United States v. Okoye ( 2023 )

Case: 22-30289 Document: 00516832451 Page: 1 Date Filed: 07/25/2023
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
July 25, 2023
No. 22-30289 Lyle W. Cayce
Clerk
United States of America,
Plaintiff—Appellee,
versus
Chukwuma N. Okoye, Jr.,
Defendant—Appellant.
Appeal from the United States District Court
for the Western District of Louisiana
USDC No. 5:21-CR-36-1
Before Graves, Ho, and Duncan, Circuit Judges.
Per Curiam:*
Defendant Chukwuma Okoye challenges the amount of restitution
ordered by the district court for his participation in a criminal conspiracy,
alleging that proceeds of the entire conspiracy were not sufficiently
established as foreseeable as required by the statute. Because the record
provides sufficient basis for establishing that the amount ordered was
foreseeable, we affirm.
*
This opinion is not designated for publication. See 5th Cir. R. 47.5.
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I.
This case arises out of Defendant’s participation—along with two
indicted co-defendants who have since fled the country—in a criminal
conspiracy that illicitly obtained funds intended for emergency relief during
the COVID-19 pandemic. The scheme involved using the stolen personal
identifying information from at least 29 different individuals to apply for
loans from the Small Business Administration and unemployment insurance
from the Washington State Employment Security Department. Those funds
were then deposited into PayPal accounts, which were in turn used to load
Green Dot debit cards—both of which were also created using stolen
personal identifying information. Those cards were then used at online
retailers and various physical stores to purchase merchandise and money
orders as well as to withdraw cash. The scheme was uncovered after the
discovery of these transactions at a Walmart store in Bossier City, Louisiana,
with investigators later concluding that $941,244 was laundered through that
store alone in just 44 days.
Defendant was indicted and subsequently entered into an agreement
with the government by which he pled guilty to conspiracy to use
unauthorized access devices. As part of the plea agreement, prosecutors and
Defendant jointly “agree[d] and stipulate[d] that the reasonably foreseeable
loss amount as to [Defendant’s] role in the conspiracy is between $250,000
and $550,000, based on the number of transactions conducted at the Bossier
City Walmart by [Defendant] and other conspirators,” though they added
the caveat that the description “d[id] not represent the totality of the
evidence obtained in this case.” Subsequently, the presentence report (PSR)
detailed that the total amount deposited into the PayPal accounts from the
federal and state agencies was $2,379,860 and recommended that Defendant
be held responsible for restitution of that amount pursuant to the Mandatory
Victim Restitution Act (MVRA), 18 U.S.C. § 3663A.
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Defendant filed his objections to the restitution amount, citing the
stipulated loss range and alleging that he “was a small part of a much larger
conspiracy.” The probation officer declined to amend the restitution
amount, explaining how the evidence indicated that Defendant was
responsible for a much larger loss than the amount stipulated. The district
court overruled Defendant’s objection to the restitution amount, explaining
that “[t]he reasons related by the probation officer [made] perfect sense.”
After adopting the PSR’s findings, the court ordered Defendant to pay the
full $2,379,860 in restitution and made the restitution joint and several with
his co-defendants. Defendant objected to the restitution order and filed a
timely notice of appeal.
II.
The MVRA mandates restitution to victims of offenses committed by
fraud or deceit. 18 U.S.C. § 3663A(c)(1)(A)(ii). “To be a victim under the
MVRA, a person or organization must suffer a foreseeable loss as a result of
the conduct underlying the convicted offense.” United States v. Benns, 810
F.3d 327, 329 (5th Cir. 2016). The MVRA also requires that the restitution
award must reflect “the value of the . . . loss.” 18 U.S.C. §
3663A(b)(1)(B)(i)(I).
This court reviews the legality of a restitution order de novo and its
amount for abuse of discretion. United States v. Williams, 993 F.3d 976, 980
(5th Cir. 2021). A factual finding concerning the amount is reviewed for clear
error. Id. There is no clear error if a factual finding is plausible in light of the
record as a whole. Id.III.
Defendant’s contention, laid out in the two-page argument section of
his brief, is that the government failed to establish that any loss above the
range stipulated in the plea agreement was foreseeable. He asserts that the
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government only established that $2,379,860 was the total amount laundered
and did not make sufficient further findings to establish the foreseeability of
that total amount.
But as Defendant admits, the district court was not bound by the
stipulation. And the record goes far beyond what the stipulation contained.
While the stipulated facts focus on Defendant’s role in making purchases and
withdrawals with the debit cards, the PSR details how Defendant and his co-
conspirators were responsible for utilizing stolen personally identifiable
information to open the PayPal accounts into which the stolen relief funds
were all deposited and for transferring the money to the debit cards. The
probation officer’s response to Defendant’s objections to the PSR also detail
their culpability in the purchases and withdrawals far beyond those included
in the stipulation, explaining how they visited Walmart stores in 27 cities
across Oklahoma, Arkansas, Texas, and Louisiana. This provides a sufficient
basis for establishing Defendant’s involvement in the entirety of the criminal
scheme, rather than merely playing a small role in the purchases and
withdrawals at a single Bossier City Walmart store. 1
The record is open to different plausible interpretations as to whether
the responsibility for these actions was Defendant’s alone or shared with his
1
Without rebuttal evidence to show that information in the PSR was “materially
untrue, inaccurate or unreliable,” the district court can adopt the contents of the PSR.
United States v. Taylor, 277 F.3d 721, 724 (5th Cir. 2001). Here, the defendant’s objections
to it don’t contain any new evidence to demonstrate his allegedly minimal role in the
scheme. To be sure, “[t]he PSR . . . cannot just include statements, in the hope of
converting such statements into reliable evidence, without providing any information for
the basis of the statements.” Id. But that’s just not the case here, with the PSR
documenting how information was gathered by Walmart’s Global Investigations Team, the
Bossier City Police Department, and others. And the PSR makes clear that “[t]he total
amount deposited into the 29 PayPal account from the [Small Business Administration]
was $2,148,200; and the amount deposited by the [Washington State Employment Security
Department] was $231,660, for a total . . . loss amount of $2,379,860.”
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two co-conspirators. But we need not wade into allocating liability among the
three because “a participant in a conspiracy . . . is legally liable for all the
actions of [his] co-conspirators in furtherance of this crime” and “[t]he
district court was therefore well within its discretion to order restitution for
the losses resulting from the entire fraudulent scheme and not merely the
losses directly attributable to [Defendant’s] actions.” United States v.
Ismoila, 100 F.3d 380, 398–99 (5th Cir. 1996). See also United States v.
Shelton, 694 F. App’x 220, 222–25 (5th Cir. 2017) (applying this rule in the
MVRA context).
***
For these reasons, we affirm.
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James E. Graves, Jr., Circuit Judge, dissenting:
I disagree with the majority’s conclusion that the amount of
restitution ordered was foreseeable in light of the stipulation of facts.
Because I would vacate and remand for resentencing, I respectfully dissent.
Chukwuma Okoye pleaded guilty pursuant to a plea agreement to
conspiracy to use unauthorized devices. The factual basis included a
stipulation of facts that was signed and agreed to by both parties. The parties
stipulated that “the reasonably foreseeable loss amount as to Okoye’s role in
the conspiracy” was “between $250,000 and $550,000, based on the number
of transactions conducted at the Bossier City Walmart by Okoye and other
conspirators.” (Emphasis added). The factual basis listed only three specific
transactions of $1,003.74 involving Okoye at one Walmart in Bossier City.
Significantly, the parties also stipulated that the pin number for the card
Okoye used was provided to him by a co-conspirator.
The factual basis also recounted the involvement of Patrick
Madubuko, Barnabas Akporehe, and others, and the use of Green Dot cards
funded by the Small Business Administration (SBA) and the Washington
State unemployment insurance via 29 PayPal accounts at one Walmart store
in Bossier City. The factual basis made clear that the government knew the
extent of the conspiracy at the time it entered into the plea agreement.
Importantly, the factual basis also said: “The above-described facts do not
represent the totality of the evidence obtained in this case. However, the
parties signing below agree and stipulate that the preceding paragraphs
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adequately describe Chukwuma N. Okoye, Jr.’s role in the offense.” 1
(Emphasis added).
After Okoye’s guilty plea was secured based on a binding agreement
that he was responsible for an amount between $250,000 and $550,000
involving transactions in Bossier City, the government then moved the mark
by introducing a Presentence Investigative Report (PSR) seeking restitution
in the amount of $2,379,860, which the district court granted. The PSR also
sought to give Okoye a 16-level enhancement because the loss was more than
$1.5 million. The district court correctly sustained Okoye’s objection as to
that enhancement, instead giving him a 12-level enhancement instead for an
intended loss of $550,000. 2 But the district court erroneously overruled
Okoye’s objection to the restitution amount, saying that “the reasons related
by the probation office make perfect sense to me.” The district court then
adopted the PSR’s findings and ordered Okoye to pay restitution of
$2,379,860.
The district court ordered the higher amount of restitution despite
the government’s concessions in its written response to Okoye’s objections
to the PSR which said that it “agrees that the loss amount reasonably
foreseeable to Okoye is between $250,000 and $550,000 as set forth in the
factual basis” and “Okoye should be ordered to pay restitution in an amount
between $250,000 and $550,000.” Notably, the government argues on
appeal that the district court did not err.
1
Both the majority and the probation officer disregard the second sentence of this
quote. The probation officer repeatedly relied on only the first sentence as meaning he was
free to expand the evidence to which the government had already stipulated.
2
Okoye was sentenced to 46 months, which was at the top of his guidelines range
of 37-46 months.
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The majority now affirms “[b]ecause the record provides sufficient
basis for establishing that the amount ordered was foreseeable.” 3 I disagree.
The amount that the parties stipulated to was what was foreseeable.
Moreover, the amount that went through the Bossier City Walmart and that
the Walmart investigator attributed to this group, as discussed above, was
less than $1 million. Authorities already seized $719,496. That puts the loss
within the $250,000 and $550,000 stipulated amount.
The majority opinion says, “as defendant admits, the district court
was not bound by the stipulation. And the record goes far beyond what the
stipulation contained.” The majority is correct that the sentencing
guidelines state that the court is not bound by the stipulation. See U.S.S.G. §
6B1.4(d). 4 However, the government is bound by the stipulation, as this
court has repeatedly concluded.
“Evidentiary stipulations are binding on the parties,” United States v.
Banks, 624 F.3d 261, 264 (5th Cir. 2010) (citing United States v. Cantu, 510
F.2d 1003, 1004 (5th Cir. 1975). “A judicial admission is a formal concession
in the pleadings or stipulations by a party or counsel that is binding on the
party making them. Although a judicial admission is not itself evidence, it
has the effect of withdrawing a fact from contention.” Martinez v. Bally’s,
244 F.3d 474, 476 (5th Cir. 2001).
The majority relies on the probation officer’s response to Okoye’s
objections as providing a sufficient basis for Okoye’s “involvement in the
3
The “record” the majority references is the PSR and the probation officer’s
response to Okoye’s objections to the PSR, discussed more fully herein.
4
The district court also cited United States v. Gremillion, 418 Fed. App’x 273 (5th
Cir. 2011), for this proposition. However, Gremillion is both unpublished and
distinguishable, as it involved a situation where the defendant did not plead guilty pursuant
to a binding plea agreement. Id. at 275.
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entirety of the criminal scheme, rather than merely playing a small role in the
purchases and withdrawals at a single Bossier City Walmart store.” 5 The
majority then says, “[t]he record is open to different plausible interpretations
as to whether the responsibility for these actions was [Okoye’s] alone or
shared with his two co-conspirators.”
The probation officer’s response to Okoye’s relevant objection set out
a list of Walmart stores in Oklahoma, Arkansas, Texas and Louisiana that the
three men allegedly visited and cited the PSR at ¶¶ 21, 23, 29 and 56. 6
Paragraph 21 of the PSR said, “[t]he [Walmart] investigator believed there
were more stores that had been used including stores in Arkansas, Louisiana,
5
In footnote 1, the majority says that “[w]ithout rebuttal evidence to show that
information in the PSR was ‘materially untrue, inaccurate or unreliable,’ the district court
can adopt the contents of the PSR,” citing United States v. Taylor, 277 F.3d 721, 724 (5th
Cir. 2001). The majority acknowledges that Taylor also says: “The PSR, however, cannot
just include statements, in the hope of converting such statements into reliable evidence,
without providing any information for the basis of the statements.” Id. (internal marks and
citation omitted). The majority then says: “But that’s just not the case here, with the PSR
documenting how information was gathered by Walmart’s Global Investigations Team, the
Bossier City Police Department, and others.” The majority also quotes a statement in the
PSR about money from the SBA and Washington state that was deposited into PayPal
accounts. Significantly, the PSR in no way connects Okoye to Washington state, the PayPal
accounts, or those amounts, as discussed herein. As quoted from Taylor above, merely
including such statements in no way converts them into reliable evidence. Moreover,
$719,496.42 of the amount referenced by the majority was already seized by authorities.
The majority’s claim is unsupported by the PSR. Nothing in the PSR documents how
Okoye was responsible for a foreseeable loss of $2,379,860. Instead, as discussed more fully
herein, the PSR documents that Okoye was responsible for three transactions of $1,003.74
and that the government stipulated the reasonably foreseeable loss attributed to Okoye’s
role in the conspiracy was between $250,000 and $550,000 to induce a guilty plea before
reneging on the stipulation. The majority now ignores both the record and precedent,
thereby nullifying the effect of legal stipulations and condoning the fraudulent inducement
of guilty pleas.
6
The probation officer follows a troubling pattern of citing his original statement
of facts without a source as authority for stating them a second time throughout his
responses. However, this circular logic does not establish an indicia of reliability.
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Texas, and Oklahoma. An aggregate amount of $960,324 was the amount
the Walmart investigator calculated this particular group amassed from
unloaded gift cards.” (Emphasis added).
Paragraphs 23 and 29 referenced the response from Green Dot,
clusters of addresses in Texas, and various transactions. However, paragraph
23 did not mention Okoye, and paragraph 29 only possibly mentioned him to
the extent that it said transactions at the 8 oz. Burger Bar in Bossier City
matched a participating Walmart employee’s statement of eating there with
“the suspects.” Paragraph 29 also said that the “total amount of money that
was transferred from PayPal to Green Dot cards was $1,339,600.” 7
Paragraph 56 essentially blamed Okoye for the entire conspiracy and
said:
The investigative material indicates the defendant
defrauded the Cares Act and/or the Washington State
Unemployment Insurance in that he, using the identity of at
least 29 people, applied for and received loans and
unemployment benefits. The defendant then laundered the
money by opening PayPal accounts in the names of the victims
and transferred the money to Green Dot debit cards. To obtain
the laundered money from the Green Dot cards, the defendant
traveled in rented cars (from Dallas, Texas) to areas (mostly)
in Arkansas, Oklahoma, and Louisiana . . . .
Other than the broad statement that, “[t]he investigative material
indicates,” this paragraph offered no source for any of the alleged facts.
However, as discussed above, paragraph 21 said that the source for part of it
is an investigator from Walmart, and the facts were what he “believed.” The
7
The PSR does not address what happened to the remainder of the $2,379,860.
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PSR also reflected that Green Dot and PayPal allegedly replied to requests
and provided partial information but neither identified Okoye as having any
involvement. The PSR discussed the statements of the three Walmart
employees who were involved in the conspiracy, but the reference is
repeatedly to “the suspects” without identifying Okoye. One Walmart
employee specifically referenced someone named “Steve.” The PSR also
said that one of the participants, Willie Townsel, provided an interview and
said that he got the cards and pin numbers from Madubuko and Akporehe.
The PSR specifically referenced Okoye in other paragraphs though.
For example, in paragraph 30 the PSR stated that a comparison of records
from the Horseshoe Casino and Green Dot transactions revealed that
Madubuko was a guest at the hotel on specific days the Walmart employees
alleged. It then says, “The following suspects were also developed: Patrick
Madubuko, Barnabas Akporehe, Willie Townsel, and Okoye. These names
also matched information from the Margaritaville Casino/Hotel.” The PSR
does not explain what exactly that is supposed to mean. In paragraph 31, the
PSR said that the Walmart employees were able to identify Okoye and others
in a photo lineup. However, there is no explanation as to what that means
beyond the fact that Walmart employees recognized photos of the guys they
had been helping and socializing with at the casino hotel. There is also no
indication that any of the Walmart employees ever said that Okoye set up any
of the PayPal accounts or Green Dot cards or that he had more than the role
stipulated to by the government.
This court has previously concluded that a probation officer’s
conclusions lack an indicia of reliability when there is nothing else in the
record to support them and they do not provide the source. See United States
v. Shacklett, 921 F.2d 580, 584 (5th Cir. 1991). Such is the case here.
Additionally, Okoye’s indictment did not mention any transactions in
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Arkansas or Oklahoma; it only mentioned the three transactions in Bossier
City.
There is no evidence that Okoye even had the pin number for the
Green Dot card(s) he used. Instead, the government stipulated that Okoye
obtained the pin number from a co-conspirator. That is an indication that
Okoye was not involved in setting up the PayPal accounts or Green Dot cards.
Also, the PSR recites nothing that directly connects Okoye to Washington
state, the SBA or the PayPal accounts.
This court has previously said that the PSR cannot merely include a
recitation of conclusions “in the hope of converting such statements into
reliable evidence, without providing any information for the basis of the
statements.” United States v. Taylor, 277 F.3d 721, 724 (5th Cir. 2001).
Further, “[b]ald, conclusionary statements do not acquire the patina of
reliability by mere inclusion in the PSR.” United States v. Elwood, 999 F.2d
814, 817-18 (5th Cir. 1993). The PSR is rife with bald, conclusory statements
that have now been accepted as fact. 8
Here, there was a stipulation of facts. Because they were stipulated
to, both Okoye’s role in the conspiracy and the amount of foreseeable loss
were withdrawn from contention. See Martinez, 244 F.3d at 476. Also, the
8
The government asserts that Okoye “did not rebut the evidence in the
presentence report.” The government does not explain how Okoye would have rebutted
evidence that did not exist. Again, nothing in the PSR directly tied Okoye to the SBA,
Washington state, or setting up either the PayPal accounts or Green Dot cards. The
government also asserts that Okoye is liable in restitution for the reasonably foreseeable
losses caused by their co-conspirators. But nothing in the PSR directly tied Madubuko or
Akporehe to the SBA, Washington state or setting up the PayPal accounts. There is
arguably evidence indicating that Madubuko and/or Akporehe were involved in setting up
the Green Dot cards, as Townsel said they provided the pin numbers. But there is not
substantial evidence that Okoye played a much larger role than what was in the stipulation.
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stipulated facts are just as binding on the government as they are on Okoye.
See Banks, 624 F.3d at 264.
This court has said that a “trial court may disregard stipulations
between parties only if accepting them would be manifestly unjust or if the
evidence contrary to the stipulation was substantial.” United States v. Ret.
Serv. Group, 302 F.3d 425, 430 (5th Cir. 2002) (quoting Hymel v. Comm’r,
794 F.2d 939, 940 (5th Cir. 1986). Here, accepting the stipulation between
Okoye and the government would not be manifestly unjust, and there is not
substantial evidence contrary to the stipulation. The district court did not
address either finding before disregarding the stipulation and overruling
Okoye’s objection.
The district court had no basis for even considering a much higher
amount for restitution until the government reneged on the stipulation and
used the PSR to seek more time and more restitution after Madubuko and
Akporehe fled the country. The district court clearly erred in finding that the
amount of loss was $2,379,860 rather than within the stipulated range. The
majority now fails to provide any authority to support a conclusion that the
government is not bound by a binding agreement regarding Okoye’s role and
the amount of reasonably foreseeable loss attributable to him. Because I
would vacate and remand for resentencing, I respectfully dissent.
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