United States v. Yulia Abair ( 2014 )

In the
United States Court of Appeals
For the Seventh Circuit
No. 13-2498
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
YULIA YUREVNA ABAIR,
Defendant-Appellant.
Appeal from the United States District Court for the
Northern District of Indiana, South Bend Division.
No. 3:12-cr-076 — Jon E. DeGuilio, Judge.
ARGUED DECEMBER 9, 2013 — DECIDED MARCH 19, 2014
Before WILLIAMS, SYKES, and HAMILTON, Circuit Judges.
HAMILTON, Circuit Judge. Two weeks before she was
planning to close on the purchase of a new home in Indiana,
appellant Yulia Abair learned that her bank in Russia would
not wire the purchase price from her account. She managed to
secure the money before the closing by withdrawing a few
hundred dollars at a time from ATMs up to her maximum
daily limit and depositing the cash at her bank in Indiana. She
was charged with violating a federal criminal statute that
2 No. 13-2498
prohibits structuring currency transactions in order to evade
federal reporting requirements for transactions involving more
than $10,000 in currency. 31 U.S.C. § 5324(a)(3). Abair was
convicted in a jury trial. She also agreed to sell her new home
and to forfeit the entire proceeds to the government. She
argues on appeal that the trial court erroneously applied
Federal Rule of Evidence 608(b) by allowing the prosecutor to
cross-examine her at length about alleged false statements on
a tax return and student financial aid applications. We find that
the government lacked a good faith basis for believing that
Abair lied on the tax and financial aid forms and therefore
conclude that the district court erred by allowing the prosecu-
tor to ask a series of accusatory and prejudicial questions about
them under Rule 608(b). We cannot say that the error was
harmless in a trial that hinged on Abair’s credibility. We
reverse Abair’s conviction and remand for a new trial. Abair
also challenges the forfeiture of the entire proceeds of her
home sale as an unconstitutionally excessive fine. We offer
some guidance on that issue in case it arises again after
remand.
I. Factual Background
Abair emigrated to the United States from Russia in 2005
and married an American citizen. They lived together in
Indiana, where Abair ran a massage therapy business and
worked toward her nursing degree. During this time, Abair
still owned her old apartment in Moscow. After being di-
vorced, Abair sold the apartment in 2010 and deposited the
proceeds in her account with Citibank Moscow. The next year,
she signed a contract to buy a home for cash in South Bend,
Indiana. That agreement set the closing for June 3, 2011.
No. 13-2498 3
Several weeks after signing the contract, Abair asked
Citibank Moscow to transfer the purchase price from her
account. The bank refused, apparently because her local bank
account was in her married name and the Citibank Moscow
account used her maiden name. The only way to reach her
money in time for the closing was by withdrawing it bit by bit
from Citibank ATMs in Indiana. Abair did so over a frenetic
two weeks in which she repeatedly withdrew the maximum
daily amount of cash (this ceiling was set in rubles but hovered
around $6400). Over the same period, Abair made eight
deposits at her local bank in amounts ranging from $6400 to
$9800—all below the $10,000 limit at which the currency
reporting requirements kick in. See 31 U.S.C. § 5313(a);
31 C.F.R. § 1010.311. The last of these deposits was on Tuesday,
May 31. Because it immediately followed the Memorial Day
weekend, her deposit was posted alongside one she had made
on Saturday, pushing her “daily” deposit over the $10,000
reporting threshold set by regulation. See 31 C.F.R. § 1010.313.
The teller asked for her identification and filled out the
required currency transaction report. We presume it was this
report that led the government to investigate Abair.
The U.S. Attorney’s Office decided Abair was worth
prosecuting, and she was indicted by a grand jury on eight
counts—later correctly merged into one—of structuring
financial transactions for purposes of evading the reporting
requirements. Abair went to trial. Because the parties stipu-
lated that her local bank was a domestic financial institution,
the only two elements the government had to prove were that
Abair knew of the reporting requirements and that she had
4 No. 13-2498
structured her transactions for the purpose of evading those
requirements.
During its case-in-chief, the government focused on Abair’s
pattern of withdrawals and deposits. It showed that on each
day Abair went to the bank, she had more than $10,000 in her
possession yet always deposited less than that amount. The
government called two IRS agents who had interviewed Abair.
They testified that during the interview, which was not
recorded, Abair revealed her knowledge of the reporting rules.
The agents also testified that Abair told them outright that she
had wanted to avoid the reporting rules because “she thought
the government would look at her as though she was part of an
organization or something, is what she said.”
For her part, Abair did not dispute that she was aware of
the $10,000 limit by the time she spoke with the agents. But she
said she learned about it only after making the deposits, when
she asked a friend why she had been asked to show identifica-
tion at the bank. Abair’s version was that the agents asked her
why she thought the requirements existed, and she “said
probably of organization or something—something like this.”
(Abair had arrived in the United States speaking very little
English, and she testified to continuing difficulties with
complex or technical conversations.) She said her deposit
amounts were based on how much cash she had on hand at the
time and how much would fit in her purse.
In cross-examining Abair, the prosecutor sought to ask
about her 2008 joint income tax return and the Free Application
for Federal Student Aid (“FAFSA”) forms she filed while
attending nursing school. Her attorney objected on relevance
No. 13-2498 5
grounds. In a sidebar conference, the prosecutor said he
believed Abair misrepresented her business expenses on the
tax return and lied on her student aid applications about her
business income and her assets. He intended to ask about the
filings to attack Abair’s truthfulness under Federal Rule of
Evidence 608(b), which allows cross-examination about specific
instances of a witness’s conduct if they are probative of
character for truthfulness, but prohibits extrinsic evidence to
prove such instances. Abair’s attorney maintained his objec-
tion, arguing that the documents had no bearing on truthful-
ness. Abair’s ex-husband had testified that he was the one who
filled out the disputed expense information on their joint tax
return, and the online FAFSA allowed Abair to skip questions
about assets. The judge ruled that the filings were probative of
Abair’s truthfulness under Rule 608(b) and that the probative
value of the evidence was not substantially outweighed by the
danger of prejudice. See Fed. R. Evid. 403. The judge said the
prosecutor was free to question Abair “in a very limited
manner on these subjects,” provided the questioning stopped
at the point she denied lying on the forms.
Ask he did, though, repeatedly, and without stopping at
the denials: “Isn’t it true that you helped make prior state-
ments—false statements—in submissions that related to
financial matters; both on your tax returns and on your
financial aid applications, you made false statements?” Abair
denied this, but the questioning continued. Didn’t the FAFSA
form ask her to state her assets? No, not exactly. Didn’t she
recall being asked about her assets? No, the computer let her
skip that part.
6 No. 13-2498
The questioning continued in the same vein. Wasn’t it true
she also lied about her income on the FAFSA forms? Didn’t she
lie on her taxes about her business’s losses? Didn’t she say
expenses were double her gross receipts? Was she unaware
that she gave her husband false numbers when he did their
taxes? Abair denied having lied. She said she played almost no
role in preparing her family’s tax returns and never signed
them. Her attorney raised multiple objections. But although the
trial court reined in the questioning somewhat, the prosecutor
had achieved what he set out to do.
The jury found Abair guilty on all counts. The court
merged the eight counts into one, sentenced Abair to two years
of probation, and ordered her to sell her new home and forfeit
to the government all the proceeds of the sale, which
amounted to $67,060.
II. Analysis
Abair argues that the district court abused its discretion in
allowing the questions about her financial filings and claims
the forfeiture was unconstitutionally excessive. Before dealing
with those issues, though, we address briefly her argument
that the original eight-count indictment was multiplicitous on
the theory that her eight deposits together could support only
one count of structuring. We have suggested as much before,
United States v. Davenport, 929 F.2d 1169, 1171–72 (7th Cir.
1991), but the district judge corrected any problem on this
score by merging the counts at sentencing. The judge did not
do so earlier because defense counsel waited until mid-trial to
challenge the indictment under Federal Rule of Criminal
Procedure 29 rather than doing so in a Rule 12 pre-trial motion.
No. 13-2498 7
The delayed merger had no effect on Abair’s sentence, and
nothing suggests the number of counts contributed to the
jury’s verdict. The jury was instructed to consider the counts
separately, and a rational jury could have found Abair guilty
of each one based on the IRS agents’ testimony and the record
of Abair’s transactions if it did not believe her testimony. We
turn now to the principal issue on appeal.
A. Cross-Examination Under Rule 608(b)
Federal Rule of Evidence 608(b) limits the use of specific
examples of a witness’s prior conduct to support or undermine
the witness’s credibility. The rule bars extrinsic evidence of
prior conduct but gives trial judges discretion to allow counsel
to ask about it on cross-examination. Because “the possibilities
of abuse are substantial,” however, the conduct must be
sufficiently relevant to truthfulness before it can be the subject
of cross-examination. Fed. R. Evid. 608(b) Advisory Committee
Note for 1972. What questions are allowed remains subject to
“the overriding protection of Rule 403,” which requires that
their “probative value not be outweighed by danger of unfair
prejudice, confusion of issues, or misleading the jury … .” Id.;
see also United States v. Seymour, 472 F.3d 969, 971 (7th Cir.
2007) (“Rule 403 establishes the standard for the exercise of the
judge’s discretion in evidentiary matters, which of course
includes cross-examination” under Rule 608(b)); United
States v. Saunders, 166 F.3d 907, 920 (7th Cir. 1999) (“district
court judges retain wide latitude to impose reasonable limita-
tions on cross-examination based on concerns about harass-
ment, prejudice, confusion of the issues or interrogation that is
only marginally relevant”).
8 No. 13-2498
In this case we conclude that the district court abused its
discretion by allowing the cross-examination on Abair’s
financial filings because the government did not provide a
sufficient basis to believe the filings were probative of Abair’s
character for truthfulness. Rule 608(b) requires that the cross-
examiner have reason to believe the witness actually engaged
in conduct that is relevant to her character for truthfulness. See
United States v. Miles, 207 F.3d 988, 994 (7th Cir. 2000) (affirm-
ing court’s refusal to allow attorney to cross-examine govern-
ment witness about failure to register firearm; conduct violated
local ordinance but was irrelevant to truthfulness); United
States v. DeGeratto, 876 F.2d 576, 584 (7th Cir. 1989) (question-
ing was improper under Rule 608(b) because government
lacked sufficient evidence “to permit a good faith belief that
DeGeratto knowingly helped the prostitution operation”); 1
McCormick on Evidence § 41 (Kenneth S. Broun ed., 7th ed.
2013) (“the cross-examiner must have a good faith basis in fact
for the inquiry” under Rule 608(b)); 4 Jack B. Weinstein and
Margaret A. Berger, Weinstein’s Federal Evidence,
§ 608.22[2][a] (Joseph M. McLaughlin ed., 2d ed. 2013). In this
case, there simply was no reason—at least, none that the
government has offered—to believe the filings had any
material bearing on Abair’s truthfulness. As we have ex-
plained, “a prosecutorial hunch” that the defendant engaged
in dishonesty is not enough. DeGeratto, 876 F.2d at 583; see
generally United States v. Benabe, 436 F. App'x 639, 655 (7th Cir.
2011) (unpublished) (“A prosecutor’s questions on
cross-examination must be based on more than the prosecu-
tor’s own suspicions.”); United States v. Elizondo, 920 F.2d 1308,
1313 (7th Cir. 1990) (same).
No. 13-2498 9
As a general matter, lying on financial documents such as
tax returns or financial aid applications would seem to be an
archetype of conduct bearing on truthfulness. See United
States v. Lynch, 699 F.2d 839, 845 (7th Cir. 1982) (per curiam);
United States v. Sullivan, 803 F.2d 87, 90–91 (3d Cir. 1986); but
see United States v. Dennis, 625 F.2d 782, 798 (8th Cir. 1980)
(“civil tax problems cannot be regarded as indicating a lack of
truthfulness under this standard”). The problem here, how-
ever, is that the government did not demonstrate a sufficient
reason to believe Abair herself actually lied. As her attorney
explained at trial, and as Abair testified, the online FAFSA
allowed her to skip questions about her assets that were
irrelevant to her application. See, e.g., U.S. Dep’t of Ed.,
2 0 1 0 – 2 0 1 1 FA F S A o n t h e We b Wo r k s h e e t ,
available at http://ifap.ed.gov/eannouncements/attachments/
FOTWWorkshEn1011.pdf (last visited March 19, 2014).
The government acknowledged at sentencing that Abair
could skip these questions, but it claimed she had nevertheless
affirmatively reported having no assets. The government failed
to explain why Abair would have done this, and the Depart-
ment of Education printout on which the government relies is
not enough to support its position. The printout shows a list of
zeros next to items relating to the applicant’s assets, but that
does not mean Abair actually entered those figures. The
printout is an internal department record, and the government
has provided no reason to think that such zeroes and similar
answers reflect verbatim what an applicant typed on her form.
(For example, Abair probably did not write “Not Been Selected
For Random Verification” or enter “0” for her date of high
school graduation.) The government has not pointed to
10 No. 13-2498
anything in the record supporting its theory in the face of
Abair’s testimony and other indications that she simply
exercised her option to skip inapplicable questions about her
assets. Without more, the government failed to establish a
good faith basis to believe that Abair’s conduct in filling out
the forms was relevant to her character for truthfulness.
The government also lacked sufficient basis for believing
Abair intentionally lied on her and her then-husband’s joint
income tax return for 2008. The return listed $8,872 in vehicle
expenses stemming from her massage business, a figure large
enough to shift the business into the red. Abair acknowledged
having provided her ex-husband most of the figures for her
business, but he testified—in response to a question from the
government—that he had calculated the vehicle numbers
himself. In addition, the government never provided any
reason for doubting Abair’s testimony that she not only did not
see the tax return but never even signed it because her hus-
band filed it electronically.
Without more than the government has presented here, it
has not established a good faith basis for attributing the vehicle
figure to Abair or thinking it was the result of a deceitful act
rather than an oversight. See Miles, 207 F.3d at 994 (“facts
strongly indicate that Contant’s failure to register his gun with
the City was an oversight rather than a deceitful act which
would bear on his truthfulness”); United States v. Manske, 186
F.3d 770, 775 (7th Cir. 1999) (reversing for new trial in part
because of Rule 608(b) error; “closer inspection” into specifics
of relevant conduct may be necessary to decide if it bears on
witness’s truthfulness). In the absence of a good faith basis for
No. 13-2498 11
asking Abair these accusatory questions at trial, it was an error
for the court to allow the cross-examination.
The error was not harmless. We could hold the error
harmless only if the government persuaded us that we could
say “with fair assurance that the error did not substantially
sway the jury.” Barber v. City of Chicago, 725 F.3d 702, 715 (7th
Cir. 2013). We find no such assurance here. The trial hinged on
Abair’s credibility. The jurors could reasonably have inferred
knowledge and intent from her pattern of transactions; they
also could have considered them an innocent series of daily
deposits by someone scrambling to save her house purchase.
They could have believed the IRS agents’ account of Abair’s
confession; they could equally have viewed any supposed
confession as the result of a misunderstanding stemming from
Abair’s nerves and/or her imperfect grasp of English. Against
this backdrop, in a case alleging financial chicanery, the
repeated accusations that Abair lied on her taxes and financial
aid applications cannot be deemed harmless.
This conclusion becomes compelling when one considers
the extent and accusatory nature of the cross-examination. The
repetitive questions about Abair’s FAFSA form, in particular,
went far beyond simply identifying the specific conduct she
was being asked about. The questioning recounted her various
assets in such detail that the court worried aloud whether it
was essentially “an attempt by the government to proffer her
bad acts.” See Weinstein, § 608.22[2][c][ii] (warning that cross-
examiner’s detailed questioning “can convey the theoretically
barred information to the jury” and be so extensive “as to
render the witness’s denials completely suspect”), citing United
States v. Morales-Quinones, 812 F.2d 604, 614 (10th Cir. 1987)
12 No. 13-2498
(affirming restrictions on excessive Rule 608(b) cross-examina-
tion of government witness), and Watkins v. Foster, 570 F.2d
501, 506 (4th Cir. 1978) (affirming grant of habeas corpus
petition where cross-examination to impeach defendant with
prior acts went too far), among other cases. While we need not
hold that the scope of the questioning itself was error under
Rule 403 or under Rule 611’s bar on harassing or wasteful
questioning, see United States v. Dawson, 434 F.3d 956, 959 (7th
Cir. 2006) (“trial judge has a responsibility not to allow
cross-examination to get out of hand, confuse the jury, and
prolong the trial unnecessarily”), the cross-examination in this
case went on so long and in such detail as to dispel any
suggestion that the error was harmless. We note a few exam-
ples to illustrate.
At the beginning of the examination on the FAFSA forms,
the prosecutor used a vague and confusing compound (triple)
question to attack: “And on that form they ask you to state
your family income; they ask you to state how much you earn
from working and they ask you to state your assets; isn’t that
true?” Abair answered (correctly) “Not exactly.” That prompt-
ed the follow-up question: “Isn’t it true that when you were
asked in the FAFSA application to state what your assets were,
to list them, to state the value of your assets—” which drew the
accurate objection that the question assumed facts not in
evidence, namely that Abair was actually asked those ques-
tions in the online form.
The prosecutor then restated his question: “Don’t you
recall, ma’am, that you were asked what the value of your
assets were when you were filling out those FAFSA forms?”
Abair answered: “When I was filling this forms, they asked
No. 13-2498 13
questions how—about tax return—how much money you
earn—and then it was giving me—it was saying—computer
said that based on my answers I might skip question about my
assets, and I did—I went to Mr. Stevens’ [defense counsel]
office and we—all screens was—I did the same thing. …”
Under Rule 608(b), the prosecutor should have been stuck
with that denial. But he continued with the following highly
improper compound question (at least twelve distinct factual
assertions are built into it) that was just an accusatory speech:
“In fact, you were asked what your assets were and you put in
zero for the value of your assets in 2009, 2010, 2011. You did
that in 2009 despite the fact that you owned a condominium
and you held bank accounts and held assets in the United
States. You did that in 2010 despite the fact that in the first part
of 2010 you owned a condominium and in the second part of
2010 you had proceeds of more than $130,000. Isn’t that
correct?” (In addition to the compound question problem,
which took things to an extreme, the confusing negative in the
wrap-up, “Isn’t that correct?” meant that a yes or no answer
would have been ambiguous.) Defense counsel objected and
the judge called a sidebar conference. The judge cautioned the
prosecutor that he was “pushing the envelope” but did not
take any corrective action, leaving the long and accusatory
“question” hanging.
When questioning resumed, the prosecutor returned to the
subject: “Isn’t it true, ma’am, that you lied not only about not
having any assets during those three years—.” Defense counsel
objected again, properly, for Abair had just denied having
done so, but the prosecutor kept repeating the question. The
judge was clearly attuned to the risk presented by this line of
14 No. 13-2498
questioning, but he did not take effective action by stopping or
rebuking the prosecutor or telling the jury to disregard these
improper and accusatory questions. The result was that the
prosecutor had excessive latitude not to ask questions but to
state and repeat accusations in a way unmistakably intended
to plant the accusations in the jurors’ minds. In this case, as we
said in DeGeratto, “this cross-examination went much too far
with too little.” 876 F.2d at 584. The government lacked a good
faith basis for this line of questioning under Rule 608(b), and
the extent of its cross-examination makes clear that the error
was not harmless.
B. Forfeiture
Abair also challenges the forfeiture of her house’s entire
value, arguing that it is so disproportionate to the crime as to
amount to an unconstitutionally excessive fine under the
Eighth Amendment. The forfeiture was ordered pursuant to
31 U.S.C. § 5317(c)(1)(A), which provides in part that as part of
a sentence for a violation of 31 U.S.C. § 5324, a court “shall
order the defendant to forfeit all property, real or personal,
involved in the offense and any property traceable thereto.”
This statutory command is subject to the constitutional limit
of the Eighth Amendment. United States v. Bajakajian, 524 U.S.
321, 337–39 (1998) (holding unconstitutionally excessive a
similar forfeiture of currency that defendant was carrying out
of U.S. without reporting, an offense not connected to other
wrongdoing). In this appeal, the government has argued that
Abair waived or forfeited her challenge to the amount of the
forfeiture. Since we are remanding for a new trial on the
merits, we need not resolve those procedural questions about
No. 13-2498 15
the forfeiture. But because the issue may arise again on
remand, we offer the following general guidance.
Applying Bajakajian, an unconstitutionally excessive fine
can be identified by looking to: (1) the nature of the defen-
dant’s crime and its connection to other criminal activity, (2)
whether the criminal statute is principally meant to reach
people like the defendant, (3) the maximum punishment that
could have been imposed, and (4) the harm caused by defen-
dant’s conduct. United States v. Malewicka, 664 F.3d 1099, 1104
(7th Cir. 2011).
In Bajakajian, the Supreme Court held that $350,000 was an
excessive punishment for the defendant’s failure to report
taking that amount of currency out of the country. We distin-
guished that case in Malewicka, affirming a $280,000 forfeiture
for the same structuring offense Abair was charged with.
Malewicka was a close case, however, and differed significantly
from the facts here. Over the course of several years, defendant
Malewicka withdrew millions of dollars from her business’s
bank account through hundreds of cash transactions just below
the $10,000 limit. Id. at 1102. We upheld the forfeiture in large
part based on the pervasiveness of the violations and the risk
that a small-business owner in her position could structure
transactions to facilitate tax evasion or other crimes. Id. at
1105–07.
Malewicka recognized a limit on the logic of Bajakajian: even
a reporting offense can warrant a large forfeiture when the
forfeiture amount is sufficiently related to the “quality and
quantity” of the criminal conduct. Id. at 1104. Abair’s prosecu-
tion involves the same criminal statute as did Malewicka but
16 No. 13-2498
otherwise bears little resemblance to that case. Abair was
sentenced on one count to Malewicka’s twenty-three. Abair
made eight deposits over a week and a half, compared with
Malewicka’s hundreds of cash withdrawals over six years.
Because Malewicka was an employer who operated her
business with cash, there was a special risk of tax evasion or
money laundering not present in Abair’s case. There is no
indication that Abair tried to avoid the reporting rules on other
occasions or that her deposits were tied to any other criminal
activity.
We recognize that the government believes that Abair may
have been involved in a range of other wrongdoing, but there
is simply no evidence of other wrongdoing. For all that
appears in this record, Abair is at most a one-time offender
who committed an unusually minor violation of the structur-
ing statute not tied to other wrongdoing. We therefore have
serious doubts that the forfeiture of her home’s entire $67,000
value comports with the “principle of proportionality” that is
the “touchstone of the constitutional inquiry under the
Excessive Fines Clause,” Bajakajian, 524 U.S. at 334, but further
exploration of the issue can await a new trial.
Abair’s conviction and sentence, including the forfeiture
order, are REVERSED and the case is REMANDED to the
district court for a new trial.
No. 13-2498 17
SYKES, Circuit Judge, dissenting. Yulia Abair, a Russian
immigrant and registered nurse, made an unusual series of
large cash deposits into her account at a bank near South Bend,
Indiana. This attracted the attention of IRS agents and eventu-
ally the Department of Justice, but their investigation turned
up no evidence of nefarious activity. Abair wasn’t evading
taxes or laundering ill-gotten gains; she was buying a home
and was having difficulty accessing funds in her Citibank
Moscow account. To get around the problem, Abair resorted
to the scheme my colleagues have described: She made
repeated ATM withdrawals from her Russian bank account
and deposited the cash with her local bank in a series of
transactions just under the $10,000 threshold that triggers the
bank’s reporting requirements for currency transactions. The
withdrawals were legitimate, but the deposits landed Abair in
big trouble.
The bank tellers told investigators that the money had a
“musty,” “mildewy,” or “dirty” odor, as if it had been kept in
a basement rather than freshly drawn from an ATM. Prosecu-
tors inferred from the odd smell that the money must have
come from an illegitimate source and brought the full force of
the federal criminal law down on Abair. The U.S. Attorney’s
Office in South Bend indicted her on eight counts of structuring
a money transaction to avoid currency reporting requirements.
See 31 U.S.C. § 5324(a)(3). A jury convicted her on all counts.
The prosecutor argued for a prison sentence, emphasizing the
suspicious nature of the smelly money, but the district judge
rejected the argument and placed Abair on probation. The
prosecutor also sought a forfeiture of the entire amount at
issue, which required Abair to sell her new home. For some
18 No. 13-2498
unknown reason, before trial Abair agreed not to fight the
forfeiture if she was convicted. Based on the pretrial
stipulation, the judge entered the requested forfeiture order,
and Abair lost the full value of her home—about $67,000—to
the government.
Abair raises four arguments on appeal: (1) the indictment
was multiplicitous; (2) the district court committed an eviden-
tiary error; (3) the evidence was insufficient to convict; and
(4) the forfeiture was excessive in violation of the Eighth
Amendment. Three of these arguments can be summarily
rejected. The district court cured the multiplicity problem by
merging the counts at sentencing. The evidence was sufficient
to convict, even though the structuring violation was technical
and not connected to any criminal activity. And because Abair
stipulated to the forfeiture, she waived the Eighth Amendment
challenge, which but for the waiver might have had substantial
merit.
That leaves the claim of evidentiary error. My colleagues
hold that the judge should not have permitted the prosecutor
to cross-examine Abair about specific instances of conduct
bearing on her truthfulness under Rule 608(b)(1) and that the
error warrants a new trial. I disagree. But my different take on
this case should not be understood as an endorsement of the
government’s decision to pursue Abair with every weapon in
its arsenal. Perhaps there’s a good (or at least adequate)
explanation for so disproportionate a deployment of criminal-
justice resources. On the present record, however, this case
shows every sign of being an overzealous prosecution for a
technical violation of a criminal regulatory statute—the kind of
rigid and severe exercise of law-enforcement discretion that
No. 13-2498 19
would make Inspector Javert proud. Despite the prosecutorial
overreaching, I find no legal error and so would affirm.
Rule 608(b)(1) permits a cross-examiner to attack the
credibility of a witness by asking leading questions about
specific instances of conduct “if they are probative of the
[witness’s] character for truthfulness or untruthfulness.” FED .
R. EVID . 608(b)(1). But the rule also prohibits the use of extrinsic
evidence to prove the witness’s character for truthfulness. So
the cross-examiner is effectively bound by the witness’s
answer; if she denies the conduct or equivocates, the rule
against admitting extrinsic evidence eliminates the opportunity
to rebut. See United States v. Bynum, 3 F.3d 769, 772 (4th Cir.
1993) (explaining that under Rule 608(b)(1), the “cross-
examiner may inquire into specific incidents of conduct, but
does so at the peril of not being able to rebut the witness’[s]
denials”); see also United States v. Whitmore, 359 F.3d 609, 618
(D.C. Cir. 2004).
As with other evidentiary questions, the trial judge has
broad discretion to permit or exclude cross-examination under
Rule 608(b)(1). Appellate review is deferential; we look only for
an abuse of discretion. United States v. Holt, 486 F.3d 997,
1000–01 (7th Cir. 2007) (“We review the district court’s decision
to limit the scope of cross-examination [under Rule 608(b)] for
an abuse of discretion.”); United State v. Dawson, 434 F.3d 956,
959 (7th Cir. 2006) (“The important point is that the decision
whether to allow a witness to be cross-examined [under
Rule 608(b)] … is confided to the discretion of the trial
judge … .”). What this means in practice is that close cases are
resolved in favor of upholding the judge’s exercise of discre-
tion to control the admission of evidence at trial; reversal is
20 No. 13-2498
appropriate only if no reasonable judge would make the same
decision. See United States v. Chapman, 692 F.3d 822, 827 (7th
Cir. 2012); United States v. Vargas, 552 F.3d 550, 554 (7th Cir.
2008) (“Only where no reasonable person could take the view
adopted by the trial court will we reverse an evidentiary
ruling.”).
Here, the judge allowed the government to cross-examine
Abair about apparent falsehoods in her 2010–2012 FAFSA
forms (federal financial-aid applications) and in her 2008
federal tax return. My colleagues conclude that this was an
abuse of discretion because “the government did not demon-
strate a sufficient reason to believe Abair herself actually lied”
in these documents. Majority op. at 9. Respectfully, this
conclusion sidesteps the applicable legal standard for
Rule 608(b)(1) cross-examination and also the deferential
standard of appellate review.
To cross-examine a witness under Rule 608(b)(1), the cross-
examiner need only have a good-faith factual basis to support
the proposed line of questioning. See United States v. Holt,
817 F.2d 1264, 1274 (7th Cir. 1987); see also United States v.
Skelton, 514 F.3d 433, 444 (5th Cir. 2008); Whitmore, 359 F.3d at
622; United States v. Cudlitz, 72 F.3d 992, 1001 (1st Cir. 1996).
That standard was met here. Copies of the relevant documents
are in the record.1 In each of Abair’s three FAFSA forms—for
financial-aid years 2010, 2011, and 2012—a zero appears on the
line asking about her cash assets, and another zero appears on
1
The documents were not offered or admitted as evidence before the jury,
consistent with the bar on the use of extrinsic evidence to prove character
for untruthfulness. See F ED . R. E V ID . 608(b)(1).
No. 13-2498 21
the line asking for the value of any investments. But other
evidence in the case showed that during these years, Abair had
substantial equity in her apartment in Russia, and after the
property was sold, held a substantial sum of money—about
$100,000—in her Citibank Moscow account. In addition, on her
2008 federal tax return, filed jointly with her husband, Abair
claimed a business loss of $6,566 from her work as a massage
therapist based in part on vehicle expenses totaling $8,872, a
seemingly implausible figure given the nature of the business.
Abair’s counsel vigorously objected to the government’s
proposed cross-examination. After a lengthy sidebar, the judge
overruled the objection and permitted the cross-examination
to proceed, concluding that the documentary evidence estab-
lished a good-faith basis for the prosecutor to ask Abair
whether she provided false information in these financial
filings. But the judge reminded the prosecutor that he could
not use extrinsic evidence; if Abair denied that she lied on the
documents, the government would be stuck with her answer.
The judge also warned the prosecutor to keep the scope of his
inquiry narrow.
Cross-examination resumed but proceeded clumsily and
was interrupted by several additional objections. Abair denied
that she lied and offered a plausible explanation for how the
misleading information wound up in these documents. She
testified that the online program for the FAFSA permitted her
to skip the questions about her assets based on other answers
she gave earlier in the form. (Her counsel speculates that the
program entered the zeroes automatically.) She also testified
that her husband completed their 2008 tax return and filed it
electronically. She acknowledged giving him financial informa-
22 No. 13-2498
tion about her massage business, but said that she neither saw
nor signed the return before it was filed.
My colleagues credit Abair’s explanation and conclude that
the cross-examination lacked a good-faith factual basis and
should have been excluded. Majority op. at 8–11. This reason-
ing misapplies the governing legal standard and overlooks the
deference owed to a trial judge’s evidentiary determinations.
The good-faith-basis standard for cross-examination under
Rule 608(b)(1) is not a high bar; a “well[-]reasoned suspicion
that a circumstance is true is sufficient.” Holt, 817 F.2d at 1274(quoting United States v. Sampol, 636 F.2d 621, 658 (D.C. Cir.
1980)). Importantly, although the inquiry into specific instances
of conduct must have a basis in fact, the cross-examiner is not
required to prove the underlying factual basis for his questions.
See Skelton, 514 F.3d at 444.
It’s true that the documentary evidence in this case gave
rise to competing inferences, but one permissible interpretation
was that Abair provided false information on these important
financial filings. That’s a sufficient factual basis for the
Rule 608(b)(1) cross-examination. To be sure, Abair disputed
the government’s interpretation of the documentary evidence
and provided a plausible explanation for how the misleading
figures might have found their way into her FAFSA forms and
tax return. My colleagues fault the government for “not
point[ing] to anything in the record supporting its theory in the
face of Abair’s testimony and other indications that she simply
exercised her option to skip inapplicable [FAFSA] questions
about her assets.” Majority op. at 9–10. They also criticize the
government for not “provid[ing] any reason for doubting
No. 13-2498 23
Abair’s testimony that she not only did not see the tax return
but never even signed it because her husband filed it electroni-
cally.” Id. at 10.
But this reasoning overlooks that the prosecutor did not
have to disprove Abair’s explanation before getting the green
light to proceed with his cross-examination. All he needed to
do was establish a good-faith factual basis to ask the questions;
here, the documents themselves provided that good-faith basis.
Nothing required the judge to credit Abair’s proffered explana-
tion when ruling on the defense attorney’s objection. Even
accepting the factual premise that the online FAFSA program
permits applicants to skip certain questions and that Abair in
fact did so, we can only speculate about whether the program
fills in zeroes automatically or leaves the skipped questions
blank. Abair’s explanatory speculation may be plausible, but
there’s no evidence one way or another. Her FAFSA forms
contain both blanks and zeroes. What we do know with some
certainty is that nothing in the caselaw applying Rule 608(b)
requires the cross-examiner to produce evidence to rebut the
witness’s explanation before gaining the judge’s approval to
cross-examine her on the subject. Nor was the government
required to prove that Abair knowingly filed a false tax return
as a precondition to cross-examining her about whether she
inflated her claimed business expenses.
Simply put, the presence of a factual dispute about the
specific instances of conduct does not defeat the cross-
examiner’s good-faith factual basis to proceed with the cross-
examination under Rule 608(b)(1). A shaky factual foundation
may be a factor in the judge’s evaluation of the relative
probative value and prejudicial effect of the cross-examination
24 No. 13-2498
under Rule 403. But to justify exclusion under Rule 403, the
evidence must be substantially more prejudicial than probative.
See FED . R. EVID . 403 (providing that “[t]he court may exclude
relevant evidence if its probative value is substantially out-
weighed by a danger of … unfair prejudice”). Here, the judge
made a specific finding that the government’s proposed cross-
examination survived Rule 403 balancing.
That ruling was sound. The disputed issues at trial were
Abair’s knowledge of the $10,000 reporting limit and her intent
to evade it. On the witness stand, she denied that she knew
about the currency-transaction limit at the time of the offense
and denied any intent to structure her transactions to evade it.
Because her credibility was key, so was the government’s
Rule 608(b)(1) cross-examination.
As my colleagues have noted, providing false information
on a financial-aid application or a tax return is “an archetype
of conduct bearing on truthfulness.” Id. at 11. So the govern-
ment’s proposed cross-examination was obviously highly
probative. Of course, the prosecutor had to take the good with
the bad; once the cross-examination was underway, he was
stuck with Abair’s denial and her plausible explanation for
what appeared to be false information in her FAFSA forms and
tax return. That she would deny lying and make an effort to
explain the information did not require the judge to sustain the
defense attorney’s objection and disallow the cross-
examination, either under Rule 608(b)(1) or Rule 403.
Finally, the court’s holding fails to account for the deferen-
tial standard of review that applies to evidentiary determina-
tions. Cross-examination under Rule 608(b)(1) always carries
No. 13-2498 25
the risk that the witness will deny the prior conduct or try to
explain it away. Sometimes this happens in response to the
cross-examiner’s accusatory questions, and sometimes the
witness is rehabilitated on redirect examination. Either way,
the fact that the witness denies or plausibly explains the prior
conduct isn’t a basis for the reviewing court to find that the
trial judge abused his discretion in allowing the cross-
examination in the first place. The standard of review is
deferential for good reason; the trial judge is in a superior
position to evaluate evidentiary disputes and must rule on the
basis of the information available at the time the objection is
made. The abuse-of-discretion standard of review guards
against appellate judges substituting their own views based on
hindsight.
When confronted with Abair’s objection, the trial judge’s
obligation was simply to test the prosecutor’s good-faith
factual basis for the proposed cross-examination. The judge did
so here, conducting a proper inquiry under both Rule 608(b)(1)
and Rule 403. The judge appropriately limited the scope of the
cross-examination and closely monitored the prosecutor’s
questions. True, the prosecutor asked compound and confus-
ing questions, but that doesn’t call into question the judge’s
initial decision to overrule the defense attorney’s objection and
allow the cross-examination to proceed. Defense counsel
interposed additional objections; some were sustained, some
questions were cut off or left unanswered, and the material
accusatory questions were met with denials and explanations
from Abair.
In short, I can find no reason to fault the district judge’s
decision to permit this cross-examination or to criticize his
26 No. 13-2498
refereeing of it once it was underway. Finding no error, I
would affirm, although not without serious misgivings about
the wisdom of this prosecution. It’s unclear to me how the
interests of justice are served by saddling Abair with a felony
conviction and forcing her to forfeit her home as punishment
for a technical, trivial violation of the structuring statute.
Without more, the government’s suspicions about the mal-
odorous money do not support an inference that broader
criminality was at work here. Abair has no criminal history,
and at sentencing the judge noted that she is otherwise a
responsible person, has a good employment history, is an
excellent mother to her 11-year-old son, and has substantial
community support. No doubt these observations contributed
to the judge’s decision to place her on probation.
For the foregoing reasons, I respectfully dissent.2
2
Despite our disagreement about the legal issue under Rule 608(b)(1), my
colleagues’ decision to reverse and remand for a new trial has the salutary
effect of permitting a fresh exercise of prosecutorial discretion. The
executive branch may choose to moderate its strict enforcement stance
against Abair and resolve not to sink further resources into prosecuting her.
Under the circumstances, that might be the most prudent and just thing to
do.