United States v. Morales-Rodríguez

467 F.3d 1, 180 L.R.R.M. (BNA) 2012, 2006 U.S. App. LEXIS 18321, 2006 WL 2034694
Court of Appeals for the First Circuit·Decided July 21, 2006·No. No. 04-2495·Published·Cited by 46 cases

Opinion

TORRUELLA, Circuit Judge.

On August 12, 2003, Rafael Morales-Rodríguez (“Morales” or “defendant”) was [5]*5charged in the United States District Court for the District of Puerto Rico in a fourteen-count indictment. He was accused of conspiracy to commit mail fraud, in violation of 18 U.S.C. § 371 (Count One); mail fraud, in violation of 18 U.S.C. § 1341 (Counts Two through Ten); embezzlement of labor union funds, in violation of 29 U.S.C. § 501(c) (Counts Eleven and Twelve); structuring money transactions, in violation of 31 U.S.C. §§ 5322(b) and 5324(3) and 18 U.S.C. § 2 (Count Thirteen); and conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h) (Count Fourteen).

On May 12, 2004, after a six-day jury trial, Morales was found guilty of all charges except for Count Two. On September 23, he filed a motion requesting a new trial, but this was denied. He was sentenced to imprisonment for a term of 121 months as to Counts Three through Ten, and Counts Thirteen and Fourteen. He was sentenced to a term of five years as to Counts One, Eleven, and Twelve. All sentences were to be served concurrently. Additionally, the district court imposed a supervised release condition requiring Morales to submit to a drug test within fifteen days of release and thereafter to random drug testing not to exceed 104 samples per year. On October 4, 2004, Morales filed this appeal, challenging both his convictions and his sentence. After careful consideration, we affirm.

I. Facts

From 1992 to 2003, Morales was Vice-President of Frente Unido de Policías Or-ganizados (“FUPO”), and José De Jesús-Serrano (“De Jesús”) was FUPO’s President. FUPO was a not-for-profit organization open to police officers and security guards, whose goal was to offer better working conditions and salaries for its members, as well as to provide legal representation in civil and criminal cases against its members.

Through various outreach efforts including promotional materials sent by mail, FUPO made constant efforts to recruit new members. New members filled out forms to authorize the payment of FUPO membership fees through automatic deductions from their salaries. Members either personally delivered these forms to FUPO’s offices or sent them by mail. Once FUPO was in possession of a new member form, a letter signed by either Morales or De Jesús would be sent by mail to the relevant agencies and municipalities, authorizing the deduction of FUPO membership fees from the new member’s salary. Once deducted, membership fees were sent to FUPO by mail. FUPO received some fifty checks for membership fees each month by mail, and all checks were handled personally by Morales or De Je-sús. Membership cards that were not picked up at FUPO’s offices were sent by mail. In the years 2002 and 2003, FUPO’s membership reached approximately 18,000.

Around the year 2000, members began to complain that promised services and benefits were not being delivered. One of the ostensible benefits of FUPO membership was that the organization assumed responsibility for members’ attorneys’ fees. It seems that when members availed themselves of attorney services, it was customary for the attorneys to send the invoices directly to FUPO. The checks were then prepared by Madeline Cabrera (“Cabrera”) but were not actually sent until so authorized by Morales or De Jesús. Typically, FUPO prepared checks for attorneys’ fees totaling $70,000 to $80,000 per month. Around the year 2000, payments made for attorneys’ fees declined, even though the invoice amounts actually increased. Although it appears that the [6]*6checks were being prepared, they were not always sent. Many members complained.

Also in the year 2000, members began to complain about FUPO’s failure to provide other promised services. Some members who were suspended from work complained that they were not being paid the money FUPO had promised in the event of suspension. Widows complained that they were not receiving the promised $2000 death benefit. Payments of disability benefits were delayed. At least one FUPO area director informed De Jesús and Morales about these problems, but the problems persisted. When Cabrera became FUPO’s Executive Secretary in 2003, she discovered that, while De Jesús was President and Morales Vice-President, FUPO had fallen several years behind in its payments of disability benefits and in its payments to the IRS, Hacienda (Treasury of Puerto Rico), and bank credit lines.

FUPO had a bank account at First Bank in Puerto Rico. Morales visited the bank each week. There, he deposited checks made out to FUPO, and because they were issued by various government agencies (police force, fire department, etc.), they cleared immediately. Copies of checks and transaction records introduced at trial indicate that after depositing the checks, Morales then would purchase a manager’s check, made out to FUPO, for part of the deposit amount. As for the remainder, he would ask the bank to issue a check against FUPO’s account, made out to “cash” for a specified amount (never exceeding $10,000). After the bank prepared the check, Morales would cash it and take the cash with him.

FUPO also had a bank account at Banco Popular de Puerto Rico (“BPPR”), opened by Morales and De Jesús. Morales went to BPPR approximately once a month to deposit the First Bank manager’s checks that were made out to FUPO. Then, Morales would issue checks from FUPO’s BPPR bank account to himself, to his company (J.R. Bodyguard), and to De Jesús. No single check was ever issued in an amount exceeding $10,000, despite the fact that Morales often issued several checks to himself in the same day whose total amount exceeded $10,000.

Typically, the total value of all checks issued to Morales was between $8,000 and $67,000 per month (totaling more than one million dollars during the course of three years),1 while those issued to De Jesús ranged from $7,000 to $95,000 per month (totaling more than $1.5 million during the same period).2 Morales and De Jesús used these funds for personal expenses, including payment of personal credit card bills.

Morales and De Jesús concealed the scheme, which was repeated each month from January 2000 to December 2002, from other FUPO employees including administrative secretary Joanna Lind (“Lind”), who was in charge of FUPO’s monthly expenses, and Héctor Navarro-Matos (“Navarro”), who was responsible for filing various FUPO financial reports with the Departments of State and Labor. Also unaware of the fraud was Angel Troche (“Troche”), one of the founders and leaders of FUPO. Troche did not know FUPO was issuing checks to “cash.” In fact, neither he nor any of the other directors ever gained access to FUPO’s account books.

[7]*7II. Analysis

A. Sufficiency of the Evidence

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United States v. Morales-Rodríguez, 467 F.3d 1, 180 L.R.R.M. (BNA) 2012, 2006 U.S. App. LEXIS 18321, 2006 WL 2034694 (1st Cir. 2006).

467 F.3d 1 (United States v. Morales-Rodríguez) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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