Conviction of eleven defendants, who were employees of the Puerto Rico Aqueducts and Sewer authority, arising from a scheme to embezzle and launder funds for a union health plan, is affirmed for the most part where: 1) based on the evidence, the Health Plan had sufficient supervision and control over the Health Plan contributions to establish that the funds embezzled were funds of a health care benefit program; 2) there was sufficient evidence to prove that the defendants acted without authority to receive the Health Plan funds; 3) evidence of defendants' knowledge and willfulness with respect to the embezzlement convictions was more than sufficient for the jury to conclude by proof beyond a reasonable doubt the element of criminal intent; 4) with respect to the Top Four defendants, the evidence was more than sufficient to support the money laundering convictions; 5) defendants' challenge to the district court's jury instructions are rejected, and any error was harmless; 6) district court did not abuse its discretion in refusing to sever mid-trial; 7) district court did not abuse its discretion when it declined to grant defendants a new trial based on an alleged misstatement made during the prosecution's closing argument; 8) district court did not abuse its discretion in declining to grant defendants a new trial based on their post-trial allegations of threats and harassment from testifying by other defendants; 9) district court did not err in assessing against each of the Top Four defendants an 18-level enhancement under the Sentencing Guidelines based on loss calculation as their extensive knowledge and control of the embezzlement scheme as a whole made the total amount each received foreseeable; 10) two of the defendants' challenges to their sentences are rejected as the sentences were reasonable; and 11) with respect to the Chapter President defendants, the money laundering convictions are reversed and remanded as conceded by the government.
Appeals from the United States District Court for the District of Puerto Rico
Decided October 20, 2009
Opinion by: Torruella, Circuit Judge
For Appellant: Linda Backiel, José R. Aguayo Caussade, Víctor P. Miranda Corrada, Rafael F. Castro-Lang, Anita Hill-Adames, Laura Maldonado-Rodríguez, Lydia Lizarribar, Francisco Dolz-Sánchez, Carlos E. Montañez, Miguel E. Miranda-Gutiérrez
For Appellee: Joseph F. Palmer, Stephan E. Oestreicher, Jr., Attorney, Appellate Section, Criminal Division, U.S. Department of Justice, Rosa E. Rodríguez-Vélez, United States Attorney, District of Puerto Rico, and José A. Ruiz-Santiago, Assistant United States Attorney, District of Puerto Rico