Mahammad Haroon Rashid v. the State of Texas ( 2021 )

Opinion issued July 1, 2021
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-19-00826-CR
———————————
MAHAMMAD HAROON RASHID, Appellant
V.
THE STATE OF TEXAS, Appellee
On Appeal from the 458th District Court
Fort Bend County, Texas
Trial Court Case No. 14-DCR-066280C
MEMORANDUM OPINION
Without a sentencing recommendation, appellant Muhammad Haroon Rashid
pleaded guilty to the offense of engaging in organized criminal activity, which—as
charged in this case—was a first-degree felony. See TEX. PENAL CODE § 71.02(a)(1),
(c). After preparation of a presentence investigation report and presentation of
additional evidence at the punishment hearing, the trial sentenced Rashid to 20 years
in prison and ordered him to pay restitution to nine victims of his offense. See TEX.
CODE CRIM. PROC. art. 42.037(a) (authorizing sentencing court to order defendant
“to make restitution to any victim of the offense”). In one issue, Rashid contends
that the evidence did not support the award of restitution to three of the purported
victims.
We affirm as modified.
Background
In March 2010, Christopher Reyes needed a loan for his Fort Bend County
business. Gus Sosebee, acting as a broker, put Reyes in contact with Rashid and
Gerald Hendrix, who were principals of Worldwide Resources USA. Reyes met with
Rashid and Hendrix and signed an agreement with Worldwide for a loan. In the
agreement, Worldwide committed to lend Reyes’s business $360,000, and Reyes
agreed to pay Worldwide a $36,000 commitment fee. The agreement provided that
if the loan did not fund within 30 days, Worldwide would refund the commitment
fee to Reyes.
By June 2010, Reyes had not received the loan, and Worldwide had not
refunded the $36,000 commitment fee. Reyes contacted Sergeant MacDonough of
the Sugar Land Police Department to report being defrauded by Worldwide.
Sergeant MacDonough began an investigation, which lasted several years. Through
2
the investigation, Sergeant MacDonough discovered that Rashid and Hendrix, along
with other co-actors, including Sosebee, used Worldwide and another company,
Global Empire Investments, to perpetrate various schemes and scams to swindle
money from unwitting parties in Texas and elsewhere.
During the investigation, Sergeant MacDonough learned that Reyes was not
the only party to whom Rashid and Hendrix had failed to return a commitment fee
after promising to provide a loan and then failing to do so. Sergeant MacDonough
discovered that Progressive Minerals, LLC, had filed a lawsuit against Rashid and
Hendrix in West Virgina for failing to return a $750,000 commitment fee. Sergeant
MacDonough reviewed the pleadings and testimony from that suit and spoke with
Progressive Minerals’s attorney. Sergeant MacDonough learned that Progressive
Minerals had sought a loan for $200,000,000 to purchase a mining company in West
Virginia. After being referred to Global Empire, Progressive was given information
representing that Global Empire was financially sound, even though it had filed
Chapter 11 bankruptcy in December 2005.
After receiving information about Global Empire, Progressive Minerals and
Global Empire entered into a loan agreement. As part of the agreement, Progressive
Minerals paid Global Empire a $750,000 commitment fee conditioned on the loan
being funded. The court filings identified Worldwide as an affiliated company of
Global Empire, Rashid as Global Empire’s and Worldwide’s president, and Hendrix
3
as Global Empire’s chief financial officer. Sergeant MacDonough also reviewed the
testimony of Progressive Mineral’s corporate representatives, given in October
2009. One of the representatives, Arch Moore, testified that, when he had contacted
Global Empire about the loan not being funded, he had been stalled and told that the
loan would still fund. Moore testified that Global Empire neither funded the loan,
nor did it return the $750,000 commitment fee to Progressive Minerals.
Sergeant MacDonough also learned that Rashid and his co-actors had engaged
in investment scams. For instance, Sergeant MacDonough discovered that, in
September 2003, Robert Oyler had loaned $558,875 to Rashid and his associate,
Jessie Botello, to use for a real estate investment. To obtain the funds, Oyler had
taken out a second mortgage on his home. Although a promissory note between the
parties required the loan’s principal to be repaid by December 2013, Rashid and
Botello never repaid the $558,875 to Oyler.
Sergeant MacDonough also learned that Chet Schickling provided $53,000 to
Worldwide to finance the purchase of an airplane. Schickling had been introduced
to Hendrix through another individual, Alan Hoover. After Schickling paid the
$53,000 to Worldwide, the funds were transferred to Rashid’s account. The aircraft
was never purchased, and the funds were never repaid to Schickling.
In addition to the transactions involving Reyes, Progressive Minerals, Oyler,
and Schickling, Sergeant MacDonough learned of numerous other loan and
4
investment schemes involving Rashid, Hendrix, their companies—Worldwide and
Global Empire—and other co-actors, including Sosebee and Hoover. As a result,
Rashid and Hendrix were arrested and indicted in Fort Bend County for multiple
offenses.
In 2018, Rashid entered an open plea of guilty to the offense of engaging in
criminal activity, charged as follows:
[Rashid] on or about and between September 1, 2003 and December
31, 2013, did, unlawfully, with the intent to establish, maintain or
participate in a combination—consisting of [Rashid] and two or more
of the following: Gus Sosebee and or Gerald Hendrix and or Alan
Hoover and or Jessie Botello and or others—or in the profits of a
combination, did, then and there, between the dates mentioned above
and pursuant to one scheme or continuing course of conduct, committed
misapplication of property by a fiduciary of the aggregate value of
$200,000 or more and or theft of the aggregate value of $200,000 or
more and or money laundering of the aggregate value of the funds being
$200,000 or more, with the intent to participate in the combination or
in the profits of the combination.1
Following Rashid’s guilty plea, the trial ordered the preparation of a
presentence investigation (PSI) report. At the sentencing hearing, the State offered
into evidence Rashid’s PSI report. Hendrix’s PSI report, from a separately filed case,
1
Here, as permitted, the State chose not to name the complainants in the indictment.
See State v. Rivera, 42 S.W.3d 323, 330 (Tex. App.—El Paso 2001, pet. ref’d)
(recognizing that State is not required to include name of complainant in indictment
charging defendant with engaging in organized criminal activity because “identity
of the owner of the property allegedly stolen was incidental to the crime alleged”);
see also Moallen v. State, 690 S.W.2d 244, 246 (Tex. Crim. App. 1985) (holding
identification of complainant in charging instrument not required when not
identified as element of charged offense).
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was also admitted into evidence. Both PSI reports set out in detail Sergeant
MacDonough’s investigation. Hendrix’s PSI report also contained his statement,
which he had provided to the probation officer preparing the report, and the
statements of the victims of Rashid’s and Hendrix’s schemes.
The State called eight witnesses to testify at the sentencing hearing. Each had
been a victim of Rashid’s and Hendrix’s criminal activities. Reyes was among the
witnesses. He testified that Rashid had paid him back the $36,000 commitment fee
but explained that he had received the payment only after Rashid had been arrested,
which was four years after the date the payment had been due.
Similarly, Jason Guidry testified that he entered into an agreement with
Rashid and Hendrix to obtain a loan from Worldwide for $2,500,000. He paid
Worldwide a commitment fee of $62,500 with the agreement that the fee would be
refunded in “a short period of time” if the loan did not fund. Guidry paid the
commitment fee to Worldwide in 2011, but the loan never funded. The commitment
fee was returned to Guidry five years later, after Rashid was arrested.
Like Reyes and Guidry, Anders Erickson testified that he entered into an
agreement with Rashid and Hendrix to obtain a $3,000,000 loan for his business,
located in Hayes County, Texas. He paid a $70,000 commitment fee to Worldwide
in March 2012 with the understanding that, if the loan did not fund in 90 days, the
commitment would be returned. The loan did not fund, and he did not receive the
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commitment fee back as agreed. Erickson requested his money back by emailing
Rashid and Hendrix and speaking on the phone with Sosebee, but they did not return
his commitment fee as requested. Ultimately, criminal charges were filed against
Rashid in Hayes County regarding the matter. Erickson testified that he received his
$70,000 commitment fee back from Rashid in exchange for agreeing that he would
not pursue the criminal case against Rashid in Hayes County.
Oyler also testified at the punishment hearing about his experience with
Rashid. He stated that, in 2003, he had loaned $558,875 to Rashid and Botello. He
stated that, to obtain the funds, he had taken a second mortgage on his home. Oyler
testified that he had signed a promissory note with Rashid. He stated that, contrary
to the terms of the promissory note, Rashid had never paid any of the money back
to him. He testified that, at one point, his home was posted for foreclosure, forcing
him to refinance. Sixteen years after he loaned the money to Rashid, Oyler testified
that he was still making monthly payments of $1,900 on the refinanced amount. He
stated that he was 70 years old and had to continue working to make the payments.
Schickling testified that he had loaned $53,000 to Worldwide to finance the
purchase of an airplane. He stated that the funds were immediately transferred to
Rashid’s bank account. He testified that he had never been repaid the funds, despite
an agreement that he would be repaid.
7
The State also called B.J. White. She testified that, at Hendrix’s request, she
had wired $60,000 to him in May 2008 for an investment involving helicopters. She
stated that she was aware that Rashid was Hendrix’s partner. She testified that she
was led to believe that she would receive $500,000 by July 2008, however, she had
never received any money from Hendrix or Rashid, including the $60,000 she
invested in 2008.
The State next called Lawrence Durbin. He testified that in 2009, Rashid and
Hendrix asked him for a loan of $1.1 million. They represented to him that they had
a Mexican bond worth $55 million, which they could use as collateral. Durbin
entered into a contractual loan agreement with Worldwide, which Hendrix signed as
chief financial officer. The terms of the agreement were that, within 45 days, Rashid
would sell other Mexican bonds he held and then pay Durbin back the $1.1 million
plus $400,000 in interest. Durbin testified that his $1.1 million was never returned.
Finally, Amy Tan testified that, in 2006, she loaned $40,000 to Rashid related
to a real estate transaction. Rashid signed a promissory note agreeing to repay Tan.
She also testified that she loaned Rashid additional money for an airline ticket. Tan
testified that Rashid never repaid her any of the money as agreed.
In addition, Tan testified about a real estate transaction between Rashid and
her friend, Wendy Wang. Tan explained that, in 2005, Wang agreed to sell real
property she owned to Rashid, and the parties signed a contract. Wang deeded the
8
property to Rashid, who then took out several loans using the property as collateral
without telling Wang. One of the lienholders ultimately foreclosed on the property.
Besides Tan’s testimony, the State offered documentary evidence relating to the real
estate transaction, which showed that Rashid’s conduct had cost Wang $2,250,000.
The State also offered hundreds of pages of bank and financial records,
including those of Worldwide and documents showing the transfer of funds between
accounts controlled by Rashid and Hendrix. The records included copies of checks
and deposit slips supporting the claims of the victims who testified, showing that
they had provided money to Rashid and his co-actors.
Among the bank records were documents reflecting that an individual named
David Hamilton had written a check for $25,000 to Worldwide in May 2010. The
memo line on the check had the notation “joint venture deposit.” Hamilton wrote
another check to Worldwide for $22,905. The memo line on that check stated, “loan
advance.” Deposit slips for Worldwide’s bank account showed the same amounts
deposited into its account.
In his PSI report statement, Hendrix said that Hamilton had “sought him out”
and that the transaction with Hamilton “was a deal involving gold.” Hendrix stated
that Hamilton had “put up” $47,900, which was paid to Worldwide. Hendrix also
said that “he” went to Africa regarding the deal, but it is unclear whether “he” refers
to Hendrix or to Hamilton. Hendrix stated that $85,000 was spent on the trip “but
9
the deal never went through.” Rashid made no statement in his PSI report regarding
Hamilton. Neither Hamilton nor any other witness testified at the sentencing hearing
about Hamilton’s transactions with Worldwide and Hendrix. Under the victim
statement portion of Hendrix’s PSI report, the probation officer who prepared the
report noted that he had sent “multiple emails” to Hamilton but “no response was
received.”
The bank records admitted into evidence also showed that another individual,
Bradley Rotter, had wired $50,000 to Worldwide in 2011. In his PSI statement,
Hendrix explained that he did not know Rotter but was aware that Rotter had
“traveled with Alan Hoover to Mexico” to meet with Rashid “to invest $50,000.”
Hendrix said that he had investigated Rotter’s company and had learned that the
company was “not earning enough to pay their top salaries.” Hendrix indicated that
meant a deal with Rotter would not be in Worldwide’s best interest. Hendrix did not
state whether a deal was reached with Rotter but said that Rotter later paid Rashid
another $2,000. But he did not explain the reason for the payment. The probation
officer preparing the PSI report noted that, when contacted, Rotter said that he had
already given a statement to a Fort Bend County assistant district attorney. The
report contained no information about the content of that statement. Rashid’s PSI
report contained no information about Rotter, and Rotter did not testify at the
sentencing hearing.
10
During closing arguments, the State requested that Rashid be sentenced to 60
years in prison because the evidence showed that he could not be rehabilitated. The
State pointed out that, in addition to the witnesses’ testimony, the PSI reports showed
that “Progressive Minerals [had] sued Rashid for $750,000 based upon the same
conduct that we’ve heard today.” The PSI report detailed the information Sergeant
MacDonough had learned during his investigation regarding the $750,000
commitment fee Rashid and his co-actors had taken from Progressive Minerals
under the guise of providing a loan for the purchase of a mine in West Virginia.
At the end of the punishment hearing, the trial court sentenced Rashid to 20
years in prison. The trial court also ordered Rashid to make restitution to the
following parties in the following amounts: (1) Robert Oyler ($468,000);
(2) Lawrence Durbin ($1,100,000); (3) Chet Schickling ($53,000); (4) Amy Tan
($45,000); (5) B.J. White ($60,000); (6) Wendy Wang ($2,250,000); (7) David
Hamilton ($47,005); (8) Bradley Rotter ($50,000); and (9) Progressive Minerals
($750,000).
Rashid now appeals, raising one issue.
Restitution
On appeal, Rashid challenges the portion of the judgment ordering him to pay
restitution to Progressive Minerals, Hamilton, and Rotter. He contends that the
11
award of restitution to those three parties was not supported by the evidence
presented at the punishment hearing.
A. Applicable Law
We review a challenge to a restitution order for an abuse of discretion.
Cartwright v. State, 605 S.W.2d 287, 288–89 (Tex. Crim. App. 1980); Ortegon v.
State, 510 S.W.3d 181, 184 (Tex. App.—Houston [1st Dist.] 2016, no pet.). An
abuse of discretion occurs if the trial court acts without reference to any guiding
rules and principles or acts arbitrarily or unreasonably. Montgomery v. State, 810
S.W.2d 372, 380 (Tex. Crim. App. 1990); Tyler v. State, 137 S.W.3d 261, 266 (Tex.
App.—Houston [1st Dist.] 2004, no pet.).
The Court of Criminal Appeals has recognized that restitution “is a victim’s
statutory right.” Burt v. State, 445 S.W.3d 752, 756 (Tex. Crim. App. 2014). The
Code of Criminal Procedure provides that a trial judge “may order the defendant to
make restitution to any victim of the offense.” TEX. CODE CRIM. PROC. art.
42.037(a). The State bears the burden of proving by a preponderance of the evidence
“the amount of loss sustained by a victim as a result of the offense.”2 Id. art.
42.037(k). To order restitution, the court must consider “the amount of loss sustained
2
“Preponderance of the evidence means the greater weight and degree of credible
evidence that would create a reasonable belief in the truth of the matter.” Ex parte
Garza, 603 S.W.3d 492, 496 (Tex. App.—Corpus Christi 2020, no pet.) (citing
Batra v. Covenant Health Sys., 562 S.W.3d 696, 706 n.8 (Tex. App.—Amarillo
2018, pet. denied)).
12
by a victim,” and “other factors the court deems appropriate.” Id. art. 42.037(c).
Courts must also be mindful of three due-process limitations: (1) the restitution
ordered must be only for the offense for which the defendant is criminally
responsible; (2) the restitution must be only for the victim or victims of the offense
for which the defendant is charged; and (3) the amount must be just and supported
by a factual basis in the record. Burt, 445 S.W.3d at 758; Campbell v. State, 5 S.W.3d
693, 696–97 (Tex. Crim. App. 1999).
B. Analysis
In challenging the sufficiency of the evidence to support the restitution order,
Rashid emphasizes that no representative from Progressive Minerals testified at the
punishment hearing nor did Hamilton or Rotter. Rashid acknowledges that both PSI
reports contain information about Progressive Minerals, and Hendrix’s PSI report
contains information about Hamilton and Rotter, but he asserts that the reports—to
which he did not object at the punishment hearing—cannot support the restitution
award because they are hearsay.
In support of his argument, Rashid cites Cartwright v. State, 605 S.W.2d 287,
289 (Tex. Crim. App. 1980). There, the trial court ordered restitution based on a
presentence investigation report that mentioned the victim’s financial losses but did
not contain any documentation of those losses. Id. The Court of Criminal Appeals
held that, because the report was hearsay, it was insufficient to establish the amount
13
of restitution. Id. However, since Cartwright was decided, Texas Rule of Evidence
802 was adopted, “which treats hearsay admitted without objection the same as all
other evidence in that it is capable of sustaining a verdict.” Maloy v. State, 990
S.W.2d 442, 445–46 (Tex. App.—Waco 1999, no pet.); see TEX. R. EVID. 802
(“Inadmissible hearsay admitted without objection may not be denied probative
value merely because it is hearsay.”).
Citing Rule 802, several courts—including this Court—have held that an
unobjected-to presentence investigation report, although hearsay, is sufficient to
sustain an order of restitution. See, e.g., Scott v. State, No. 03-15-00096-CR, 2016
WL 4506156, at *5 (Tex. App.—Austin Aug. 24, 2016, no pet.) (mem. op., not
designated for publication) (holding that PSI report, to which defendant did not
object, provided sufficient factual basis to support restitution award); Nugent v.
State, No. 01–05–00775–CR, 2006 WL 2893429, at *2 (Tex. App.—Houston [1st
Dist.] Oct. 12, 2006, pet. ref’d) (mem. op., not designated for publication) (holding
that unobjected-to PSI report—containing detailed breakdown of each victim of
appellant’s offense and amount of loss each had sustained as result of charged
offense—was sufficient factual basis to support restitution to victims who did not
testify at sentencing hearing); Harrison v. State, 713 S.W.2d 760, 764 (Tex. App.—
Houston [14th Dist.] 1986, pet. ref’d) (holding that list of expenses in PSI report,
which was not objected to, provided factual basis to support restitution order).
14
Moreover, the Court of Criminal Appeals has made clear since Cartwright that,
“generally, the rules of evidence do not apply to the contents of [a] PSI [report].”
Fryer v. State, 68 S.W.3d 628, 631 (Tex. Crim. App. 2002); see Snow v. State, No.
03-12-00573-CR, 2014 WL 3411209, at *1 (Tex. App.—Austin July 10, 2014, no
pet.) (mem. op., not designated for publication) (concluding that trial court properly
considered PSI report in awarding restitution because rules of evidence do not apply
to PSI reports). Thus, the trial court in this case was permitted to rely on the PSI
reports to determine whether to award restitution.
Rashid also contends that, even considering the PSI reports, the evidence was
not sufficient to support restitution to Progressive Minerals, Hamilton, and Rotter.
Rashid asserts that the evidence failed “to show [a] nexus” between his conduct, for
which restitution was awarded, and “the crime for which [he] was convicted.” As
mentioned, Code of Criminal Procedure article 42.037(a) permits a sentencing court
to order a defendant to pay restitution to “any victim of the offense.” TEX. CODE
CRIM. PROC. art. 42.037(a). We interpret Rashid’s argument to be an assertion that
the State failed to show that Hamilton, Rotter, and Progressive Minerals were
“victims” of his offense of engaging in criminal activity, as statutorily required for
them to be awarded restitution. See id.“[F]or purposes of the restitution statute, a ‘victim’ is any person who suffered
loss as a direct result of the criminal offense.” Hanna v. State, 426 S.W.3d 87, 94
15
(Tex. Crim. App. 2014). “The phrase ‘as a result of the offense’ includes the notion
of both actual and proximate causation.” Id. at 95. “[T]he damages must be a ‘direct’
result of the defendant’s criminal offense—that is, the State must prove, by a
preponderance of the evidence, that the loss was a ‘but for’ result of the criminal
offense and resulted ‘proximately,’ or foreseeably, from the criminal offense.” Id.
Included in his argument, Rashid contends that the State’s decision not to name
Hamilton, Rotter, and Progressive Minerals as complainants in the indictment limits
their ability to recover restitution; however, the Court of Criminal Appeals has made
clear that restitution “may be ordered for someone whose name did not appear in the
charging instrument,” so long as the State proves that “the defendant’s commission
of the offense was the direct cause of the harm.” Id. at 89–90.
With respect to the offense of engaging in organized criminal activity, Rashid
pleaded guilty to the charges in the indictment, judicially admitting that, “with the
intent to establish, maintain or participate in a combination—consisting of [Rashid]
and two or more of the following: Gus Sosebee and or Gerald Hendrix and or Alan
Hoover and or Jessie Botello and or others—or in the profits of a combination,” he
committed “[1] misapplication of property by a fiduciary of the aggregate value of
$200,000 or more and or [2] theft of the aggregate value of $200,000 or more and or
16
[3] money laundering of the aggregate value of the funds being $200,000 or more,”3
“pursuant to one scheme or continuing course of conduct” between the dates of
September 1, 2003 and December 31, 2013.
1. Progressive Minerals
We begin by determining whether the State offered sufficient evidence to
show, by a preponderance of the evidence, that Rashid’s commission of the charged
offense of engaging in organized criminal activity was a direct cause of Progressive
Minerals’s loss of its $750,000 loan commitment fee. In other words, we determine
whether the evidence was sufficient for the trial court to have concluded that
Progressive Minerals was a victim of the offense.
Evidence supporting the $750,000 restitution award to Progressive Minerals
was contained in Rashid’s and Hendrix’s PSI reports. The reports detail the findings
3
The indictment alleges Rashid committed the offense of engaging in organized
criminal activity between September 1, 2003 and December 31, 2013. During that
period, the Penal Code classified the predicate offenses of (1) misapplication of
fiduciary property, (2) theft, and (3) money laundering as first-degree felony
offenses, if the value of the property involved was $200,000 or more. See Act of
May 30, 2003, 73d Leg., R.S., ch. 900, § 1.01, sec. 32.45, 1993 Tex. Gen. Laws
3586, 3653 (amended 2015) (current version at TEX. PENAL CODE § 32.45(c)(7)
(requiring $300,000 or more in property misapplied to constitute first-degree
felony)); Act of June 19, 2003, 73d Leg., R.S., ch. 900, § 1.01, sec. 31.03, 1993 Tex.
Gen. Laws 3586, 3638 (amended 2015) (current version at TEX. PENAL CODE
§ 31.03(e)(7) (requiring $300,000 or more in property stolen to constitute first-
degree felony)); Act of Sept. 1, 2005, 79th Leg., R.S., ch. 1162, § 2, sec. 34.02, 2005
Tex. Gen. Laws 3802, 3803 (amended 2015) (current version at TEX. PENAL CODE
§ 34.02(e)(4) (requiring $300,000 or more in funds laundered to constitute first-
degree felony)).
17
of Sergeant MacDonough’s investigation, through which he learned that Rashid and
Hendrix failed to return Progressive Minerals’s $750,000 loan commitment fee,
resulting in a suit by Progressive Minerals against Rashid and Hendrix. The PSI
reports document that Progressive Minerals entered into an agreement with Global
Empire—of which Rashid was president—to obtain a loan for $200,000,000 for the
purchase of a mining company in West Virginia. Progressive Minerals paid Global
Empire the $750,000 commitment fee conditioned on the loan being funded. Before
entering into the loan agreement, Progressive Minerals was presented with
information representing that Global Empire was financially sound, even though
Global Empire had filed Chapter 11 bankruptcy in December 2005. A representative
of Progressive Minerals, Arch Moore, testified in October 2009 that he had contacted
Global Empire about the status of the loan, but he was stalled and told that the loan
would still fund. Moore also testified that Global Empire never funded the loan nor
did it return Progressive Minerals’s $750,000 commitment fee. Other evidence—
specifically, witness testimony, the PSI reports, and bank records—showed that
Rashid and his co-actors had collaborated to commit an array of offenses pursuant
to a common scheme, including misappropriating and misapplying loan
commitment fees of other borrowers, such as Reyes, Guildry, and Erickson. Thus,
the State’s evidence was sufficient—by a preponderance of the evidence—for the
trial court to have exercised its discretion to determine that Progressive Minerals was
18
a victim of Rashid’s offense of engaging in criminal activity. That is, the evidence
sufficiently showed that Progressive Minerals’s loss of $750,000 was a direct result
of the offense. See Hanna, 426 S.W.3d at 94.
In his brief, Rashid cites Martin v. State as support for his argument that there
was an insufficient nexus between the award of restitution to Progressive Minerals
and the charged offense. 874 S.W.2d 674 (Tex. Crim. App. 1994). In Martin, the
defendant was indicted and convicted of defrauding one investor in the amount of
$3,717.19. Id. at 675. As a condition of probation, the trial court ordered the
defendant to pay restitution in the amount of $65,179.08, which was half the total
amount allegedly lost by approximately 40 investors. Id. On appeal, the Court of
Criminal Appeals held that the amount of restitution awarded could not include
amounts owed to victims of other crimes for which the defendant had not been
charged or convicted. Id. at 677–78.
Unlike the facts in Martin, Rashid was charged with, and pleaded guilty to,
the offense of engaging in organized criminal activity, which by its nature may have
multiple victims. As charged here, the offense was not limited to the commission of
one predicate offense with only one victim but, as shown by the evidence, had many
victims resulting from Rashid and his associates acting in combination over many
years to perpetrate illegal schemes. Cf. O’Brien v. State, 544 S.W.3d 376, 379 (Tex.
Crim. App. 2018) (“We hold that the commission of each predicate crime constitutes
19
a different manner and means of committing the single offense of engaging in
organized criminal activity.”). Thus, Rashid’s reliance on Martin is misplaced.
Rashid also contends that the State did not provide evidence to show that the
transaction between Progressive Minerals occurred between September 1, 2003 and
December 31, 2013, the period during which the indictment alleged Rashid had
committed the offense of engaging in criminal activity. However, the PSI reports
indicate that Progressive Minerals agreed to the loan transaction with Rashid’s
company, Global Empire, based on information that the company was financially
sound, when in fact it had filed Chapter 11 bankruptcy in December 2005. In
addition, the PSI reports state that Progressive Minerals’s corporate representative,
Arch Moore, testified in the suit filed by Progressive Minerals against Rashid in
2009. The dates provided in PSI reports provide a basis from which the trial court
could have reasonably determined that the predicate offense involving Progressive
Minerals occurred between September 1, 2003 and December 31, 2013.
Finally, Rashid asserts that the trial court abused its discretion in awarding
restitution to Progressive Minerals because the evidence did not “provide
information from which appropriate venue could be determined.” We conclude
Rashid’s argument is without merit.
The State was not required to establish the venue of each predicate offense or
act supporting the charged offense of engaging in organized criminal activity,
20
including any act or conduct related to the transaction involving Progressive
Minerals. Rather, the offense of engaging in organized criminal activity “may be
prosecuted in any county in which any act is committed to effect an objective of the
combination.” TEX. CODE CRIM. PROC. art. 13.21 (emphasis added); see Ford v.
State, 282 S.W.3d 256, 266 (Tex. App.—Austin 2009, no pet.) (recognizing that
offense of engaging in organized criminal activity may be prosecuted in any county
in which any act is committed to further objective of the combination). Rashid makes
no argument that Fort Bend County was not the proper venue for his offense of
engaging in organized criminal activity to be prosecuted. See TEX. R. APP. P.
44.2(c)(1) (providing that, “[u]nless the [matter was] disputed in the trial court, or
unless the record affirmatively shows the contrary, the court of appeals must
presume . . . that venue was proved in the trial court”).
We conclude that the evidence supported the trial court’s determination that
Progressive Minerals was entitled to $750,000 in restitution from Rashid. We hold
that the trial court did not abuse its discretion by ordering Rashid to make that
restitution. We overrule the portion of Rashid’s sole issue challenging the restitution
to Progressive Minerals.
2. Hamilton and Rotter
We turn to whether the evidence supported a determination that Hamilton,
who was awarded $47,005 in restitution, and Rotter, who was awarded $50,000 in
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restitution, were victims of Rashid’s offense of engaging in criminal activity. We
review the evidence to ascertain whether the evidence supported a determination that
Hamilton and Rotter suffered a loss as a direct result of the criminal offense. See
Hanna, 426 S.W.3d at 94.
Bank records admitted into evidence at the punishment hearing reflected that
Hamilton wrote a check for $25,000 to Worldwide in May 2010. The memo line on
the check had the notation “joint venture deposit.” Hamilton wrote another check to
Worldwide for $22,905. The memo line on that check stated, “loan advance.”
Deposit slips for Worldwide’s bank account showed the same amounts deposited
into its account.
In his statement in the PSI report, Hendrix said that Hamilton had “sought him
out” and that the transaction with Hamilton “was a deal involving gold.” Hendrix
stated that Hamilton had “put up” $47,900, which was paid to Worldwide. Hendrix
also said that “he” went to Africa regarding the deal, but it is unclear whether “he”
refers to Hendrix or to Hamilton. Hendrix stated that $85,000 was spent on the trip
“but the deal never went through.” Rashid made no statement in his PSI report
regarding Hamilton. Neither Hamilton nor any other witness testified at the
sentencing hearing about Hamilton’s transactions with Worldwide and Hendrix.
Under the victim statement portion of Hendrix’s PSI report, the probation officer
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who prepared the report noted that he had sent “multiple emails” to Hamilton but
“no response was received.”
The bank records admitted into evidence also showed that Rotter had wired
$50,000 to Worldwide in 2011. In his PSI statement, Hendrix explained that he did
not know Rotter but was aware that Rotter had “traveled with Alan Hoover to
Mexico” to meet with Rashid “to invest $50,000.” Hendrix said that he investigated
Rotter’s company and had learned that the company was “not earning enough to pay
their top salaries.” Hendrix indicated that meant a deal with Rotter would not be in
Worldwide’s best interest. Hendrix did not state whether a deal was reached with
Rotter but said that Rotter later paid Rashid another $2,000. Hendrix did not state
the reason for the payment. The probation officer preparing the PSI report noted that,
when contacted, Rotter said that he had already given a statement to a Fort Bend
County assistant district attorney. The report contained no information about the
content of the statement. Rashid’s PSI report contained no information about Rotter,
and Rotter did not testify at the sentencing hearing.
We agree with Rashid that the evidence was insufficient to show, by a
preponderance of the evidence, that Hamilton and Rotter suffered a loss as a direct
result of Rashid’s offense of engaging in criminal activity. Unlike Progressive
Minerals’s loss, the evidence regarding Hamilton’s and Rotter’s transactions did not
show that any losses incurred by Hamilton and Rotter were “but for” results of the
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offense. See id. While the evidence related to Progressive Minerals provided details
about the transaction between it and Global Empire regarding what had been
represented to Progressive Minerals regarding Global Empire’s financial stability,
the terms of the loan transaction, and the return of its commitment fee, no equivalent
evidence was presented regarding the business dealings between Hamilton or Rotter
and Rashid or his cohorts. And, because there was no evidence regarding the terms
of the business dealings, there was no evidence that Hamilton and Rotter expected a
return of any or all the funds they paid to Worldwide. Any award of restitution to
Hamilton or Rotter would be based on speculation that they suffered a loss as a direct
result of Rashid’s offense.
We conclude that the evidence did not support a determination by the trial
court that Hamilton and Rotter were victims of Rashid’s offense entitling them to
restitution under article 42.037(a).4 We hold that the trial court abused its discretion
4
As support for the restitution awards to Hamilton and Rotter, the State points to an
offense report from the Sugar Land Police Department found only in the clerk’s
record. The State represents that the offense report was offered as an exhibit at
Rashid’s plea hearing. The offense report bears a “State’s Exhibit 2” sticker on its
first page, but there is no indication that it was admitted into evidence at the plea
hearing. To the contrary, the reporter’s record from the plea hearing indicates that
State’s Exhibit 2 was a “Waiver of Appeal,” signed as part of his plea agreement.
The offense report was also not referenced or mentioned at the punishment hearing.
Cf. Heberling v. State, 834 S.W.2d 350, 356 (Tex. Crim. App. 1992) (holding that
evidence which, although not formally introduced is nevertheless treated by trial
court and parties as if it had been, may be considered on appeal as if admitted).
“When documents appear in the clerk’s record that have not been introduced in
evidence, they cannot be considered as part of the record.” Webber v. State, 21
S.W.3d 726, 731 (Tex. App.—Austin 2000, pet. ref’d) (citing Chambers v. State,
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when it ordered Rashid to make restitution to Hamilton and Rotter. Therefore, we
sustain the remainder of Rashid’s sole issue, and modify the judgment to delete the
award of restitution to Hamilton and to Rotter. See Burt, 445 S.W.3d 752, 757–58
(holding that deletion of written restitution order is appropriate either when trial
judge does not have statutory authority to impose specific restitution order or when
evidence does not show proximate cause between defendant’s criminal conduct and
victim’s injury); see also TEX. R. APP. P. 43.2(b) (providing that court of appeals
may “modify the trial court’s judgment and affirm it as modified”); Kelley v. State,
No. 03-19-00040-CR, 2021 WL 81691, at *7 (Tex. App.—Austin Jan. 8, 2021, no
pet.) (mem. op., not designated for publication) (deleting restitution award from trial
court’s judgment after holding that evidence was insufficient to support
determination that recipient of award was “victim” for restitution purposes).
194 S.W.2d 774, 775 (Tex. Crim. App. 1946); Watson v. State, 12 S.W. 404, 404–
05 (Tex. App. 1889)). Therefore, we do not consider the offense report in the
analysis of whether restitution was properly awarded in this case.
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Conclusion
We affirm the judgment of the trial court as modified.
Richard Hightower
Justice
Panel consists of Justices Goodman, Hightower, and Rivas-Molloy.
Do not publish. Tex. R. App. P. 47.2(b).
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