Free Response to Motion - District Court of Arizona - Arizona

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DIANE J. HUMETEW A United States Attorney District of Arizona HOW ARD D. SUKENIC Assistant U.S. Attorney Arizona State Bar No. 011990 United States Attorney's Office Two Renaissance Square 40 North Central Avenue, Suite 1200 Phoenix, Arizona 85004-4408 Telephone: (602) 514-7500 [email protected]

UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA United States of America, Plaintiff, v. Margaret Molter, RESPONSE TO DEFENDANT'S SUPPLEMENTAL SUBMISSION RE: LOSS CALCULATION CR 04-0539-06-PHX-MHM

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Comes Now the United States of America, by and through undersigned counsel, and responds to the defendant's Supplemental Submission Re: Loss Calculation. STANDARD OF PROOF: Given defendant Molter's admission that her loss amount is $99,854.83, the government submits that the standard of proof required in calculating the loss amount is by a preponderance of evidence. "As a general rule, the preponderance of evidence standard is the appropriate standard for factual findings used for sentencing. However, when a sentencing factor has an extremely disproportionate effect on the sentence relative to the offense of conviction, the government may have to satisfy a `clear and convincing' standard." U.S. v. Dare, 425 F.3rd 634, 642 (9 th Cir. 2005). In the instant case, as to loss amount, the advisory guideline calculations are crafted from U.S.S.G. § 2F1.1(b)(1)(H) (Nov. 1998). The defendant's admitted amount

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would cause an increase of six levels whereas the government's and probation's proposed loss calculation would only be one level higher, an increase of seven levels. 1/ GUIDELINES USED BY I.R.S. SPECIAL AGENT ANGELA WONG: As the Court may recall from Special Agent ("S.A.") Wong's testimony, she employed certain guidelines to make a determination as to how the funds should be allocated. They were as follows: 1. Who had dominion and control over the funds. 2. Who was the authorized signatory on the bank account. 3. Who directed the disbursements (this information was derived by looking at notations or from witness interviews). 4. Notations written on the checks. 5. Review of internal books and records. 6. Who received the disbursement. PAYMENTS MADE TO RICHARD AND ELLEN MOLTER: The government has reviewed the evidence provided by the defendant in her pleading. The government accepts the documents as presented and therefore agrees that a reduction of $7,807.69 is appropriate. 2/ PAYMENTS TO ANNETTE AND JOHN DEPLER: The paper trail provided by the defendant leads to one clear conclusion, MMCB Holdings Incorporated participated and benefitted from the transaction. MMCB stands for Margaret Molter and Craig Brosnan (defendant Tullo's brother in law). It appears that the property flowed to MMCB Holdings Incorporated and the Deplers were cashed out by MMCB. Given the familial relationship between Ms. Molter and the Deplers and Ms. Molter's relationship with

This factor should assist the Court in deciding to apply the preponderance of evidence standard. The difference of one level does not create a disproportionate effect as to the sentence. This however appears to be an amount that should be attributed to Mr. Tullo. Such an addition would not affect his advisory Guideline calculations. 2
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MMCB Holdings Incorporated, it stands to reason that there is a sufficient amount of evidence for this Court to find, by a preponderance, that defendant Molter did benefit. The government submits that the value of the cashiers check, paid to the Deplers in the amount of $10,355.68, could substitute as a reasonable valuation of any property benefit obtained by MMCB Holdings Incorporated as a result of the transaction. Therefore, the government does not agree to this requested reduction. THE INVESTMENT IN "BRITE BABY": Testimony received by this Court, on December 18, 2007, from S.A. Angela Wong revealed S.A. Wong's investigative conclusion that defendant Molter had an ownership interest in Brite Baby. The defendant, in contrast, has proffered an affidavit but no witness who could be subject to cross examination. Therefore, the government requests that this Court give the affidavit minimal weight. S.A. Wong testified that, among other things, she assessed the amounts against each defendant based on notations and other evidence indicating who controlled or knowingly received funds.
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This is why that although there are some Brite Baby

expenditures attributed to defendant Tullo there are others attributed to defendant Molter. Therefore, based on S.A. Wong's careful analysis and testimony, the government asserts that this Court may find that the government has met its burden and that a preponderance of evidence would allow the Brite Baby amounts to be attributed to defendant Molter as listed in government's Exhibit 3, (admitted at the December 18, 2007 hearing). 4/ CONCLUSION: The government agreed to a reduction of $5,500 at the December 18, 2007 hearing. The government also agrees that the additional evidence provided by the defendant as to the payment

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See S.A. Wong's guidelines listed above.

The government is unable to determine how defendant arrived at the figure $41,111.81. Exhibit 3 reveals a total number of payments from the BELFC-Wells Fargo Account #xxxx-xxxx91 to be $23,999.30, $7,000 from ABF Old-Wells Fargo Account #xxxxxxxx39 and, $195.00 from Salesmasters Bank of Arizona Account #xxxx-xx76. The total amount that the government has calculated is $31,194.31 3

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to Richard and Ellen Molter is sufficient to prove that defendant Molter did not benefit. The government opposes further reductions and asserts that it has met its burden by a preponderance of the evidence that the loss/gain amount, reduced by $13,307.69, should be $154,911.88. This reduction would not affect the enhancement imposed under the applicable advisory Guideline. Respectfully submitted this 3 rd day of January, 2008. DIANE J. HUMETEWA United States Attorney District of Arizona S/Howard D. Sukenic

9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 S/Howard D. Sukenic HOWARD D. SUKENIC 4 Justine L. Kozak/Mark W. Nebgen Senior U.S. Probation Officer Sandra Day O'Connor Courthouse 401 W. Washington, Suite 260 Phoenix, AZ 85003 David C. Derrickson 3636 N. Central Ave., Suite 1050 Phoenix, Az. 85012 Jess A. Lorona Ducar, Lorona & Parks 3003 N. Central Ave., Ste 1800 Phoenix, Az. 85012 CERTIFICATE OF SERVICE I hereby certify that on January 3, 2008, I electronically transmitted the attached document to the Clerk's Office using the CM/ECF system for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: David R. Appleton 8711 E. Pinnacle Peak Rd., #109 Scottsdale, Az. 85255 Michael D. Kimerer Kimerer & Derrick, P.C. 221 E. Indianola Ave. Phoenix, Az. 85012 Michel B. Bernays 3839 N 3 rd St., Ste 400 Phoenix, Az. 85012 HOWARD D. SUKENIC Assistant U.S. Attorney

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