Siriwan Update

7/30/2019 Siriwan Update

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ANDR BIROTTE JR.United States AttorneyROBBERT E. DUGDALE

Assistant United States AttorneyChief, Criminal DivisionJONATHAN E. LOPEZ (SBN 210513)

Deputy Chief, Asset Forfeitureand Money Laundering SectionCriminal DivisionUnited States Dept. of Justice

1400 New York Ave, N.W.Bond Building, Room 2200Washington, D.C. 20005Telephone: (202) 307-0846Facsimile: (202) 616-2547Email: [email protected]

Attorneys for PlaintiffUNITED STATES OF AMERICA

UNITED STATES DISTRICT COURT

FOR THE CENTRAL DISTRICT OF CALIFORNIA

WESTERN DIVISION

UNITED STATES OF AMERICA,

Plaintiff,

v.

JUTHAMAS SIRIWAN,aka the Governor, and

JITTISOPA SIRIWAN,aka Jib,

Defendants.

)))))))))))))

CR No. 09-81-GW

GOVERNMENT'S SECOND SUPPLEMENTALBRIEF IN OPPOSITION TODEFENDANTS MOTION TO DISMISS RE:INTENT TO PROMOTE AND ORGANICJURISDICTION

Hearing Date: November 29, 2012Hearing Time: 8:30 a.m.

______________________________)

Plaintiff United States of America, through its counsel of

record, hereby submits its second supplemental brief to theCourt. The governments second supplemental brief is based upon

the attached memorandum of points and authorities, the files and

records in this matter, including, the governments Response in

opposition to defendants motion to dismiss the Indictment (DE

Case 2:09-cr-00081-GW Document 96 Filed 11/15/12 Page 1 of 16 Page ID #:1217


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67) and the governments subsequent filings, as well as any

evidence or argument presented at any hearing on this matter.

DATED: November 15, 2012 Respectfully submitted,

ANDR BIROTTE JR.United States Attorney

ROBERT E. DUGDALEAssistant United States AttorneyChief, Criminal Division

JAIKUMAR RAMASWAMYChief, Asset Forfeitureand Money Laundering SectionCriminal DivisionUnited States Dept. of Justice

/s/JONATHAN E. LOPEZDeputy Chief, Asset Forfeitureand Money Laundering SectionCriminal DivisionUnited States Dept. of Justice


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MEMORANDUM OF POINTS AND AUTHORITIES

The government files this supplemental briefing to further

brief the Court with respect to the pending extradition request

and certain defense arguments in advance of the scheduled hearingon defendants Motion to Dismiss on November 29, 2012.

Specifically, this filing will (1) update the Court on the status

of the governments extradition request; (2) provide additional

briefing relating to charging a foreign official with a money

laundering offense with the FCPA as one of the specified unlawful

activities; and (3) inform the Court of two recent cases relating

to defendants jurisdictional arguments.

A. Status of Extradition Request

On November 14th, the undersigned received, via the United

States Department of State, a letter from Mr. Thavorn Panichpant,

Acting Attorney General of Thailand, dated November 9, 2012,

stating, in part:

Currently, we are in the process of gathering furtherevidences before completing the investigation in order tobring both offenders to court to be formally charged.Hence, we must postpone the extradition process of bothpersons as requested by the U.S. Government...

(emphasis added). The above letter and translation into

English1, is attached hereto as Exhibit A.

It is the governments position that the above response does

not constitute a denial of the governments extradition requestor an assertion of sole jurisdiction over this matter. Attached

as Exhibit B is a letter from the Department of State confirming

1 The English translation was completed by a United StatesEmbassy employee in Thailand.

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the same. As stated in previous filings, while Thailand has

chosen to investigate its own domestic law-based charges in the

first instance, prosecution by a foreign sovereign does not

preclude the United States from bringing criminal charges.2

Regardless of Thailands response, as argued previously, and

as touched upon in Part C of this filing, reliance on

international law in this case is improper as Congress has

expressed a clear extraterritorial intent for extraterritorial

jurisdiction pursuant to 18 U.S.C. 1956(f). Where the statute

is clear as to Congresss intent, then Article III courts . . .

must enforce the intent of Congress irrespective of whether the

statute conforms to customary international law.3 The

government incorporates by reference its previous arguments on

this issue. See DE 67 at 35-36; DE 84 at 9-13.

B. Congressional Intent With Regard to the FCPA and theProsecution of Foreign Officials for Non-FCPA Crimes

One issue that appears to concern the Court is whether a

foreign official can be charged with money laundering with the

FCPA as a specified unlawful activity, when the foreign official

cannot be charged with a violation of the FCPA or conspiracy to

violate the FCPA.4 The basis of the Courts concern seems to

rely on United States v. Castle, 925 F.2d 831 (5th Cir. 1991).

As discussed further below, the Castle opinion is based on a

2 United States v. Richardson, 580 F.2d 946, 947 (9th Cir.1975).

3 United States v. Yousef, 327 F.3d 56, 92 (2nd. Cir. 2003).

4 Defendants arguments in this area do not apply todefendant Jittisopa Siriwan.

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legal principle that only applies to conspiracies and their

relation to underlying substantive charges - in Castle the FCPA.

As such, the holding in Castle limiting conspiracy FCPA

prosecutions does not extend to the separate and distinctoffenses - such as of money laundering. In addition, in passing

the FCPA, there was no Congressional intent to prevent foreign

officials from being prosecuted in any situation that touched on

bribery. The international promotion money laundering charges

set forth in the indictment are entirely consistent with both

Castle and Congress intent.

1. The Castle Opinion is Application of the GebardiPrinciple and Therefore Necessarily Limited toFCPA Conspiracy Offenses

The Castle opinion is predicated on the Supreme Court case

Gebardi v. United States, 287 U.S. 112 (1932), which held that if

an agreement needs to be proved to form the substantive

prosecution (but one party is exempt from prosecution for the

substantive offense), the government cannot then charge that same

agreement again in a conspiracy prosecution. This became known

as the Gebardi principle.

Specifically, in Gebardi, the Supreme Court analyzed the

Mann Act which criminalizes the transportation of a woman across

state lines for immoral purposes. The Mann Act criminalized the

conduct of the transporter, but not the conduct of the womanherself.5 The Supreme Court held that because a woman who agrees

to participate in a Mann Act violation is exempt from

5 Id. at 118; 18 U.S.C. 398.

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prosecution, the same agreement cannot form the basis of a

conspiracy charge.6

The court in Castle applied the Gebardi principle to the

FCPA and found that Congress intended in the FCPA to deter andpunish certain activities which necessarily involved the

agreement of at least two people, but Congress chose . . . to

punish only one party to the agreement.7 Because foreign

officials, to participate in a bribery scheme, would have to

agree to the bribes and because a conspiracy to violate the FCPA

would prosecute that same agreement, Castle held that foreign

officials exemption from the FCPA prosecution also exempted them

from conspiracy prosecution.

While the Gebardi principle, relied on in Castle, applies to

conspiracy charges relating to the underlying substantive

offense, it cannot be extended or applied to separate substantive

offenses, such as money laundering, which have their own distinct

elements beyond merely an agreement.8 The government has not

found, nor has defendant cited, any precedent to the contrary.

Like Castle, the court in United States v. Bodmer, 342

F.Supp. 2d 176 (S.D.N.Y. 2004) applied the Gebardi principle in

prohibiting the prosecution of an FCPA exempt individual for

conspiracy to violate the FCPA. In Bodmer, the defendant was

charged with conspiracy to violate the FCPA and money laundering

6 Id. at 123.

7 Castle, 925 F.2d at 833 (emphasis added).

8 For example, FCPA violations do not require financialtransaction involving the United States, as money launderingviolations do.

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conspiracy. Bodmer was not a foreign official but a foreign

national agent who, like foreign officials, could not be

prosecuted criminally under FCPA as it existed at the time of his

offenses.9

While Bodmer held that Gebardi applied to the FCPAconspiracy charge, Bodmer further held that Gebardi did not

extend to the money laundering charge. Unlike conspiracy

charges, which involve precisely the same conduct, Bodmer

explained that [t]he elements of a money laundering offense do

not include, or even implicate, the capacity to commit the

underlying unlawful activity.10 Thereason that Bodmer did not

dismiss the money laundering charge was that Gebardiapplies does

not apply to separate substantive offenses such as money

laundering. Indeed, the court in Bodmer stated that no court

has ever applied the Gebardi principle to dismiss a charge of

conspiracy to launder money.11

2. Legislative history concerning foreign officials

In previous arguments before the Court there have been

several references to the nature of the FCPAs legislative

history concerning foreign officials. Simply put, there is no

legislative history explaining Congress intention not to have

foreign officials prosecuted under the FCPA. Indeed, the FCPA

only exempts foreign officials from prosecution by implication of

the FCPAs structure. There are no statements by Congressconcerning its intent that bribe receiving foreign officials

9 Id. at 181.

10 Id. at 190-91.

11 Id. at 190 n. 15.

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should not be prosecuted. The elements of the FCPA only apply to

the bribe-giving side of a corrupt transaction, which is why

foreign officials are exempt. Therefore, although Congress was

clear that foreign officials could not be prosecuted under theFCPA, it did not give an explanation, and this Court should not

assume that Congress reasoning would apply to any other statute.

In addition, in the FCPAs legislative history, Congress was

necessarily silent on the subject of money laundering as money

laundering was not a federal offense until nine years later.

Congress could not have expressed an intent to prevent

prosecution of foreign officials from a category of crime that

had yet to exist.

Because substantive offenses are necessarily different from

each other, in construing them it is important to look at each

statutes own legislative history. Indeed, the money laundering

statutes were passed by Congress to achieve different purposes

than the FCPA. Of particularly relevance here, in 2001, Congress

passed 315 of the Patriot Act, 18 U.S.C. 1956(c)(6)(B)(iv),

that included as specified unlawful activity a variety of

offenses against a foreign nation including bribery of a

public official. In passing this provision, Senator Kerry

explained,

By expanding the definition of Specified UnlawfulActivity to include a wide range of offenses . . . weare confirming that our money laundering statutesprohibit anyone from using the United States as aplatform to commit money laundering offenses againstforeign jurisdictions in whatever form that they occur.It should be clear that our intention that the moneylaundering statutes of the United States are intended

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to insure that all criminals and terrorists cannotcircumvent our laws.12

A foreign bribery violation necessarily involves a foreign

official, and Congress was emphatic that the money laundering

statutes reach as broadly as possible.

In addition, Congress has subsequently expressed its support

of money laundering prosecutions against foreign officials.

Congress described the inclusion of foreign bribery as a

specified unlawful activity as having, for the first time, made

the knowing acceptance of foreign corruption proceeds a money

laundering offense.13 Congress further explained that this

provision was one component of the anti-corruption battle

against politically powerful foreign officials, their relatives,

and close associates [who] utilize U.S. financial institutions to

conceal, transfer, and spend funds suspected to be the proceeds

of corruption.14

As a consequence, it is clear that Congress intended that

money laundering offenses be permitted against foreign officials

who accept bribes in violation of foreign bribery law and use

U.S. financial institutions in doing so. It would be

12 Proceedings and Debates, USA Patriot Act of 2001, 147Cong. Rec. S10990-02 (Oct. 25, 2001), 2001 WL 1297566 (emphasisadded).

13 United States Senate Permanent Subcommittee onInvestigations, Committee on Homeland Security and Governmental

Affairs, Majority and Minority Staff Report, Keeping ForeignCorruption Out of the United States: Four Case Histories at 9 (Feb.4, 2010) available athttp://www.hsgac.senate.gov/subcommittees/investigations/hearings(emphasis added).

14 Id.

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inconsistent for Congress to intend to make these same bribe-

receiving foreign officials exempt from prosecution for money

laundering offenses predicated on the separate specified unlawful

activity of violation of the FCPA.3. Precedent for Prosecution of Foreign Officials for

Non-FCPA Crimes

There is binding precedent in the Ninth Circuit that foreign

officials who accept bribes are not exempt from money laundering

prosecutions where the underlying specified unlawful activity is

akin to foreign bribery, despite the FCPAs exemption. In United

States v. Lazarenko, Lazarenko was extremely powerful as the

governor of the Dnepropetrovsk region of the Ukraine and

required businesses to pay him fifty percent of their profits in

exchange for his influence to make the businesses successful.

564 F.3d 1026, 1030 (9th Cir. 2009). Lazarenko was charged with,

among other offenses, money laundering with extortion as a

specified unlawful activity. Id. at 1038.

Because the extortion was the equivalent of international

bribery, Lazarenko argued that he was exempt from prosecution

under the money laundering laws as a foreign official on the

receiving end of a bribe, as the FCPA exempted that class of

offenders from prosecution.15 The Ninth Circuit, acknowledging

the FCPAs exemption of foreign officials, the holding in Castle,

and the resemblance of Lazarenkos actions to bribery,

15 Lazarenko, 564 F.3d at 1038; Def. Br. 2007 WL 2302047.Notably, both Lazarenko and the Ninth Circuit appear to acknowledgethat, after the Patriot Act was passed in 2001, foreign officialswho engage in transactions involving proceeds of foreign corruptionare squarely liable under the money laundering statutes. Id.

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nonetheless rejected this argument. Id. In sum, Lazarenko (like

defendant Juthamas Siriwan) could not have been prosecuted under

the FCPA or for conspiring to violate the FCPA but could be

prosecuted for money laundering.Other precedent for prosecution of foreign officials in

bribery cases includes three cases from the Southern District of

Florida. There, three money laundering prosecutions have been

successfully brought against former foreign officials relating to

international bribery schemes where they accepted bribes. In

United States v. Antoine, and United Sates v. Joseph, the

defendants pleaded guilty to one count of a money laundering

conspiracy where the specified unlawful activities were violation

of the FCPA, violation of Haitian bribery law, and wire fraud.16

In United States v. Duperval, the defendant was tried and

convicted on two counts of money laundering conspiracy and 19

counts of money laundering where the specified unlawful

activities were violation of the FCPA, violation of Haitian

bribery law, and wire fraud.17 In all three cases, no challenge

was made by the former foreign officials that they were exempt

from prosecution of the money laundering charges against them

because, as foreign officials, they could not be prosecuted under

the FCPA.

16 See Plea Agreement, United States v. Antoine, No. 09-cr-21010, DE No. 135 (S.D. Fla. Mar. 12, 2010); Plea Agreement, UnitedStates v. Joseph, No. 09-cr-21010, DE No. 706 (S.D. Fla. Feb. 8,2012).

17 See Verdict, United States v. Duperval, No. 09-cr-21010,DE No. 757 (S.D. Fla. Mar. 13, 2012).

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In addition, two foreign officials have pleaded guilty to

FCPA charges where they acted as intermediaries for bribes to

other foreign officials.18 Neither raised any challenge based on

an argument that foreign officials were categorically exemptedfrom FCPA prosecution. These cases demonstrate an important

point: Although receipt of an international bribe by a foreign

official may not violate U.S. law, other, related conduct such as

serving as an intermediary for the bribe (or, as we argue,

laundering the bribe proceeds) can still be prosecuted.

C. 1956(f) is the Appropriate Jurisdictional Statute

The government brings to the Courts attention two recent

cases relating to defendants jurisdictional arguments that 18

U.S.C. 1956(b)(2)(A) is the appropriate jurisdictional statute:

United States v. Kuok,671 F.3d 931 (9th Cir. 2012) and United

States v. Galvis-Pena, 2012 WL 425240 (N.D. Ga. Feb. 9, 2012).

Both of the above cases cite to and interpret 1956(f) as the

appropriate extraterritorial jurisdictional statute in criminal

money laundering violations even in situations where 1956(h)

(conspiracy) and 18 U.S.C. 2 are alleged. As these cases

illustrate, and as argued previously, the jurisdiction in this

case is proper and Section 1956(b)(2)(A) is irrelevant to the

criminal money laundering jurisdictional discussion.

In Kuok, the defendant, who is a citizen of Macau, wasindicted for conspiracy and substantive violations of arms export

control violations, as well as with international promotion money

18 See Plea Agreement, United States v. Basu, No. 02-cr-475(D.D.C. Dec. 17, 2002); Plea Agreement, United States v. Sengupta,No. 02-cr-40 (D.D.C. Jan. 30, 2002).

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laundering pursuant to both 1956(a)(2)(A) and 18 U.S.C. 2

(Count 4 of Indictment) in connection with transmitting funds

with the intent of carrying on the smuggling and export offenses

charged under the export control act (Counts 2 and 3 of theIndictment). Kuoks conduct, as it relates to the international

promotion money laundering offense, was that of arranging for a

wire transfer from outside of the United States of $5,400 into

the United States for the purchase of a prohibited encryptor.

The funds were subsequently picked up in San Diego by an

undercover law enforcement agent.

The defendant in Kuok challenged the governments

jurisdictional authority pursuant to the monetary requirement of

1956(f) - which requires that at least $10,000 in funds be

transmitted. The Ninth Circuit analyzed the jurisdictional

impact of 1956(f) (not 1956(b)(2)(A)) and found that while

the government established that relevant conduct had occurred, in

part, in the United States (due to Kuoks arranging of the wire

transfer into San Diego), the monetary threshold had not been met

and vacated the money laundering conviction. Id. at 940.

In Galvis-Pena, the defendant was charged violations of

conspiracy pursuant to 1956(h), money laundering pursuant to

1956(a) and aiding and abetting pursuant to 2. Defendant

Galvis-Pena argued that the court lacked jurisdiction under 1956(f) because his conduct occurred outside the United States

and that there was no evidence that he personally made any

transfers into or out of accounts in the United States. Id. at

*2-3. The court in Galvis-Pena first found that 1956(f)

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provides for extraterritorial jurisdiction over 1956(a) cases,

including in cases where conspiracy ( 1956(h)) and aiding and

abetting ( 2) are also charged.19 The court then stated that

with respect to the substantive money laundering counts, whetherconduct occurred in part in the United States was a jurisdiction

defense intermeshed with questions going to the merits of the

case and should not be determined by pre-trail motion...indeed

such questions are for a jury to decide. Id. at *3-4.20

Importantly, the court noted that the above defense argument

only applies to the substantive offense of money laundering, and

not the conspiracy or aiding and abetting charges. Even if

Galvis-Pena did not personally make transfers into or out of

accounts in the United States, he could be subject to the courts

jurisdiction for conspiring to do so or for aiding and abetting

others in doing so. Id. at 3.

The instant Indictment on its face establishes that conduct

occurred in the United States. Similar to defendant Kuok

defendants arranged for wire transfers out of the United States

into bank accounts all over the world.21 Defendants also set up

all of the overseas bank accounts to receive from the United

States (all in excess of $10,000).22 In addition, defendant

19 2012 WL 425240 at *2-3 (N.D. Ga. Feb. 9, 2012)(citingUnited States v. Belfast, 611 F.3d 783, 813 (11th Cir. 2010) andUnited States v. Yakou, 428 F.3d 241, 252 (D.C. Cir. 2005)).

20 The court also cited Fed. R. Crim. P. 12(B)(2) statingonly those defenses that the court can determine without a trial ofthe general issue may be raised by pretrial motion.

21 Indictment at 19,25, Overt Act #2.

22 Indictment at 18.

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Juthamas Siriwan, made several trips to the United States.23

Defendants attempts to claim that their actions do not

constitute conduct24 in the United States ignore well-

established case law. In the Ninth Circuit, for example, adefendant need only be aware of the transfers for 1956(a)(2)(A)

liability. Specifically in United States v. Moreland, 622 F.3d

1147, 1166-67 (9th Cir. 2010), a 1956(a)(2)(A) case, the court

held that the defendant was liable for the transfers because he

was behind the wires and controlled the accounts the money

was going into.25 Even assuming defendants take issue with the

above facts, pursuant to Galvis-Pena, the evidentiary issue of

conduct is for trial, not a pre-trial motion.

Most importantly, at no time in Kuok or Galvis-Pena, did the

court, the government, or defense in any way discuss or consider

the jurisdictional implications of 18 U.S.C. 1956(b)(2)(A),

defendants proffered jurisdictional statute. The reason for

this is simple, 1956(b)(2)(A) is not a criminal jurisdictional

limitation on 1956(f). Indeed, defendants have failed to cite

one criminal case, let alone a criminal case involving

1956(a)(2)(A), that supports their position that a major change

23 Indictment at 25. The government proffers that defendantJittisopa Siriwan also made several trips to the United States insupport of their scheme. Regardless, the ability of the governmentto prove that conduct occurred in the United States is a trialissue, not one relating to the sufficiency of the indictment.United States v. Buckley, 689 F.2d 893, 897-99 (9th Cir. 1982).

24 DE 87 at 12.

25 See also United States v. Gotti, 459 F.3d 296, 335 (2dCir. 2006)(person who accepts a transfer of cash participates inthe conclusion of the transfer, and therefore conducts thetransaction).

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in jurisdictional reach, limiting the power of the government,

occurred in 2001 with the enactment of the penalty provisions of

1956(b)(2)(A). As set forth in Kuok, Bodmer, Galvis-Pena, and

every case that has looked at criminal extraterritorialjurisdiction, 1956(f), not 1956(b)(2)(A), is the appropriate

jurisdictional statute and defendants jurisdictional claims and

arguments stemming from those claims, should be denied.

This Court should DENY defendants Motion to Dismiss.

DATED: November 15, 2012 Respectfully submitted,

ANDR BIROTTE JR.

United States Attorney

ROBERT E. DUGDALEAssistant United States AttorneyChief, Criminal Division

JAIKUMAR RAMASWAMYChief, Asset Forfeitureand Money Laundering Section

United States Dept. of Justice

/s/JONATHAN E. LOPEZDeputy Chief, Asset Forfeitureand Money Laundering SectionCriminal DivisionUnited States Dept. of Justice


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Siriwan Update