from the United States District Court for the Northern
District of Georgia D.C. Docket No. 1:13-cr-00437-TCB-ECS-1
WILSON and JORDAN, Circuit Judges, and MOORE, [*] District Judge.
JORDAN, Circuit Judge:
Annamalai appeals his convictions and 327-month sentence for
numerous offenses related to his operation of a Hindu temple
in Georgia. After reviewing the record, and with the benefit
of oral argument, we reverse his convictions for bankruptcy
fraud, conspiracy to commit bankruptcy fraud, money
laundering (which were based on the underlying specified
unlawful activity of bankruptcy fraud), and conspiracy to
harbor a fugitive. We also conclude that the government
established by a preponderance of the evidence that the loss
resulting from Mr. Annamalai's bank fraud scheme was just
over $100, 000, but did not prove that it exceeded $400, 000.
We affirm in all other respects and remand for resentencing.
Annamalai is a self-proclaimed Hindu priest. In 2005, he
opened the Hindu Temple and Community Center of Georgia, Inc.
in an office building in Norcross, Georgia. The Hindu Temple
generated income in part by charging fees for religious and
spiritual products and services, including religious
ceremonies and horoscopes. See generally Laurence R.
Iannaccone & Feler Bose, Funding the Faiths: Toward a
Theory of Religious Finance, in The Oxford Handbook of
the Economics of Religion 9 (2010) ("[E]ven in the
United States, where Hindu temples are more congregationally
oriented, fee-for-service financing remains the norm. Visit
an[y] Hindu temple or website and you will almost always
encounter an explicit menu of price and products.").
Hindu Temple advertised its services online and in magazines
(including one that Mr. Annamalai published) that were
distributed in Indian grocery stores and other temples. In
typical transactions, followers called the advertised phone
number for the Hindu Temple and spoke with Mr. Annamalai or
one of the priests he employed. Followers who agreed to
purchase a service (like a horoscope reading or prayers)
would then provide a credit card number to complete the
evidence at trial showed that Mr. Annamalai used the Hindu
Temple as part of a criminal scheme to defraud his followers
and commit bank fraud. Mr. Annamalai used the fraud proceeds
to fund a lavish lifestyle, including multiple homes and
example, Mr. Annamalai charged unauthorized amounts-for
services not requested or provided-on his followers'
credit cards. If the followers complained about the
unauthorized charges, he would claim that the charges fell
under the Hindu Temple's "no refund" policy. If
the followers then disputed the charges with their banks, he
would submit false documents with the followers'
signatures-which he had obtained by sending magazines to
their homes through certified mail-to the banks. He would
tell the banks that the signatures were proof that the
followers had ordered the disputed services.
Mr. Annamalai would publish detailed stories of the
followers' confidential personal struggles in his
magazine. He would also create altered audio recordings of
conversations with the followers and submit them to law
enforcement to justify the disputed charges.
August of 2009, the Hindu Temple filed for Chapter 11
bankruptcy. On November 4, 2009, the bankruptcy court
appointed a trustee who became the administrator of the Hindu
Temple's bankruptcy estate. Following his appointment,
the trustee quickly closed the Hindu Temple, shut its doors,
and did not conduct any more business on its behalf.
days after the trustee's appointment, Mr. Annamalai
caused the incorporation and registration of a new temple
called the Shiva Vishnu Temple of Georgia, Inc. Mr. Annamalai
had previously used that name in magazine advertisements and
other documents as an alternative name for the Hindu Temple.
the Hindu Temple, the Shiva Vishnu Temple provided religious
and spiritual products and services for a fee. A number of
followers paid the Shiva Vishnu Temple for religious and
spiritual services it provided to them after the Hindu Temple
filed for bankruptcy and was shut down by the trustee. These
payments formed the basis for the bankruptcy fraud charges
against Mr. Annamalai.
2013, a grand jury in the Northern District of Georgia
returned an indictment against Mr. Annamalai and others. The
government subsequently obtained two superseding indictments.
The second superseding indictment charged Mr. Annamalai with
34 criminal offenses: conspiracy to commit bank fraud in
violation of 18 U.S.C. §§ 1349 and 1344 (Count 1);
bank fraud in violation of 18 U.S.C. §§ 1344 and 2
(Counts 2–8); filing a false federal income tax return
in violation of 26 U.S.C. § 7206(1) (Count 9);
conspiracy to commit bankruptcy fraud in violation of 18
U.S.C. §§ 371 and 152(1) (Count 10); bankruptcy
fraud in violation of 18 U.S.C. §§ 152(1) and 2
(Counts 11–20); money laundering in violation of 18
U.S.C. §§ 1956(a)(1)(B)(i) and 2 (Counts
21–30); making a false statement in writing in
violation of 18 U.S.C. §§ 1001(a)(3) and 2 (Count
31); obstruction of justice in violation of 18 U.S.C.
§§ 1503 and 2 (Count 32); making false statements
under oath in a bankruptcy proceeding in violation of 18
U.S.C. §§ 152(2) and 2 (Count 33); and conspiracy
to harbor a fugitive in violation of 18 U.S.C. §§
1071 and 371 (Count 34).
Annamalai sought to dismiss several of the charges, and/or to
sever some of the counts, but the district court denied his
motions and the case proceeded to trial. After an 11-day
trial, and four hours of deliberations, the jury convicted
Mr. Annamalai of all 34 charges.
sentencing, the district court determined that Mr. Annamalai
had a total offense level of 39 (based in part on a loss
amount of over $400, 000 for the bank fraud offenses) and a
criminal history category of I, which under the 2013
Sentencing Guidelines produced an advisory recommended
imprisonment range of 262 to 327 months. The district court
sentenced Mr. Annamalai to 327 months in prison, to be
followed by five years of supervised release. It also ordered
him to pay restitution in the amount of $550, 527.92.
Annamalai challenges the joinder of the 34 offenses and the
district court's denial of his motion to sever several
charges that he asserts were unrelated. "We undertake a
two-step analysis to determine whether separate charges were
properly tried at the same time." United States v.
Hersh, 297 F.3d 1233, 1241 (11th Cir. 2002). First, we
review de novo whether the charges were properly
joined under Federal Rule of Criminal Procedure 8(a).
Id. Second, we review the district court's
denial of the defendant's motion to sever for abuse of
8(a) permits an indictment to charge a defendant with
multiple offenses when they "are of the same or similar
character, or are based on the same act or transaction, or
are connected with or constitute parts of a common scheme or
plan." We construe Rule 8(a) "broadly in favor of
initial joinder" so that charges that are similar may be
tried together "even if [the] offenses do not arise at
the same time or out of the same series of acts or
transactions." Hersh, 297 F.3d at 1241. We
reverse only if improper joinder "affect[ed] substantial
rights" and "result[ed] in actual prejudice because
it had substantial and injurious effect or influence in
determining the jury's verdict." United States
v. Zitron, 810 F.3d 1253, 1257 (11th Cir. 2016)
charges in complex cases are properly joined as long as they
arise out of the same underlying conduct. For example, in
United States v. Dominguez, 226 F.3d 1235, 1237
(11th Cir. 2000), we refused to reverse the joinder of 28
counts-conspiracy to possess cocaine with intent to
distribute, conspiracy to commit money laundering, money
laundering, use of a telephone facility in commission of a
felony, and mortgage fraud. Although the charges were
seemingly unrelated, the government theorized and later
proved at trial that the defendant "submitted fraudulent
income tax returns when applying for mortgage loans in order
to conceal the fact that his income had been derived from
drug activity." Id. at 1239.
Dominguez, Mr. Annamalai's improper joinder
argument fails. We determine whether joinder is proper by
looking at "the allegations stated on the face of the
indictment, " id. at 1238 (quoting United
States v. Weaver, 905 F.2d 1466, 1476 (11th Cir. 1990)),
and here the grand jury charged that Mr. Annamalai used the
Hindu Temple-which later filed for bankruptcy-to carry out a
fraudulent scheme and then committed a number of offenses
related to that scheme. The indictment alleged that Mr.
Annamalai defrauded followers of the Hindu Temple, misled the
financial institutions that charged those followers, moved
the fraud proceeds (proceeds which he failed to report on his
income tax return) to a foreign bank account, improperly
concealed property belonging to the Hindu Temple's
bankruptcy estate, committed money laundering with the
proceeds of that bankruptcy fraud, and committed a number of
illegal acts related to the criminal investigation into his
fraudulent activities (submitting a false document to the
IRS, obstructing justice, providing false statements under
oath, and conspiring to conceal a fugitive). All of these
claims arose out of and were connected to the same general
fraudulent scheme. Where, as here, there is an "explicit
connection between the groups of charges, " we need not
look outside "the four corners of the indictment."
Rule 14(a), "[i]f the joinder of offenses or defendants
in an indictment . . . appears to prejudice a defendant . . .
the court may order separate trials of counts, sever the
defendants' trials, or provide any other relief that
justice requires." Fed. R. Crim. P. 14(a). "The
decision whether to grant a severance lies within the
district court's sound and substantial discretion."
United States v. Mosquera, 886 F.3d 1032, 1041 (11th
Cir. 2018). We reverse only when the defendant demonstrates
"a clear abuse of discretion resulting in compelling
prejudice against which the district court could afford no
protection." Id. (quoting United States v.
Ramirez, 426 F.3d 1344, 1352 (11th Cir. 2005)).
Compelling prejudice occurs when, "under all the
circumstances of a particular case, " it is apparent
that the average juror could not follow the "court's
limiting instruction and appraise the independent evidence
against a defendant solely on that defendant's own acts,
statements, and conduct in relation to the allegations
contained in the indictment and render a fair and impartial
verdict." United States v. Walser, 3 F.3d 380,
386–87 (11th Cir. 1993).
Annamalai argues that he meets this demanding standard
because the jury convicted him of several charges despite
insufficient evidence, convicted him of every single offense
charged, and returned its decision after only four hours. The
jury's quick deliberation and straight-ticket conviction
on all charges give us some pause, but we presume that juries
will follow the instructions given by the district court.
See Mosquera, 886 F.3d at 1042 (citing
Ramirez, 426 F.3d at 1352). Although complex charges
make for complicated trials, the intricacy of a case alone
does not require severance. That is why we have
"declined to find that severance was required in some
complex, multi-defendant cases." United States v.
Lopez, 649 F.3d 1222, 1235 (11th Cir. 2011) (citing
examples). Absent other indications of prejudice, "the
complexity of the case and the speed of deliberation alone
[do] not constitute prejudice." United States v.
Hernandez, 921 F.2d 1569, 1580 (11th Cir. 1991). See
also id. (noting that "relatively short jury
deliberations are an ambiguous indicator" because
"[r]ather than indicating haste, it could also indicate
strong evidence."). Here, Mr. Annamalai has not shown an
abuse of discretion or compelling prejudice, and to the
extent that his severance argument is premised on the lack of
evidence on certain charges, we address that matter below and
set aside some of his convictions.
Annamalai contends that his prosecution, conviction, and
sentencing violated his constitutional rights to due process,
equal protection, and freedom of religion. Exercising plenary
review, see, e.g., Agan v. Vaughn, 119 F.3d 1538,
1541 (11th Cir. 1997) (applying de novo review to
First Amendment challenge to conviction), we reject these
First Amendment prohibits a criminal charge of fraud from
being based on "the truth or verity of [a person's]
religious doctrines or beliefs." United States v.
Ballard, 322 U.S. 78, 86 (1944). But the
government's case here was not an impermissible attack on
the Hindu religion or on the truth or verity of Mr.
Annamalai's beliefs. Rather, the government prosecuted
Mr. Annamalai for a scheme in which he abused his position as
a Hindu priest by, among other things, causing his
followers' credit cards to be charged in excess of agreed
amounts and without authorization, and submitting false
documents to financial institutions to substantiate the
unauthorized charges. See D.E. 86 at 2–5. The
government's description of Mr. Annamalai and his temple
as "a scam" was a fair comment on the
evidence-given the testimony presented at trial about the
fraud perpetrated on followers who sought and paid for
spiritual help-and did not constitute an improper hostility
towards Hinduism. See Cantwell v. Connecticut, 310
U.S. 296, 306 (1940) (noting that "penal laws are
available to punish" those who, "under the cloak of
religion, . . . commit frauds upon the public");
Church of Scientology Flag Service Org., Inc. v. City of
Clearwater, 2 F.3d 1514, 1544 (11th Cir. 1993)
(explaining that "the state does indeed have a
compelling interest in protecting church members from
affirmative, material misrepresentations designed to part
them from their money"); United States v.
Rasheed, 663 F.2d 843, 847 (9th Cir. 1981) ("The
First Amendment does not protect fraudulent activity
performed in the name of religion."). See also
Ballard, 322 U.S. at 95 (Jackson, J., dissenting)
("I do not doubt that religious leaders may be convicted
of fraud for making false representations on matters other
than faith or experience, as for example if one represents
that funds are being used to construct a church when they in
fact are being used for personal purposes.").
acknowledge that some of the government's comments during
closing argument went too far. For example, the government
twice referred to the individuals who served as priests at
the Hindu Temple as "so-called priests." D.E. 390
at 2078, 2085. Although there was evidence that some of those
priests were former salesmen for Mr. Annamalai's business
in India and had no religious training, see D.E. 384
at 813–15, generally it is not for the government to
pass on religious qualifications. Cf. Gonzalez v. Roman
Catholic Archbishop of Manila, 280 U.S. 1, 16 (1929)
(explaining that "it is the function of the church
authorities to determine what essential qualifications of a
chaplain are and whether [a] candidate possesses them, "
and that such determinations are conclusive on courts). But
Mr. Annamalai did not object to these comments when they were
made, and on this record there is no plain error warranting
reversal. Assuming that there was error, and that the error
was plain, the error did not affect Mr. Annamalai's
substantial rights. See United States v. Olano, 507
U.S. 725, 732–37 (1993) (articulating plain error
standard); United States v. Young, 470 U.S. 1,
14–20 (1985) (applying plain error standard to
government's improper remarks during rebuttal closing
take Mr. Annamalai's point that the government
exaggerated at sentencing by saying that "every dollar
that was deposited into the [Hindu Temple] was in fact a
fraud." D.E. 467 at 93. Indeed, some of the followers
who testified at trial acknowledged that certain services
they paid for-such as horoscope readings and prayers-were
performed as requested and promised. See D.E. 381 at
103, 113; D.E. 382 at 212. Cf. Watts v. Fla. Int'l
Univ., 495 F.3d 1289, 1298 (11th Cir. 2007)
("Simply put, judges and juries must not inquire into
the validity of a religious doctrine, and the task of courts
is to examine whether a plaintiff's beliefs are, 'in
his own scheme of things, religious.'") (citation
omitted). But the district court ultimately did not use all
of the Hindu Temple's revenue as a proxy for loss, so the
government's "oratorical exaggeration, "
Vanskike v. Union Pac. R.R. Co., 725 F.2d 1146, 1149
(8th Cir. 1984), did not prejudice Mr. Annamalai.
10 charged Mr. Annamalai with conspiracy to commit bankruptcy
fraud in violation of 18 U.S.C. § 371. Counts
11–20 charged him with substantive bankruptcy fraud in
violation of 18 U.S.C. § 152(1), which prohibits
knowingly and fraudulently concealing from a Chapter 11
bankruptcy trustee "any property belonging to the estate
of a debtor."
the substantive bankruptcy fraud charges were based on funds
that the Shiva Vishnu Temple acquired or received
after the Hindu Temple filed for bankruptcy in
August of 2009 and after the trustee shut it down in
early November of 2009. Counts 11–14 and 16–20
concerned credit card receivables for transactions spanning
from November 25, 2009, to October 25, 2010. An illustrative
example is Count 20, which was based on credit card
receivables of $2, 428.42 that the Shiva Vishnu Temple
received through American Express on October 25, 2010. Count
15 was different; it concerned a donation check for $3, 000
made out to the Hindu Temple in January of 2010 and deposited
into the Shiva Vishnu Temple bank account.
Annamalai argues that the government failed to introduce
sufficient evidence to support his convictions on Counts
10–20. See Appellant's Br. at 38. The
district court acknowledged that the matter was "close,
" D.E. 389 at 1792, but denied the Rule 29 motion for
judgment of acquittal. See D.E. 390 at
2071–72; D.E. 256 at 3–4.
de novo review, and viewing the evidence "in
the light most favorable to the government, " United
States v. Robertson, 493 F.3d 1322, 1329 (11th Cir.
2007), we agree with Mr. Annamalai that the new income
generated by the Shiva Vishnu Temple, for post-bankruptcy
religious or spiritual services provided to and paid for by
followers, did not constitute property of the bankruptcy
estate of the Hindu Temple. We also agree with him that the
post-petition donation check made out to the Hindu Temple did
not constitute property of the estate. And because the