United States v. Diego Pineda Sanchez

NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with Fed. R. App. P. 32.1
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Argued August 7, 2019
Decided September 19, 2019
Before
DANIEL A. MANION, Circuit Judge
DIANE S. SYKES, Circuit Judge
AMY C. BARRETT, Circuit Judge
No. 18-3173
UNITED STATES OF AMERICA, Appeal from the United States District
Plaintiff-Appellee, Court for the Northern District of
Illinois, Eastern Division.
v.
No. 14 CR 539
DIEGO PINEDA-SANCHEZ,
Defendant-Appellant. Andrea R. Wood,
Judge.
ORDER
Diego Pineda-Sanchez pleaded guilty to conspiracy to commit money
laundering, 18 U.S.C. § 1956(h), and admitted that his offense involved $1.2 million in
drug proceeds. The district judge found, however, that Pineda-Sanchez was responsible
for laundering more than $61 million in proceeds from the United States to Mexico—a
sum that corresponded to a 22-level increase in offense level. See U.S.S.G.
§ 2B1.1(b)(1)(L). Based on several mitigating factors, the judge imposed a below-
guidelines sentence of 180 months in prison. Pineda-Sanchez appeals his sentence and
argues that the judge attributed the additional laundered funds to him based on
unreliable evidence—the testimony of a cooperating coconspirator and the postarrest
No. 18-3173 Page 2
interview of a codefendant. Because the judge’s consideration of this evidence was not
improper, we affirm.
I. Background
Pineda-Sanchez led a conspiracy to launder drug proceeds from Mexican-based
drug traffickers through the purchase and resale of gold. As set forth in his plea
agreement, Pineda-Sanchez directed cartel members, including codefendant Carlos
Parra-Pedroza, to collect and use drug proceeds to purchase scrap and fine gold from
pawnshops and jewelers. They then shipped the gold to large refineries in Florida and
California, and these refineries in turn wired the cash value to Parra-Pedroza and other
coconspirators in Mexico.
Pineda-Sanchez admitted responsibility for laundering $1,183,520 in drug
proceeds. This amount corresponds to a base offense level of 24. See U.S.S.G. §§ 2S1.1,
2B1.1(b)(1)(I). A two-level reduction for acceptance of responsibility would drop the
offense level to 22, see id. § 3E1.1(a), which together with his criminal-history category of
I would yield a guidelines range of 41 to 51 months. The government maintained,
however, that the total value of the laundered funds was much, much higher—
$100 million—a sum corresponding to a base offense level of 32, see id. §§ 2S1.1,
2B1.1(b)(1)(M), and a guidelines range exceeding the statutory maximum of 240 months
in prison, see 18 U.S.C. § 1956(a).
The district court held an evidentiary hearing to determine the amount of
laundered funds. A Homeland Security agent testified about his knowledge of the
operation based in part on his communications with a cooperating witness and his
participation in a codefendant’s postarrest interview. The agent had watched
coconspirator Juvenal Torres repeatedly drive to a residence in southwest Chicago, then
to jewelry stores, and then back to the residence, leaving with several shipping boxes.
Those boxes, the agent later discovered, were being sent to a gold-trading company in
South Florida called Golden Opportunities. The government introduced records
(obtained during the execution of an unrelated search warrant) showing that Golden
Opportunities received more than $98 million in gold from “Shopping Silver,” a
fictitious company name used by Parra-Pedroza.
After a year of surveillance, agents conducted a traffic stop of Torres and found
him with a large amount of drug proceeds. Some months later Torres was confronted
with evidence about his money-laundering activities, and at this point he agreed to
cooperate with the government. He described the operation, identified both Parra-
No. 18-3173 Page 3
Pedroza and Pineda-Sanchez, and explained their roles in the scheme. Torres estimated
that he had laundered $23 million as part of the operation.1 And to support the
government’s undercover investigation, he agreed to reestablish contact with Parra-
Pedroza, resume his role in receiving drug proceeds, purchasing gold, and sending it to
Golden Opportunities.
During the undercover investigation, Torres was directed by Pineda-Sanchez
and Parra-Pedroza to collect and launder at least $2.4 million that did not go through
Golden Opportunities. This sum included $1,484,789 that the government intercepted
from couriers attempting to bring money to Torres; $588,787 that agents wired to a bank
account at the direction of Pineda-Sanchez and Parra-Pedroza as part of the undercover
operation; and $322,116 in gold that Torres sent to another refinery, Barba International.
Agents eventually arrested Parra-Pedroza and questioned him. He told the
officers that Pineda-Sanchez had recruited him into the money-laundering conspiracy
in either 2010 or 2011. Parra-Pedroza estimated his role in the laundering operation at
$100 million. He said that he first laundered money for Pineda-Sanchez and another
individual, with Pineda-Sanchez generating most of his business. After July 2012,
however, he laundered money solely for Pineda-Sanchez. He also identified Pineda-
Sanchez as the operation’s main conduit to Mexican cartel members.
At sentencing the judge credited Parra-Pedroza’s postarrest statements, which
she deemed consistent with and corroborated by records and other testimony. She
found that Pineda-Sanchez was responsible for laundering approximately $61 million in
drug proceeds. In arriving at this figure, the judge first considered how much of the
$98 million laundered through Golden Opportunities was attributable to Pineda-
Sanchez. Based on Parra-Pedroza’s statement that Pineda-Sanchez generated most of
his business, the judge concluded that Pineda-Sanchez could be held accountable for
51% of the $81.3 million Golden Opportunities received from Shopping Silver prior to
July 2012—about $41 million. Golden Opportunities also received $17.5 million from
Shopping Silver after July 2012 when Parra-Pedroza worked exclusively with Pineda-
1 Torres testified at the evidentiary hearing that he pleaded guilty to laundering
$23 million. He explained that in exchange for his cooperation, the government agreed
to recommend a sentence 70% below the recommended guidelines range.
No. 18-3173 Page 4
Sanchez. Finally, the judge added the $2.4 million unrelated to Golden Opportunities
that Pineda-Sanchez and Parra-Pedroza had directed Torres to launder.
This $61 million figure correlated with a 22-level increase under the guidelines,
see U.S.S.G. § 2B1.1(b)(1)(L), boosting the base offense level to 30, see id. § 2S1.1(a). The
judge added another six levels because Pineda-Sanchez knew the laundered funds were
the proceeds of a drug crime, see id. § 2S1.1(b)(1)(B), four levels for a leadership role, see
id. § 3B1.1(a), and four levels for being in the business of laundering funds, see id.
§ 2S1.1(b)(2). She then subtracted two levels for acceptance of responsibility. See id.
§ 3E1.1(a). Based on the resulting offense level of 42 and a criminal history category of I,
the guidelines range was the statutory maximum of 240 months in prison. See 18 U.S.C.
§ 1956(a). The judge then noted that there were “many” mitigating factors in Pineda-
Sanchez’s favor, including his guilty plea, his family’s reliance on him for financial
support, his lack of involvement in any violence or threats of violence, and the absence
of any prior criminal history. She imposed a below guidelines sentence of 180 months.
II. Discussion
On appeal Pineda-Sanchez challenges the district court’s decision to hold him
responsible for $61 million of laundered funds. He first questions the judge’s decision to
credit Torres’s estimate that he laundered $23 million. This figure, he says, is unreliable
both because it is “an exceedingly difficult mathematical estimate” and because Torres
had an “obvious incentive to embellish the scope” of the money-laundering scheme to
curry favor with the government.
But the accuracy of Torres’s estimate is irrelevant because the judge did not rely
on it to reach the $61 million figure. Rather, roughly $58 million of the $61 million
estimate was based on records obtained during the execution of the search warrant at
Golden Opportunities. And the remaining $2.4 million did not come from Torres’s
estimate either—$1.5 million was seized by the government; the remainder was sent to
Barba International or wired to an international account.
To the extent Pineda-Sanchez contests the $2.4 million based on Torres’s
credibility, its inclusion in the $61 million calculation would not affect his guidelines
range. Pineda-Sanchez was subject to a 22-level increase in his base offense level
because the total amount of laundered funds was between $25 million and $65 million.
See U.S.S.G. § 2B1.1(b)(1)(L). Whether he was responsible for $58 million or $61 million,
his base offense level would remain the same. Thus, even if the judge should have
No. 18-3173 Page 5
ignored the $2.4 million, any mistake would be harmless. See United States v. Haywood,
777 F.3d 430, 433 (7th Cir. 2015).
Pineda-Sanchez also contends that the judge’s $61 million estimate is flawed
because she based her calculations on Parra-Pedroza’s unreliable postarrest statements.
Those statements were not credible, he maintains, because the agent who testified about
the interview did not speak Spanish—the language in which the interview was
primarily conducted—and could not have known whether Parra-Pedroza was telling
the truth. Pineda-Sanchez primarily relies on United States v. Palmer, 248 F.3d 569 (7th
Cir. 2001), where we vacated the defendant’s sentence because he pleaded guilty to
possessing a small amount (4.7 grams) of crack yet was held accountable for more than
150 grams. Id. at 570–71. We took issue with the sentencing judge’s reliance on
testimony from a U.S. Marshal that a third party (unavailable to testify in court) had
attributed 241 grams to the defendant. The judge noted that the particular transaction to
which the marshal testified was over two years old and that the judge made no
credibility finding regarding the one person who did have firsthand knowledge of the
incident. Id. at 571.
The circumstances warranting reversal in Palmer are not present here. Unlike
Palmer the judge here made an express credibility finding regarding the individual with
firsthand knowledge. She explicitly said that she was crediting Parra-Pedroza’s
statements because they were consistent and corroborated by other evidence. Nor did
the judge rely solely on the agent’s account of the conversation; she stated that she
reviewed all exhibits in the case, among them a video recording and transcript of Parra-
Pedroza’s interview. And to the extent the judge relied on the agent’s characterization,
his inability to speak Spanish is immaterial because a translator was present throughout
the interview. Pineda-Sanchez has not challenged the accuracy of the translation.
Finally, Pineda-Sanchez contends that he lacked a meaningful opportunity to
challenge Parra-Pedroza’s account of events. But a judge may consider evidence at
sentencing that would be inadmissible at trial, including hearsay. See United States v.
Ghiassi, 729 F.3d 690, 695 (7th Cir. 2013). In any event, it would not matter that Pineda-
Sanchez had no opportunity to challenge Parra-Pedroza because the Sixth
Amendment’s Confrontation Clause does not apply once guilt has been established. Id.
at 695–96. And Parra-Pedroza’s statements—corroborated by Torres’s testimony,
Pineda-Sanchez’s plea agreement, seized records, and recorded phone calls—bore a
No. 18-3173 Page 6
“sufficient indicia of reliability” for the judge to consider them. United States v. Mays,
593 F.3d 603, 608 (7th Cir. 2010).
AFFIRMED