A blog of the Philadelphia Bar Association’s Criminal Justice Section

By Burt Rose
Click to download opinionAsya Richardson PDF

The UNITED STATES COURT OF APPEALS for the THIRD CIRCUIT has decided the case of UNITED STATES OF AMERICA v. ASYA M. RICHARDSON, Appellant, No. 11-1202, 2011 WL 4430808 (September 23, 2011). This was an appeal from the United States District Court for the Eastern District of Pennsylvania, No. 2-05-cr-00440-018, before Judge R. Barclay Surrick. The Panel was composed of Judges RENDELL, SMITH, and ROTH. Judge Smith wrote the Opinion.

Alton Coles was the leader of a Philadelphia drug distribution ring responsible for selling cocaine base from 1998 to 2005. The defendant in this appeal, Asya Richardson, was Coles’ fiancée. In the summer of 2005, the couple used drug money to purchase a new home for $466,190. Not long after, a federal grand jury charged Coles and others with various drug trafficking and firearms offenses and Richardson with money laundering. The government’s theory was that, in the course of purchasing their new home, Richardson had participated in financial transactions with Coles, knowing that they were designed to conceal the criminal origin of the money involved. The case proceeded to trial and Richardson was convicted. The Court sentenced Richardson to 24 months in prison. On appeal. the Court concluded that the evidence was insufficient to sustain Richardson’s conviction.

18 U.S.C. § 1956(a)(1)(B)(i), the provision of the money-laundering statute under which Richardson was convicted, provides as follows: Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity … knowing that the transaction is designed in whole or in part … to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of specified unlawful activity … shall be sentenced to a fine … or imprisonment for not more than twenty years, or both.

Asya Richardson initially contended that the government failed to prove that the transactions involved the “proceeds” of drug distribution in that the evidence established only that the transactions involved gross receipts of drug distribution, and not the profits of drug distribution. Citing the Supreme Court’s decision in United States v. Santos, 553 U.S. 507 (2008), attorney Ellen Brotman, who represented the Appellant, argued that the term “proceeds,” as used in the money-laundering statute, meant profits, not gross receipts. The government acknowledged that it had failed to prove that the transactions involved profits of drug distribution, but it argued that the statute’s use of the term “proceeds” means gross receipts, at least in drug trafficking cases.

Judge Smith first noted that Congress had legislatively overruled Santos in the Fraud Enforcement and Recovery Act of 2009, 18 U.S.C. § 1956(c)(9), Pub.L. No. 111–21, § 2(f)(1), 123 Stat. 1617, 1618 (2009). As now amended, the money-laundering statute defines “proceeds” as “any property derived from or obtained or retained, directly or indirectly, through some form of unlawful activity, including the gross receipts of such activity.” The government acknowledged that the 2009 amendment would not apply retroactively here. However, Judge Smith wrote that “proceeds” means gross receipts in the circumstances of this drug trafficking case.

The Appellant next argued that even if she knew drug money was used to purchase the home, there was not sufficient evidence to prove that she participated in financial transactions knowing that they were designed, at least in part, to conceal the nature, location, source, ownership, or control of the money. The government offered no evidence suggesting that Richardson participated in or knew about Coles’ transactions. Although Richardson lied about her income and had the property titled in her name, this appears to have been done not to hide Coles’ obvious involvement, but rather to get around Coles’ bad credit in order to purchase the house. Without knowledge of a design to conceal the nature, source, or ownership of the money, Richardson could not have agreed to conceal the nature, source, or ownership of the money. Therefore, a judgment of acquittal was entered.

PS: The Appellant was promptly released from prison.

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