Court: Court of Appeals for the Seventh Circuit; December 5, 2001; Federal Appellate Court
Roman Kosmel, a Czech citizen, was convicted of multiple offenses including unlawfully harboring illegal aliens, encouraging illegal residency, and money laundering. He represented himself during the trial but now argues that this decision was not made knowingly and intelligently. The United States Court of Appeals for the Seventh Circuit upheld his conviction but remanded the case for resentencing.
Kosmel entered the U.S. as a tourist in April 1996, remaining beyond his visa expiration date. He worked for Universal Maintenance, depositing paychecks for other undocumented Czech employees into his personal account. His successful tenure led to the establishment of his own company, Roman Services, Inc., which employed approximately 40 illegal Czech nationals from November 1997 to October 1999.
The hiring process involved Czech nationals arriving on class B-2 visas, who were then contacted by individuals already in the U.S. to facilitate their transportation to Kosmel. He employed them at Roman, paying near-minimum wage while deducting rent and car usage fees. Kosmel also engaged with the local Social Security office, assisting his employees with paperwork while manipulating their Social Security cards to remove the “not valid for employment” notation. An example highlights this operation: Jaromir Tenev, upon arrival in the U.S., was recruited by a Czech speaker and eventually hired by Kosmel, who promised to help him secure valid working documentation.
Kosmel established two commercial checking accounts for the financial operations of his businesses, 'Cleaning Services, Inc.' and 'Roman Service, Inc.' Over two years, he deposited 42 checks amounting to $344,262 and disbursed $107,238.50 in wages to 40 Czech employees, including payments of $3,386 to Marek Vencl and $1,230 to Petr Krhovkjak. He also paid $14,643 in rent to three landlords for housing these employees. Additionally, Kosmel arranged for Czech women to work as topless dancers at a local nightclub, extorting 20-40% of their earnings and charging for airline tickets and visa assistance.
In late 1998, concerned about his immigration status, Kosmel solicited Colleen Davis for a sham marriage to secure citizenship, paying her $10,500. After marrying and submitting petitions to the Immigration and Naturalization Service, he was indicted. In October 1999, the district court appointed the Federal Defender's office for his representation. Dissatisfied, Kosmel sought to represent himself but later requested new counsel when his attorney refused to present fraudulent documents. The district court appointed substitute counsel, and during trial preparations, Kosmel expressed a desire to question witnesses, which the court denied, emphasizing he could not partially represent himself.
Kosmel chose self-representation after a warning from the court regarding the risks involved, including the irrevocability of this choice. The court rejected a request for a flexible arrangement where Kosmel could switch between self-representation and attorney representation, insisting he must make a definitive choice.
Kosmel was given until the next day to decide on representation and chose to represent himself, prompting the district court to appoint standby counsel. He was convicted on nine counts, including unlawfully harboring aliens and money laundering. During the sentencing hearing, Kosmel, still representing himself, raised three objections: the applicability of the money laundering guideline, the amount of money attributed to him for laundering, and the two-point enhancement for obstruction of justice due to false information given to a probation officer. The district court upheld the obstruction enhancement based on the supervisor's testimony, as the original probation officer could not attend due to a blizzard. Kosmel received a sentence of 79 months imprisonment and three years of supervised release and subsequently appealed.
In reviewing the appeal, the court applies a de novo standard to the waiver of counsel and reviews factual findings for clear error. Kosmel argued that the district court mischaracterized self-representation law, which led him to waive his Sixth Amendment right to counsel. He pointed to the court's statement that he needed to decide between self-representation or having an attorney, which he believed impeded his ability to make an informed waiver. The court disagreed, noting that while a defendant has a right to self-representation, this right is contingent on the timing of the request. Before trial, the request is absolute, but once trial has begun, the court can weigh the defendant's interests against the potential disruption to proceedings.
The district court's handling of Kosmel's requests regarding self-representation and legal counsel demonstrated a careful consideration of his interests and the potential for disruption in the trial process. Kosmel initially pushed for the introduction of fraudulent documents and made frivolous motions, leading to a change of attorneys when his first counsel refused these actions. Despite the competent conduct of his first attorney, the court appointed a substitute, which did not satisfy Kosmel, prompting him to seek self-representation. The court warned him of the risks involved but ultimately allowed him to reconsider representation. When Kosmel expressed a desire to question witnesses and later to "take over" his defense, the court denied these requests, indicating that his waiver of the right to counsel was knowing and intelligent. The court noted that Kosmel's true intentions regarding control of his defense seemed unclear, suggesting improper motivations behind his indecision. Hybrid representation, where a defendant acts as co-counsel, is not favored in this Circuit due to the potential for trial complications. The district court's decision to deny Kosmel's requests was deemed appropriate, confirming that he was adequately informed of his Sixth Amendment rights. Furthermore, it was emphasized that no absolute right to self-representation exists once a trial has commenced; rather, the court has broad discretion in such mid-trial requests. Kosmel's argument misinterpreted this discretion, as the court is not obligated to grant self-representation simply because it has the authority to do so.
Kosmel argues that the district court incorrectly sentenced him under the money laundering guideline (U.S.S.G. sec. 2S1.1) instead of the harboring illegal alien guideline (U.S.S.G. sec. 2L1.1), claiming this would lead to a lower sentence. He cites the introduction to Appendix A of the Sentencing Guidelines, which suggests using the guideline most relevant to the offense. However, this language has been deleted by Amendment 591, effective November 1, 2000, which emphasizes applying the guideline referenced in the Statutory Index for the statute of conviction. Since Kosmel was convicted of money laundering, the amendment applies to his case. Sentences are generally based on guidelines in effect at the time of sentencing unless applying them would violate the ex post facto clause.
Kosmel references United States v. Rubin to support his argument, where a sentence under the mail fraud guideline was vacated in favor of a less punitive one. However, the court's decision in Rubin relied on a specific Application Note that does not exist for the money laundering guideline. Consequently, Kosmel's reliance on the introductory language of Appendix A is insufficient to support his claim.
In United States v. Buckowich, 243 F.3d 1081 (7th Cir. 2001), the Seventh Circuit rejected the approach taken by the Third and Eighth Circuits regarding sentencing for multiple convictions. The court emphasized that a defendant convicted of both wire fraud and money laundering must be sentenced considering both offenses, rather than treating the conviction as singular. Congress has also dismissed a proposal from the Sentencing Commission aimed at aligning money laundering offense levels more closely with underlying criminal conduct. As a result, the district court appropriately sentenced Kosmel under the money laundering guideline, as Amendment 591 did not change the legal standards in this circuit.
Kosmel attempted to argue against the applicability of the money laundering guideline by citing a proposed amendment that would connect offense levels to underlying conduct. However, the court noted that proposed amendments hold little weight until formally enacted, especially given Congress's recent rejection of a similar proposal. Kosmel's claim of an 'atypical' case was unsupported; he failed to demonstrate that his actions deviated from typical money laundering, as the jury had convicted him based on the broader context of his conduct involving over $350,000 related to illegal workers.
Additionally, Kosmel contended that the district court erred in calculating the amount of money for which he was held accountable under the money laundering guideline. The court included $53,000 in paychecks deposited by Kosmel on behalf of Universal employees and $344,000 paid to Roman, which Kosmel argued was erroneous because the check cashing occurred before he opened Roman. However, this assertion did not negate the overall scheme to launder funds.
34 U.S.S.G. sec. 2S1.1(b)(2) increases the base offense level for money laundering based on the value of the funds involved, which reflects the scale of the criminal enterprise. The Commentary emphasizes that the amount of money is crucial for evaluating a defendant's relevant conduct and determining total dollar amounts at play. Relevant conduct encompasses all actions by the defendant that relate to the offense. Kosmel argues that personal financial transactions should not count towards money laundering convictions or the calculation of fund value, citing United States v. Jackson, which is distinguished on two grounds: it focused on a conviction challenge rather than fund valuation, and the defendant's transactions were unrelated to the crime. The court disagrees with Kosmel's claim that his check cashing was purely personal, noting that it supported illegal activities related to his later operations. Therefore, funds involved were deemed relevant conduct under the Guidelines. Additionally, the $344,000 received from Universal cannot be excluded from consideration, as it was integral to the scheme for which Kosmel was convicted. The district court's calculations are upheld as not constituting plain error.
Kosmel also challenges the obstruction of justice enhancement, asserting that he provided false information about his earnings to his probation officer. He contends that the officer did not inquire about additional payments from Universal. However, the officer's supervisor testified that the officer likely did not ask about these payments due to a lack of knowledge at the time of the initial interview.
Under U.S.S.G. § 3C1.1, a defendant’s sentence may be enhanced if there is willful obstruction of justice during investigation, prosecution, or sentencing. Providing materially false statements to a probation officer can justify this enhancement, but the court must determine if the defendant had the specific intent to obstruct justice or if misleading statements arose from confusion or mistake. In this case, there is insufficient evidence to conclude that Kosmel's misleading statement was willful, as the record lacks testimony from Seaton regarding her inquiries to Kosmel. Consequently, the district court's enhancement of Kosmel's sentence for obstruction of justice is vacated, and the case is remanded for further examination of Seaton's interview with Kosmel. While Kosmel's conviction and the remainder of his sentence are affirmed, the absence of evidence for the obstruction enhancement necessitates reversal of that specific aspect of the sentence. The document also references various points about Kosmel's hiring practices, visa regulations, and previous court rulings, emphasizing that the government's evidence indicated Kosmel's conduct promoted criminal activity, which does not require further examination of concealment under the money laundering statute.
