Date: 07-28-2014

Case Style: United States of America v. Maria M. Ullua

Case Number: 13-1577

Judge: McConnell

Court: United States Court of Appeals for the First Circuit on appeal from the District of New Hampshire

Plaintiff's Attorney: Seth R. Aframe, Assistant United States Attorney, with
whom John P. Kacavas, United States Attorney, was on brief, for
appellee.

Defendant's Attorney: Bjorn Lange, Federal Public Defender Office, for
appellant.

Description: A jury convicted Maria
Magdelena Ulloa of ten counts of submitting fraudulent federal tax
returns in violation of 18 U.S.C. § 287. On appeal, Ms. Ulloa
argues that the district court erred in three ways: by (i) finding
that the jury instruction preventing the jury from considering a
co-worker’s criminal conduct as propensity evidence under the
Federal Rules of Evidence Rule 404(b) was harmless error; (ii)
declining to strike the summary testimony of Internal Revenue
Service (“IRS”) Agent Tama Mitchell; and (iii) refusing to grant
Ms. Ulloa’s motion for acquittal on Count Eight pursuant to the
Federal Rules of Criminal Procedure Rule 29. Finding no reversible
error in the district court’s rulings, we affirm.
I. BACKGROUND
We recount the facts in the light most favorable to the
jury verdict, consistent with the court record below. United
States v. Noah, 130 F.3d 490, 493 (1st Cir. 1997).
Ms. Maria Magdelena Ulloa, owner of Main Travel in
Nashua, New Hampshire, provided services, including travel, as the
name suggests, as well as tax preparation and filing, the services
at issue in this case. It seems that Ms. Ulloa had a reputation
within the Nashua community for maximizing her customers’ refunds
by embellishing certain details. Many witnesses testified at her
trial that they began using Main Travel’s services because they
heard that Ms. Ulloa could prepare returns claiming fictitious
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dependents and day care costs. On some occasions, she included
this information on tax returns with the customers’ knowledge, but
sometimes they were not aware. In all cases, Ms. Ulloa would
prepare these false returns, file them with the IRS, and take a
fee. That fee came in several different forms.
Ms. Ulloa’s tax preparation business partnered with Santa
Barbara Bank and Trust (“SBBT”) to establish a refund anticipation
loan program so that Main Travel customers could be given expedited
tax refunds in the amount anticipated in the form of a loan.
Ms. Ulloa would electronically file the individual’s tax return
with the IRS and simultaneously, SBBT would receive the refund
anticipation loan application. Ms. Ulloa would either pay a
reduced refund up front to the customer and then fraudulently
endorse the bank loan check to Main Travel or demand cash payment
from the customer who later received a refund directly from the
IRS.
The thrust of Ms. Ulloa’s defense was to blame a Main
Travel employee, Gladys Pena, for all of the fraudulent activity at
Main Travel. Ms. Ulloa employed Ms. Pena at Main Travel from
January until June of 2007. Prior to working with Ms. Ulloa,
Ms. Pena and her two children lived with Ms. Ulloa. Ms. Pena had
a prior criminal conviction for fraud and served a ninety-day
prison term for that offense. While employed at Main Travel,
Ms. Pena learned that Ms. Ulloa was falsifying tax returns and
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began to do the same. At Ms. Ulloa’s direction, Ms. Pena forged a
customer’s name on a refund anticipation loan check for Ms. Ulloa
to deposit in her own bank account. Ms. Pena had access to
Ms. Ulloa’s bank accounts.
Meanwhile, Ms. Pena also filed fraudulent tax returns on
behalf of Main Travel customers without Ms. Ulloa’s knowledge. She
concealed her activity and deposited the ill-gotten gains in her
own bank accounts. While Ms. Pena was away in the Dominican
Republic in June of 2007, Ms. Ulloa discovered her crimes.
Ms. Pena never returned to Main Travel. Ms. Pena ultimately pled
guilty to charges arising from her employment at Main Travel, but
testified that she was not responsible for filing any of the
returns for which Ms. Ulloa was charged.
Ms. Ulloa was tried on ten counts of presenting false tax
returns to the IRS for the 2006 and 2007 tax years. Following a
five-day trial, the jury convicted Ms. Ulloa on all counts.
Ms. Ulloa was sentenced to 21 months in prison. She has timely
appealed to this court.
II. ANALYSIS
Ms. Ulloa argues that the district court committed three
errors at trial that are fatal to her convictions.
A. THE RULE 404(B) JURY INSTRUCTION
At trial, both the Government and Ms. Ulloa’s counsel
asked Ms. Pena about the other fraud-based crimes that she
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committed before and after her employment at Main Travel. During
the trial, the district court declined to give the propensity
instruction that Ms. Ulloa proposed. Instead, the district court
instructed the jury that it could not infer based on the evidence
of Ms. Pena’s other crimes that she had a propensity to commit the
crimes of which Ms. Ulloa was charged, but that it could consider
Ms. Pena’s prior criminal acts on the issue of opportunity or
identity. However, upon reconsideration, after the trial and
verdict against Ms. Ulloa, the district court found that it had
erred in limiting the jury’s consideration of and ability to infer
a propensity to commit fraud based on Ms. Pena’s other crimes.
Citing this court’s prior decisions, the district court concluded
that the jury should not have been limited in its consideration of
Ms. Pena’s other crimes. See United States v. David, 940 F.2d 722,
736 (1st Cir. 1991) (“Objections based on Rule 404(b) may be raised
only by the person whose ‘other crimes, wrongs, or acts’ are
attempted to be revealed.” (citation omitted)); United States v.
Gonzalez-Sanchez, 825 F.2d 572, 583 (1st Cir. 1987) (“Rule 404(b)
does not exclude evidence of prior crimes of persons other than the
defendant.”); see also United States v. Procopio, 88 F.3d 21, 29
n.1 (1st Cir. 1996); United States v. Isabel, 945 F.2d 1193, 1200
(1st Cir. 1991). The district court determined that its error was
“not of constitutional dimension,” however, and undertook to
analyze the effect of the error under a conventional harmless error
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standard. Reflecting on the record as a whole, the district court
determined that the error was harmless.
On appeal, Ms. Ulloa challenges the district court’s
denial of her request for an instruction to the jury that it could
consider Ms. Pena’s prior criminal acts as evidence of her
(Ms. Pena’s) propensity to commit crimes of fraud. Ms. Ulloa
agrees with the district court that it erred in its instruction,
but urges that the error was not harmless as it found. She adds
that because the jury was not permitted to consider Ms. Pena’s
other, similar crimes, for the purpose of showing propensity to
have committed these crimes, the error violated her constitutional
right to present a complete defense and thus was of constitutional
dimension. Therefore, the district court should have applied a
more stringent standard, requiring the Government to prove beyond
a reasonable doubt that the error did not influence the verdict.
The Government, on the other hand, argues that the district court’s
reliance on the above cases was misplaced and therefore, it did not
err in instructing the jury on Rule 404(b). Alternatively, the
Government argues that if the district court did err, then its
analysis under the harmless error standard was appropriate as was
its conclusion of harmless error. For purposes of this appeal,
this court will assume without deciding that the district court was
correct in concluding that the jury instruction it gave on Rule
404(b) evidence was in error. Beyond that assumption, we must
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consider whether the assumed error is of constitutional magnitude.
After all,
[t]here are two standards for measuring harmless error in
a criminal case. The less grueling standard (viewed from
the government’s coign of vantage) allows a conviction to
stand as long as a reviewing court can say with fair
assurance, after pondering all that happened without
stripping the erroneous action from the whole, that the
judgment was not substantially swayed by the error. This
less grueling standard applies chiefly to errors of a
non-constitutional dimension. The stricter standard,
which applies to errors of constitutional dimension,
requires reversal unless the government proves beyond a
reasonable doubt that the error did not influence the
verdict.
United States v. Melvin, 730 F.3d 29, 39 (1st Cir. 2013) (internal
quotation marks and citations omitted).
While the opportunity to present a complete defense is
constitutionally guaranteed, see Holmes v. South Carolina, 547 U.S.
319, 324 (2006), this court finds that the district court’s
erroneous jury instruction on propensity did not abridge
Ms. Ulloa’s right to present a complete defense. While it did
restrict the jury’s consideration of Ms. Pena’s propensity, it did
not prevent Ms. Ulloa from introducing copious amounts of evidence
of Ms. Pena’s similar fraudulent acts. She did introduce that
evidence and the district court instructed the jury that it could
consider it in “deciding whether Pena had an opportunity to commit
the acts of which the defendant is accused, as well as the identity
of the person who committed the offenses.” United States v. Ulloa,
942 F. Supp. 2d 202, 209 (D.N.H. 2013). As the district court
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found below, Ms. Ulloa was able to defend herself by arguing to the
jury that Ms. Pena was the person who committed the fraudulent acts
despite the legally incorrect instruction. Therefore, she was not
deprived of her defense and the instruction was not an error of
constitutional dimension meriting review under the harmless beyond
a reasonable doubt standard.
Using the less stringent harmless-error standard, the
district court determined that Ms. Ulloa’s convictions should stand
because the jury heard about Ms. Pena’s convictions for similar
conduct and was told that “evidence of Pena’s prior conduct was
relevant to the identity of the person who committed the offenses
of which Ulloa was accused, and that it was entitled to take that
evidence into account when considering whether Ulloa was in fact
the person who committed those offenses.” Ulloa, 942 F. Supp. 2d
at 209. In other words, the jury was instructed that it could
consider the evidence to determine whether it was Ms. Pena, not
Ms. Ulloa, who committed the charged crimes.
Obviously, because Ms. Ulloa argued at the outset that
the error was of a constitutional dimension, she believes that it
would also fail under the conventional harmless error analysis
based on the same defense that Ms. Pena committed the fraudulent
acts, not her. She asserts that the jury instruction limited the
efficacy of her defense. The district court found that Ms. Ulloa
did in fact defend herself by blaming Ms. Pena and therefore, the
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incorrect jury instruction had no effect on the verdict and was a
harmless error.
This court agrees with the district court. Ms. Ulloa
defended herself by turning the focus on Ms. Pena’s prior criminal
conduct and the limiting instruction did not prevent her from doing
just that. The jury heard Ms. Pena testify that she used
Ms. Ulloa’s debit card for electronic fund transfers. Ms. Pena
also testified that she fabricated thousands of dollars of checks,
forged signatures, and deposited the money in fake accounts that
she later withdrew. Moreover, the other evidence against Ms. Ulloa
was overwhelming, diffusing the impact of the erroneous
instruction. See United States v. Pridgen, 518 F.3d 87, 92-93 (1st
Cir. 2008). Eight of her customers testified that they dealt with
her directly, contradicting her defense that it was Ms. Pena who
committed those frauds. In light of the fact that the instructions
permitted the jury to consider Ms. Pena’s prior criminal conduct as
evidence that she could have committed, and had the opportunity to
commit, the fraudulent acts that Ms. Ulloa was accused of, the
limitation of the jury’s consideration on propensity was
insignificant and would not have substantially swayed the verdict.
The district court recognized its error and determined
that it did not impact the verdict in light of the trial record as
a whole. The bottom line is that we see no reversible error here.
Ms. Ulloa’s convictions should stand.
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B. SUMMARY TESTIMONY OF IRS AGENT TAMA MITCHELL
Ms. Ulloa next argues that the district court erred in
declining to strike the summary testimony of IRS Agent Tama
Mitchell. Agent Mitchell testified that the Count Three and Count
Seven taxpayers each paid a portion of their IRS refund money to
Ms. Ulloa. She moved to strike the testimony as beyond the scope
of a summary witness because it was beyond Agent Mitchell’s
personal knowledge. The district court denied the motion.
On appeal, Ms. Ulloa argues that Agent Mitchell’s
testimony relied on inadmissable hearsay and put the imprimatur of
the Government on the testimony of two witnesses who were motivated
to curry favor with the Government based on their immigration
status. The Government counters that Agent Mitchell merely
summarized the testimonial evidence from the taxpayers in order to
show that the money was deposited into Ms. Ulloa’s account. We
review a trial court’s decision to admit or exclude evidence for
abuse of discretion. See United States v. Maldonado–Garcia, 446
F.3d 227, 231 (1st Cir. 2006).
The district court did not abuse its discretion in
declining to strike the agent’s brief, summary testimony. This
court has found in the past that allowing an IRS agent to testify
summarily is useful in tax cases as long as the testimony “does no
more than analyze facts already introduced into evidence” and “the
witness does not directly address the ultimate question” in the
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case. See United States v. Stierhoff, 549 F.3d 19, 28 (1st Cir.
2008)(tax evasion). Agent Mitchell’s testimony fits within the
confines of that rule. The jury heard the same testimony from the
taxpayers themselves. Agent Mitchell merely summarized the money
trail for each fraudulent refund, using the taxpayers’ own
testimony. Ms. Ulloa has not raised, and nothing in the record
demonstrates, that Agent Mitchell expressed an opinion on whether
Ms. Ulloa intended to file false tax returns. See id. This point
of error is rejected.
C. SUFFICIENCY OF THE EVIDENCE ON COUNT EIGHT
Ms. Ulloa’s final argument on appeal is that the district
court erred in denying her motion for a judgment of acquittal on
Count Eight pursuant to Federal Rules of Criminal Procedure Rule
29. Count Eight involved a tax return filed on behalf of George
Melo, who testified that he met with “Magdelena” at Main Travel and
gave her the names of dependent children he wanted to claim on his
taxes. Because Mr. Melo never specifically identified Ms. Ulloa as
the “Magdelena” he met with at Main Travel, Ms. Ulloa asserts that
the Government did not prove beyond a reasonable doubt that she
committed that fraud. The Government counters that Ms. Ulloa was
undoubtedly “Magdelena” because that is her middle name. It also
points out that the jury could infer that Mr. Melo did meet with
Ms. Ulloa because he testified that he specifically went to
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Ms. Ulloa’s business because he heard from others that she could
falsify his tax return.
In order to prove a tax fraud violation under 18 U.S.C §
287, the Government had to demonstrate that Ms. Ulloa knowingly
made and presented false, fictitious, and fraudulent claims to the
IRS. We consider an appeal from the denial of a Rule 29 motion de
novo. See United States v. Santos-Rivera, 726 F.3d 17, 23 (1st
Cir. 2013). Specifically,
we examine the evidence, both direct and circumstantial,
in the light most favorable to the jury’s verdict. We
do not assess the credibility of a witness, as that is
a role reserved for the jury. Nor need we be convinced
that the government succeeded in eliminating every
possible theory consistent with the defendant's
innocence. Rather, we must decide whether that
evidence, including all plausible inferences drawn
therefrom, would allow a rational factfinder to conclude
beyond a reasonable doubt that the defendant committed
the charged crime.
United States v. Troy, 583 F.3d 20, 24 (1st Cir. 2009) (citations
and internal quotation marks omitted).
The evidence in this case was overwhelming such that a
rational jury could conclude beyond a reasonable doubt that
Ms. Ulloa committed the fraud charged in Count Eight. Mr. Melo
testified that he worked on his 2006 tax return together with
Magdelena at her office at Main Travel. Magdelena is Ms. Ulloa’s
middle name. The jury could reasonably have found that Ms. Ulloa
was the person at Main Travel with whom Mr. Melo met and prepared
false tax returns. This a reasonable conclusion since Mr. Melo
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testified that he sought out Ms. Ulloa’s business upon the
recommendation of others that Ms. Ulloa could falsify the child
care and dependent information on his tax return. He repeatedly
answered questions at trial that referenced his meetings and
discussions with Ms. Ulloa about claiming deductions for dependent
children who did not live with him. These two facts alone, in the
context of this entire case, would be sufficient to ground an
inference that Ms. Ulloa knowingly made fraudulent claims to the
IRS on Mr. Melo’s behalf, but there is more. The evidence also
established that Mr. Melo gave Ms. Ulloa the information she needed
to complete the fraudulent forms, that she processed the return,
and he received the money in the form of a refund anticipation loan
from the bank. All of these facts are more than sufficient to
support the jury’s verdict on Count Eight; Ms. Ulloa knowingly
presented false, fictitious, and fraudulent claims to the IRS.

Outcome: We see no error in the district court’s analysis of the
effect of the erroneous jury instruction or IRS Agent Mitchell’s
testimony. Further, the record supports the jury’s verdict against
Ms. Ulloa as to each claim, including Count Eight.

Affirmed.

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