United States v. Willie Harris ( 2009 )


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  •                             In the
    United States Court of Appeals
    For the Seventh Circuit
    Nos. 08-1138 & 08-1161
    U NITED S TATES OF A MERICA,
    Plaintiff-Appellee,
    v.
    R OOSEVELT P OWELL and W ILLIE H ARRIS,
    Defendants-Appellants.
    Appeals from the United States District Court
    for the Northern District of Indiana, Hammond Division.
    No. 06 CR 197—Philip P. Simon, Judge.
    A RGUED A PRIL 9, 2009—D ECIDED A UGUST 7, 2009
    Before M ANION, R OVNER, and W OOD , Circuit Judges.
    M ANION, Circuit Judge. A grand jury indicted Willie
    Harris, a Gary, Indiana, lawyer, and Roosevelt Powell,
    who collected property taxes on behalf of Lake County,
    Indiana, for their role in the sale of two properties to the
    Gary Urban Enterprise Association. A jury found Harris
    and Powell guilty of wire fraud, conspiring to defraud
    the United States, and filing a false tax return. They
    appeal. We affirm their convictions and Harris’s sen-
    2                                   Nos. 08-1138 & 08-1161
    tence, but vacate Powell’s sentence and remand to the
    district court for further proceedings.
    I.
    Indiana’s enterprise zone program was devised in 1983
    in an attempt to provide incentives for businesses to
    locate or expand in distressed and blighted areas.
    Jim Landers & Dagney Faulk, In the Zone: A Look at Indi-
    ana’s Enterprise Zones, Ind. Bus. Rev., Summer 2005, at 7.
    Businesses inside the enterprise zone receive tax incen-
    tives in exchange for donating a percentage of the tax
    savings to the local urban enterprise association. Id. at 9.
    The Gary Urban Enterprise Association (“GUEA”) was
    such an association; businesses located within the Gary
    enterprise zone contributed heavily to it in lieu of paying
    inventory taxes. However, due to a combination of a
    large pot of money at the GUEA’s disposal—as much as
    five million dollars a year—and minimal oversight over
    how the money was to be spent, the GUEA attracted a
    corrupt abuse of the funds. The GUEA was ultimately
    dissolved after an investigation revealed that the
    GUEA’s executive director, JoJuana Meeks, was treating
    the GUEA as her personal bank account. Prior to its
    demise, however, the GUEA had embarked on a property-
    purchasing spree, acquiring many properties in Gary
    for the purpose of redeveloping them. The convictions of
    defendants Roosevelt Powell and Willie Harris in this
    case resulted from their roles in the sale of two properties
    in Gary to the GUEA: a former grocery store located at
    6300 Miller, and a vacant building located at 768 Broad-
    way.
    Nos. 08-1138 & 08-1161                                      
    3 A. 6300
     Miller1
    Towards the end of 1999, the owners of 6300 Miller, who
    had long ceased operating the building on the property
    as a grocery store, let the members of the Lake County
    Council know that they intended to donate the property
    to a public charity. William Smith, one of the councilmen
    and—later—a co-defendant of Powell and Harris, got
    wind of the intended donation and indicated that he
    knew of an organization that might have some interest
    in the property. Harris, an attorney who owned the law
    firm Willie Harris & Associates in Gary, then contacted
    Gerald Bishop, one of the lawyers for the owners of
    6300 Miller, about the property. He told Bishop that the
    Gary Historical and Cultural Society (“Historical Society”),
    a local nonprofit organization, would accept 6300 Miller
    as a donation. Dharathula Millender, Harris’s 84-year-old
    aunt by marriage, was the Historical Society’s president,
    and Harris was its attorney. The papers for the transfer
    were drawn up and signed at Harris’s law office on
    December 27, 2000. At the time of the donation, 6300 Miller
    was appraised for $397,500 and had $37,000 in accrued
    property taxes, which the Historical Society assumed.
    Harris, Smith, and Powell then attempted to sell the
    property. In the spring of 2001, Powell called Meeks at the
    GUEA and told her about it. Powell knew her from his
    work at SRI, a company hired to run the delinquent
    1
    We base our account of the facts on the evidence presented
    at trial, taken in the light most favorable to the government.
    United States v. Hach, 
    162 F.3d 937
    , 942 (7th Cir. 1998).
    4                                  Nos. 08-1138 & 08-1161
    property tax sale auctions in Lake County. Powell had
    seen Meeks attend several auctions on behalf of the
    GUEA and, after finding out what she was doing, offered
    to help her. He eventually assisted Meeks in buying “a lot”
    of property for the GUEA—including a house he owned
    in his daughter’s name.
    Powell and Smith showed Meeks the property at
    6300 Miller. Powell told her that the property was in
    the process of being transferred from the county to the
    Historical Society (which was not true) and that she
    could buy it once the transfer was completed. They then
    discussed a purchase price. Powell stated that they
    wanted $450,000. After Meeks told him that the GUEA
    “couldn’t do that,” the parties quickly agreed on a price
    of $200,000. Property taxes were not discussed—even
    though, by this point, the unpaid property taxes had
    ballooned to $73,000. Powell directed Meeks to prepare
    a purchase agreement in the name of the Historical
    Society and to make out the check to that organization.
    A purchase agreement was prepared and addressed to
    Millender but signed by Harris on behalf of the
    Historical Society. While the agreement called for the
    GUEA to pay the outstanding property taxes, no
    amount was listed. Meeks assumed that taxes would not
    be an issue because the county was transferring the
    property to the Historical Society.
    Property taxes did indeed turn out to be a non-issue, but
    not for the reason Meeks assumed. In addition to his
    work for SRI, Powell also owned and operated a
    company named US Research Consultants, Inc. (“US
    Nos. 08-1138 & 08-1161                                   5
    Research”), which had a contract with Lake County to
    collect delinquent property taxes on its behalf. On
    October 2, Lee Christakis, an attorney working for US
    Research who acted on Powell’s instructions, filed a
    lawsuit against the Historical Society regarding the delin-
    quent taxes owed on 6300 Miller. Despite the fact that
    the building was in decent shape and the GUEA was
    paying $200,000 to buy it in order to use it as a training
    center, the complaint stated that the property was in a
    state of disrepair necessitating its demolition in order to
    be restored to a tax-paying basis. Harris personally ac-
    cepted service of the complaint on behalf of the
    Historical Society three minutes after the complaint was
    filed. An agreed order was entered later that day
    reducing all property taxes due on the property to
    $15,000, which Harris paid. The Lake County Treasurer—
    whose permission US Research was required to seek
    before reaching a settlement with a taxpayer—was not
    aware of either the lawsuit or settlement.
    On the same day as the lawsuit to reduce the property
    taxes, Powell picked up the $200,000 check from the
    GUEA. The check was deposited into Harris’s law firm
    trust account on October 3. At the same time, Harris wrote
    a check from the trust account to himself (postdated
    October 4) for $50,000 and deposited it into his law firm’s
    business account. He also wrote a check to Smith for
    $75,000, one to Powell for $25,000, and another to the
    Historical Society for $50,000. Bank records showed that
    Smith deposited his check shortly thereafter, while
    Powell deposited his check about a week later.
    6                                     Nos. 08-1138 & 08-1161
    Millender deposited the $50,000 check in the Historical
    Society’s bank account a week after Powell. According to
    her testimony at trial, Millender’s entire understanding of
    how the Historical Society obtained the $50,000 rested on
    a conversation she had with Smith, during which he had
    asked her if “they” could “borrow” the Historical Society’s
    501(c)(3) status 2 for $50,000 “to get a building for a training
    program for young people.” Although Millender was
    present at the short meeting in Harris’s law office during
    which the documents donating the property to the His-
    torical Society were completed, and even signed the
    document transferring the property from the former
    grocery store owners to the Historical Society, she testified
    that she did not know that the Historical Society ever
    owned 6300 Miller. Rather, she stated that she had com-
    plete trust in her attorney Harris: “if he said sign it,
    I would sign it. I wouldn’t read it. I would sign it, if he
    said it’s something you’re supposed to do.”
    Millender was not told that the Historical Society would
    have to own any property in order to receive the $50,000.
    She testified that she would never have taken title to 6300
    Miller because the cash-strapped Historical Society had
    difficulty meeting expenses for the old school building
    it currently possessed. She was surprised when FBI
    agents showed her the $200,000 check from the GUEA to
    2
    Section 501(c)(3) of title 26 exempts from federal income
    taxation “[c]orporations, and any community chest, fund, or
    foundation, organized and operated exclusively for religious,
    charitable, scientific, testing for public safety, literary, or
    educational purposes.”
    Nos. 08-1138 & 08-1161                                    7
    the Historical Society; she did not know about that check
    either, or that Smith, Powell, and Harris had pocketed
    $150,000 of the proceeds. Millender also was never in-
    formed about the property taxes owed on the property
    or the lawsuit filed against the Historical Society. Her
    signatures both on the $200,000 check and the deed trans-
    ferring 6300 Miller to the GUEA were forged. She did
    acknowledge receiving and depositing the $50,000 check
    on behalf of the Historical Society.
    B. 768 Broadway
    The second property sale involved in this case was the
    sale of the vacant building located at 768 Broadway to
    the GUEA. Harris paid $2,600 for the property in Septem-
    ber 1999. Because he was having marital problems at
    the time, Harris hid his ownership of the property from
    his wife by titling the property in the name of Dorothy
    Ard, a close family friend. Harris told Ard he would pay
    for the property, its maintenance, and any taxes.
    In August 2001, Powell contacted Meeks and told her
    that 768 Broadway was available, claiming that his client
    was Dorothy Ard, “an elderly woman who was trying to
    divest herself and move back south.” After viewing the
    property, Meeks again spoke with Powell, who stated
    Ard was looking for at least $60,000. Meeks offered $40,000,
    and Powell said he would contact Ard. Powell called
    back and claimed that he had spoken to Ard and that she
    would settle for $51,500. Meeks agreed and gave Powell a
    GUEA check for $51,500 made out to Dorothy Ard. The
    check was deposited into Harris’s law firm business
    8                                   Nos. 08-1138 & 08-1161
    account. Powell received $14,000 from Harris for the sale
    of the building.
    At trial, Ard testified that Harris told her in 2001 that
    he had reconciled with his wife and asked Ard to sign a
    deed transferring the property back to him. Based on
    Harris’s representation, Ard signed the deed. Harris did
    not tell Ard he was selling the property; the deed that Ard
    signed was in fact the deed transferring the property to
    the GUEA. Ard also did not know that the GUEA had
    purchased the property for $51,500. Her signature on
    both the check from the GUEA and the deeds filed in the
    state auditor’s office were forged.
    A jury convicted Harris and Powell under 
    18 U.S.C. §§ 2
    and 1343 of wire fraud in relation to the sale of 6300 Miller
    and under 
    18 U.S.C. § 371
     for conspiring to commit theft
    of government funds by reducing the property taxes on
    6300 Miller. It also found Powell guilty under 
    26 U.S.C. § 7206
    (1) for willfully filing a false tax return due to his
    failure to report the income he received from the sales
    of 6300 Miller and 768 Broadway. Lastly, the jury con-
    victed Harris under § 7206(1) for failing to report his
    income from the sale of 768 Broadway as a capital gain.
    For their sentences, Powell received 37 months’ imprison-
    ment, while Harris received 55 months’ imprisonment.
    Both Powell and Harris appeal.
    II.
    On appeal, both Powell and Harris present several
    challenges to their convictions and sentences. We turn
    Nos. 08-1138 & 08-1161                                         9
    first to Powell’s challenge to the sufficiency of the gov-
    ernment’s evidence supporting his wire fraud conviction.3
    Our review of a challenge to the sufficiency of the
    evidence is quite deferential. We examine the evidence
    in the light most favorable to the government, United
    States v. Useni, 
    516 F.3d 634
    , 646 (7th Cir. 2008), looking
    only at whether evidence exists from which “any
    rational trier of fact could have found the essential ele-
    ments of the crime beyond a reasonable doubt.” Hach,
    
    162 F.3d at 942
    . That standard, by itself, presents “a
    nearly insurmountable hurdle to the defendant.” 
    Id.
    (quoting United States v. Teague, 
    956 F.2d 1427
    , 1433 (7th
    Cir. 1992)).
    The wire fraud statute, 
    18 U.S.C. § 1343
    , prohibits the
    use of the interstate wires in “any scheme or artifice to
    defraud, or for obtaining money or property by means
    of false or fraudulent pretenses, representations, or prom-
    ises.” To convict a defendant of wire fraud, the government
    must prove three elements: (1) the defendant participated
    in a scheme to defraud; (2) the defendant intended to
    defraud; and (3) a use of an interstate wire in furtherance
    of the fraudulent scheme. United States v. Turner, 
    551 F.3d 657
    , 664 (7th Cir. 2008). Powell argues that the evi-
    3
    Harris states in his brief that he “adopts and incorporates by
    reference, without repeating, the standard of review and the
    argument on the wire fraud issue . . . as presented in the Ap-
    pellant’s Brief of co-appellant Powell.” Because Harris
    does not provide any further argument besides his incorpora-
    tion of Powell’s arguments, we will discuss only Powell’s
    contentions.
    10                                   Nos. 08-1138 & 08-1161
    dence was insufficient to support a jury finding that
    he knowingly participated in a scheme to defraud involv-
    ing the use of the interstate wires in furtherance of the
    scheme.
    We examine first Powell’s claim that there was no
    scheme to defraud. “A scheme to defraud requires ‘the
    making of a false statement or material misrepresentation,
    or the concealment of [a] material fact.’ ” United States v.
    Sloan, 
    492 F.3d 884
    , 890 (7th Cir. 2007) (quoting United
    States v. Stephens, 
    421 F.3d 503
    , 507 (7th Cir. 2005)). Powell
    asserts that there was no false statement or material
    misrepresentation because Millender and the Historical
    Society got the benefit of the bargain: Smith promised
    Millender and the Historical Society $50,000 if “they” could
    “borrow” the Historical Society’s 501(c)(3) status, and
    Millender and the Historical Society received $50,000.
    Thus, Powell contends, there was no fraud perpetrated
    on the Historical Society.
    Powell’s argument ignores the defendants’ failure to give
    Millender the whole story on how the Historical Society
    was to receive the $50,000. Neither Smith nor Harris nor
    Powell disclosed to Millender that the Historical Society
    needed to take title to 6300 Miller, and therefore assume
    all the burdens of owning that property—including a
    hefty property tax bill. Nor did they tell her that they
    were able to sell the property for $200,000, or that they
    were going to keep nearly three-quarters of the pro-
    ceeds for themselves. These were significant omissions:
    Millender testified that she would never have taken title
    to 6300 Miller because the cash-strapped Historical
    Nos. 08-1138 & 08-1161                                   11
    Society could not even meet the expenses for the other
    building it possessed.
    Powell claims that Millender should have known that
    the Historical Society owned 6300 Miller because she was
    present at Harris’s office when the documents were
    executed transferring 6300 Miller to the Historical Society.
    But the jury reasonably could have concluded otherwise.
    Millender testified that she completely trusted Harris,
    who was her nephew-in-law and the Historical Society’s
    attorney, and that she would sign whatever he put in
    front of her without reading it. She also repeatedly denied
    ever knowing that the Historical Society owned 6300
    Miller. A jury was entitled to take Millender at her word.
    “[I]t is not our role, when reviewing the sufficiency of the
    evidence, to second-guess a jury’s credibility determina-
    tions.” United States v. Buchmeier, 
    255 F.3d 415
    , 420 (7th
    Cir. 2001).
    Moreover, even if Powell could show beyond dispute
    that Millender knew the Historical Society owned 6300
    Miller, he does not contest that neither he nor Smith
    nor Powell disclosed to Millender the sale of the property
    to the GUEA for $200,000. Nor does he contest that they
    failed to tell Millender that they would pocket three-
    quarters of the proceeds from that sale. Those omissions
    are material; absent them, the impoverished Historical
    Society stood to gain an additional $150,000 in badly
    needed funds. Significantly, Smith, Powell, and Harris
    did not merely fail to tell Millender about the sale and
    their profiting from it. They actively concealed the sale
    from her, going so far as to forge her signature on both
    12                                  Nos. 08-1138 & 08-1161
    the $200,000 check from the GUEA and the deed transfer-
    ring 6300 Miller to the GUEA so that she would never
    know about the transaction. As we have said before, a
    failure to disclose information may constitute fraud if
    the “omission [is] accompanied by acts of concealment.”
    United States v. Stephens, 
    421 F.3d 503
    , 507 (7th Cir. 2005).
    A reasonable jury certainly could have concluded that is
    what occurred here. The government thus presented
    sufficient evidence of a scheme to defraud the Historical
    Society.
    But, Powell asserts, even granting that there was a
    scheme to defraud, he did not knowingly participate in it.
    That argument was not raised in either of Powell’s Rule 29
    motions in the district court, which challenged only the
    sufficiency of the evidence supporting the scheme to
    defraud. Powell has therefore forfeited it, and we review
    only for plain error. United States v. Groves, 
    470 F.3d 311
    ,
    324 (7th Cir. 2006). Under the plain error standard,
    Powell must show “that a ‘manifest miscarriage of justice
    will occur if his conviction is not reversed.’ ” United
    States v. Hensley, ___ F.3d ___, 
    2009 WL 2178650
    , at *5 (7th
    Cir. July 23, 2009) (quoting United States v. Irby, 
    558 F.3d 651
    , 653 (7th Cir. 2009)). “Put another way, reversal is
    warranted only if the record is devoid of evidence
    pointing to guilt, or if the evidence on a key element was
    so tenuous that a conviction would be shocking.” 
    Id.
    There is no such lack of evidence in this case. Powell
    characterizes his role in the sale of 6300 Miller as merely
    that of a real estate agent receiving a commission for
    bringing “together a willing seller with a willing buyer.”
    Nos. 08-1138 & 08-1161                                       13
    Such a characterization, however, does not square with
    the evidence of Powell’s willingness to drop more than
    50% off the asking price (and appraised value) of
    6300 Miller on the day of the sale,4 since it is highly un-
    likely that a legitimate real estate agent would settle so
    quickly on such a reduction. Nor does it mesh with
    Powell’s role in the fraudulent lawsuit filed on behalf of
    Lake County to reduce the property taxes owed on 6300
    Miller, which he does not challenge in this court.5 That
    lawsuit was a fraud on the court. Powell obtained the
    property tax reduction by falsely representing to the
    judge through his attorney that 6300 Miller needed to be
    demolished and by failing to tell the judge that the prop-
    erty was being sold the same day for $200,000—an amount
    easily sufficient to satisfy the back property taxes. A real
    estate agent receiving a legitimate commission does not, on
    the same day as the sale, orchestrate a dishonest lawsuit
    that results in an unauthorized reduction of property taxes
    to the tune of $58,000. A jury was therefore entitled to
    reject Powell’s real-estate-agent gloss to his involvement
    4
    Recall that the property recently had been appraised for
    $397,000 and that Powell had initially told Meeks that his
    “client” was looking for $450,000.
    5
    Both in his reply brief and at oral argument, Powell’s attor-
    ney expressly admitted that, if the jury chose to believe Lake
    County Treaurer Peggy Katona’s testimony that Powell
    had not gotten her required authorization for the property tax
    reduction, the evidence was sufficient for a jury to find
    against him on count two of the indictment, the § 371 count,
    which charged a conspiracy based on the fraudulent reduc-
    tion of the property taxes owed on 6300 Miller.
    14                                   Nos. 08-1138 & 08-1161
    in the sale of 6300 Miller. See United States v. Humphreys,
    
    468 F.3d 1051
    , 1054 (7th Cir. 2006) (“[A]lternative ex-
    planations alone, even if plausible, do not ordinarily
    overcome the defendant’s burden in challenging the
    sufficiency of the evidence.” (quoting United States v.
    Romero, 
    57 F.3d 565
    , 570 (7th Cir. 1995))).
    Powell disputes that the property tax reduction had
    any relationship to the scheme to defraud, but that argu-
    ment is a non-starter. A reasonable jury could have con-
    cluded that any tax savings advanced the scheme by
    going straight to the defendants’ bottom line. While the
    purchase agreement called for the GUEA to pay the
    outstanding property taxes, no amount was listed. Meeks
    testified that the defendants had given her the impression
    that property taxes would not be an issue because they
    had told her the Historical Society was in the process of
    obtaining the property from the county. Meeks’s testimony
    is backed by the fact that Harris, and not the GUEA, paid
    the remaining $15,000 due after the fraudulent lawsuit
    reduced the property taxes. Because the property tax
    reduction allowed the schemers to keep more of their ill-
    gotten gains, it was part and parcel of the overall
    scheme to defraud.
    Powell, however, compares his lot to that of the defen-
    dant in United States v. Rahseparian, 
    231 F.3d 1257
     (10th Cir.
    2000). Like Powell, the defendant in Rahseparian was
    also convicted on circumstantial evidence. But that is
    where the similarity ends. In Rahseparian, the defendant’s
    participation in the illegal scheme was limited to acts that,
    by themselves, were innocent: doing the banking for his
    sons, who ran the fraudulent telemarketing scheme at
    Nos. 08-1138 & 08-1161                                   15
    issue there, and purchasing “lead sheets” for them, a
    common and perfectly legal way for telemarketing busi-
    nesses to identify potential customers. The Tenth Circuit
    held that those activities, in and of themselves, did not
    support an inference that the defendant knew that his
    sons’ business was defrauding its customers. 
    231 F.3d at 1263
    .
    In contrast, the lawsuit filed by Powell’s company, US
    Research, which caused a substantial reduction of the
    property taxes owed, was inherently fraudulent. It repre-
    sented that 6300 Miller needed to be demolished when
    in fact it was being sold that day for a substantially dis-
    counted $200,000. As we have discussed above, the
    lawsuit furthered the overall scheme by leaving more
    money for the defendants to divide amongst themselves.
    Considering that the evidence showed that Powell
    himself received $25,000 from the sale of 6300 Miller, the
    jury could reasonably infer that Powell had knowledge
    of, and intended to further, the scheme to defraud the
    Historical Society.
    Powell also challenges the use-of-the-wires element of
    his wire fraud conviction. He claims that there was insuf-
    ficient proof that the wires were used in furtherance of
    the fraudulent scheme. Again, Powell’s failure to raise
    this argument in his Rule 29 motions means that we
    review only for plain error. Groves, 
    470 F.3d at 324
    .
    Our recent decision in United States v. Turner, 
    551 F.3d 657
     (7th Cir. 2008), spells out the current state of the law
    on the use-of-the-wires element:
    The mail- and wire-fraud statutes are not intended to
    reach all frauds but only those in which a mailing or
    16                                     Nos. 08-1138 & 08-1161
    use of an interstate wire is part of the scheme. Schmuck
    v. United States, 
    489 U.S. 705
    , 710, 
    109 S. Ct. 1443
    , 
    103 L. Ed. 2d 734
     (1989). The use of the mail or wire need not
    be an indispensable part of the fraud to satisfy the “in
    furtherance of” element of the offense; it need only “be
    incident to an essential part of the scheme . . . or a step
    in [the] plot.” 
    Id. at 710-11
     (alteration in original)
    (internal quotation marks & citation omitted). “In
    other words, the success of the scheme must in some
    measure depend on the mailing [or wire transmis-
    sion].” United States v. Seward, 
    272 F.3d 831
    , 836 (7th
    Cir. 2001). The defendant himself need not
    personally cause the mailing or use of the wire; it is
    enough that the use of mail or wire “will follow in the
    ordinary course of business, or where such use can
    reasonably be foreseen, even though not actually
    intended.” Pereira v. United States, 
    347 U.S. 1
    , 8-9, 
    74 S. Ct. 358
    , 
    98 L. Ed. 435
     (1954) (“Where one does an act
    with knowledge that the use of the mails will follow in
    the ordinary course of business, or where such use can
    reasonably be foreseen, even though not actually
    intended, then he ‘causes’ the mails to be used.”);
    United States v. Hickok, 
    77 F.3d 992
    , 1004 (7th Cir. 1996).
    The mailing or use of the wires need not itself contain
    false or fraudulent material; a “routine or innocent”
    mailing or use of the wire can supply this element of
    the offense, as long as the use of the mail or wire is part
    of the execution of the scheme. Schmuck, 
    489 U.S. at 714-15
    , 
    109 S. Ct. 1443
    ; United States v. Brocksmith, 
    991 F.2d 1363
    , 1368 (7th Cir. 1993).
    Turner, 
    551 F.3d at 666
     (internal footnote omitted).
    Nos. 08-1138 & 08-1161                                   17
    To satisfy the use-of-the-wires element in this case, the
    government relied on the transfer of the $200,000 sale
    proceeds of 6300 Miller from the GUEA’s bank through
    an interstate wire to Harris’s trust account. As the object
    of the scheme to defraud the Historical Society was the
    money, the actual receipt of the funds into Harris’s trust
    account was an essential part of the scheme. See Turner,
    
    551 F.3d at 668
    . Powell argues, however, that the $200,000
    wire transfer is insufficient to support his conviction
    because the fraud was already completed when the
    money was received by the bank. Harris’s law firm trust
    account was credited with $200,000 on October 3, 2001,
    while the interstate wire transfer did not occur until
    October 5. To support that argument, Powell relies primar-
    ily on United States v. Kann, 
    323 U.S. 88
     (1944). Kann held
    that the use of interstate means to collect a check does not
    violate § 1341 because the scheme was complete as soon
    as the depository bank paid the check:
    The banks which cashed or credited the checks, being
    holders in due course, were entitled to collect from the
    drawee bank in each case and the drawer had no
    defense to payment. The scheme in each case had
    reached fruition. The persons intended to receive the
    money had received it irrevocably. It was immaterial to
    them, or to any consummation of the scheme, how the
    bank which paid or credited the check would collect
    from the drawee bank. It cannot be said that the
    mailings in question were for the purpose of
    executing the scheme, as the statute requires.
    
    323 U.S. at 94
    ; see also United States v. Maze, 
    414 U.S. 395
     (1974).
    18                                   Nos. 08-1138 & 08-1161
    We previously considered Kann in United States v. Franks,
    
    309 F.3d 977
     (7th Cir. 2002), a case involving a medical
    clinic worker who stole checks from her clinic and depos-
    ited them in her personal bank account. There we held
    that the bank’s use of interstate couriers to forward
    the checks for collection was sufficient for purposes of
    § 1341. We distinguished Kann thusly:
    Kann predates the Uniform Commercial Code, which
    makes it easy for a customer’s bank to reverse the
    credit if the instrument cannot be collected. Franks
    deposited the checks into her personal account. Even
    if she drew off the embezzled funds promptly, her
    own funds remained and could have been debited to
    cover the loss, had the checks not been sent out of
    state and paid in due course. This made interstate
    transportation essential to the scheme’s success.
    Franks, 
    309 F.3d at 978
    . That same distinction also
    applies here. While Harris’s trust account may have been
    credited with the $200,000 immediately, the bank easily
    could have withdrawn such provisional credit until
    it received the $200,000 wire transfer. See 
    Ind. Code §§ 26-1
    -
    4-201(a), 26-1-4-214(a). Had the bank done so, the defen-
    dants would have failed to fully execute their scheme
    to enrich themselves at the Historical Society’s expense.
    (Powell certainly would not have benefitted because he
    did not cash his check until well after the transfer.) Thus,
    while the defendants in Kann may have received the
    funds “irrevocably,” 
    323 U.S. at 94
    , Harris and his co-
    schemers did not until after the wire transfer of the funds.
    A jury could therefore have reasonably concluded that
    Nos. 08-1138 & 08-1161                                     19
    a use of the wires was in furtherance of the scheme and
    find the use-of-the-wires element satisfied on that basis.
    We next turn to the defendants’ challenges to the suffi-
    ciency of the evidence supporting their tax convictions.
    Powell contests his conviction for failing to accurately
    report his total income on his 2001 tax return in viola-
    tion of 
    26 U.S.C. § 7206
    (1). He claims that there was not
    enough evidence of willfulness to convict him. Because
    Powell did not raise any challenge to that conviction in
    either of his Rule 29 motions, our review of this issue is for
    plain error only. Groves, 
    470 F.3d at 324
    . Recall that,
    under that standard, the record need only contain some
    evidence pointing to guilt; as long as the record is not
    completely devoid of such evidence, we will affirm.
    Irby, 
    558 F.3d at 653
    .
    We conclude that the record contains sufficient evidence
    of Powell’s guilt on the § 7206(1) count to clear that low
    hurdle. For conviction, § 7206(1) requires that a defendant
    “[w]illfully make[ ] and subscribe[ ] any return, statement,
    or other document, which contains or is verified by a
    written declaration that it is made under the penalties
    of perjury, and which he does not believe to be true and
    correct as to every material matter.” See also United States
    v. Pree, 
    408 F.3d 855
    , 865-66 (7th Cir. 2005). In other words,
    a conviction “under section 7206(1) requires proof that:
    (1) a person made or subscribed to a federal tax return
    which he verified as true; (2) the return was false as to a
    material matter; (3) the defendant signed the return
    willfully and knowing it was false; and (4) the return
    contained a written declaration that it was made under
    20                                   Nos. 08-1138 & 08-1161
    the penalty of perjury.” United States v. Presbitero, 
    569 F.3d 691
    , 700 (7th Cir. 2009).
    Here, it is undisputed that Powell’s 2001 return, which
    he signed under penalty of perjury, did not report either
    the $25,000 Powell received from the sale of 6300 Miller or
    the $14,000 he received from the sale of 768 Broadway.
    While the return was prepared by his accountant, the
    accountant testified that she relied upon her clients for the
    information she placed in the returns. Failure to supply
    an accountant with accurate information is evidence of
    willfulness. See Useni, 
    516 F.3d at 650
    . Moreover, the jury,
    when considering Powell’s income omission, had before
    it the evidence of the defendants’ fraudulent scheme to
    profit off of the sale of 6300 Miller. Because the $25,000
    was obtained through fraud, Powell had a strong
    incentive to refrain from reporting the income. See United
    States v. Ytem, 
    255 F.3d 394
    , 397 (7th Cir. 2001) (“[T]he fact
    that illegal income is taxable is widely known, even
    among lay people.”).
    In arguing against the government’s evidence of willful-
    ness, Powell highlights the fact that he filed an amended
    return in 2004, after a civil audit, that included the
    $39,000, the aggregate amount he received from the
    fraud. However, for what it was worth, Powell was able to
    put that evidence in front of the jury. And the probative
    value of it was minimal because it only raised the
    question of why the information was not included in the
    first place. United States v. Ross, 
    626 F.2d 77
    , 81 (9th Cir.
    1980). The critical time-frame for determining willfulness
    is when Powell signed the return, not two years after-
    Nos. 08-1138 & 08-1161                                       21
    wards. See United States v. McClain, 
    934 F.2d 822
    , 835 (7th
    Cir. 1991); see also United States v. Radtke, 
    415 F.3d 826
    , 840-
    41 (8th Cir. 2005).
    Powell also makes much of the fact that his accountant
    lost the information that he had provided her about his
    2001 income, and that as a result she could not verify for
    certain that he had failed to provide her the information
    about the $39,000 he received from Harris for the sale of
    6300 Miller and 768 Broadway. Yet that fact was also
    presented to the jury, and the jury still convicted Powell.
    In light of the evidence of willfulness we have discussed,
    the jury’s guilty verdict on the § 7206(1) count cannot
    be seriously challenged; it certainly was not “shocking.”
    Irby, 
    558 F.3d at 653
    . We therefore will not disturb
    Powell’s conviction for failing to accurately report his
    total income on his 2001 tax return.
    Harris also challenges his conviction under § 7206(1).
    Like Powell, Harris failed to raise this issue in his Rule 29
    motion in the district court, so our review again is for
    plain error only. Groves, 
    470 F.3d at 324
    . Harris was con-
    victed for willfully failing to report on his 2001 return,
    as a capital gain, the $34,900 in profit he made from the
    sale of 768 Broadway. Harris claims that his conviction
    should be reversed because he reported that income—just
    not as a capital gain. At trial, Harris introduced through
    his wife—who did the accounting work for his law
    firm—accounting schedules. Those schedules, supposedly
    used to prepare Harris’s 2001 taxes, contained entries for
    each deposit into the law firm’s bank account. One of
    the entries was the $51,500 check from the GUEA for the
    22                                  Nos. 08-1138 & 08-1161
    sale of 768 Broadway. Because the total income from the
    deposits listed on the schedules matched the amount
    Harris reported for total income on Schedule C, Harris
    claims that he reported the income from the sale of 768
    Broadway on Schedule C.
    The government, however, presented evidence casting
    doubt on that claim. The accounting schedules upon
    which Harris relied were time-stamped March 31, 2007,
    one week after the superseding indictment that added the
    tax count against Harris was handed down. Harris did not
    provide them to the government until shortly before
    trial—which was almost a year after the grand jury had
    subpoenaed them. Moreover, at the time they were sub-
    poenaed, Harris, citing an unspecified “computer crash,”
    told the grand jury that he did not have any papers sup-
    porting his 2001 tax return. Such timing of the schedules’
    disclosure, coupled with the fact that they were under the
    control of Harris’s wife—who had a strong motive to
    doctor the records—cast doubt on their reliability. See
    United States v. Spano, 
    421 F.3d 599
    , 604 (7th Cir. 2005).
    Moreover, the schedules were inaccurate. Despite the
    testimony of Harris’s wife that the entries on the schedules
    would match the actual deposits made into the law firm
    bank account, they did not. In fact, they were off by more
    than $200,000. That substantial discrepancy between the
    record of actual deposits and the accounting schedules
    reinforces the inference that they were altered. Since
    those schedules were the only evidence Harris offered to
    show that he reported the income from the sale, the jury
    reasonably could have chosen to disbelieve Harris’s
    Nos. 08-1138 & 08-1161                                       23
    claim that he reported the income from the sale. At the
    very least, Harris has failed to establish plain error.
    We turn now to the sentencing issues raised by the
    defendants.6 Both Harris and Powell question the amount
    of loss used to compute their sentences. After grouping
    their convictions on count one (the wire fraud offense) and
    count two (conspiring to commit theft of Lake County’s
    funds by reducing the property taxes on 6300 Miller), the
    court enhanced both Harris’s and Powell’s sentences
    twelve levels based on a loss of $208,000. See U.S.S.G.
    § 2B1.1(b)(1)(G). The district court reached that loss
    amount by adding $150,000 (the loss to the Historical
    Society, or alternatively the gain to the defendants, from
    the diverted proceeds of the sale of 6300 Miller) to $58,000,
    the money the defendants stole from Lake County by
    illegally reducing the property taxes owed on 6300 Miller
    from $73,000 to $15,000.
    6
    Harris’s brief states that it “adopts and incorporates by
    reference, without repeating, the standard of review and the
    argument on the coerced jury issue” as well as “on the conspir-
    acy to commit theft form [sic] the Historical Society and from
    Lake County issue, as presented in the Appellant’s Brief of co-
    appellant Powell.” Powell, however, did not appeal those
    issues. Harris has therefore incorporated two non-existent
    arguments. Because Harris does not present any argument or
    cite any legal authority in his own brief on those issues, he
    has waived appellate review of them. Useni, 
    516 F.3d at 658
     (“It
    is not the obligation of this court to research and construct
    the legal arguments open to parties, especially when they are
    represented by counsel.”).
    24                                   Nos. 08-1138 & 08-1161
    “We review a district court’s loss calculations, which
    need only be ‘a reasonable estimate of the loss,’ U.S.S.G.
    § 2B1.1 cmt. 3(C), for clear error.” United States v. Watts,
    
    535 F.3d 650
    , 658 (7th Cir. 2008). We see no clear error
    here. The GUEA paid $200,000 for 6300 Miller, so the “fair
    market value of the property unlawfully taken” was at
    least that amount. U.S.S.G. § 2B1.1 application note 3(C)(i)
    (2007); see also United States v. Radziszewski, 
    474 F.3d 480
    ,
    487 (7th Cir. 2007); United States v. Hardy, 
    289 F.3d 608
    , 613
    (9th Cir. 2002). That amount is offset by the $50,000 the
    Historical Society received, see U.S.S.G. § 2B1.1 application
    note 3(E)(i) (2007), leaving $150,000 as the loss to the
    Historical Society from the sale or, alternatively, the
    amount the defendants unlawfully gained. Similarly,
    Lake County received $15,000 in property taxes when,
    absent the defendants’ duplicitous lawsuit, it was entitled
    to $73,000, a difference of $58,000. Adding those two
    amounts, as the district court did, yields $208,000, thereby
    justifying the application of U.S.S.G. § 2B1.1(b)(1)(G).
    We reject the defendants’ arguments for a lesser loss.
    Powell and Harris argue that, by including both the loss
    to the Historical Society and the loss to Lake County, the
    district court impermissibly double-counted. But that
    argument ignores the fact that two separate entities
    suffered distinct losses, as embodied by the two counts
    of conviction. In count one, the Historical Society lost
    (or the defendants improperly gained) $150,000 because,
    as the owner of the property (at least on paper), it was
    entitled to the full proceeds from the sale. And in count
    two, the county lost $58,000 in property tax revenue
    that could have been paid from the proceeds of the sale.
    Nos. 08-1138 & 08-1161                                     25
    Those are different losses, and the district court was
    right to include both of them.
    In a variation on their first argument, the defendants
    also argue that the district court should have reduced
    the amount of property taxes payable from its calcula-
    tion of the loss to the Historical Society, or the gain to the
    defendants, from the sale of 6300 Miller. According to
    Powell and Harris, had the Historical Society received the
    full $200,000, it would have had to pay the $73,000 in
    property taxes; thus, they claim that the $73,000 in prop-
    erty taxes ought to have been deducted from the loss.
    Alternatively, because Harris paid $15,000 in property
    taxes, they claim that amount should have been deducted
    from the $150,000 the district court calculated as the
    defendants’ gain.
    Neither Harris nor Powell cite any authority to sup-
    port reducing either the loss or gain that way, and the
    commentary to the Guidelines do not provide for that type
    of reduction. See U.S.S.G. § 2B1.1 application note 3(D)-(E)
    (2007). Moreover, Harris’s $15,000 payment of the
    property taxes was to further the fraudulent scheme.
    We have held that such expenses in furtherance of the
    unlawful activity need not be excluded from the gain. See
    United States v. Marvin, 
    28 F.3d 663
    , 664-65 (7th Cir. 1994).
    Furthermore, the loss to the Historical Society is undimin-
    ished by the property taxes because the purchase agree-
    ment between the GUEA and the Historical Society
    expressly obligated the GUEA, not the Historical Society,
    to pay any outstanding property taxes. The defendants’
    arguments concerning the reduction of the loss amount
    therefore have no merit.
    26                                  Nos. 08-1138 & 08-1161
    Harris raises two other objections to his sentence.
    First, he challenges his two-level enhancement under
    U.S.S.G. § 3C1.1 for obstruction of justice. We review a
    district court’s factual findings supporting a § 3C1.1
    enhancement for clear error. United States v. Strode, 
    552 F.3d 630
    , 635 (7th Cir. 2009). The district court’s factual
    findings will stand as long as they are “plausible in light
    of the record in its entirety.” United States v. White, 
    368 F.3d 911
    , 916 (7th Cir. 2004).
    Harris’s obstruction enhancement was based on his
    failure to comply with a grand jury subpoena requesting
    copies of tax returns and accounting schedules used to
    prepare the returns. In September 2006, FBI agents served
    Harris’s law firm with the subpoena. In a signed state-
    ment, Harris responded to the subpoena by claiming
    that the law firm did not have the accounting schedules
    due to a “computer crash.” However, on March 31, 2007,
    one week after the grand jury returned a superceding
    indictment adding a tax count against Harris, Harris’s
    wife, who was the law firm’s accountant, printed out the
    accounting schedules. At trial, she testified that Harris
    never gave her the subpoena and that she did not
    know that the grand jury had subpoenaed the law firm’s
    accounting schedules until after the indictment.
    According to the commentary to the obstruction en-
    hancement, “concealing . . . evidence that is material to an
    official investigation” is obstruction. U.S.S.G. § 3C1.1
    application note 4(d) (2007). The district court concluded
    that Harris’s behavior was just that. We agree. At the very
    least, it was obstructive for Harris to fail to tell the one
    Nos. 08-1138 & 08-1161                                27
    person in his law firm who had control over the subpoe-
    naed documents—his wife—about what documents the
    subpoena requested, since those documents were
    material to the investigation. Moreover, the computers’
    fortuitous recovery in time for Harris to use the ac-
    counting schedules in his own defense strongly suggests
    that Harris’s “computer crash” excuse was unworthy of
    belief. The district court did not commit clear error in
    applying the obstruction enhancement.
    Harris’s second objection to his sentence is what he
    views as an unwarranted disparity between his sentence
    (55 months) and Powell’s (37 months). Harris claims their
    conduct was similar and therefore warranted similar
    sentences. We reject that argument, first, because it is
    wrong on the law, United States v. Omole, 
    523 F.3d 691
    ,
    700 (7th Cir. 2008) (“This court refuses to view the dis-
    crepancy between sentences of codefendants as a basis
    for challenging a sentence.”), and, second, because it is
    wrong on the facts. In many ways, Harris’s conduct was
    more culpable than Powell’s. The most important differ-
    ence between the two is that Harris was the one who
    abused his position as the Historical Society’s lawyer to
    pull off the sale of 6300 Miller. Indeed, it was Harris’s
    own law firm and its trust account that was the locus of
    the fraud. Moreover, as we have discussed above, Harris
    obstructed justice by failing to turn over documents the
    grand jury had ordered him to produce. Given those
    significant differences, we see no error in the district
    court’s decision to mete out a stiffer sentence to Harris
    than to Powell.
    28                                    Nos. 08-1138 & 08-1161
    We turn now to Powell’s final challenge to his sentence.
    He claims that the district court improperly disregarded
    his arguments at sentencing for leniency based on his
    advanced age and health problems. Regarding those
    arguments, the district court stated the following when
    it pronounced sentence:
    I specifically have taken into consideration every-
    thing that Mr. Milner has brought to my attention.
    The defendant’s age, his lack of criminal history, his
    health problems. Those are certainly factors that
    weigh greatly on me and bear on the history and
    characteristics of the Defendant, but they are, of course,
    also taken into account by the guidelines themselves.
    It is not clear what the district court meant by that last
    phrase that we have emphasized; it appears to be a mis-
    statement of the law. Although the Guidelines do
    account for a defendant’s criminal history, see U.S.S.G.
    §§ 4A1.1, 4A1.2, they do not factor in a defendant’s age
    and health. Instead, the Guidelines list advanced age
    and serious health conditions as grounds for departure,
    though in limited circumstances: the commentary to the
    Guidelines states that, although age and health are “not
    ordinarily relevant in determining whether a departure
    may be warranted,” they may be a “reason to depart
    downward” when a defendant is either “elderly” or
    “seriously infirm.” U.S.S.G. §§ 5H1.1, 5H1.4. Of course,
    post-Booker, those departures are “obsolete.” United States
    v. Johnson, 
    427 F.3d 423
    , 426 (7th Cir. 2005). While the
    district court can still use them for guidance, United States
    v. Filipiak, 
    466 F.3d 582
    , 584 (7th Cir. 2006), it has the
    Nos. 08-1138 & 08-1161                                            29
    authority to consider Powell’s physical impairments and
    advanced age when determining the sentence it believes
    appropriate under 
    18 U.S.C. § 3553
    (a). United States v.
    Millet, 
    510 F.3d 668
    , 680 (7th Cir. 2007).
    Because the district court appeared to misapprehend its
    authority under § 3553(a), a remand is appropriate to give
    the district court an opportunity to clarify its ruling.7 On
    remand, the district court should consider Powell’s argu-
    ments about his advanced age and infirm health in light
    of the factors outlined in 
    18 U.S.C. § 3553
    (a).
    III.
    The government presented sufficient evidence that
    Powell and Harris knowingly participated in a scheme
    to defraud the Historical Society that involved the use
    of the interstate wires, and both Powell’s and Harris’s
    7
    The district court did state later on during its pronounce-
    ment of the sentence that, “[o]n the other issues of the defen-
    dant’s age, and his lack of criminal history, I just don’t think
    that those are enough to persuade me that a nonguideline
    sentence is appropriate in this case.” However, that ambiguous
    statement, while coming closer to a correct understanding of
    the court’s § 3553(a) authority, does not mitigate the court’s
    previous statements, which appeared to rely on an invalid
    ground to reject Powell’s arguments. A remand is therefore
    necessary. Cf. United States v. Smith, 
    562 F.3d 866
    , 874-76 (7th Cir.
    2009) (finding no remand necessary where it was clear
    from context that the district judge did not rely on his
    previous misstatement of the law when pronouncing sentence).
    30                                 Nos. 08-1138 & 08-1161
    convictions under 
    26 U.S.C. § 7206
    (1) survive review for
    plain error. Furthermore, the district court properly
    calculated the loss amount used to determine both
    Harris’s and Powell’s sentences by adding the $150,000
    proceeds the defendants purloined from the sale of 6300
    Miller to the $58,000 Lake County lost in property taxes
    as a result of the fraudulent lawsuit. The district court
    also correctly enhanced Harris’s sentence based on his
    failure to comply with the grand jury subpoena requiring
    him to hand over accounting schedules material to the
    government’s investigation of his 2001 tax returns. And
    the disparity between Harris’s sentence and Powell’s
    was warranted. We therefore A FFIRM the defendants’
    convictions and Harris’s sentence. However, because the
    district court appeared to improperly reject Powell’s
    arguments for leniency based on his advanced age and
    poor health, we V ACATE and R EMAND Powell’s sentence
    for further proceedings consistent with this opinion.
    8-7-09