Counsel for contestant compared Burtis’ statements with the testimony of Rev. Mr. Worcester in relation to the same matter. Mr. Worcester, said the counsel, stands head and shoulders over any witness here produced; no man can question his veracity; if he have any fault it is that of underestimating the force of the fact testified to by himself; there can be no doubt, according to the argument of counsel for contestant, that the visit of Burtis was made at 2 o’clock, as he testified at first. The testimony of Burtis is not trustworthy as a whole; it is a mass of contradictions; the insertion of the “Short Memorandum” in the safe deposit box is claimed to have been effected through his agency; as soon as this paper was discovered they asked each other, “Who is Mrs. Sara B. Smith?” They all responded each to the other that they had never known nor heard of her; Mr. Worcester did not, neither did Mr. French, nor Mr. Burtis, but how was this professed ignorance of Burtis and French reconcilable with the finding of the “Altered Will,” Exhibit 3, in the drawer of decedent when they were looking over Ms papers? Burtis is the solitary exception of the old pupils of the professor who had never heard of Mrs. Sara Barker Smith, but she confessed that on one occasion she had heard Dama mention the name of Burtis at the time the professor gave her the ivory boat. Dama’s last visit to the safe deposit was May 20, 1887; this was before he went east. The last date of a visit before the date of the alleged Will (May 8, 1887) was May 3, 1887. Between May 3 and May 20, 1887, there is no record of a visit to the Safe Deposit Company. The “Long Memorandum” is dated Novem*171her 1, 1885, and that is the date of the “Altered Will.” The counsel for contestant contends that this goes to show that the forger intended to have these two go together to holster up each other,- so the alleged Will and the “Short Memorandum” were dated the same day and intended by the forger to support each other; this was doubtless the design of the forger. Counsel asks the court to read and compare the testimony of Mrs. Sara Barker Smith at the original probate of the Will and upon this contest. At thé probate she testified that she did not see what was on the envelope inclosed in the other marked “Private Paper,” and yet here, only a short time prior to the submission of the case, she swore that, she did know what was on it. Counsel for contestant claims that this is a most material variance. The words “Private Paper” is an emanation of her own; it is not an expression of Dama; it was her peculiar phrase; she testified that she gave the expression to him; it is by these little things that forgeries are detected; it is such “trifles light as air” that aid in the detection of crime and contribute to the conviction of the criminal. (See Article “<mask> as a Fine Art,” San Francisco “Law Journal,” Wednesday, January 6, 1892.) To show that everything was not straight, as it should be, counsel calls attention further to the testimony of Burtis. (See page 108, official reporter’s transcript of testimony concerning the letter dated at San Jose, February 4, 1888, to Benjamin Randall from O. A. Hale, the brother in law of Burtis.) What prompted Mr. Hale “in the interest of justice” to write to Benjamin Randall? Why was this letter written, if there were nothing sinuous in the conduct of these persons and nothing crooked in the circumstances of the case? Was the conscience of Burtis beginning to smite him, or was he growing weak-kneed because of his connection with this crime? Why otherwise inspire such a letter? Reverting to the circumstances and incidents connected with


Other courts considering similar drug paraphernalia legislation have also rejected facial challenges. These decisions issued prior to Hoffman and Brache, did not discuss coverage of single and multiuse items. Instead, they held that the definitional phrases “designed for use” and “intended for use” applied to the subjective intent of the alleged violator of the statute, and thus provided fair *886notice. (See, e.g., Franza v Carey, supra;.Brache v County of Westchester, 507 F Supp 566; Casbah, Inc. v Thone, 651d 551; New England Accessories Trade Assn, v Browne, 102 F Supp" 1245; Mid-Atlantic Accessories Trade Assn, v Maryland, 500 F Supp 834; Delaware Accessories Trade Assn, v Gebelein, 497 F Supp 289; World Imports v Wood-bridge Twp., 493 F Supp 428 and Nova Records v Sendak, 504 F Supp 938; see, also, People v Taylor, 70 Misc 2d 970 [upholding Penal .Law, § 220.50, “[cjriminally using drug paraphernalia in the second degree”, against a vagueness challenge]; Penal Law, §§ 140.35 [criminal possession of burglar’s tools], 170.40 [criminal possession of <mask> devices], containing “designed for use” language.)1


The misstatement in question would seem covered by this statute. But, aside from that, is it a material variance to use the abbreviation “ Geo.” instead of the full word “ George ? ” It is a common and well-understood abbreviation. There may be cases where it would be a question of fact for the jury to say whether the meaning was the same, but this is not such a case, nor did the defendant ask to leave it to the jury. In Lewis v. Few (5 Johns., 1, 28), wdiere the allegation was “ U. States,” and the proof “ United States,” the variance was held to be immaterial. In United States v. Hinman (1 Baldwin, 292) the indictment charged a <mask> of an order on "the cashier of the corporation of the president and directors of the Bank of the United States,” and the order in evidence was drawn on “ the cashier of the Bank of the United States; ” held, not fatal. The order was alleged to have been signed " Jno. Ilulse,” and that in evidence was signed “ Jna. Ilulse; ” held, matter for the jury to say whether the same person was meant. (See People v. Runkel, 9 Johns., 156; also State v. Kean, 10 N. H., 347; 1 Archbold’s Cr. Pl. and Pr. [8th ed.], 242, 375, and notes.) The refusal to quash the indictment was not error.


Defendant urges us to construe section 473(b) in the context of the entire statutory scheme for <mask>, but doing so further supports our conclusion section 473(b) was intended to provide a limited exclusion for seven specific types of forgery. In section 470, subdivision (d) (section 470(d)), the general forgery statute lists over 50 different instruments that constitute forgery-the first seven of which correspond precisely to the instruments identified in section 473(b). ( Martinez, supra, 5 Cal.App.5th at p. 242, 209 Cal.Rptr.3d 480.) Had the drafters of Proposition 47 intended to redesignate all forgery offenses valued at less than $950 as misdemeanors, they could have listed each of the instruments identified in section 470(d), rather than only the first seven; or more, simply, they could have referred to "forgery" as defined in section 470. We will not rewrite the statute on their behalf. (See People v. Guzman (2005) 35 Cal.4th 577, 587, 25 Cal.Rptr.3d 761, 107 P.3d 860 [" 'insert [ing]' additional language into a statute 'violate[s] the cardinal rule of statutory construction that courts must not add provisions to statutes. [Citations.] ... [A] court must not 'insert what has been omitted' from a statute.' "]; Martinez , at p. 242, 209 Cal.Rptr.3d 480 [to adopt argument that " 'receipt for goods' " forgery convictions are misdemeanors, court would have to add " 'receipt for goods' " to language in section 473(b) ].)


Nor did the plaintiff bank owe a duty to the Riese appellants to authenticate or guarantee the genuineness of the signatures of their partner, defendant Elie Hirschfeld, on the March 1992 mortgage modification documents. There is no fiduciary duty or privity of contract arising out of the contractual arm’s length debtor and creditor legal relationship between a borrower and a bank which would give rise to a cause of action for negligent misrepresentation (Bank Leumi Trust Co. v Block 3102 Corp., 180 AD2d 588, 589). Any failure by the bank mortgagee to be reasonably vigilant against the risk of <mask> by defendant Hirschfeld, a non-appellant, does not constitute a defense to a foreclosure because the bank mortgagee owes no duty to ascertain the true identities of other parties executing the mortgage (Money Store/Empire State v Lenke, 151 AD2d 256, 257; First Am. Tit. Ins. Co. v Kevlin, 203 AD2d 681).


If Mrs. Atkins was in Chicago and the decedent and proponent at Springside on October 23, 1901, of course the testimony of Mrs. Bell and Mrs. Atkins concerning the execution of the will of that date at the Bell house cannot be true, and the presence of the paper itself in the ease, instead of being evidence of the testator’s purpose, inveighs strongly against the proponent’s case. If this conclusion is correct, its importance to the history of the case cannot be misunnderstood. It stamps the motives and conduct of the parties most interested in the will offered for probate, and prepares the mind for the conclusion, already reached by an independent process, that the signature to that instrument is a <mask>. It tends to explain the origin of that instrument without intent to execute it on the part of the decedent, while the mere existence of the second will would signify that the decedent did not deem or consider that the first will was in force or effect.


This alleged Will is clothed in all the conceivable habiliments of crime; it bears upon its face the stamp of falsehood and the impress of fraud and all the indicia of <mask>, and those who forged it, who conceived, concocted, and consummated this crime, were in possession of the Will actually executed in May, 1887, attested in presence of Dellasanta, who did not sign as a subscribing witness, as Dama told him it was not necessary, as three were enough, Mathieu, Godard, and Bellini having already attested, and the conspirators and forgers used that document as a pattern in the execution of their pernicious purpose.


I am satisfied that Rachel Mills, the chief beneficiary of the <mask>, conspired with Johnstone, the draftsman of the paper, to forge the instrument. They added to the separated portion of the instrument an introductory testamentary clause. They then added between the end of the genuine text of the will and the signature of deceased a forged paragraph intended to give Rachel Mills an interest in a bank account of deceased. Apparently on his own initiative the draftsman, Johnstone, later added another forgery to the will by inserting a provision which purported to name him executor. The use by these somewhat artless forgers of different inks and the necessity under which they were to write the forged additions in part through the creased portion of the paper enabled the handwriting expert called by the court to disclose vividly not only the extent of the forgery but the order in which the forgery was done.


First, that the will was not executed with due statutory formalities. Second, that the signature to the will was a <mask>. Third, that the execution of the will was procured by undue influence or fraud. Fourth, that at the time of the execution of the will the decedent was not of sound mind and memory. *582The material facts in this case are as follows: Roxalana Williams, who was the widow of John B. Williams, died in the month of October, 1888, at- the age of about 82 years. She was somewhat feeble in health for a year or two prior to her decease, but was not confined to* her bed or room until a short time prior to her death. For a number of years prior and down to the time of her death, she had been quite deaf, and Unable to hear any words spoken to her, but conversa? tion was carried on with her by use of a slate or tablet of paper, aided by signs or gestures. Questions were usually written upon paper or slate, and verbal answers given by her. She was an intelligent woman, of an apparently active mind, and a large number of witnesses testify that she conversed readily and intelligently in the method above described. Ever since the death of her husband, which occurred forty years or more prior to her death, she had resided with her brother, Jacob F. Hall, a bachelor, upon his farm of about 140 acres, situate in the town of Pittstown, which was of the value of about $5,000. Her brother was also possessed of personal property of the value of about $20,000. Mrs. Williams had a small property of her own, not to exceed $4,000 or $5,000; but no real estate. Jacob F. Hall died on the 28th of February, 1887, having been in feeble health for some months prior to his death. The disease was softening of the brain. He died intestate, leaving- his sister, Mrs. Williams, his sole heir at law and next of kin. On the 17th of February, 1887, the will iii question here is alleged to have been made. It .appears from the testimony offered by the proponent *583that about two weeks prior to the execution of the will, Merritt Snyder, who resided about two miles from the residence of Jacob F. Hall, where Mrs. Williams then lived, was requested by Mr. Carpenter, the husband of the principal beneficiary in this will, who lives upon the farm adjoining Mr. Snyder, to call upon Mrs. Williams, as she wanted him (Snyder) to do some writing for her. Mr. Snyder states that he went over and saw her; that they went into the room off from the kitchen, and that Mrs. Williams said she wanted him to do some writing for her,—to draw her will. He wrote on the slate that he would do it, if she would dictate to him just what she wanted. She wrote, in reply: “ I don’t know who I will get for witnesses.” He wrote that “ he could be one, and his wife could be another.” She said: “ I didn’t think you could witness it if you wrote the will.” He nodded that he could. This is all that took place between them at that time. Two or three days afterwards Mrs. Carpenter brought over and gave to him a memorandum for Mrs. Williams’ will. The instructions were drawn in Mrs. Carpenter’s handwriting. Within a day or two Mr. Snyder made a draft of the will from the memorandum, interlined it somewhat, to make it correspond with the instructions, and then made a copy of the draft, which he subsequently compared with his wife, she holding the draft, and he holding the completed copy. The next morning Mr. Snyder and his wife went over to the house of Jacob F. Hall; got there about 9 o’clock. They found there, in the kitchen, Mrs. Williams, Mr. Hall, Mrs. Carpenter, Mr. Downey, and Hannah Eldredge. Shortly *584after his arrival Mr. Snyder handed Mrs. Williams the will.' She left the room, and went to her own room, and, after the lapse of about thirty minutes, she came into the sitting-room, a room adjoining the kitchen, where she found Mr. Snyder and his wife sitting by a fire, which in the meantime had been built by Mrs. Carpenter. When Mrs. Williams came in Mrs. Carpenter left, and' closed the door. On coming into the room, in the presence and hearing of Mr. Snyder and his wife, Mrs. Williams stated that it (referring to the will) was “all right; just as she wanted it.” Then Mr. Snyder wrote upon the slate : “ Do you acknowledge this to be your last will and testament, and do you want us to sign it,—my wife and I ? ” and she said : “ Yes; but I must first sign it myself.” Mrs. Williams then sat down. Snyder gave her a pen, and she wrote her name as it appears in the will, “ Roxy Lany Williams.” Thereupon Mr. Snyder and his wife wrote their names below as witnesses. The testatrix then said that “ that was her will, and she was glad it was done.” Snyder then folded up the paper, handed it to her, and. she handed it back to him, saying she wished he would keep it for her.


prison hanging oﬀ the skids of a helicopter.1 He was convicted in the Southern District of Illinois for drug and criminal en‐ terprise oﬀenses and in the Southern District of Florida for racketeering, and $60 million and $50 million forfeiture judg‐ ments were entered against him, respectively, as part of his sentences.2 Over a decade later, Kramer filed a motion for an accounting in the Southern District of Illinois of the amounts collected by the government to satisfy his $60 million forfei‐ ture judgment. The district court granted the motion but, given the complexity of his case, limited the accounting to what was collected in the Southern District of Illinois toward that judgment. On appeal, Kramer argues that the district court should not have credited to his judgment the amounts forfeited un‐ der a 2003 settlement agreement. He also claims that the dis‐ trict court abused its discretion in limiting the accounting only to the amounts that were collected in the Southern Dis‐ trict of Illinois. We disagree and aﬃrm the district court’s judgment. In the 1980s, Kramer and his associates oversaw a nation‐ wide drug smuggling operation. The venture was lucrative, generating about $180 million in profits. To keep their ill‐got‐ ten gain, they sought the help of Sam Gilbert, who devised an elaborate international <mask> scheme. As


On or about December 3, 1996, J&J presented the first of the four checks. It was dishonored. On or about December 10, 1996, J&J learned that Infinity had commenced bankruptcy proceedings. At the first meeting of creditors, Dilmanian learned from the testimony of Nathan Itzchaki, a principal of Infinity, that Republic had closed the account on October 10, 1996 (four days before Dilmanian’s second conversation with Perkins) and had been investigating Infinity for <mask>.


Kenneth L. Gartner, J. A published news article recently reported that an investiga*10tion into possible <mask> being conducted through the racetracks operated by the defendant New York Racing Association was prompted by a small-time money laundering case in which a Queens bank robber used stolen money to purchase betting vouchers and then exchanged the vouchers for clean cash. (Newsday, Sept. 28, 2000, at A33, col 1.) The instant case does not involve any such question of wrongdoing, but does raise a novel legal issue regarding the negotiability of those same vouchers when their possession is obtained by a thief or finder. The defendant concedes that “there are no cases on point.”


On the night of November 19, 2007, State Police investigators watched Baez carry a black bag into 80 Bennett Avenue in Washington Heights. The bag was seized and found to contain more than $500,000 in cash, claimed by the Special Narcotics Prosecutor to be the proceeds of narcotics traffic. By a one-count felony complaint filed November 20, 2007, Baez was charged based on these events with <mask> in the second degree.


New York’s <mask> statutes are substantially modeled on their modern federal counterparts {see Donnino, Supp Practice Commentary, McKinney’s Cons Laws of NY, Book 39, Penal Law art 470, 2008 Pocket Part, at 192), and, like their *908chief federal analogue, allow for the prosecution of money laundering under what are sometimes termed “concealment” and “promotion” theories (see generally United States v Garcia-Torres, 341d 61, 65 [1st Cir 2003] [contrasting theories in the federal statute]; United States v Bolden, 325d 471, 486-487 & nn 19, 20 [4th Cir 2003] [same]).1 The felony complaint charge against Baez, brought under Penal Law § 470.15 (1) (b) (ii) (A) and (iii), rested exclusively on the concealment theory. That is, it alleged, in pertinent part, that Baez conducted one or more financial transactions “[k] no wing that the transaction or transactions in whole or in part [were] designed to . . . conceal or disguise the nature, the location, the source, the ownership or the control of the proceeds of specified criminal conduct.” (Id.)


Baez’s prosecution then underwent an immediate and significant change in theory. In Supreme Court proceedings before me that same day, the prosecution requested that Baez waive indictment and consent to be prosecuted by a superior court information charging <mask> in the second degree exclusively under the promotion theory set forth in Penal Law § 470.15 (1) (b) (i) (A) and (iii). Under that theory, the prosecution is not required to prove that the defendant acted with knowledge that the transaction was designed to conceal the nature, location, source, ownership, or control of proceeds of past criminal conduct. However, it must prove, in pertinent part, that the defendant conducted one or more financial transactions “[w]ith intent to . . . promote the carrying on of specified criminal *909conduct.” (Id.) The variance from the felony complaint theory struck me as unusual, and I inquired of the prosecutor whether it was intended. I was told that it was. I allowed it, and Baez waived indictment by a document naming money laundering in the second degree exclusively under the statutory provisions defining the promotion theory.


Baez relies on this rule. As noted above, the felony complaint charged the concealment theory of <mask> in the second degree, and it was with respect to the offense as so charged that I held Baez for grand jury action. As further noted, Baez thereafter waived indictment by a document naming the distinct, promotion theory of money laundering in the second degree, and the promotion theory underlay the sole count of the superior court information, to which Baez pleaded guilty. Baez therefore contends that he impermissibly waived indictment with respect to, and pleaded guilty under a superior court information charging, a crime other than that for which he had been held for the action of the grand jury.


It follows that Baez was never held for grand jury action on the charge named in his indictment waiver, and alleged in the superior court information. Baez was held under a felony complaint the accusatory part of which alleged concealment <mask>. The determination to hold him for grand jury action required a judicial determination of probable cause to believe he committed “the crime charged in the accusatory part,” and it is for this crime exclusively that he could validly have been held, irrespective of whether the complaint’s allega*914tions would have supported holding him on the promotion theory which “need never have been considered.” (Zanghi, 79 NY2d at 818.) Nor may Baez be deemed to have been held on the promotion theory on the supposition that any finding of probable cause to believe a defendant committed concealment money laundering necessarily implies a finding of probable cause to believe he committed the promotion variety too. (Cf. Menchetti, 76 NY2d at 474-477 [defendant held for grand jury action with respect to offense deemed held likewise on its lesser included offenses].) Simply put, one may knowingly hide the spoils of crime without intending to promote future criminal ventures. Thus, a defendant who commits concealment money laundering will not necessarily commit promotion money laundering concomitantly. (Cf. United States v Jackson, 935d 832, 842 [7th Cir 1991] [opining that “only in the unusual case” will one transaction support both theories].)


Second, the prosecutor proffers an assertion that “the charge in the SCI was supported by the facts in the complaint.” Even if true, this is immaterial. The People likewise asserted in Zanghi that the felony complaint supported the information charge, but, as noted, the Court dismissed the point as insignificant because the judge who held the defendant for grand jury action “need never have . . . considered” whether they did so. (79 NY2d at 818.) Likewise here, there was no necessity, in holding Baez for grand jury action, to determine whether the felony complaint’s allegations supported probable cause to believe he had committed promotion <mask>. Thus, even if the allegations did so, this would not alter the fact that, under Zanghi, he was held on a different offense. (Cf. Kohl, 19 AD3d at 1155-1156 [defendant held on credit card theory of grand larceny not held on credit card theory of felony possession of stolen property despite “common elements of fact and law”].)


. Federal prosecutors have been permitted to allege both theories conjunctively in support of a single count, yet seek to convict on proof of either (Garda-Torres, 341d at 64-67; Bolden, 325d at 486-487 & nn 19, 20; United States v Booth, 309d 566, 571-573 [9th Cir 2002]; cf. United States v Jackson, 935d 832, 842 [7th Cir 1991] [trial court erred in supposing proof of both required]). Indeed, one federal court of appeals has concluded that it would be improperly multiplicitous to allege in one count that a defendant committed concealment <mask>, and in another, by the same conduct, promotion money laundering. (United States v Stewart, 256d 231, 246-249 [4th Cir 2001]; but see United States v Sierra-Garcia, 760 F Supp 252, 255-257 [ED NY 1991].) I take no view here concerning analogous pleading questions under the New York statutes.


Defendants request the court to revisit the viability of the <mask> counts against these defendants (count 44 [originally 54 — Penal Law § 470.15 (1) (b) (ii) (A); (iii)];1 count 45 [originally 55 — Penal Law § 470.15 (1) (b) (ii) (A); (iii)]) and for a dismissal of those counts or an order precluding proof of them by the prosecutor at trial, based upon United States v Santos (553 US —, 128 S Ct 2020 [2008]).


It is impossible for a trial court, faced with the imminent trial of an indictment for violations, inter alia, of a <mask> statute modeled on and very similar to its federal counterpart, to ignore the Santos decision. The Santos holding is that the rule of lenity requires that “proceeds” means and is limited to “profits” in the context of the federal criminal money laundering statute (18 USC § 1956 [a] [1] [A] [i]).21 have decided to apply that holding to the instant Rozenberg indictment. Not only was the New York statute modeled on the federal statute, but it has been authoritatively stated that “federal case law to date should guide the interpretation of these [New York] stat*237utes.”3 The New York statute is identical to the federal statute in many important respects — notably in failing to define “proceeds” within the four corners of that statute. I have found that the references submitted by the Attorney General to legislative history and other statutes, such as ones concerning civil forfeiture, are insufficient to overcome the United States Supreme Court analysis and application of the rule of lenity in the money laundering context.4 Federal and New York State civil forfeiture statutes have their own more expansive definition of proceeds — not found in the criminal statutes — and traditionally have had broader reach.


The prosecution’s theory that Dr. Rozenberg’s endorsements to the management companies of checks received by AR Medical amount to <mask> is too dependent on a string of inferences about which I now believe I was too deferential in allowing the grand jury to draw. (See People v Deegan, 69 NY2d 976 [1987].) The inferences are: (1) that all or at least a large portion of these receipts were the proceeds of specified criminal conduct, which is contradicted in part by evidence that bona fide patients with real injuries were being treated at the clinic; (2) that all or a substantial number of such endorsements themselves constituted discrete illegal financial transactions; and (3) that Rozenberg by such endorsements intended to conceal the source of these receipts. Both inferences (2) and (3) *238are contradicted by the circumstances under which it was obvious that the management companies used much of these funds to pay expenses to run the clinic.


Upon further review of the grand jury presentation, prompted by this defense application under Santos, I have concluded that there was legally insufficient evidence to support the “intent to conceal” element of <mask> by Rozenberg. There was not a scintilla of direct evidence before the grand jury that Rozenberg knew what Polack and Kucherovsky did with those monies other than to run the clinic, which circumstance negates an intent to conceal. To impute knowledge to Rozenberg of concealment and money laundering by Kucherovsky and/or Po-lack was therefore too speculative and unwarranted.


An additional dubious inference regards the amounts of money involved. As the court’s December 17, 2007 decision shows, 19 of the larceny and insurance fraud counts had to be reduced because of a failure of proof to meet the monetary thresholds. It is true that in that same decision the court implicitly allowed the grand jury to infer that a significant portion of the clinic’s revenues could be considered proceeds subject to <mask>. However, it is one thing to extrapolate from the revenues of the “staged” accident victims and the overtreated patients to reach larger threshold sums; it becomes quite another to do so using “profits.” When the amounts of money are limited to “profits,” and here I refer back to my decision to follow Santos, and the defense has rightly argued that a “profit analysis” was never done in the grand jury, the inference drawn from these calculations to reach the required threshold monetary amounts becomes too speculative and untenable.


. By written decision and order of December 17, 2007 the court dismissed this previous count 54 because the one and only predicate felony for this count, enterprise corruption (Penal Law § 460.20 [1] [a]) was dismissed on the Attorney General’s motion. For the first time after that decision, on July 16, 2008, the Attorney General moved orally for that count to be restored and reduced to <mask> in the second degree on the ground that only this count included Mighty Management, L.L.C., as distinguished from the different management company charged in count 55, Mighty Management Group, Inc. I originally sustained count 55. Despite the delay I would grant the application were I not to dismiss all the money laundering counts.


MetLife contends that the payment of the premiums by Stanley may have been a form of illegal speculation in insurance, which is disallowed under its underwriting practices, in con*959junction with, and mandated by, the federal “USA PATRIOT Act,”2 in order to avoid potential <mask> in furtherance of terrorism. It claims to have a “strict policy” of not accepting third-party checks without knowledge of the source of the funds, especially where payment of the premiums is made by a party who is not closely related to the insured. MetLife argues that decedent falsely represented that he would be paying the premiums, and that plaintiffs actively concealed the identity of the true payor.3 It claims that it would not have issued the policy had it known that the decedent would not be paying as represented. MetLife maintains that “at minimum, MetLife would have postponed issuing the policy while it conducted an investigation with respect to whether the intended premium payor had an acceptable explanation for paying the premiums” so that it could “properly estimat[e] the degree and character of the risk it was assuming.” (MetLife’s mem of law in opposition at 2.)


“The MetLife Enterprise is firmly committed to complying with all applicable anti-<mask> laws, rules, and regulations. Specifically, the USA PATRIOT ACT requires MetLife to verify the identity of its customers and understand the source of all funds that it receives for the purchase of financial products. The task of certifying the source of funds for financial product purchases and subsequent payments is extremely difficult when we receive monetary instruments or funds from other than the owner of an account or policy.” Consequently, MetLife has, as applicable here, devised procedures to track, among other things, third-party checks “written on a checking account, annuitant, or insured of the MetLife account or policy.” (Id.)


Title III of the PATRIOT Act (Pub L 107-56, 115 US Stat 272) is entitled the “International <mask> Abatement and Anti-Terrorist Financing Act of 2001,” and is, as its name suggests, concerned with the problem of money laundering within financial institutions. Pursuant to title III, as reflected in 31 USC § 5312 (a) (2) (M), an insurance company is a “financial institution.” 31 USC § 5318 (h) requires financial institutions, such as insurance companies, to “establish anti-money laundering programs,” with particular attention toward *964“the development of internal policies, procedures, and controls” (31 USC § 5318 [h] [1] [A]). 31 CFR 103.137, entitled “Anti-money laundering programs for insurance companies,” provides the regulatory framework for the insurance industry with regard to the creation of “anti-money laundering” programs, with emphasis on possible money laundering through the purchase of insurance products. 31 CFR 103.137 (b) provides that “each insurance company shall develop and implement a written anti-money laundering program applicable to its covered products that is reasonably designed to prevent the insurance company from being used to facilitate money laundering or the financing of terrorist activities.” Paragraph (c) sets forth the minimum requirements for the anti-money laundering programs, as applicable, as follows:


“[a]t a minimum, the program required by paragraph (b) of this section shall: “(1) Incorporate policies, procedures, and internal controls based upon the insurance company’s assessment of the <mask> and terrorist financing risks associated with its covered products. Policies, procedures, and internal controls developed and implemented by an insurance company under this section shall include provisions for complying with the applicable requirements of subchapter II of chapter 53 of title 31, United States Code and this part, integrating the company’s insurance agents and insurance brokers into its anti-money laundering program, and obtaining all relevant customer-related information necessary for an effective anti-money laundering program.” 31 CFR 103.137 also provides for the appointment of a compliance officer ([c] [2]), ongoing training ([c] [3]), and independent testing to see if the company is in compliance with the regulations ([c] [4]).


In the present action, MetLife’s affiants have made reference to the existence of an anti-<mask> program, as required by the PATRIOT Act, by providing the court with internal policy statements apparently meant for its employees’ edification and use in evaluating insurance practices and risks. MetLife has not produced any specific documentary evidence of its underwriting practices, although it has offered the affidavit of an underwriter reiterating that MetLife’s decision to void the policies was made under the mandates of the PATRIOT Act.


The PATRIOT Act is an important piece of legislation containing directives to the insurance industry concerning many aspects of the procurement of policies, revealed through the regulations which have been promulgated thereunder. Despite the paucity of specifics provided by MetLife as to what aspect of the PATRIOT Act would permit it to void the subject policies on the ground that the premiums were paid by Stanley rather than by decedent, this court finds that MetLife has put forth sufficient evidence to show that it may have had reason to revoke the policies, or at least to investigate the situation with regard to Stanley, under its legislatively-required anti-<mask> program, adequate to forestall summary judgment at this time. Whether MetLife’s decision to void the policy was a reasonable exercise of its rights under the PATRIOT Act is a factual question.


“The legislature deems it necessary, in order to enhance consumer protection, reduce fraud and ensure the public welfare, that mortgage loan originators who originate mortgage loans on residential real property be subject to regulation by the superintendent and that such regulation be consistent with Title V of The Housing and Economic Recovery Act of 2008, also known as the S.A.F.E. Mortgage Licensing Act, as it may be amended from time to time, and regulations thereunder or interpretations thereof, that may be adopted from time to time by the Secretary of the U.S. Department of Housing and Urban Development.” In memoranda supporting the new legislation, it is specifically noted that no longer will applicants who have been convicted of a felony involving fraud, dishonesty, breach of trust or <mask> be eligible for an MLO license, absent a pardon. (Rampolla aff, exhibit F, at 1.)


“1. Findings. Notwithstanding any other law, the superintendent shall not issue a mortgage loan origination license unless he or she makes, at a minimum, the following findings: . . . “(b) No felony conviction. That the applicant has not been convicted of, or pled guilty or nolo contendere to, a felony in a domestic, foreign, or military court: “(i) During the seven-year period preceding the date of the application for licensing; or “(ii) At any time preceding such date of application, if such felony involved an act of fraud, dishonesty, or a breach of trust, or <mask>, provided *168that for purposes of this subdivision, the superintendent may, in his or her discretion, disregard a conviction where the felon has been pardoned.” These provisions are identical to those set forth in the Act.


Mark Dwyer, J. Defendant Pinchuk and five others have been indicted on multiple counts of conspiracy in the second and fourth degrees, for <mask> in the second degree, and on 37 counts of sale and possession of controlled substances. The People’s theory is that between March 2009 and June 2010 defendant, based in California, supplied amphetamines, alprazolam, hydrocodone, and oxycodone to codefendant Pinchas Goldshtein and others in Brooklyn. Defendant would ship pills via Federal Express from Los Angeles to Brooklyn, often supplying Goldshtein with a tracking number in a text message. To pay for the pills Goldshtein would deposit money into a bank account in Brooklyn, and defendant would withdraw that money in Los Angeles. Over the course of their dealings, defendant and his California and New York accomplices exchanged numerous text and cell phone messages, many of which were intercepted pursuant to court order and were highly incriminating.


There is no evidence that defendant left California during the period of the alleged conspiracy. Relying on People v Carvajal (6 NY3d 305 [2005]), defendant moves to dismiss the substantive counts of the indictment on jurisdictional grounds. The essence of his argument is that because he was never in New York, this state has no jurisdictional predicate for charging him with selling and possessing drugs or with <mask> in New York.1 For the reasons that follow, this court rejects defendant’s claim.


On February 7, 2011, a 107-count indictment was filed with the Nassau County Court Clerk charging 14 defendants, each with a count of enterprise corruption, conspiracy in the fourth degree and scheme to defraud in the first degree. Each defendant was charged with additional differing counts, including <mask> in various degrees, falsifying business records in various degrees, identity theft in the first degree and grand larceny in various degrees.


Plaintiff claims she provided money to defendant in several ways. Much of it she gave to him in the form of “investment” checks. These checks were paid in increments of $10,000, $12,000 or $13,000. Plaintiff signed, dated and wrote the amount on these checks, but left the payee portion blank. She provided these checks to defendant multiple times throughout any given month. Apparently, defendant cashed many of these checks in money exchange houses in South America and in the United States, including the Beacon Hill Service Corporation in New York. That company was later the subject of a criminal *352investigation for <mask> and for transmitting funds without a license. Plaintiff claims that between 1992 and 2004, she wrote checks to defendant for “investments” in the amount of $7,579,500.


Martin Marcus, J. The defendant was indicted by the grand jury of Bronx County and charged with 21 counts of grand larceny in the second degree (Penal Law § 155.40 [1]); eight counts of grand larceny in the third degree (Penal Law § 155.35 [1]); and two counts each of <mask> in the first degree (Penal Law § 470.20 [1] [b] [i] [A]; [ii] [A]) and scheme to defraud in the first degree (Penal Law § 190.65 [1] [a], [b]). The defendant is also charged with two counts of fraudulent practices in respect to stocks, bonds and other securities (General Business Law § 352-c [5], [6] [hereinafter the Martin Act counts]). In essence, the defendant allegedly operated a “Ponzi scheme” in which he fraudulently induced 29 people to place with him some or all of their retirement savings or other funds, totaling millions of dollars. Promising to invest their money either in a real estate project or in various financial instruments, and assuring them that they would receive a (more or less) guaranteed rate of return, he did not invest their funds as promised, and instead used their money to make some payments due to earlier investors and to pay airlines, casinos, restaurants and others for personal expenses. Some of the investors received none of the *566payments their agreements called for. A few initially received the monthly payments they were due, but soon those payments came in lesser amounts and then stopped altogether.


In the first cause of action, the amended complaint alleges that “[b]y virtue of its superior knowledge, BNY MELLON owed a common law duty of care to the Rye Funds to disclose material adverse facts affecting assets under BNY MELLON’s administration.” (Amended complaint ¶ 100.)1 It further alleges that BNY Mellon acted with gross negligence, and breached its common-law duty of care, in the following respects: First, the Bank allegedly failed to disclose that Madoff reported bogus trades on the Rye Funds’ behalf of BNY Mellon’s own shares, and calculated the Rye Funds net asset value (NAV) as if the trades in such shares were “real.” (Id. ¶ 101.) The amended complaint alleges that the Bank had business records reflecting *891the purchase and sale of its own shares and therefore had “superior knowledge of the true facts.” (Id. ¶¶ 69-71.) Second, the Bank failed to disclose suspicious activities in the BMIS account that was also maintained at the Bank. (Id. ¶ 102.) The amended complaint alleges that the Bank was required by the Bank Secrecy Act (31 USC §§ 5311-5332) to conduct due diligence on accounts maintained with it and to report <mask> transactions to the government. The amended complaint further asserts that BNY Mellon therefore had superior knowledge about the BMIS account, and acted with gross negligence in not disclosing to the Rye Funds “the conflict of interest arising from Madoff s suspicious banking activities” involving the BMIS account. {Id. ¶¶ 59-65.) Third, the Bank ignored “red flags” that should have alerted it to the fact that the Funds’ assets were at risk for fraud. {Id. ¶ 97.) The amended complaint catalogs red flags that included suspiciously consistent returns and patterns of purchases, suspect trading volumes, Madoff s role as both broker and custodian for all of the assets he managed, public reports questioning his operations, Madoff s use of paper trade confirmations, and the Rye Funds’ lack of electronic access to their accounts at BMIS. (Id. ¶¶ 9, 66-68.) Fourth, the Bank’s predecessor acquired a subsidiary, Ivy Asset Management LLC (Ivy), which purportedly limited its investments with Madoff due to concerns about his operations. The amended complaint alleges that the predecessor “undoubtedly conducted substantial due diligence on Ivy” before acquiring it, and the Bank therefore knew or should have known that Mad-off was misusing client funds. (Id. ¶¶ 72-82.) Fifth, as cash custodian for the Rye Funds, the Bank had common-law and fiduciary duties to “monitor and protect any and all cash and cash equivalents of the Rye Funds,” and should have discovered and disclosed the inadequacy of Madoff s sub-custodial records of cash and cash flows. (Id. ¶¶ 56-58.)


The Rye Funds entered into two substantially similar administrative services agreements—a July 1, 2007 agreement between Rye Select Broad Market Fund LP and Rye Select Broad Market Prime Fund LP and BNY-AIS (Mehta aff, exhibit D); and a September 1, 2006 agreement between Rye Select Broad Market XL Fund LP and BNY-AIS. (Mehta aff, exhibit E.) The agreements provided for BNY-AIS to furnish the administrative services listed on schedule I, which include: establishing and maintaining accounts in the name of the Rye Funds; receiving and disbursing subscription payments in connection with the sale of the Funds’ shares; receiving and paying fees and expenses on behalf of the Funds; acting as registrar and transfer agent with respect to the Funds’ shares and, in that capacity, processing subscription applications and maintaining subscriber registers and ledgers; preparing and maintaining customary financial and accounting books and records; acting as liaison with the Rye Funds’ independent public accountants; computing the net asset value of the Funds’ shares; and providing specified anti-<mask> services involving subscribers.


In asserting the applicability of this doctrine (although not referring to it by name), plaintiffs contend that BNY Mellon had superior knowledge about Madoff from three principal sources: First, they claim that BNY Mellon’s predecessor, The Bank of New York, “undoubtedly conducted substantial due diligence” in acquiring Ivy, a subsidiary that had evidence that Madoff was a fraud risk, and that BNY Mellon therefore “knew or should have known about the evidence that Madoff was misusing client funds.” (See amended complaint ¶¶ 72-82.) Second, plaintiffs claim that BNY Mellon was obligated to maintain business records reflecting purchases of its own stock and, based on these records, “would have actual and/or constructive knowledge that Madoff had not actually purchased the numbers of shares” he claimed. (Id. ¶ 69.) In response to BNY Mellon’s point that the shares were held in street name, plaintiffs argue that the Bank acted recklessly in not checking its own data. (Plaintiffs’ mem in opp at 20-21.) Third, plaintiffs argue that because Madoff maintained a BMIS account at BNY Mellon, the Bank had obligations under the Bank Secrecy Act to identify and report suspicious <mask> activities to the government. (Amended complaint ¶¶ 59-64.) Plaintiffs assert that the Bank therefore “either was or should have been suspicious of Madoff’s money laundering operations through the BMIS account,” and “recklessly overlooked or ignored evidence that something was wrong with the cash flows to and through the BMIS account.” (Id. ¶ 65.)


. The complaint alleges that BNY Mellon had an obligation under the Bank Secrecy Act (31 USC §§ 5311-5332) to conduct due diligence on BMIS in order to report <mask> transactions to the government; that BNY Mellon had a duty to avoid conflicting loyalties to Madoff and the Rye Funds; and that it failed to disclose its “conflict of interest arising from Madoff s suspicious banking activities,” thereby breaching both its duty of due care and its fiduciary duties. (Amended complaint ¶¶ 59-65.) In opposing defendants’ motion to dismiss, plaintiffs acknowledge that the Bank Secrecy Act did not impose any obligation on BNY Mellon to report to the Rye Funds about the BMIS account. Without withdrawing, or specifically addressing, the pleaded allegations, plaintiffs represent that they do not assert that BNY Mellon breached a duty under the Bank Secrecy Act, and assert generally that their claim is that the Bank breached its fiduciary and common-law duties as cash custodian and administrator to the Rye Funds. (Plaintiffs’ mem in opp at 21.)


DOE considered all the requisite elements. However, DOE erroneously concluded that the crime, and the facts which surrounded petitioner’s plea, bore a “direct relationship” to the license’s requirement of working with children and failed to give effect to the presumption to which petitioner was entitled. This conclusion is arbitrary and capricious as there is no evi*313dence in the record concerning this “direct relationship” nor does DOE ever articulate how petitioner’s crime or his prior acts bear a “direct relationship” with the job duties of a paraprofessional.3 Instead the denial appears to be based simply on supposition unsupported by facts. Such decision-making does not comport with the Correction Law, and runs athwart to the presumption of rehabilitation afforded by Correction Law § 753 (2) (see e.g. Matter of Dellaporte v New York City Dept. of Bldgs., 106 AD3d 446 [1st Dept 2013] [denial of the renewal of a stationary engineer license was arbitrary and capricious because the conviction for theft of funds bore no direct relationship to the duties of a stationary engineering license and respondent failed to afford petitioner with the mandatory presumption of rehabilitation attendant to petitioner certificate of relief from disabilities]; Matter of Gil v New York City Dept. of Bldgs., 107 AD3d 632 [1st Dept 2013] [respondents arbitrarily concluded that petitioner’s convictions of mail fraud and <mask> bore a direct relationship to the duties and responsibilities attendant to a stationary engineer]; compare with Matter of Bonaventure v Perales, 106 AD3d 665 [1st Dept 2013] [direct relationship existed between petitioner’s crimes including convictions for assault and larceny and his employment as a security guard whose duties consisted primarily of the protection of persons and property]).


DOE arbitrarily and capriciously concluded that the crime and facts surrounding petitioner’s plea bore a “direct relationship” to the license’s requirement of working with *392children. According to DOE, as part of her licensing investigation, petitioner revealed that she was convicted of petit larceny for stealing merchandise while employed at Best Buy. DOE proffers no evidence demonstrating how such conduct would be relevant to petitioner’s potential employment as a school bus attendant, where she would not be in charge of sales, handling cash, or taking in orders and processing returns (see Matter of Gil v New York City Dept. of Bldgs., 107 AD3d 632 [1st Dept 2013] [holding that respondents arbitrarily concluded that petitioner’s conviction for mail fraud and <mask> bore a direct relationship to the duties and responsibilities attendant to a stationary engineer]). DOE’s argument that petitioner would be responsible for the “confidential information” of children during the performance of her duties is unpersuasive. DOE does not specify what, if any, “confidential information” of children petitioner would be responsible for in her capacity as a school bus attendant. Had the potential for a financial benefit been shown here, DOE could have established a link between petitioner’s prior offense and the license she now seeks. No such connection was established. Indeed, DOE has not shown that a situation could emerge wherein petitioner would use the “confidential information” of children for the purpose of inuring a financial benefit to herself. Instead, DOE’s denial appears to be based on supposition unsupported by facts.


The Court of Appeals amended the order of the Appellate Division which dismissed the plaintiffs’ entire proceeding against the bank since it determined that plaintiff had sufficiently pleaded a cause of action for commercial bad faith. The court held that the plaintiff pleaded "not merely a lapse of Vary vigilance’ * * * or even 'suspicious circumstance which might well have induced a prudent banker to investigate’ ” but, instead, the plaintiff portrayed a scheme of massive dimension accomplished in part through a pattern of <mask> conducted on a near daily basis by a single individual concentrated within a few months at one branch (Prudential-Bache Sec. v Citibank, supra, at 276). The court held that using these facts prior to discovery the court was required to view plaintiffs’ assertion favorably and as such they were sufficient to form the basis for a cause of action for commercial bad faith.


Renee A. White, J. On June 2, 1992 the defendant was convicted, after a jury trial, for the crimes of grand larceny in the second degree, two counts of criminal possession of stolen property in the second degree, two counts of criminal possession of a forged instrument in the second degree and <mask> in the second degree. Following the verdict, the People requested that bail be set. The court set bail in the amount of $25,000 and adjourned the matter to July 13, 1992 for sentence. On June 3, 1992 the defendant’s wife, Gloria R. Mosesson, posted the bail and the defendant was released.


It is the contention of the plaintiff that the moneys attached in the brokerage accounts maintained by the various defendants in Panama and Miami, Florida, are proceeds of <mask> stemming from the activities of narcotics sales by the Cali Cartel in the State of New York. The defendants argue that the attachments must be vacated because the situs of the accounts are in Panama and Florida and are thus beyond the court’s attachment power. Moreover, the cross-moving defendants claim that they are in no way involved in drug activity, that they are legitimate business people in Columbia and that their acquisition of the claimed tainted moneys coming from the United States was innocent of any criminality or knowledge of its source.


Capparelli’s stated purpose in obtaining these checks was to make a down payment on the Queens house. With the aid of the checks, Capparelli was able to purchase the house, enabling Capparelli to benefit from the extortion by investing the cash derived from that crime and further aiding Capparelli to commit and profit from that crime by providing opportunity for the use of labor and materials extorted from McCormack International and its subcontractors on the Tudor project. (Penal Law § 470.10 [2]; see, e.g., United States v Saget, 991d 702, 712 [11th Cir 1993].) It is important to note that the purchase of the house with the proceeds of the crime is not <mask> under our statute, since real estate is not "[equivalent property” as defined by section 470.00 (2). The purchase of the house is relevant only insofar as it proved that the defendant’s intent in converting the cash to checks, was to enable him to benefit from the proceeds of the crime, and to facilitate its commission. (See, e.g., United States v Montoya, 945d 1068, 1076 [9th Cir 1991] [applying 18 USC § 1956 (a) (1) (A) (i) defendant’s deposit of bribe check sufficed under statute requiring proof that defendant engaged in the transaction with " 'inten(t) to promote the carrying on of specified unlawful activity’ ”].) Accordingly, these counts are sustained.


The remaining counts of <mask> in the second degree are based upon the defendant’s demand that McCormack International deposit $50,000 in an Irish bank account in his wife’s name. This deposit, according to the victims of *1012the extortion, was a direct result of Capparelli’s threats. Credit in an account in a financial institution is a form of "[equivalent property” (Penal Law § 470.00 [2]), and a deposit of money into a bank account is a "[transaction” (Penal Law § 470.00 [3]) within the meaning of the statute. However, not every transaction involving the proceeds of specified criminal conduct is money laundering. (See, e.g., United States v Sanders, 928d 940, 944-947 [10th Cir 1991].) The evidence must establish that the transaction involved an "exchange” of proceeds of criminal conduct for other monetary instruments or equivalent property. Had the defendant attempted to withdraw these funds, the withdrawal would have constituted a "[t]ransaction” (Penal Law § 470.00 [3]) in which the proceeds were exchanged, and would have established money laundering. (See, e.g., United States v Jackson, supra, 935d, at 841.) Here, the $50,000 deposit was the product of the crime. Accordingly, only the first part of the required exchange occurred. Nonetheless, the evidence justifies the inference that the defendant intended by this deposit in his wife’s name, to conceal the source of this money and to benefit from his extortion. Only the further requirement of his wife’s personal presence to complete forms, prevented culmination of the exchange. Since the evidence showed that the McCormacks’ deposit of the $50,000 put it within the defendant’s power to complete the exchange, which he apparently failed to do only out of fear of detection, these counts are reduced to an attempt to commit money laundering in the second degree. (People v Mahboubian, 74 NY2d 174, 191-192 [1989].)


"(a) A corporate account was apparently controlled by three lawyers, who were listed as officers of this corporation. One of these persons was linked with a <mask> scheme in *700the Pablo Escobar indictment proceeding in April, 1990. Shortly after the public release of the Pablo Escobar information, the salesman in charge of the account * * * [agreed] that this account * * * would leave DLJ and come back repackaged as an offshore trust. Subsequently, this account came back with the same [government-backed $10 million] securities, not as a trust but as an offshore corporation. However, the papers at DLJ did not disclose (in violation of SEC and New York Stock Exchange rules) any of the persons in control of the corporation because the officers listed for this corporation were not individuals, but three other offshore corporations. "(b) Money was being taken in from third parties and sent out to other third parties who had no apparent relationship to the accounts. Many of these accounts in which this occurred had no security transactions. The wiring of funds to third parties and the receipt of third party checks violated DLJ’s rules * * * "(c) Trades were done in apparently unrelated accounts, in a manner indicating that the salesman involved was using discretion without written authorization as required by DLJ rules * * * "(e) Money was wired overseas to third parties, in large amounts, to accounts in countries generally regarded as secrecy countries. In three instances, funds were wired in such a manner as to conceal the true name of the DLJ customer wiring the funds. "(f) Many accounts did not contain proper documentation for trading authorizations or disclose the individuals who actually controlled these accounts, in violation of DLJ and New York Stock Exchange rules.” After his discharge, plaintiff maintained that he had been dismissed because of his reporting of the alleged violations of rules and regulations to, among others, the defendant Robert Albano, DLJ’s compliance director. Thereafter, plaintiff brought an arbitration proceeding before the New York Stock Exchange. In the arbitration proceeding, plaintiff filed a statement of claim indicating DLJ’s alleged motivation for his discharge. DLJ filed a response to statement of claim which vigorously denied plaintiff’s allegations of violations of rules and regulations related to money laundering and maintained the plaintiff had been discharged because of poor job performance. In May 1993, the New York Stock Exchange issued an *701arbitration award in favor of Mulder in the amount of $114,668, and costs of $1,000. The decision did not specify the basis of the award. However, the award recited the following case summary: "Ex-employee, Internal Auditor vs. Member Firm and Officers alleging that when he uncovered and brought to senior management’s attention, by way of an audit report, a drug money laundering scheme within the firm, he was wrongfully terminated and his professional reputation was damaged. Claimant also alleges false reporting to the NYSE and seeks back pay and benefits, payment for his consulting services, future earnings and exemplary damages.”


It is true that punitive damages are not normally granted unless there is a wrong to the public (Walker v Sheldon, 10 NY2d 401). However, punitive damages can be awarded for a breach of contract where there is bad faith or a dishonest failure to carry out a contract (Gordon v Nationwide Mut. Ins. Co., 30 NY2d 427). Although punitive damages in contract actions are relatively rare, they can be awarded where the defendant’s conduct is deemed by the court to be truly egregious. For example, in Aero Garage Corp. v Hirschfeld (185 AD2d 775 [1st Dept], lv denied 81 NY2d 701), in which a landlord deliberately prevented a tenant from obtaining a permit needed to operate the tenant’s business, the Court awarded the tenant punitive damages against the landlord. In the instant case, if plaintiff’s allegations are assumed to be true, as they must be for present purposes, DLJ dismissed plaintiff by reason of his attempt to report serious violations of securities laws and regulations designed to prevent <mask>. Certainly there is a strong public policy in favor of encouraging persons such as plaintiff to report violations of these laws without fear of retaliation by the employer. Thus, the claim for punitive damages in the first cause of action shall be sustained.


In the present case, the Wall Street Journal article, after briefly describing the nature of the arbitration proceeding and indicating that plaintiff had received an award of $114,668, set forth DLJ’s position as follows: "Donaldson Lufkin said it fired Mr. Mulder for poor performance unrelated to his <mask> report. 'The fanciful tale of intrigue and cover-up Mulder made regarding money laundering in DLJ’s Miami office * * * is without basis in fact and is irrelevant to Mulder’s termination,’ the firm said in papers filed with arbitrators.”


Concurrent with the diversion of funds from BNU an investigation of Steve’s operations by the United States Department of Justice was underway. Two weeks after the hearing before this court on BNU’s motion for a TRO on the funds in the accounts in New York City, the United States Attorney filed an indictment against Steve’s principals, Steve Wangboje and Azie Guice, in the United States District Court in New Jersey. The indictment charged that they had engaged in "money laundering” of funds from narcotic operations, wire fraud and conspiracy. The affidavits of the United States Drug Enforcement Agency personnel in support of the orders for the interception of wire communications among the defendants indicated that the <mask> scheme was related to drug trafficking activities by car dealerships located in Nigeria. One such dealership was Skymit Motors, Ltd. in Lagos, Nigeria, to which Steve’s shipped luxury vehicles and parts. Communications intercepted from Wangboje’s home with the other defendants "reflect that the Subject[s] themselves are actively involved in fraudulent schemes * * * and have customers who were/are engaged in drug trafficking.” The wiretaps also revealed that Skymit attempted to impede the investigation in Nigeria by, inter alia, instructing Steve’s to manufacture and alter documents, and "stonewall” the investigators.


There are two distinguishing factors which make Feathers (supra) inappropriate and inapplicable in the view of this court. First, assuming the truth of the allegations, Money Center is accused of having committed an affirmative act in New York, <mask>, via instructions conveyed to BONY. (See, Pilates, Inc. v Pilates Inst., 891 F Supp 175 [SD NY 1995].) Second, to allow a defendant to conspire and direct tortious activities in New York, in furtherance of that conspiracy, and then avoid jurisdiction because it directs those activities from outside the State or country, is to ignore the reality of modern banking and computer technology in the end of the 20th century! A defendant with access to computers, fax machines, etc., no longer has to physically enter New York to perform a financial transaction which may be criminal or tortious, i.e., conversion. He may secrete himself and/or direct activities from locations where jurisdiction may be impossible to acquire, including a boat beyond the three-mile limit. Thus, the emphasis should be on the locus of the tort, not whether defendant was physically here when the tortious act occurred. Once the court finds that the tort occurred within the State, it should look at the totality of the circumstances, to determine if jurisdiction should be exercised under CLPR 302 (a) (2) (see, Parke Bernet Galleries v Franklyn, 26 NY2d 13 [1970] [which held that a telephone call during an auction from a buyer outside New York was sufficient to create an agency relationship to the gallery’s employee]). Having found that the tort occurred within New York the court concludes that defendant’s bodily presence is not an indispensable requirement for long-arm jurisdiction. It would be a travesty to permit the use of our institutions to channel stolen funds and/or the proceeds from *189heroin sales by those who impudently claim they are beyond our borders! It would be a gross violation of common sense and reality to shelter such activities.


However, an allegation of fraud may be based on "an act or conduct by defendant” that is intended to deceive plaintiff. Concealment of facts one has an obligation to disclose with the intent to defraud has the same legal effect as an affirmative misrepresentation. (See, Quadrazzi Concrete v Mastroianni, 56 AD2d 353 [1977].) Here, the complaint alleges that Money Center was part of the conspiracy to defraud BNU which began in Macau with Chan’s misappropriation of the $6.5 million. The heart of the allegation is that Money Center willingly took part in a phase of the conspiracy. Money Center’s financial links to Steve’s, Keymon and Skymit are clear. There is a strong indication that those three entities were involved in a <mask> scheme that included the purloined BNU funds.


Finally, there are two other items that indicate that Money Center was not duped into participating in the <mask> scheme but was a knowing participant. First is the reference to Money Center in the DEA summaries of the wire taps monitoring the conversations between Skymit’s principal, Tayo Ayeni, and Steve’s principal, Steve Wangboje. The summary states: "They discuss the guy with the Money Center, Mr. Ogbege [sic] and Skymit.” Second is the conclusion stated in the "Letter Of Request for the Apprehension of Funds” from the Criminal Investigation Court of Macau which states, inter alia, referring to the Money Center BONY account, "upon the holder[s] of those accounts exist strong suspicion of having received such funds, being well aware were originated of criminal activities”. Taken as a whole there is enough to rebut a motion to dismiss.


John A.K. Bradley, J. Among the many mundane cases that pass through this courtroom, occasionally a case more likely found in Hollywood than in New York Supreme Court arises. This is such a case, involving, among other things, high-priced call girls and a tony *468escort service, an allegedly corrupt senior police officer, a vengeful gun dealer and lover, relationship abuse, bigamy, alleged prosecutorial persecution, and much more. Before the court are a number of motions designed to parse through this exciting fact pattern and have this court rule on the efficacy of this prosecution for falsifying business records, <mask>, and promoting prostitution.


“A person is guilty of <mask> in the second degree when that person exchanges or receives in exchange, in one or more transactions, one or more monetary instruments which are the proceeds of specified criminal conduct and have a total value exceeding ten thousand dollars for one or more other monetary instruments and/or equivalent property when that person knows that the monetary instrument or instruments exchanged or received in exchange are the proceeds of any criminal conduct and that person: “1. intentionally makes the exchange to conceal or disguise the nature, the location, the source, the ownership, or the control of such proceeds; or “2. intentionally makes the exchange to aid himself or another person to commit or profit or benefit from specified criminal conduct”. (Penal Law § 470.10.) As set forth in the Practice Commentaries to Penal Law article 470, the essential conduct involved in money laundering is the exchange of certain forms of ill-gotten money for other forms of money or equivalent property. (Donnino, Practice Commentaries, McKinneys Cons Laws of NY, Book 39, Penal Law art 470, at 582.) Usually, cash is the medium of money laundering, but it need not be. Here the allegation is that credit with *471American Express was obtained, through which American Express would give checks and electronic deposits to the limousine companies, which would then give checks to defendant Carlyle, the escort service. The defendants’ point is a technical one, that checks are not monetary instruments within the meaning and intent of the statute. The People argue that the statutory definition of “monetary instrument” includes “coin and currency of the United States or of any other country; bank checks; traveler’s checks; money orders; and investment securities and negotiable instruments in such form that delivery is sufficient to pass title.” (Penal Law § 470.00 [1].) Here, however, the checks at issue were none of these; they were personal business checks. The equivalent Federal statute tracks the State definition almost precisely (see, 18 USC § 1956 [c] [5]), except the Federal statute explicitly includes “personal checks”. While the People assert that this was a mere oversight and the Legislature intended to include personal checks, the court cannot agree. The inclusion of bank checks, which are independent obligations of the bank issued on behalf of, in some instances, an anonymous remitter, shows that the Legislature focused on the issue of checks, but deliberately excluded personal checks. The instruments here are not bank checks.


It is true, as the People argue, that checks are negotiable instruments, but this is irrelevant because mere delivery of such a check is not sufficient to pass title, as the statute requires. The purpose of the <mask> statutes is to prevent criminals from moving the profits of criminal activity into one or more anonymous forms of consideration. Each of the items included in the statute qualifies as anonymous financial consideration, but a personal check does not. Not only is its provence traceable, but it may not be converted to cash without endorsement, literally a signature. (UCC 3-202.) A personal check (except perhaps one drawn to “cash”) may not be effectively passed without such identifying endorsement. Accordingly, these counts must be dismissed.


The magazine article, entitled Power Play, describes itself as an exclusive report revealing how the Russian mob has muscled its way into the National Hockey League. One of the subjects of the article is Slava Fetisov, who was questioned by the author, Mr. Friedman, in connection with the article. Mr. Fetisov is said to be linked to the mob, and a close associate of Vyacheslav Ivankov. The article quotes a confidential FBI report as describing Mr. Ivankov “as a shrewd and respected leader over a group of ruthless members knowledgeable in business, financial, legal and government operations * * * In addition to extortion, <mask>, drug trafficking, Ivankov is suspected of not only arranging numerous murders but bragging about them.” (Details, at 146.) Plaintiff Komarov is mentioned in the article in connection with the author’s interview of Fetisov, as follows:


This is an action alleging libel based on an article written by Susan Edelman which contained a photograph by Devlin Barrett. The article was published on December 11, 2000 in the New York Post, which is published by NYP Holdings, Inc. The article reported that Boris Kotlyarsky was under a federal indictment charging him with conspiracy and <mask> for organized crime. It also described the alleged scheme, and reported that the government had stated that Reliable, a medical clinic run by the plaintiffs, was a “medical mill set up to defraud insurance companies.” On December 12, 2000, Boris Kotlyarsky left a message for Susan Edelman, which she returned on December 19, 2000. During the course of the conversation, Boris Kotlyarsky requested a retraction, after advising Susan Edelman that the contents of the article were false, and that his reputation, his wife’s, and that of his business, had been damaged. On January 3, 2001, he pleaded guilty to one count of conspiracy to money launder. Thereafter, Boris Kotlyarsky attempted to contact Susan Edelman between January 20, 2001 and March 18, 2001. However, a meeting between the two parties was not convened until April 20, 2001 at the New York Post office. At this meeting, Boris Kotlyarsky brought court documents from his criminal case, attempting to prove the falsity of the article. During the course of the meeting, photographs were taken with either the expressed or implied promise that they would be used in a retraction. On May 29, 2001, Boris Kotlyarsky began serving his sentence. While he was incarcerated, he received no news of the retraction, so he wrote a letter to Susan Edelman requesting a copy of the retraction. Susan Edelman responded in a letter dated February 12, 2002 that she had left messages with his criminal attorney about a possible article, and that since she did not receive a response, the requested retraction article was withdrawn. Plaintiffs Boris Kotlyarsky, Alla Kotlyarsky, and Reliable Rehabilitation Center, Inc., commenced this action against defendants New York Post, Susan Edelman, Devlin Barrett, and NYP Holdings, Inc., by filing the complaint on August 12, 2002. On September 4, 2002, plaintiff served defendant NYP Holdings, Inc. with the summons and complaint. Neither Susan Edelman nor Devlin Barrett was served. Issue was joined on September 24, 2002. Defendants now move for *152summary judgment dismissing the complaint based on grounds that it was time-barred.


Before Owen, Chief Judge, and Clement and Engelhardt, Circuit Judges. Edith Brown Clement, Circuit Judge: Adrian C. Hammond, Jr. pleaded guilty to bank fraud, <mask>, and obstructing the administration of internal revenue laws in 2017. At sentencing, the district court granted him a U.S.S.G. § 5K1.1 downward departure and a downward variance. It then sentenced him to one year and one day of imprisonment with three years of supervised release. Hammond was released in August of 2019. On March 29, 2021, the United States Probation Office (USPO) filed to revoke Hammond’s supervised release, alleging two Class C violations. Case: 21-30433 Document: 00516191695 Page: 2 Date Filed: 02/04/2022


Hammond admitted to the first violation and the district court found him guilty of the second violation. The district court calculated Hammond’s guideline range at 5 to 11 months. It then upwardly departed pursuant to § 7B1.4 cmt. n.4 and imposed a 24-month sentence, stripping him of the previous benefits afforded to him. Hammond timely appealed, claiming that the district court failed to put him on notice that it might upwardly depart under § 7B1.4 cmt. n.4. We affirm the district court’s sentence. I. On November 6, 2016, a federal grand jury returned an indictment against Hammond. The indictment was superseded on May 23, 2017. Following the superseded indictment, Hammond pleaded guilty on August 23, 2017, to bank fraud, <mask>, and obstructing the administration of internal revenue laws. His white-collar scheme included the following: (1) he knowingly and intentionally defrauded a bank when he provided it with falsified documents to obtain a loan; (2) he then laundered some of the proceeds from that loan; and (3) he did all this while attempting to subvert IRS’ efforts to collect taxes by filing false court documents and engaging in business transactions intended to conceal his earnings. After pleading guilty and initially refusing to cooperate with law enforcement, Hammond eventually provided the authorities with some information. As the government describes in its brief, however, that information “warranted only a ‘very modest benefit.’” The government accordingly recommended a one-point reduction under U.S.S.G. § 5K1.1. On August 22, 2018, the district court held Hammond’s sentencing hearing. According to his presentence report, Hammond initially faced 41 to 51 months of imprisonment as a Level 20, category III offender. The district court then granted Hammond a § 5K1.1 one-level reduction for his


to forfeiture, rather than the amount that was received by the entire criminal enterprise. We therefore conclude that the DHS can meet its burden of demonstrating a loss in excess of $10,000 to the victims of an offense involving fraud or deceit under section 101(a)(43)(M)(i) by showing that a respondent was subject to criminal forfeiture for such an amount and that the forfeiture ordered was traceable and sufficiently tethered to the conviction. See Chiao Fang Ku v. Att’y Gen. U.S., 912 F.3d 133, 140 (3d Cir. 2019) (considering a forfeiture allegation contained in the information and holding that a conviction under 18 U.S.C. § 1343 constituted an aggravated felony under section 101(a)(43)(M)(i)); Eversley-MacClaren v. Holder, 578 F. App’x 664, 666 (9th Cir. 2014) (determining that the Board appropriately relied on a forfeiture order, along with other sentencing documentation, to find the loss to the victims exceeded $10,000 under section 101(a)(43)(M)(i)); cf. Barikyan v. Barr, 917 F.3d 142, 146–47 (2d Cir. 2019) (holding that an order of forfeiture showing a respondent laundered more than $10,000, established that he was convicted of aggravated felony <mask> pursuant to section 101(a)(43)(D) of the Act). In the instant case, the respondent was convicted of conspiracy to commit wire fraud under 18 U.S.C. §§ 1349 and 1343. He agreed in his plea agreement that he was subject to forfeiture for his offense under 18 U.S.C. § 981(a)(1)(C) (subjecting to forfeiture all property derived from proceeds traceable to the offense, or a conspiracy to commit the offense). See Thompson, 990 F.3d at 683 (involving a defendant convicted under 18 U.S.C. §§ 1349 and 1343 who was subject to forfeiture under 18 U.S.C. § 981(a)(1)(C)); United States v. Day, 524 F.3d 1361, 1375–76 (D.C. Cir. 2008) (describing when a forfeiture order is appropriate under 18 U.S.C. § 981(a)(1)(C)). The sentencing judge applied the Supreme Court’s decision in Honeycutt in determining the forfeiture amount, specifically linking this amount to proceeds directly traceable to the respondent. See Thompson, 990 F.3d at 689 (determining Honeycutt applies to forfeiture under 18 U.S.C. § 981(a)(1)(C)); see also Honeycutt, 137 S. Ct. at 1632–35 (holding that forfeiture is limited to property or proceeds in the defendant’s possession that are directly traceable to his or her conduct). According to the amended judgement, the respondent was ordered to pay “[f]orfeiture traceable to the offense, in the amount of $346,717.08.” The amended judgment and the letter from the Federal prosecutor both explicitly state that the $346,717.08 forfeiture amount was traceable to the respondent’s criminal conduct of conspiring to defraud cell phone customers. 3 This amount is thirty-four times greater than $10,000. The respondent asserts that the prosecutor’s letter is not sufficiently reliable to establish that he agreed to the $346,717.08 forfeiture amount. However, as we previously noted,


This was not the only fraud in this matter, but was the only one discussed in the affidavit. Nyamekye was tried on charges of conspiracy to commit <mask>, 18 U.S.C. § 1956(h), and engaging in monetary transactions in property derived from specified unlawful activity, § 1957(a). The District Court had jurisdiction under 18 U.S.C. § 3231 and we have jurisdiction under 28 U.S.C. § 1291.


When Triggs’s employer confronted her about the payments, she said another employee was responsible and had threatened her. Triggs quit her job in May 2015, and she told her employer her husband had died. Triggs later admitted her husband was alive and she was responsible for the fraudulent payments. She promised to pay back the money she took. On January 2, 2018, the People filed an information charging Triggs with identity theft (§ 530.5, subd. (a); count 1), false personation for a written instrument (§ 529, subd. (a)(2); count 2), three counts of grand theft (§ 487, subd. (a); counts 3–5), and <mask> (§ 186.10, subd. (a); count 6). As to the grand theft charges, the People further alleged that Triggs engaged in a related pattern of felony conduct resulting in the loss of more than $100,000, within the meaning of section 186.11, subdivision (a)(3). On January 7, 2020, Triggs pleaded no contest to the charges and admitted the section 186.11 allegation. The court postponed sentencing because Triggs agreed to make scheduled restitution payments to her employer. Specifically, she agreed to make a $14,000 payment within a week, an $11,000 payment by June, and $2,000 payments each month beginning in February. The court noted if Triggs “fall[s] short on restitution, this is clearly a [state] prison case” and it would not “hesitate to send her to prison . . . .” Triggs had not made any payments to her employer as of early February 2020. On February 13, 2020, the employer received an envelope from Triggs, but it was empty. It appears Triggs claimed she mailed a check, but someone took it out of the envelope before it got to the employer. The prosecutor believed Triggs was lying.


consecutive terms of 60 months and 84 months that were required for his two 18 U.S.C. § 924(c) convictions. Lewis was also convicted of one count of conspiracy to interfere with commerce by threats or violence, a violation of the Hobbs Act; eleven counts of <mask>; one count of money transactions in property derived from specific unlawful activity; seven counts under the Hobbs Act for interference with commerce by threats or violence; and one count of possession of a firearm by a felon. Lewis first challenges the district court’s application of the five-level enhancement under U.S.S.G. § 2B3.1(b)(2)(C) to two robberies. The enhancement applies if a firearm is brandished during a robbery. With respect to the robbery in Strongsville, Ohio, the district court did not clearly err in determining that it was reasonably foreseeable to Lewis that a firearm would be brandished. See United States v. Jordan, 945 F.3d 245, 263-64 (5th Cir. 2019), cert. denied, 140 S. Ct. 2698 (2020), and cert. denied, 141 S. Ct. 606 (2020). Although Lewis did not commit the Strongsville robbery himself, the evidence sufficiently connected him to the robbery and the unknown person who brandished the firearm while committing the robbery. The evidence showed that Lewis entered the jewelry store about two weeks before the robbery and discussed the availability of high-priced diamonds with the manager. The unknown person later stole diamonds from the same case of large diamonds where Lewis spoke to the manager. Lewis also stayed at a hotel near the store, and he later possessed diamonds that were consistent with ones taken in the robbery. He also had personal knowledge that brandishing a firearm was one way to commit a robbery because he earlier provided a different accomplice with a firearm and that accomplice brandished the firearm during two other robberies. Lewis also challenges the application of the § 2B3.1(b)(2)(C) enhancement to the robbery of Wright Pawn and Jewelry Company. Contrary to Lewis’s argument that the Government failed to rebut the


Significantly, the defendants in Paul for Councilconceded that their conduct was illegal, but argued that despite the illegality, their conduct was nevertheless entitled to the protections of the anti-SLAPP statute. (Paul for Council, supra, 85 Cal.App.4th at p. 1366, 102 Cal.Rptr.2d 864["Defendants contend their campaign <mask> activity was taken 'in furtherance ' of their constitutional right of free speech, and therefore such activity comes within the parameters of section 425.16's protection, even though such activity was found to be illegal"].) The same is not true here. Defendants do not concede that all of the conduct underlying Sweetwater's complaint was illegal. As a result, Paul for Council is not as similar to this case as Sweetwater suggests, and it is clearly not controlling.


Lastly, DeskSite posits that <mask> is a "known concern" within the automobile industry, especially with high-end exotic cars. Even if we accept this to be true, the use of a third party's check to pay for a car by itself is still not a red flag of money laundering, particularly where, as here, the check contains a memo line with the customer's initials on it. Further, courts have refused to fashion new duties to deal with similar endemic problems such as identity theft and have justified that refusal with reasoning that is equally applicable here: "Given the scope of the problem and the consequences to the community of imposing a noncontractual duty with resulting liability for breach, a decision to shift the burden of loss from the actual victim to a third party duped by the thief is one to be made, if at all, by the Legislature, not the judiciary." ( Rodriguez , supra , 162 Cal.App.4th at p. 466, 75 Cal.Rptr.3d 543.)


The People originally filed a criminal complaint, but later dismissed it in favor of *721a grand jury hearing. On May 16, 2016, a Riverside County criminal grand jury returned an indictment against petitioner and codefendants Cary Abramowitz, Ana Solis, and Gladys Ross3 in Riverside County case No. RIF1670175. The indictment charges count 1 for conspiracy (§ 182, subd. (a)(1) ), for conspiring to knowingly make or causing to be made any false or fraudulent claims for payment of health care benefits, in violation of section 550, subdivision (a)(6) (Heidary, Abramowitz, Solis, and Ross); counts 2 through 19 for false or fraudulent claims for payment of health care benefits to 18 different, named insurers (§ 550, subd. (a) ) (Heidary, Abramowitz, Solis, and Ross); counts 20 through 37 for willfully and unlawfully making and causing to be made a knowingly false and fraudulent material statement and material representation to 18 different named insurers for payment of workers' compensation ( Ins. Code, § 1871.4, subd. (a)(1) ) (Heidary, Abramowitz, Solis, and Ross); counts 38 through 66 for <mask> ( Pen. Code, § 186.10, subd. (a) ) (Heidary); count 67 for unlicensed practice of medicine ( Bus. & Prof. Code, § 2052, subd. (a) ) (Heidary); count 68 for "capping" ( Pen. Code, § 549 ) (soliciting, accepting or referring any business with the knowledge that, or with reckless disregard for whether, the individual or entity intends to violate Pen. Code, § 550 or Ins. Code, § 1871.4 ) (Heidary, Abramowitz, and Solis); and count 69 for the unlicensed practice of law ( Bus. & Prof. Code, § 6126, subd. (a) ) (Heidary and Abramowitz). The indictment also alleges a white-collar crime enhancement ( Pen. Code, § 186.11, subd. (a)(2) ) (Heidary, Abramowitz, Solis, and Ross).


First, only a portion of the 69 counts in the operative indictment involve aggregation of multiple acts into single counts. Notably, counts 2 through 19 for insurance fraud in violation of Penal Code section 550, subdivision (a)(6), explicitly allege that "the aggregate amount of claims and amount at issue exceeded Nine Hundred Fifty dollars ($950) ...." Counts 20 through 37 for violations of Insurance Code section 1871.4, subdivision (a)(1) (the workers' compensation claims as defined in Lab. Code, § 3207 ), do not overtly use the term "aggregate" regarding multiple acts, but the counts are based on such multiple acts. Further, petitioner argues as much in the petition and in his traverse, contending that the insurance and workers' compensation fraud claims are improperly aggregated, violate the due process requirement of adequate notice of the charges against him (discussed in the next section), and that the other counts against him (e.g., conspiracy, capping, etc.) must fall if the fraud claims are improper. Counts 38 through 66 for <mask> ( Pen. Code. § 186.10, subd. (a) ), addressed solely against this petitioner, do not aggregate claims, nor do the remaining counts. Accordingly, we will only address the aggregation issue with respect to counts 2 through 19 and 20 through 37.


The November 5, 2016 article noted Flater's relationship to Gallaher and that Flater had spent "nearly $192,000 on mailers and canvassing in support of three of the six candidates for City Council." That spending "accounts for more than a third of the total in the race, including spending by candidates' campaigns." The article observed, "The record-breaking infusion of private cash into the race has highlighted the inequity between the $500 limits Santa Rosa puts on individual contributions to local campaigns and the unlimited amounts state law allows donors and groups to spend on independent expenditures not associated with candidates' campaigns." The article also reported that "Gallaher was cleared earlier this year of a similar complaint alleging" one of his companies "`engaged in campaign <mask> by making contributions in the name of'" persons who received reimbursement from the company.


Defendant Jedadiah Ray Bolding was convicted of one count of grand theft and eight counts of <mask>. On appeal, he challenges his money laundering convictions, in part, on the ground that the prosecution failed to offer sufficient evidence tracing the illegally obtained money to the monetary transactions involved in each of the money laundering counts. We conclude there was sufficient evidence supporting defendant's money laundering convictions based on the language of Penal Code section 186.10, subdivision (a), and current analogous federal law on money laundering.


We hold that, in a prosecution for <mask> under Penal Code section 186.10, subdivision (a), when the prosecution proceeds on the theory that the defendant conducted money laundering activities "knowing that the monetary instrument represents the proceeds of, or is derived directly or indirectly from the proceeds of, criminal activity," the prosecution must demonstrate that the amount of the illegally obtained funds equals or exceeds the amount of the monetary transaction. Acknowledging the fungibility of money, we also hold that, whether or *762not the illegally obtained funds have been commingled with legally obtained funds, the prosecution need not prove full or dollar for dollar tracing between the illegally obtained funds and the monetary transaction, as Mays held. Because the statutory basis on which Mays rested its holding has changed, we publish our opinion to clarify the current state of the law.


In the unpublished portions of this opinion, we conclude that (1) there was sufficient evidence of <mask> in count 25 of the operative charging document; (2) defendant forfeited an issue regarding the jury instructions for the money laundering counts; (3) the sentencing enhancements for white collar crime must be reversed; (4) the trial court did not err by imposing consecutive rather than concurrent sentences on the money laundering counts; and (5) the minute order and abstract of judgment must be amended to reflect the correct amount of defendant's custody credits.


A forensic accountant identified a total of 524 unauthorized checks written against the law firm's payroll account that were made out to defendant, totaling $ 1,115,396. The unauthorized checks had all been signed by defendant. The forensic accountant also charted deposits into and expenditures from defendant's personal Wescom Credit Union account from 2007 through October 2013. In analyzing the transactions from defendant's credit union account, the forensic accountant identified the following, which comprised the basis for the <mask> counts:


A jury convicted defendant of one count of grand theft ( Pen. Code, § 487, subd. (a) [count 1] ), and eight counts of <mask> (id. , § 186.10, subd. (a) [counts 20 through 27] ). The jury found defendant not guilty of 18 counts of fraudulently falsifying records. (Id. , §§ 470, 471 [counts 2 through 19].) The jury found true the sentencing enhancement allegations that the conduct in counts 1 and 20 through 27 involved the taking of more than $ 500,000 (id. , § 186.11, subd. (a)(1), (2)); that the transactions represented by counts 20 through 27 involved more than $ 50,000 but less than $ 150,000 (id. , § 186.10, subd. (c)(1)(A)); and that the value of the property loss in count 1 was in excess of $ 200,000 (id. , § 12022.6, subd. (a)(2)).


The trial court sentenced defendant to 10 years in state prison: an aggravated term of three years on count 1; a consecutive five-year term for the Penal Code section 186.11, subdivision (a) enhancement; and a consecutive two-year term for the Penal Code section 12022.6, subdivision (a)(2) enhancement on count 1. The court imposed a three-year aggravated term on each of the <mask> charges, and ordered that those sentences be served concurrently to the sentence on count 1. The Penal Code section 186.10, subdivision (c)(1)(A) enhancements on counts 20 through 27 were stricken for purposes of sentencing. In addition to other fees and fines, the court ordered defendant to pay $ 1,115,396 plus interest in restitution.


As is relevant to the theory pursued by the prosecutor, Penal Code section 186.10, subdivision (a) provides: "Any person who conducts or attempts to conduct a transaction or more than one transaction within a seven-day period involving a monetary instrument or instruments of a total value exceeding five thousand dollars ($ 5,000) ... through one or more financial institutions ... knowing that the monetary instrument represents the proceeds of, or is directly or indirectly from the proceeds of, *764criminal activity, is guilty of the crime of <mask>."


Mays, supra, 148 Cal.App.4th 13, 55 Cal.Rptr.3d 356 was the first, and remains the only, published case in California addressing tracing under Penal Code section 186.10. In Mays , the defendant was convicted of pimping and <mask>. The money laundering counts involved checks written for rent on the office through which the defendant ran his prostitution business, rent on a residence at which the prostitutes lived, and bills for cell phones used in the business. ( Mays, supra, 148 Cal.App.4th at pp. 18, 20, 55 Cal.Rptr.3d 356.) The trial court concluded that a prosecution, based on the same theory employed here, namely that a defendant conducted "a transaction through a financial institution with a monetary instrument of $ 5,000 or more based on the knowledge of criminal proceeds theory, requires proof that (1) the defendant's entire business was illegal, (2) there were deposits of $ 5,000 or more in criminally derived funds, or (3) there was a transfer of all funds out of the account." ( Id. at p. 32, 55 Cal.Rptr.3d 356.)


The Attorney General argues that Mays was incorrectly decided and should not be followed by this court. To determine whether tracing was required for a Penal Code section 186.10 violation, the court in Mays looked to the federal <mask> statutes: sections 1956 and 1957 of title 18 of the United States Code (hereafter " section 1956" and " section 1957," respectively), and to federal cases interpreting those statutes.


The majority view, as summarized by the Fourth Circuit Court of Appeals, is: "Money is fungible, and when funds obtained from unlawful activity have been combined with funds from lawful activity into a single asset, the illicitly-acquired funds and the legitimately-acquired funds (or the respective portions of the property purchased with each) cannot be distinguished from each other [citation]; that is, they cannot be traced to any particular source, absent resort to accepted, but arbitrary, accounting techniques [citation]. As a consequence, it may be presumed in such circumstances, as the language of section 1957 permits, that the transacted funds, at least up to the full amount originally derived from crime, were the proceeds of the criminal activity or derived from that activity. [Citations.] A requirement that the government trace each dollar of the transaction to the criminal, as opposed to the non-criminal activity, would allow individuals effectively to defeat prosecution for <mask> by simply commingling legitimate funds with criminal proceeds." ( U.S. v. Moore (4th Cir. 1994) 27 F.3d 969, 976-977 ; see U.S. v. Silver (S.D.N.Y. 2016) 184 F.Supp.3d 33, 51-52.)


Even before Rutgard was decided, a majority of other courts had employed an analysis when tracing in <mask> cases recognizing that money is fungible. As explained by the Tenth Circuit Court of Appeals: "The government had the burden of showing that the criminally derived property used in the monetary transactions was in fact derived from specified unlawful activity. This does not mean, however, that the government had to show that funds withdrawn from the defendant's account could not possibly have come from any source other than the unlawful activity. Once proceeds of unlawful activity have been deposited in a financial institution and have been credited to an account, those funds cannot be traced to any particular transaction and cannot be distinguished from any other funds deposited in the account. The 'tainted' funds may be commingled with 'untainted' funds, with the result being simply a net credit balance in favor of the depositor. The credit balance gives the depositor a claim against the bank and allows him to withdraw funds *767to the extent of the credit. In the context of a withdrawal, the portion of § 1957 requiring a showing that the proceeds were in fact 'derived from specified unlawful activity' could not have been intended as a requirement *1046that the government prove that no 'untainted' funds were deposited along with the unlawful proceeds. [Citation.] Such an interpretation would allow individuals to avoid prosecution simply by commingling legitimate funds with proceeds of crime. [Citation.] This would defeat the very purpose of the money-laundering statutes." ( U.S. v. Johnson (10th Cir. 1992) 971 F.2d 562, 570.)


Second, since both Rutgard and Mays were decided, section 1957 has been amended to include a definition of "proceeds." In U.S. v. Santos (2008) 553 U.S. 507, 128 S.Ct. 2020, 170 L.Ed.2d 912, the Supreme Court held that the word "proceeds" in section 1956 was ambiguous and could mean profits or receipts. ( U.S. v. Santos, supra, 553 U.S. at p. 511, 128 S.Ct. 2020.) Under the rule of lenity, the court interpreted proceeds as meaning profits because to trace the <mask> transaction to the defendant's profits would require more from the prosecution in order to obtain a conviction. ( Id. at pp. 513-514, 128 S.Ct. 2020.)