## Facts

- Four defendants promoted and operated “Wealth-Mart,” marketed as a Christian-oriented international investment program supposedly trading “prime bank”/“bank debenture” instruments in secret overseas markets.
- Investors were told their principal was guaranteed and that the program would generate extraordinarily high returns in a short time.
- The purported investment program did not exist; investor funds were not invested as promised and were instead diverted to defendants’ personal spending and other ventures.
- The scheme raised more than $14 million from investors.
- At trial, the government introduced extensive evidence of what defendants said at promotional seminars, including testimony by investors who used handwritten seminar notes as memory aids.

## Issues

1. Whether the evidence was sufficient to support convictions for conspiracy to commit wire fraud and related substantive counts (wire fraud, securities fraud, and money laundering).
2. Whether the district court committed reversible evidentiary or procedural error, including by admitting investors’ handwritten notes and related testimony about seminar statements.
3. Whether Dazey’s sentence violated the Sixth Amendment under *United States v. Booker* because it was increased based on judge-found facts under mandatory Sentencing Guidelines.

## Decision

- The Tenth Circuit affirmed the convictions of all defendants.
- The court rejected defendants’ evidentiary and procedural challenges, including objections to investors’ notes and testimony about seminar representations.
- The court affirmed Mathew’s sentence.
- The court vacated Dazey’s sentence and remanded for resentencing because the district court increased his Guidelines range based on judicial fact-finding under a mandatory Guidelines regime, and the error was not harmless.

## Legal Principles

- On sufficiency review, an appellate court views the evidence in the light most favorable to the government and asks whether any rational juror could find guilt beyond a reasonable doubt; the court does not reweigh credibility.
- Knowing participation in a fraudulent scheme may be inferred from coordinated promotional roles, promises of unrealistic returns and guarantees, continued solicitation despite warning signs, and diversion of investor funds from stated purposes.
- Trial testimony about what a witness personally heard is admissible based on personal knowledge; contemporaneous notes may be used to refresh recollection or qualify as recorded recollection when proper foundations are met, and erroneous admission may be harmless in an evidence-rich trial.
- Under *Booker*, it is constitutional error to increase a defendant’s sentence under mandatory Guidelines based on judge-found facts beyond what the jury verdict alone authorizes; resentencing is required when the error is not harmless.

## Conclusion

The Tenth Circuit upheld the defendants’ convictions arising from a fraudulent “prime bank” investment scheme and rejected claimed trial errors, but vacated Dazey’s sentence because mandatory-Guidelines enhancements based on judge-found facts constituted non-harmless *Booker* constitutional error requiring resentencing.


United States v. Dazey, 403 F.3d 1147 (10th Cir. 2005)