenses.Finally, Mazza-Alaluf's sentence was neither procedurally nor substantively unreasonable.Accordingly, we affirm the judgment of conviction.

I.Background

On October 15, 2008, a grand jury in the Southern District of New York charged Mazza-Alaluf in a two-count, superseding indictment with conspiring to operate and actually operating an unlicensed money transmitting business, Turismo, in violation of 18 U.S.C. § 371and§ 1960.The indictment alleged that Turismo was an unlicensed money transmitting business because it (1) operated without appropriate state money transmitting licenses, see18 U.S.C. § 1960(b)(1)(A); and (2) failed to comply with federal registration requirements for money transmitting businesses, seeid.§ 1960(b)(1)(B).

Pursuant to Fed.R.Crim.P. 23, Mazza-Alaluf waived his right to a jury trial.The district court held a two-day bench trial, after which it made thorough findings of fact, which are neither contested on appeal nor clearly erroneous.SeeUnited States v. Mazza-Alaluf,607 F.Supp.2d 484(S.D.N.Y.2009).Accordingly, we assume familiarity with the district court's opinion and do not ourselves repeat its discussion of the facts of the case except as necessary to resolve Mazza-Alaluf's challenges to his conviction.

Although the district court found Mazza-Alaluf guilty of both conspiring to operate and operating a money transmitting business without obtaining appropriate licenses in New York, Illinois, and Michigan, see18 U.S.C. § 1960(b)(1)(A), it concluded that the government had not proved Mazza-Alaluf guilty of failing to comply with federal money transmitting registration requirements codified at 31 U.S.C. § 5330, see18 U.S.C. § 1960(b)(1)(B).On this point, the district court found that Turismo's actions in the United States made it a “domestic financial institution” under 31 U.S.C. § 5312.Nevertheless, because Turismo lacked an agent, agency, branch, or office “within the United States,”31 C.F.R. § 103.11(n), (uu), it was not subject to federal registration regulations.The government does not appeal this determination.

Because the value of funds transmitted by Turismo in the three states was approximately $244 million, the Probation Office reported that Mazza-Alaluf's base offense level under the Sentencing Guidelines was thirty-four.SeeU.S.S.G. §§ 2X1.1, 2S1.3(a)(2), 2B1.1(b)(1)(O).The district court then granted a two-level reduction for acceptance of responsibility.Seeid.§ 3E1.1(a).With a criminal history category of I, the district court calculated that Mazza-Alaluf faced a Guidelines range of 121 to 151 months' imprisonment.Title 18 U.S.C. § 1960(a), however, provided a maximum prison term of five years on each count of conviction, thereby reducing the Guidelines range to a total of 120 months.SeeU.S.S.G. § 5G1.1(a).Based on its evaluation of the 18 U.S.C. § 3553(a) factors, the court determined that a considerably lower prison term was warranted, and it sentenced Mazza-Alaluf to a total of forty-two months' imprisonment, two years' supervised release, and a $200 special assessment.Mazza-Alaluf timely filed this appeal.

II.DiscussionA.Mazza-Alaluf's Sufficiency Challenge

Although we review a challenge to the sufficiency of the evidence de novo, seeUnited States v. Sabhnani,599 F.3d 215, 241(2d Cir.2010), defendant“bears a heavy burden because a reviewing court must consider the evidence ‘in the light most favorable to the prosecution’ and uphold the conviction if ‘any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.’ ”United States v. Aguilar,585 F.3d 652, 656(2d Cir.2009)(quotingJackson v. Virginia,443 U.S. 307, 319, 99 S.Ct. 2781, 61 L.Ed.2d 560(1979)(emphasis inJackson )).We apply this same deferential standard when we review a verdict rendered by a judge after a bench trial.SeeUnited States v. Pierce,224 F.3d 158, 164(2d Cir.2000);United States v. Zabare,871 F.2d 282, 284, 286(2d Cir.1989).To the extent Mazza-Alaluf's challenge presents an issue of statutory construction, however, our review is de novo.SeeUnited States v. Shyne,617 F.3d 103, 106(2d Cir.2010).

1.Section 1960(b)(1)(A) Does Not Require Proof that the Charged Money Transmitting Business Was a “Domestic Financial Institution” Covered by Federal Reporting Requirements

Title 18 U.S.C. § 1960(a) makes it a crime knowingly to “conduct [ ], control[ ], manage[ ], supervise[ ], direct[ ], or own[ ] all or part of an unlicensed money transmitting business.”Section 1960(b)(1), in turn, states as follows:

[T]he term “unlicensed money transmitting business” means a money transmitting business which affects interstate or foreign commerce in any manner or degree and-

(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;

(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; or

(C) otherwise involves the transportation or transmission of funds that are known to the defendant to have been derived from a criminal offense or are intended to be used to promote or support unlawful activity[.]

18 U.S.C. § 1960(b)(1).Although the government argued at trial that Mazza-Alaluf was guilty under both § 1960(b)(1)(A) for failing to comply with state licensing requirements and § 1960(b)(1)(B) for failing to comply with federal registration requirements, the district court was persuaded by only the former argument.

In mounting a sufficiency challenge to his § 1960(b)(1)(A) convictions, Mazza-Alaluf does not contest that he owned and managed Turismo.Nor does he challenge the evidence of money transmittals.Rather, Mazza-Alaluf maintains that his convictions must be vacated because the evidence was insufficient to demonstrate that Turismo was a money transmitting business as defined in 31 U.S.C. § 5330(d)(1)(B).That section, referenced in 18 U.S.C. § 1960(b)(1)(B), defines a “money transmitting business” as any business required to file reports under 31 U.S.C. § 5313, which in turn relates to “domestic financial institution[s].”Title 31 U.S.C. § 5312(b)(1) states that the term “domestic financial institution,” for purposes of that subchapter, “appl [ies] to an action in the United States of a financial agency or institution.”Because Mazza-Alaluf raised his Title 31 argument in the district court only as it pertained to the government's reliance on a § 1960(b)(1)(B) theory of guilt, we review his recasting of that claim to challenge his § 1960(b)(1)(A) conviction for plain error, and we identify none here.SeeFed.R.Crim.P. 52(b);see alsoUnited States v. Needham,604 F.3d 673, 678(2d Cir.2010)(recognizing that plain error analysis requires (1) error, (2) that is plain, (3) that affects defendant's substantial rights, and (4) that seriously affects fairness, integrity, or public reputation of judicial proceedings).

Mazza-Alaluf contends that for him to be guilty of violating § 1960(b)(1)(A), the government was required to prove that Turismo was a “money transmitting business,” as defined by 31 U.S.C. § 5330(d)(1)(B), because that statute contains the only definition of “money transmitting business” in the United States Code.We are not persuaded.Section 5330(d) states that its definitions apply only “[f]or purposes of this section.”This court has declined to apply a definition from one statutory provision to another under such circumstances.SeeUnited States v. Savin,349 F.3d 27, 36-37(2d Cir.2003)(declining to apply Internal Revenue Code...