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Case 1:13-cr-00452-ENV Document 259 Filed 09/24/15 Page 1 of 6 PageID #: 1024

U.S. Department of Justice

United States Attorney


Eastern District of New York
CAO
F. #2013R01274

271 Cadman Plaza East


Brooklyn, New York 11201

September 24, 2015

By ECF with Courtesy Copy by Interoffice Mail


The Honorable Eric N. Vitaliano
United States District Judge
Eastern District of New York
225 Cadman Plaza East
Brooklyn, New York 11201
Re:

United States v. Gary Kershner, Songkram Sahachaisere, et al.,


Criminal Docket No. 13-452 (S-2)(ENV)
_

Dear Judge Vitaliano:


The government respectfully submits this letter to request reconsideration of
the Courts September 17, 2015 decision dismissing Count 23 from the Second Superseding
Indictment as time barred. The government respectfully requests that the Court reconsider in
light of the legislative history and caselaw that clearly states that obstruction of justice under
Title 18, United States Code, Section 1512 is a continuing offense defined by the
proceeding, not by the obstructive acts themselves. As such, the charge would not be time
barred until December 2015 and the Court should reconsider its decision.
In the alternative, the government wants to advise the Court and the defense
that the government will introduce evidence at trial that Sahachaisere lied under oath on
multiple separate occasions about his use of an illegal Costa Rican international business
corporation to conceal his payments for promoting RSGR, RNER, SYNW and TMHO.
Therefore, even if the Securities and Exchange Commissions (SEC) investigation is not
discussed in this trial, Sahachaiseres false statements under oath constitute direct evidence
of his consciousness of guilt. As discussed more fully infra, no discussion of the SEC
investigation is necessary to prove that Sahachaisere actively lied about his Moneyline
accounts.
As a final point, Sahachaisere has failed to officially assert an advice of
counsel defense by the Courts deadline. The government therefore requests an order barring
the defendant from referencing such a defense at trial.

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I.

Section 1512(c)(2) is a Continuing Offense That is Not Time-Barred

The statute of limitations at issue here provides that no person shall be


prosecuted for any offense ... unless the indictment is found ... within five years next after
such offense shall have been committed. 18 U.S.C. 3282 (1994). An offense is committed
when it is completed, Toussie v. United States, 397 U.S. 112, 115 (1970), that is, when each
element of that offense has occurred, United States v. McGoff, 831 F.2d 1071, 1078
(D.C.Cir. 1987). An exception has been recognized for continuing offenses. McGoff, 831
F.2d at 1078.
Continuing offense is a term of art and does not merely mean an offense
that continues in a factual sense. United States v. Yashar, 166 F.3d 873, 876 (7th Cir. 1999).
An offense is deemed continuing for statute of limitations purposes only when (a) the
explicit language of the substantive criminal statute compels such a conclusion, or (b) the
nature of the crime involved is such that Congress must assuredly have intended that it be
treated as a continuing one. Toussie, 397 U.S. at 115, 90 S.Ct. 858. The classic example of
a continuing offense is a conspiracy, but other offenses such as escape or kidnapping also
may fall within those definitions. See, e.g., McGoff, 831 F.2d at 1078; United States v.
Garcia, 854 F.2d 340, 34344 (9th Cir.1988); see also Toussie, 397 U.S. at 134135 (White,
J., dissenting) (listing offenses traditionally considered continuing offenses).
The hallmark of the continuing offense is that each day brings a renewed
threat of the evil Congress sought to prevent even after the elements necessary to establish
the crime have occurred. 397 U.S. at 122. For those crimes, the statute of limitations does
not begin to run when all elements are first present, but rather begins when the offense
expires. Yashar, 166 F.3d at 876. Therefore, for a continuing offense such as a conspiracy,
the statute of limitations would not run from the time of the first overt acts, but instead would
run from the occurrence of the last act in furtherance.
The government notes that Count 23 expressly charges a scheme between June
2009 and November 2010. Statutes that punish schemes, are considered to be continuing
offenses. See e.g., United States v. Hickman, 331 F.3d 439, 44548 (5th Cir. 2003) (health
care fraud is a continuing offense; United States v. Smith, 373 F.3d 561, 567 (4th Cir. 2004)
(embezzlement is a continuing offense); United States v. Nash, 115 F.3d 1431, 1441 (9th Cir.
1997) (bank fraud is a continuing offense); United States v. Sampson,--- F.Supp.3d ----,
2015 WL 4872551, at *8 (E.D.N.Y. August 12,2015) (Irizarry, J.) (stating that the crime is
complete and the statute runs only if the single act would make out the entire crime);
(United States v. Winn, F. Supp.3d 1119, 1123 (D. Nev. 2014). The test is whether the
statute punishes the execution of the scheme or merely each individual act. Hickman, 331
F.3d at 445446. It is well-settled that, when it comes to making false or misleading
statements, that the crime continues until the communication is received by person or
persons to whom it is intended to affect. United States v. Angotti, 105 F.3d 539, 543 (9th
Cir. 1997) (Discussing false statements under 18 U.S.C. 1014); see also United States v.

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Candella, 487 F.2d 1223, 1227 (2d Cir. 1973) (in an 18 U.S.C. 1001 prosecution, the crime
was continuing until received by the decisionmaker who ended the transaction).
As described in the statute, and charged here, it is clear that Section 1512(c)(2)
obstruction addresses interference with ongoing official proceedings, not just the
individual acts. The proceedings here could never be just a deposition, which would not
complete the crime. Rather, on the face of the statute, the crime is not complete until there
have been an obstruction of the ongoing proceeding. Fortunately, we do not need to rely
solely upon an interpretation of the text.
Obstruction of justice under Section 1512 was not considered a continuing
offense by all circuits in the past. See United States v. Moore, 582 F.Supp. 1575, 1577
(D.D.C. 1984) (witness tampering, Section 1512). However, Congress enacted the special
venue provision [18 U.S.C. 3237(a)] expressly to overrule these cases with respect to
Sections 1503 and 1512. . . . United States v. Trie, 21 F.Supp.2d 7, 18 (D. D.C. 1998). It is
axiomatic that Section 1503 is a continuing offense for the purposes of calculating the statute
of limitations. United States v. Berardi, 675 F2d 894, 898 (7th Cir. 1982); United States v.
Ruggiero, 1986 WL 15555, at *4 (E.D.N.Y. October 15, 1986); United States v. Peterson,
544 F.Supp.2d 1363, 1372 (M.D. Ga. 2008). 1 For the purposes of this analysis, there are no
meaningful differences between Sections 1503 and 1512(c)(2). The government has found no
cases that treat Section 1512 differently than 1503 for these purposes. Indeed, the legislative
history indicates that Congress intended both 1512 and 1503 to be treated as continuing
offenses. Trie, 21 F.Supp.2d at 18. Therefore, in light of the caselaw about Section 1503,
the statutory history of Section 1512 and the manner in which the crime was charged here,
the offense is continuing.
The government submits that Section 1512(c)(2), just like Section 1503 in the
same chapter, is a continuing offense that was not completed until the false sworn statements
were received by both the SEC and the judge, thereby ending the official proceeding.
For this reason, we ask that the Court reconsider its September 17, 2015 order and reinstate
Count 23.
II.

The Facts Establishing the Continuing Nature of the Obstruction

The proceedings in this case were an ongoing SEC investigation, which


commenced on March 2, 2009, the Securities and Exchange Commission (SEC) issued a
formal order of investigation in the matter of Investsource; continued on or about July 9,
2010, when the SEC filed a civil complaint against Sahachaisere and Investsource for the

Moreover, this Circuit has already noted how an individuals acts can have multiple
obstructive effects through time. United States Reich, 479 F.3d 179, 185-186 (2d Cir. 2007)
(discussing how a single forged judicial order continued to cause obstructive effects for
months after its creation).

Case 1:13-cr-00452-ENV Document 259 Filed 09/24/15 Page 4 of 6 PageID #: 1027

fraudulent promotion of several penny stocks; and concluded on December 8, 2010, when
United States District Judge David O. Carter entered a judgment against Sahachaisere.
The Courts order suggests that Sahachaiseres only action in furtherance of
this scheme was the false testimony on June 17, 2009. That is incorrect. First, from 2009 to
2011, Sahachaisere discussed his Moneyline account in 7 phone calls that have been marked
for admission during trial. Third, on October 30, 2009, in connection with the SYNW
promotion, Sahachaisere expressly discusses his deposition with co-conspriator Mohammad
Dolah. See Exhibit 428. Second, on April 12, 2010, Sahachaisere submitted a false and
misleading sworn affidavit to the SEC. See Appendix A 2. In that affidavit, in response to a
question asking him to list all securities or commodities brokerage accounts and accounts at
banks or other financial institutions under your control; in which you have or had a beneficial
interest; or to which you were a signatory since January 1, 2007, Sahachaisere listed 37
separate accounts from multiple countries. Sahachaisere omitted his Costa Rican Moneyline
account from that list.
However, as shown in governments exhibits 845, 846 and 847, Sahachaisere
made more than a hundred transactions relating to the stocks charged in this indictment with
the Siam Capital Partners account that he lied about to the SEC. Sahachaisere also opened
a personal account into which he began transferring stock and money on January 14, 2010.
See Government Exhibit 847. On March 17, 2010, Sahachaisere withdrew more than
$10,000 from his Moneyline account that he received from the sale of SYNW stock. Thus,
the April 12, 2010 Sahachaisere affidavit lied twice about his brokerage accounts, both of
which he was actively using at the time.
These ongoing activities were not the end of the obstruction. The government
will provide testimony by multiple witnesses that they utilized Moneyline, a Costa Rican
company, specifically to avoid scrutiny by United States regulators. They will also testify
that Moneyline itself utilized multiple shell companies so that none of its disbursements or
deposits could be directly traced. All of these actions continued into 2011.
Moreover, Sahachaisere reintroduced his false and misleading statements into
the SEC proceeding. On or about July 9, 2010, the SEC filed a civil complaint against
Sahachaisere and Investsource for the fraudulent promotion of several penny stocks. On or
about November 15, 2010, based in part upon the June 17, 2009 testimony, Sahachaisere
entered into a consent judgment with the SEC. Indeed, the SEC Consent Order, which is
endorsed by Sahachaisere, expressly states that the settlement is made relying upon sworn
deposition testimony and affidavits to decide the SECs pending motion for disgorgement.
Those were two of the false and misleading statements Sahachaisere made as part of his
obstruction. On December 8, 2010, United States District Judge David O. Carter entered a
judgment in reliance upon the November 24, 2010 consent, thereby ending the official
2

The government received this affidavit on September 18, 2015. We are marking it
for trial as government exhibit 79.

Case 1:13-cr-00452-ENV Document 259 Filed 09/24/15 Page 5 of 6 PageID #: 1028

proceeding. Again, Judge Carter stated that he would rely upon deposition testimony and the
affidavits in determining the SECs pending motion for disgorgement from Sahachaisere.
For this reason, the government submits that the continuing offense of
obstruction continued long after the deposition.
The Courts September 17, 2015 order expressed concern that an offense could
continue forever. However, that concern is unfounded. Congress intended the crime to be a
continuing offense, Trie, 21 F.Supp.2d at18, which is tied to the official proceeding. The
obstruction cannot continue past the SEC proceeding, which ended in this case on December
8, 2010. Therefore, the Courts concern should be addressed by the clear congressional
intent.
III.

False Statements about Moneyline as Consciousness of Guilt

The government anticipates that the central issue at this trial will be
Sahachaiseres knowledge of the securities frauds, not that they occurred. Therefore, even if
the Court reaffirms its dismissal of Count 23, which it should not, Sahachaiseres sworn false
statements regarding his income from promoting RSGR, RNER, SYNW and TMHO
constitute direct evidence of his consciousness of guilt. Prior false and misleading
statements constitute highly probative and admissible direct evidence of knowledge and
intent. See United States v. Perez, 387 F.3d 201, 209 (2d Cir. 2004). Moreover, [f]alse
exculpatory statements have independent probative value regardless of whether a defendant
testifies on his own behalf. United States v. Strother, 49 F.3d 869, 877 (2d Cir. 1995); see
United States v. Scheibel, 870 F.2d 818, 822 (2d Cir.1989) (although false exculpatory
statements cannot provide the sole basis for a conviction, they are evidence of a
consciousness of guilt, which can be considered with other evidence in determining guilt or
innocence).
While a 403 analysis still applies to this type of evidence, Perez, 387 F.3d at
209, the government submits that this evidence is clearly highly probative, id. (affirming
decision to include false statements where the trial concerned the defendants state of mind).
Indeed, in Perez, the Second Circuit was primarily concerned with whether the false
statements were accompanied by violence, which is not the case here. Id. In the instant case,
Sahachaisere gave multiple false statements under penalty of perjury about the Moneyline
brokerage accounts that he utilized in the instant case. He made those false statements at the
same time that he was promoting RSGR, RNER, SYNW and TMHO and being paid in
shares of those stocks. The deposit of those shares and Sahachaiseres liquidation of the
same all occurred in the Costa Rican brokerage house that he lied about under oath. Those
lies did not occur years later, they occurred during the charged conspiracy and were
referenced in the emails and phone calls that will provide much of the evidence in this trial.
If Sahachaisere had no knowledge of the fraudulent promotion, why would he lie about how
he was paid for these promotions? The jury should examine this vital evidence.

Case 1:13-cr-00452-ENV Document 259 Filed 09/24/15 Page 6 of 6 PageID #: 1029

Finally, the government notes that the evidence of Sahachaiseres false


statements need not actually reference the SEC investigation. As discussed earlier, the SEC
investigation should definitely stay in as relevant to Count 23. However, for the purposes of
its relevance to the fraud charges, the relevant portion of the statements is that they were
made under oath during the conspiracy. Appendix A already makes no mention of the
investigation and the deposition could easily be the subject of a stipulation.
IV.

Advice of Counsel

Sahachaisere has provided no notice of an advice of counsel defense.


Consistent with the Courts order, he should be barred from asking any questions, presenting
any evidence or making any arguments related to that waived defense.
V.

Conclusion

For the foregoing reasons, the order dismissing Count 23 should be


reconsidered and reversed. If the Court does not reconsider, which it should, the evidence of
the contemporaneous false statements, made under penalty of perjury, should be presented to
the jury as consciousness of guilt evidence.
Respectfully submitted,
KELLY T. CURRIE
Acting United States Attorney
By:

/s/
Christopher A. Ott
Assistant U.S. Attorney
(718) 254-6154

Attachments:
Appendix A (via hand delivery to chambers and email only).
cc:

Joel Stein, Esq.


Lawrence Dubin, Esq.