APPEALS FROM THE UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF MASSACHUSETTS [Hon. Leo T. Sorokin, U.S. District
B. Kransoo, with whom Krasnoo, Klehm & Falkner LLP was on
brief, for appellant.
M. DiSantis, Assistant United States Attorney, with whom
William D. Weinreb, Acting United States Attorney, was on
brief, for appellee.
Lynch, Stahl, and Barron, Circuit Judges.
BARRON, CIRCUIT JUDGE.
David Cohen ("Cohen") appeals his convictions for
one count of conspiracy to convert government property, in
violation of 18 U.S.C. § 371; fourteen counts of
conversion of government property, in violation of 18 U.S.C.
§ 641; and one count of conspiracy to commit money
laundering, in violation of 18 U.S.C. § 1956(h). He also
challenges his sentence. The convictions stem from his role
in using bank accounts that he owned or controlled in order
to negotiate fraudulently-obtained federal tax refund checks.
We affirm the convictions and the sentence.
and his co-conspirators, both indicted and unindicted, were
alleged to have engaged in a scheme in Massachusetts that,
beginning in October 2011 and continuing through December
2014, involved the use of stolen identities to obtain
fraudulent tax refunds from the United States Internal
Revenue Service ("IRS"). The alleged scheme worked
conspirators (though not Cohen) obtained tax refund checks by
using stolen identities. Cohen, who was a real estate
attorney in Massachusetts, deposited the refund checks into
his existing Interest on Lawyers' Trust Accounts
("IOLTA") bank account, subsequently-opened IOLTA
accounts, and conventional business accounts (opened by
himself or by a co-conspirator) at various banks. Cohen and
his co-conspirators then wrote checks from those accounts
that were cashed, made cash withdrawals from those accounts,
and engaged in other transactions in order to launder the tax
refunds. When questioned by various bank officials about the
deposits being made to the various IOLTA and business
accounts, Cohen often stated that he was depositing checks in
these accounts for clients who were involved in real estate
closing transactions for which he was their attorney.
year and a half into the alleged scheme, on or about May 22,
2013, Cohen entered into an agreement with the Massachusetts
Attorney General's Office (the "AG Settlement")
to settle a lawsuit alleging that Cohen provided his advice
for, and consent to, unlawful conduct by a client whom Cohen
represented. In the AG Settlement, Cohen agreed to pay a $40,
000 fine and not to conduct real estate closings for a period
of six months. The government alleges that, after entering
into the AG Settlement, Cohen stopped using his IOLTA
accounts to launder the fraudulently- obtained checks, at
which time the conspiracy switched to using conventional
business bank accounts for such activities.
trial, Cohen testified in his own defense. He asserted that
he was not a "crook, " but a "fool" who
"was do[ing] favors for people who he knows, who are
friends, " and that he failed to look closely at
documents or ask enough questions. After a ten-day trial,
however, the jury convicted him of each of the sixteen counts
that were given to the jury.
sentencing, Cohen disputed the sentencing range that the
Pre-sentence Report ("PSR") set forth under the
United States Sentencing Guidelines (the "Sentencing
Guidelines"). Cohen contended that the PSR wrongly
calculated that range by attributing too large a loss from
the conspiracy to him and, therefore, by applying too large
an enhancement to his base offense level, see
U.S.S.G. § 2B1.1(b)(1)(I) (2015); by
wrongly applying to his base offense level the enhancement
that applies for an offense that involves ten or more
victims, see id. § 2B1.1(b)(2)(A)(i); and by
wrongly applying to his base offense level the enhancement
that applies for obstruction of justice, see id.
§ 3C1.1. Cohen argued that, without these wrongly
applied enhancements, he should have been assigned a total
offense level of twenty-two, which, given his criminal
history, would appear to have resulted in a sentencing range
of forty-one to fifty-one months imprisonment under the
District Court disagreed, applied the enhancements, and
calculated Cohen's total offense level to be
twenty-eight, which corresponded to a recommended guideline
sentencing range of seventy-eight to ninety-seven months
imprisonment. However, after considering the sentencing
factors set forth in 18 U.S.C. § 3553, the District
Court found the guideline range to be "too high"
and sentenced Cohen to a below-guideline term of imprisonment
of fifty-four months.
now appeals both his convictions and his sentence.
start with Cohen's challenge to his convictions. He
argues first that they must be vacated because the District
Court erred in "permit[ting the AG Settlement]" to
be used at trial. He also argues that the convictions must be
vacated because the District Court erred in allowing an
expert witness for the government to testify regarding the
Massachusetts "rules about IOLTA accounts" for
attorneys. We find neither argument persuasive.
facts that bear on Cohen's challenge regarding the AG
Settlement are as follows. Prior to trial, the government
informed Cohen and the District Court that if Cohen presented
any character witnesses to testify to his reputation for
truthfulness and honesty, the government intended to
cross-examine those witnesses about the AG Settlement. During
trial, but prior to the close of the government's case,
the government also made clear that if Cohen decided to
testify in his own defense, the government would
cross-examine Cohen about the AG Settlement pursuant to
Federal Rule of Evidence 608(b).
light of the government's stated intentions, Cohen
requested the District Court "rule . . . in advance of
[Cohen's] testimony, to exclude completely any
cross-examination of him arising out of the [AG
Settlement]." United States v. Cohen, No.
1:15-cr-10008-LTS (D. Mass. Jan. 17, 2016). Cohen's
counsel told the District Court that he had been under the
impression that evidence concerning the AG Settlement
"wasn't going to see the light of day, if [his]
reputation evidence wasn't going to come [in]." He
explained, however, that if evidence of the AG Settlement
would be used to cross-examine Cohen, then Cohen "might
as well" introduce "a fair number of reputation
witnesses" "because [he was] foiled."
hearing argument by both parties, the District Court, in a
January 17, 2016 order, ruled as follows:
This request is DENIED without prejudice to the defendant
challenging specific questions posed by the government on
cross-examination. The Court notes that permissible
cross-examination of the defendant and permissible
cross-examination of possible defense character witnesses is
not identical. For example, as to the latter the government
may challenge the basis for the witness'[s] opinion or
reputation testimony regarding the defendant's character.
Thus, while asking the character witness whether he or she is
aware of the fact of the lawsuit may well be a permissible
challenge to the basis of the witness'[s] testimony that
same question of the defendant, at least standing alone, does
not appear to bear on truthfulness or untruthfulness.
parties then informed the District Court that they had
"reached an agreement." If Cohen testified and the
government chose to cross-examine him about the AG
Settlement, the government agreed that it would only ask
Cohen "of the date of the [AG Settlement], when [Cohen]
agreed with the Attorney General's [O]ffice not to engage
in real estate transactions for six months." In return,
Cohen agreed that he would not "present any reputation
evidence witness[es] at all." At trial, the government
limited its cross-examination to the agreed-upon scope and,
thereafter, Cohen did not call any character witnesses.
appeal, Cohen now characterizes the District Court's
conditional order as "permitting the [g]overnment to use
. . . prejudicial, irrelevant evidence to impeach Cohen's
[potential] witnesses who would have testified to Cohen's
reputation for truthfulness and honesty." He also
contends that the "repeated references to the [AG
Settlement] during cross-examination of Cohen's
[potential] reputation-evidence witnesses, . . . would have
been so prejudicial to [Cohen's] defense . . . Cohen was
forced to eliminate [the reputation witness] portion of his