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United States v. Ramirez

August 3, 2009


Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 1:06-cr-00809-5-John W. Darrah, Judge.

The opinion of the court was delivered by: Tinder, Circuit Judge.


Before MANION, ROVNER, and TINDER, Circuit Judges.

Beatricz Ramirez was charged with one count of wire fraud in violation of 18 U.S.C. § 1343. Following a jury trial, she was convicted. She was sentenced to a term of imprisonment of 18 months and ordered to pay restitution. Ramirez appealed her conviction, arguing that the district court erred by giving the jury an ostrich instruction and by refusing to include language stating that mere negligence did not support a finding of knowledge. For the following reasons, we affirm.


Luis Uribe was a successful mortgage broker for Freedom Mortgage in the Elgin, Illinois area. But his legitimate success was not good enough for him. So he devised a fraudulent mortgage scheme, using the identities of former clients with good credit to obtain mortgage financing for persons who could not qualify for mortgages and padding his wallet in the process. The scheme basically worked like this: A person with poor or no credit would find a house he or she wanted to buy, and Uribe used the name and identifiers of another person in negotiating the purchase contract and applying for financing. Sometimes the names and identifiers used were those of various individuals, including Jorge Itoralde, Griselda Sanchez, and Uribe's brother, Carlos, who agreed to sell their credit histories to non-qualifying buyers. On other occasions, Uribe used the names and identifiers he had stolen from former clients. Then he arranged for someone to use a fake identification card in the name of the person whose identity had been stolen to pose as the buyer at the closing. After the closing, the person with poor or no credit would move into the house and try to make the mortgage payments. The record does not disclose that the title to the property was ever passed to that person.

Uribe did business with Beatricz Ramirez, a licensed real estate agent, over a three-year period beginning in 2003.

Ramirez began working as a realtor for Starck Realty in Elgin, Illinois in about October 2003. (She had worked a short time as a realtor for another office prior to that.) She was trained about a real estate agent's responsibilities, including how to fill out contracts. Between April and mid-July of 2005, Ramirez acted as the buyer's agent in seven fraudulent transactions that were part of Uribe's scheme.

The only issue at trial was whether Ramirez knowingly participated in the scheme.*fn1 To establish knowing participation, the government presented the testimony of Uribe; the testimony of Rafael Cruz, another participant in the scheme; statements by Ramirez to the FBI during its investigation of the fraud; Ramirez's grand jury testimony; and evidence of numerous suspicious circumstances surrounding the fraudulent transactions. Ramirez testified at trial on her behalf and denied knowingly participating in the scheme.

Uribe, who was cooperating with the government, testified that when he had a client for whom he was going to apply for a fraudulent loan and who had not yet found a home, he referred him or her to Ramirez.

According to Uribe, both he and the persons referred informed Ramirez that these individuals could not qualify for financing in their own names. Ramirez worked directly with these buyers, showing them houses, and thus knew their names. Once the buyer found a house he or she wanted to live in, Ramirez filled out a form real estate purchase contract. At first, Ramirez filled in the buyer's name, and Uribe would return it to her crossed or whited out. Eventually he asked her for blank purchase contract forms, indicating to her, he claims, that the title companies were complaining about the changes in the contracts. Ramirez complied and gave him blank contract forms. Then Uribe filled in the blanks with the name of the person whose identity he had stolen and returned the completed contract to Ramirez to provide to the seller or listing agent. The name of the person to whom Ramirez showed the house and whom she knew would live in the house did not appear anywhere on the purchase contract.

Uribe testified that Ramirez asked him where he was getting the identities he used to obtain the fraudulent loans, and he told her that he was using the names and identities of former clients as the purported buyers. He also testified that he told Ramirez that a third person with fake identification in the name of the former client would attend the closing and sign as the purported buyer. Uribe claimed that Ramirez asked him how he was able to get so many mortgage applications using one person's identity, and he told her that as long as the loans closed within a thirty- to sixty-day period of each other, several closings could take place with the same identity-credit reports were not updated in a shorter time period. Uribe also testified that he had a few conversations with Ramirez in which she expressed concern over the fraudulent loan transactions. According to Uribe, she indicated that she knew what he was doing was not right and questioned him whether he knew what he was doing.

Uribe further testified that he instructed Ramirez to negotiate a seller's concession, which required the seller to pay a specified amount purportedly toward closing costs, in the purchase contracts. He said that he explained to her that the concession was necessary to pay his commission and to pay the persons who attended the closings posing as the purported buyers, including Rafael Cruz. According to Uribe, Ramirez said that was fine with her. The evidence was that Ramirez did, in fact, negotiate seller's concessions in the purchase contracts involved in some of the seven fraudulent transactions for which she was the buyer's agent, including a house at 1365 Kaskaskia. (And, in fact, Ramirez even admitted that she negotiated the seller's concession on the Kaskaskia property.)

Cooperating witness Rafael Cruz testified that he met Uribe in 2004 when Cruz refinanced his home. Cruz wanted to buy a new home, so he returned to Uribe. Uribe told Cruz that he could not qualify for a loan but indicated that he could help Cruz get a loan-at a cost. Cruz understood that he would pay someone to sign the contracts for him. Uribe referred Cruz to Ramirez to find a home. Ramirez showed properties to Cruz and his wife, Juana Angelito, and they decided to buy one at 286 Chaparral. Uribe applied for a mortgage loan for the property in the name of Jorge Itoralde, who had agreed to sell his credit history. Itoralde attended the closing for 286 Chaparral and signed the contracts in his own name. Uribe testified that Ramirez knew that Uribe applied for the mortgage using Itoralde's name because Uribe told her so and because she knew that Cruz paid Itoralde $5,000 for the use of his name and identity-Cruz had complained to her about how much he had to pay Itoralde.

In early 2005 Uribe asked Cruz if he would be able to obtain fake IDs, using names and identifiers Uribe would provide. Uribe also asked Cruz to attend real estate closings posing as the persons whose names would appear on the fake IDs and contracts. Cruz agreed to do so. Cruz attended at least three closings posing as Luis Gonzalez, a former client of Uribe's whose identity Uribe had stolen. Cruz testified at trial that the first Gonzalez closing involved a property at 212 Hill, which he believed was purchased by two young people. Cruz said that Uribe drove him to the closing and on the way, they discussed that Ramirez would be there. Uribe told Cruz that he would advise Ramirez that Cruz was posing as Gonzalez because she already knew Cruz from helping him find his home at 286 Chaparral. Uribe testified that he did, in fact, tell Ramirez that Cruz would be posing as Gonzalez, and she laughed and said something like "as long as the documents match and the IDs match," it was fine with her. Cruz testified that Ramirez arrived late at the closing on 212 Hill, but was in time to see him sign the closing documents.

Ramirez, however, testified at trial that she did not attend the closing for 212 Hill. She also testified that the buyers were Alejandro Cano and his wife, not the "two young persons," as claimed by Cruz. Ramirez stated that she prepared the purchase contract for the Canos and then sent it to the selling agent for approval. The contract was approved. After receiving the signed contract from the seller, Ramirez forwarded it to the attorney as well as the lender, Uribe. She explained that Uribe had referred the Canos to her. She subsequently received a letter, dated May 12, 2005, from the Canos' lawyer, Salvador Lopez, indicating that there had been a change in the buyer and that the buyer was Luis Gonzalez.

The second Gonzalez closing involved a property at 1238 Surrey. Ramirez showed the home to Alejandro Espinoza and another young male. Uribe testified that Ramirez attended the closing on 1238 Surrey. Ramirez testified that she arrived late at the closing, but admitted that she saw Cruz in the room where the closing took place. She also testified that after the closing, she received a call from Cruz, who said, "I'm Rafael Cruz, Luis Gonzalez, or whoever I'm supposed to be."

The third Gonzalez closing, which took place in June 2005, involved a property at 386 Vincent Place. Ramirez showed this property to Dennis Davis, an individual she had met at a shopping mall while looking for sunglasses. At trial Ramirez admitted that she referred Davis to Uribe for a loan and discussed with him that if he did not qualify for a loan, Uribe could find someone to assist him, what she referred to as a "co-signer." Ramirez explained that she understood a "co-signer" to be someone who signed for a property on behalf of the person who would live there. She claimed not to know that there was anything wrong in telling him that. Ramirez admitted that she attended the closing for 386 Vincent Place, but again claimed to have arrived late. But she also admitted that she saw Cruz at the closing and that she knew, at the closing, that Cruz was claiming to be Luis Gonzalez.

Jose Bahena testified at trial that he had discussed purchasing a home with Uribe who told him that he could not get a loan in his own name. Uribe also told Bahena that Uribe could get him a loan anyway-Uribe would get a co-signer. Bahena said that Ramirez showed him a house at 1365 Kaskaskia, which he liked, so she told him to get together with Uribe to get a loan. The contract date on the purchase contract for 1365 Kaskaskia was July 14, 2005. Bahena testified that he contacted Uribe and eventually attended a closing for the property. Bahena said that Uribe and Maria Moreno, his co-signer, also attended the closing, but Ramirez did not. Bahena testified to his understanding that both he and Moreno would sign the closing papers and that he was supposed to pay her $1,000 for helping him. However, Bahena said that he did not sign any papers at the closing. Uribe had told him that he did not qualify and only Moreno qualified. After the closing Bahena met Ramirez to obtain the keys to the house.

FBI Special Agent Brian E. Smith testified that during the summer of 2006 he was involved in an investigation of mortgage fraud in the Elgin, Illinois area. In the course of his investigation he determined that Ramirez was the realtor on seven of twenty-one properties he had identified as having been obtained with fraudulent mortgages. Smith interviewed Ramirez in June 2006. Ramirez told Smith that Luis Uribe was a mortgage broker who referred clients to her-in fact, in 2005 the majority of Ramirez's referrals were from Uribe-and she referred clients to him. She said that she had done approximately 33 properties with Uribe over a two-year period and had attended between eight and ten closings with him. Ramirez admitted that she found homes for persons she knew could not qualify for mortgages-persons referred by Uribe. She also told Smith that co-signers purchased the properties and the persons living in the homes paid the mortgages. Ramirez advised the agent that she earned two and one-half percent com-mission on the sales price of the homes on which she worked with Uribe.

Ramirez indicated to Agent Smith that in the beginning she filled out the purchase contracts with the information she received from Uribe on the persons who wanted to buy a property. However, because those persons did not qualify, the title company was getting frustrated with the changes in the contracts, and Uribe therefore asked for blank contracts, which she gave him. Ramirez also said that Uribe had told her that credit reports were updated every 60 to 90 days or so and that multiple properties purchased would not show up within that time period. Before interviewing Ramirez, Agent Smith had been unable to identify who had obtained the stolen IDs used in the mortgage scheme. Ramirez identified Cruz as the person who did that.

Agent Smith testified that Ramirez told him that she attended at least three closings where Cruz signed as Gonzalez. Smith inquired about a property at 1238 Surrey Road, and Ramirez told him that it was one of the properties for which Cruz signed as Gonzalez. Ramirez also said that Gonzalez's address on the contract for 1238 Surrey was listed as 212 Hill. And Ramirez volunteered to Smith that she attended the closing for 212 Hill and again saw Cruz sign as Gonzalez. Agent Smith asked Ramirez about 1365 Kaskaskia, and she told him that she found that property for someone named Bahena. Smith told her that the named buyer on the property was Maria Moreno, and Ramirez volunteered that if it was Maria Moreno, it wasn't the real Maria Moreno because Uribe had other people signing and posing as Maria Moreno. Ramirez offered that Cruz's wife, sister or girlfriend, she wasn't sure which, had signed as Maria Moreno and another purported buyer, Olga Trejo.

Ramirez also told Agent Smith that she had gone to the mall to purchase sunglasses and met a person who had poor or no credit, but wanted to buy a home. According to Smith, Ramirez said that she told the man that she had a friend, Luis Uribe, who could find a co-signer to buy the property for him at the cost of $1,500. Ramirez advised Smith that she found this person a home and attended the closing. Agent Smith determined through his investigation that the property was 386 Vincent Place, with a purchase contract date of April 19, 2005, and that the purported buyer was Luis Gonzalez.

As mentioned, Ramirez testified before the grand jury. The government read the transcript of her grand jury testimony at trial. Ramirez's grand jury testimony repeated much of what she had said during Agent Smith's interview. She testified that over the past two years she did approximately 33 real-estate sales transactions with Luis Uribe for which she was the real estate agent for the buyers of the properties. She admitted that for all of the properties, her buyer was supposed to live in the property and pay the mortgage, but another person's name was on the mortgage; that she would send Uribe contracts and he would let her know that the person did not qualify and he needed another person's name on the contract; that as the realtor it normally was her responsibility to write up a contract for the property in the name of her buyer; and that Uribe ultimately requested blank contract forms from her and would fill in the information himself. Ramirez further testified that she attended at least three closings where Cruz showed identification indicating that he was Luis Gonzalez and signed the mortgage contract and title of the property as Gonzalez. She admitted that she knew Cruz wasn't Gonzalez. She also admitted that on one occasion Cruz called her and introduced himself as Rafael Cruz and then corrected himself, saying he was Luis Gonzalez or whoever he was supposed to be. Ramirez further testified that she attended the closing for 386 Vincent Place in June 2005 and believed that was when she learned that Cruz and Gonzalez were not the same person.

Before the grand jury Ramirez also testified that she had a conversation with Uribe in which she said that Luis Gonzalez was buying so many properties so fast, that she couldn't draw up the contracts, and was embarrassed to show the contracts around her office. She said that Uribe had told her not to worry, a person could buy as many properties as he wants, and credit reports are only updated every three months, so the properties would not show up. At trial, Ramirez testified that this conversation had taken place before any of the Gonzalez closings.

Ramirez also testified at trial that she sold Cruz his house at 286 Chaparral and that she knew the house was not purchased in Cruz's name, but was signed for in Jorge Itoralde's name because Cruz could not qualify for a mortgage. She claimed that every time Uribe gave her another person's name, she took it as a "co-signer." Though Ramirez readily admitted that she knew who Cruz was when she saw him at a Gonzalez closing, she was quick to deny that she actually witnessed Cruz sign any closing documents. She offered the explanation that she went to the closing late. But she conceded that she knew the property had been applied for and signed for in Luis Gonzalez's name.

Ramirez testified that she attended the closing on 201 North 9th Street. Olga Trejo was the purported buyer for that property. Ramirez also testified that she attended the closing on 2185 Heather Lane. Co-defendant Griselda Sanchez was the purported buyer for that property. Ramirez denied knowing that Moreno was not going to be living in these properties. Ramirez explained that she only learned that as a result of the investigation into the mortgage fraud.

At trial Ramirez admitted that some of Uribe's referrals involved purchasing homes in the name of other persons' identities and that she sent him blank contracts so he could fill in the name of the person who would actually sign for the home. She agreed that she had found a home for Jose Bahena at 1365 Kaskaskia, drew up a contract, dated July 14, 2005, which she sent to Uribe, and that he changed it to show Maria Moreno as the buyer. Ramirez also admitted that she did these things knowing that Bahena, not Moreno, would live in the house. Ramirez claimed, however, to believe that Moreno was a co-signer. She also claimed that her testimony before the grand jury and her statement to Agent Smith during his interview that, if 1365 Kaskaskia was purchased in the name of Maria Moreno then it wasn't the real Maria Moreno, was based on a conclusion she had drawn from her awareness about the investigation. She made the same claim with respect to her statement to Agent Smith that she knew Cruz had a woman who lived with him and attending closings, signing as Maria Moreno and Olga Trejo.

Ramirez denied that Uribe instructed her to negotiate a seller's concession and denied that he told her he needed a seller's concession so he and Cruz could get paid. She acknowledged that it was the realtor's responsibility to negotiate any type of seller's concession, however. Ramirez further denied knowing that Uribe would take his commission from the seller's concession, even though she admitted she knew the loans were 100% financed and that the buyers had no cash on hand. And she denied any knowledge of fake IDs. She also denied knowingly participating in a scheme to defraud and she denied ever intending to defraud anyone.

Mary Roberts, the manager of the Starck Realty Elgin, Illinois, office, testified at trial. Roberts had 31 years' experience in real estate and was a licensed agent and broker. She testified that she hired Ramirez in late 2003 and that Starck Realty trains its agents on the importance of accuracy in drawing up sales contracts. Roberts testified about the usual real estate transaction: the real estate buyer's agent would complete the contract with the buyer, have the buyer sign it, and then present it to the listing agent who presents it to the seller, and once the parties reach an agreement, the contract is signed, initialed, dated and provided to the attorneys and lender.

Roberts testified that in September 2005, while covering for Ramirez who was on vacation, she fielded some calls from sellers' agents about Ramirez's transactions. Roberts pulled the files in question and discovered that the same lender and same attorney were involved in each transaction, which alarmed her somewhat. When Ramirez returned, Roberts spoke with her about her concerns about this pattern, asked her if everything was okay, and asked her to use a different attorney or lender. Ramirez responded that everything was okay-she had asked Uribe and he said not to worry, he would take care of her.

Roberts also testified that in 2004-including the time frame of the mortgage scam-Ramirez earned commissions of around $16,000 on written contracts of $700,000 and in 2005 her earned commissions had climbed to $58,550 on written contracts of approximately $5 million. This ...

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