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Sentencing Hearing Transcript, October 23, 2023 — United States v. Adedayo Ilori
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A transcript of a sentencing hearing in United States v. Adedayo Ilori, 21 Cr. 746 (MKV), in the U.S. District Court for the Southern District of New York, held October 23, 2023 before Judge Mary Kay Vyskocil and filed November 6, 2023 as Document 149. Assistant United States Attorneys Juliana N. Murray and Daniel G. Nessim appear for the government and Sanford N. Talkin for the defendant. The court places on the record the six counts of conviction, the history of adjournments and changes of defense counsel, and the sentencing submissions before it, including a June 9th, 2023 defense letter seeking a Fatico hearing on loss amount and access devices. It addresses objections to the presentence report and the government's corrected figures, including approved fraudulent loans of $1,024,625 and restitution including $48,400 owed to another victim. The transcript is 69 pages.
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No. 1:21-cr-00746-MKV · Doc. 149 · Docket on CourtListener
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Case 1:21-cr-00746-MKV NANCiloS Document 149 2 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK ------------------------------x 3 UNITED STATES OF AMERICA, 4 v. 5 ADEDAYO ILORI, 1 6 7 Filed 11/06/23 Page 1 of 69 21 Cr. 746 (MKV) Defendant. ------------------------------x 8 New York, N.Y. October 23, 2023 11:00 a.m. 9 10 Before: 11 HON. MARY KAY VYSKOCIL, 12 District Judge 13 APPEARANCES 14 15 16 17 18 DAMIAN WILLIAMS, United States Attorney for the Southern District of New York BY: JULIANA N. MURRAY DANIEL G. NESSIM Assistant United States Attorneys SANFORD N. TALKIN Attorney for Defendant 19 20 21 ALSO PRESENT: ISABEL LOFTUS, AUSA Paralegal 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1 Case 1:21-cr-00746-MKV NANCiloS Document 149 1 (Case called) 2 MS. MURRAY: Filed 11/06/23 Page 2 of 69 Good morning, your Honor. Juliana Murray 3 and Daniel Nessim on behalf of the United States. 4 by paralegal specialist, Isabel Loftus. 5 6 7 8 THE COURT: Ms. Loftus. MR. TALKIN: Good morning, your Honor. 10 morning to you, Mr. Ilori. Good morning, Mr. Talkin. 11 THE DEFENDANT: 12 THE COURT: 15 And good Good morning. So we are here once again for the sentencing of Mr. Ilori. As you know, I am Judge Vyskocil. Just for the sake of the record, Mr. Ilori, you do speak and understand English clearly; correct? 16 THE DEFENDANT: 17 THE COURT: 18 San Talkin for Mr. Ilori, who is seated to my left. THE COURT: 14 We're joined Good morning, Ms. Murray, Mr. Nessim, and 9 13 2 Yes. You do not need the services of an interpreter? 19 THE DEFENDANT: No, I don't. 20 THE COURT: 21 THE DEFENDANT: 22 THE COURT: 23 And Ms. Murray, are there victims entitled to notice Sorry? I don't need an interpreter. Thank you. 24 and has notice been provided? 25 MS. MURRAY: Yes, your Honor, there are victims and SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 3 of 69 3 notice has been provided. 2 THE COURT: Thank you. 3 By way of background in June of last year, 2022, a 4 grand jury returned a superseding indictment charging Mr. Ilori 5 with six counts. 6 Count One charged him with major fraud against the 7 United States, in violation of Title 18, United States Code, 8 Section 1031, 2, and 3147. 9 Count Two charged Mr. Ilori with conspiracy to commit 10 wire and bank fraud, in violation of Title 18, United States 11 Code, Section 1349 and 3147. 12 Count Three charged Mr. Ilori with wire fraud, in 13 violation of Title 18, United States Code, Section 1343, 2, and 14 3147. 15 Count Four charged Mr. Ilori with bank fraud, in 16 violation of Title 18, United States Code, Section 1344, 2, and 17 3147. 18 Count Five charged Mr. Ilori with aggravated identity 19 theft, in violation of Title 18, United States Code, 20 Section 1028A, 2, and 3147. 21 Finally, Count Six charged Mr. Ilori with conspiracy 22 to commit money laundering, in violation of Title 18, United 23 States Code, Section 1956(h), and 3147. 24 On November 1st of last year, 2022, after a six-day 25 jury trial, the jury found Mr. Ilori guilty of all six counts SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 4 of 69 1 charged in that superseding indictment. 2 has completed its investigation and the parties have filed 3 their sentencing submissions and numerous supplemental 4 submissions. 5 4 The probation office I note, too, that the sentencing of Mr. Ilori has 6 repeatedly been adjourned or delayed. Sentencing was 7 originally scheduled for January of 2023, but was adjourned 8 because Mr. Ilori fired his trial lawyer, Mr. Peter Brill, and 9 requested new counsel. 10 requested additional time to prepare for sentencing. 11 ECF 108 and 122. I then appointed Avraham Moskowitz, who That's at Sentencing was scheduled for May 25, 2023. 12 Despite many months of delay, Mr. Moskowitz informed 13 the Court at the May 25 sentencing hearing that Mr. Ilori was 14 not prepared to proceed. 15 that Mr. Ilori wanted new counsel again, and that, against the 16 advice of counsel, Mr. Ilori sought a Fatico evidentiary 17 hearing with respect to the loss amount and the number of 18 access devices used in his fraud scheme. 19 that May 25th hearing is at ECF No. 127. Specifically, Mr. Moskowitz explained The transcript of 20 Given the obvious conflict between Mr. Moskowitz and 21 Mr. Ilori, I appointed Mr. Talkin to replace Mr. Ilori, and I 22 warned Mr. Ilori at that time that new counsel would not be 23 appointed again. 24 transcript is at ECF No. 131. 25 That happened on May 30th of 2023. The Now, since Mr. Talkin was appointed as counsel, both SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 5 of 69 1 parties have submitted additional sentencing materials, made 2 some new objections, requested revisions to the PSR. 3 I will turn now to laying out all of the materials I 4 have received that are part of the record, and I'll deal then 5 with the various objections, requests, et cetera. 6 5 So, the following is what is before the Court in 7 connection with today's sentencing. 8 listen very carefully because, as I say, there were many 9 submissions that were made after the initial ones and I want to 10 be sure we have everything noted on the record. 11 So I'd ask you please So, I have the final presentence report prepared by 12 probation, that was filed on February 14th of 2023. 13 ECF No. 113. 14 Mr. Ilori's sentencing date, although it was not revised again 15 to reflect today's date, to correct typographical errors and to 16 reflect that a telephone interview was conducted with 17 Mr. Ilori's wife. 18 That's at The probation office made revisions to update The PSR is at docket entry 113. Now, in terms of objections, just noting them right 19 now, then I'll turn back and we'll deal with them. The 20 government originally did not file any objections. That's 21 noted on page 31 of the PSR, but in a supplemental submission 22 filed on June 28th of 2023 — that's ECF No. 130 — the 23 government requested a number of corrections. 24 page 2, the statutory citation for Count Four was revised to 25 read 18 U.S.C. Sections 1344, 2, and 3147, the latter 3147 Specifically, on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 6 of 69 6 being what was corrected. 2 Next, the itemized offense level calculation should 3 include a paragraph for a two-level enhancement pursuant to the 4 sentencing guidelines Section 2S1.1(b)(2)(B) because the 5 defendant was convicted under 18 U.S.C. Section 1956. 6 7 Next, in paragraphs 21, 56, 57, and 59, the amount of the approved fraudulent loans should read $1,024,625. 8 Next, in paragraph 139, and on pages 34, 36, and 39, 9 the amount of restitution owed should read $1,120,462.47, of 10 which $1,072,062.47 is owed to the Small Business 11 Administration with the remaining individual restitution of 12 $48,400 owed to the other victim identified in the schedule of 13 victims. 14 Finally, in that June 28th letter, the government 15 states that paragraph 40 should read: 16 amount of $1,072,067.47 is joint and several with his 17 codefendant in this case..." 18 "Restitution in the In another supplemental submission, dated October 13th 19 of 2023 — that's at ECF 144 — the government identified an 20 error in its and the probation office's guidelines calculation. 21 The government requested that the Court delete paragraph 70 of 22 the PSR and revise Mr. Ilori's adjusted offense level downward 23 from 40 to 38. 24 25 While represented by Mr. Moskowitz, Mr. Ilori objected to three paragraphs of the PSR. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 7 of 69 7 1 First, he objected to paragraph 67, arguing the actual 2 loss rather than intended loss should be used to calculate the 3 enhancement pursuant to guideline 2B1.1(b)(1)(K). 4 Next, he objected to paragraph 69, arguing that the 5 sophisticated means enhancement, pursuant to Section 6 2B1.1(b)(10)(C) should not apply because the crimes of which he 7 was convicted couldn't have been committed without 8 sophisticated means. 9 Next, he objected, through Mr. Moskowitz, to paragraph 10 71, arguing that the two-level enhancement for receiving more 11 than $1 million in gross receipts, pursuant to Section 12 2B1.1(b)(17)(A) cannot apply because there is no basis to 13 conclude that Mr. Ilori individually derived more than 14 $1 million in gross receipts. 15 16 Thereafter, Mr. Talkin lodged on Mr. Ilori's behalf three substantive objections. 17 Paragraph 67, making a different argument with respect 18 to paragraph 67, arguing that two fraudulent loans shouldn't be 19 included in the loss calculation, pursuant to Section 20 2B1.1(b)(1)(K). 21 Next, he objected to paragraph 68, arguing that the 22 ten-or-more-victims enhancement, pursuant to 23 Section 2B2.1(b)(1)(A)(i) should not apply because the SBA, the 24 Small Business Administration, was his only victim. 25 Next, he objected to paragraph 70, arguing that the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 8 of 69 8 1 enhancement, pursuant to Section 2B1.1(b)(11) should not apply 2 to the extent that it is applied regarding authentication 3 features. 4 Then, in a supplemental submission, filed on October 5 10th of 2023 — that's at ECF 142 — Mr. Talkin requested a 6 correction to page 39 of the PSR. 7 includes a sentence beginning: "As stipulated in the 8 defendant's plea agreement..." That's on page 39 of the PSR. 9 Mr. Talkin points out correctly that Mr. Ilori did not enter 10 into a plea agreement, he did not plea. 11 sentence be stricken from the PSR. 12 Specifically, that page He requests that the So, those are the objections I have. As I say, I'll 13 turn to them in a moment. 14 submissions, I then have the defendant's sentencing submission, 15 the original submission, filed on April 24th, 2023. 16 ECF 118. 17 2023 at ECF 129 that attached two letters of support, one for 18 Mr. Ilori's mother, another from his wife. 19 contain redactions. 20 With regard to the rest of the That's at There is a supplemental submission filed on June 9th, Both letters I have then the government's sentencing submission, 21 filed on May 1, 2023 — that's at ECF No. 130 — together with a 22 supplemental submission, filed on June 28th, 2023. 23 victim impact statement, which has been filed under seal, and a 24 sentencing transcript from Judge Liman, and proposed orders of 25 forfeiture and restitution. I have a With its June 28th supplemental SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 9 of 69 9 1 submission, the government provided revised proposed orders of 2 forfeiture and restitution. 3 I then have the defendant's original sentencing 4 submission and the two letters of support -- I'm sorry. 5 defendant's original sentencing submission and the two letters 6 of support contain redactions, and the government's original 7 submission has no redactions, but the victim impact statement 8 was filed under seal. 9 unredacted documents under seal. 10 The The Court will maintain all of those Now, in terms of the supplemental submissions. I have 11 a letter, dated July 13th, 2023, filed by Mr. Talkin — at ECF 12 136 — in which he requests a Fatico hearing with respect to two 13 sentencing enhancements: 14 ten or more victims enhancement. 15 request by letter, dated July 14th, 2023. The gross receipt enhancement and the The government opposed that That's at ECF 138. 16 On August 8th of this year, 2023, I entered an order — 17 that's filed at ECF No. 140 — denying the request for a Fatico 18 hearing, explaining that Mr. Ilori would be given ample 19 opportunity to address these two items at sentencing. 20 I then entered an order on October 4th, 2023, 21 requesting copies of several of the government's trial 22 exhibits, which both sides address or allude to in their 23 various filings, and I did receive copies of those exhibits 24 from the government on October 5, 2023. 25 Just for the record, I assume, Ms. Murray, that you SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 10 of 69 10 1 provided copies to Mr. Talkin? 2 MS. MURRAY: Yes, your Honor. 3 THE COURT: Thank you. 4 Finally, I received a letter, dated October 10, 2023, 5 filed by Mr. Talkin — that's at ECF No. 142 — which belatedly 6 raises an issue with respect to forfeiture. 7 filed an opposition to that letter on October 13th of this 8 year — that is at ECF No. 144. 9 That is the entirety of what I have by way of the 10 record. 11 missing anything. Let me just confirm with each side that I'm not 12 Ms. Murray. 13 MS. MURRAY: 14 The government That's correct, your Honor, you're not missing anything. 15 THE COURT: Mr. Talkin. 16 MR. TALKIN: Your Honor, I believe you refer to my 17 June 9th letter and the substance of the objections, I just 18 don't know that you called it out by date for the record. 19 may have missed that, but I did -- there was also a June 9th 20 letter with some objections. 21 specific objections, but I don't know that you actually said 22 the June 9th letter. 23 record, as well. I And you did refer about those So I want to make sure that's part of the 24 THE COURT: Yes, I do have it. Do you have the -- 25 MS. MURRAY: It's docket No. 129. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 1 THE COURT: Thank you. 2 Yes, 129, June 9th, 2023 letter. Page 11 of 69 11 That's the letter in 3 which Mr. Talkin requested the Fatico hearing with respect to 4 the two issues that I mentioned, yes. 5 of the record. That is, of course, part 6 Anything else? 7 MR. TALKIN: That's it. 8 THE COURT: Before I turn to my questions, let me just Thank you. 9 confirm for the record, Mr. Ilori, did you have a chance to 10 review the PSR to note any comments or objections and to 11 discuss them with your various lawyers? 12 THE DEFENDANT: 13 THE COURT: Yes, I did. Mr. Talkin, have you had an opportunity to 14 review the PSR, all of the supplemental filings, to discuss 15 them with Mr. Ilori, and to file any objections that you wish 16 to make? 17 MR. TALKIN: Yes, your Honor. 18 THE COURT: Ms. Murray, has the government had an 19 opportunity to read and tender any objections to the PSR? 20 MS. MURRAY: Yes, your Honor. 21 THE COURT: Thank you. 22 So I have a few questions that I want to talk about 23 with everyone before we get to my ruling on all of the 24 outstanding issues. 25 First, Mr. Talkin, can you please confirm for me that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 12 of 69 12 1 you've reviewed specifically the mandatory, standard, and 2 special conditions that have been proposed by probation if I 3 were to impose supervised release, and that you do not object 4 to my referring to them collectively without reading them into 5 the record verbatim? 6 MR. TALKIN: Your Honor, I don't have an objection to 7 you referring to them collectively. 8 these conditions, but I can't say, as I stand here, that -- I 9 know that I've gone through every one with my client. 10 through all of the submissions and we talked about objections, 11 but -- 12 THE COURT: I know that we went over We went We're going to take a recess and I'd like 13 you to review them with Mr. Ilori so that any issues can be 14 noted on the record. 15 My question is: Can I refer generically to the 16 standard and mandatory conditions by calling them "standard" 17 and "mandatory" and not putting them verbatim on the record? 18 Then I'll give you my next question so you can do it all at the 19 same time. 20 MR. TALKIN: Yes, your Honor. 21 THE COURT: Are there any objections to the two 22 proposed special conditions of supervised release? 23 24 25 Those I will put on the record now. They are as follows: The first is a search condition. Mr. Ilori, that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 13 of 69 13 1 condition, during any term of supervised release, would require 2 that you submit your person, any property, residence, vehicles, 3 papers, computers, or other electronic communication, data 4 storage devices, cloud storage or media and effects to a search 5 by any United States probation officer who, if needed, could 6 enlist the assistance of law enforcement. 7 conducted if there were a reasonable suspicion concerning a 8 violation of a condition of supervision or of any unlawful 9 conduct by the person being supervised — that, of course, is 10 you. 11 revocation of release and you would be ordered to warn any 12 other occupant that the premises may be subject to search 13 pursuant to this condition. 14 conducted at a reasonable time and in a reasonable manner. 15 Probation also recommends that I impose a special The search would be Failure to submit to a search may be grounds for I would order that any search be 16 condition with respect to financial issues. Specifically, you 17 must not incur new credit card charges or open any additional 18 lines of credit without the approval of the probation officer 19 unless you are in compliance with the installment payment 20 schedule that would be included in any judgment, and you must 21 provide the probation officer with access to any requested 22 financial information. 23 So those would be the two special conditions. 24 in addition, there are the mandatory and standard conditions of 25 supervised release that are on pages 37 through 39 of the PSR. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Then, Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 14 of 69 14 So I'm going to adjourn briefly and ask that you 2 review them with Mr. Ilori and confirm to me that you've done 3 so. 4 MR. TALKIN: Your Honor, we've discussed these when we 5 went over the PSR originally, we did discuss both of these. 6 do not have any objection. 7 client that we had discussed in the past. 8 object to the collective reference by the Court through the 9 sentence. I just confirmed that with my And we also don't 10 THE COURT: To the what? 11 MR. TALKIN: To how you refer to them as special 12 13 We conditions. THE COURT: There are either two, if you group the 14 financials together, or three proposed special conditions. 15 there any objections to those? 16 MR. TALKIN: No, your Honor. 17 THE COURT: Thank you. 18 Next question: Are According to the government, the PSR 19 neglected to include a two-point enhancement under sentencing 20 guidelines Section 2S1.1(b)(2)(B) stemming from Mr. Ilori's 21 conviction of a violation of 18, United States Code, 22 Section 1956. 23 24 25 That's in the government's memorandum at 8. Does Mr. Ilori object to the application of that enhancement? MR. TALKIN: No, your Honor. We went through that. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 I Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 15 of 69 1 followed up, I did the research, and we agree that a fair 2 application of the guidelines requires that. 15 3 THE COURT: 4 Next, the statutory maximum fine for Counts One, Two, 5 and Four is $1 million per count, $250,000 for Counts Three and 6 Five, and $500,000 for Count Six. 7 Thank you. Does the government take any position with respect to 8 the appropriate fine? 9 MS. MURRAY: No, your Honor. 10 THE COURT: Now, I have a question regarding We defer to the Court. 11 restitution. 12 copy of your revised proposed order of restitution. 13 14 Ms. Murray, this is really for you. I have a Let me just ask you first, I want to confirm, you provided both of those to Mr. Talkin; right? 15 MR. TALKIN: Yes, your Honor. 16 THE COURT: Mr. Talkin, do you consent to either? 17 MR. TALKIN: Yes, your Honor, I've discussed those. I 18 think the issue was that there was interest added to the first 19 number. 20 THE COURT: Are we talking restitution now? 21 MR. TALKIN: Yes, restitution. I'm sorry. 22 went through that and we do consent to that. 23 As far as the forfeiture -- 24 THE COURT: 25 Let's hold off on that. And we That's my fault. I did lump them together. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 16 of 69 16 So the restitution order is on consent, but the 2 question I have for you, Ms. Murray, I have, as I started to 3 say, what you attached to your June 28th letter. 4 out a $48,400 payment for which Mr. Ilori is individually 5 liable, but the proposed order still appears to include a 6 different amount to be paid than that, which was included in 7 consent order of restitution that I entered with respect to 8 Mr. Recamier. 9 severally liable for $1,072,062.47 and your proposed order says 10 that Mr. Ilori is jointly and severally liable — that would be 11 with Mr. Recamier — for $1,072,067.47. 12 difference this interest issue that you were alluding to? 13 14 That order stated that Mr. Recamier is joint and MS. MURRAY: No, your Honor. Is that five-dollar And apologies, that is a typographical error on the government's part. 15 THE COURT: In the order? 16 MS. MURRAY: In the order. 17 You separate It should be as it was in Mr. Recamier's order, $1,072,062.47. 18 THE COURT: So the "62" is the correct number? 19 MS. MURRAY: Correct. 20 THE COURT: Did you submit this in Word format? 21 MS. MURRAY: No, we submitted it on the docket in PDF. 22 THE COURT: So revise it, please, and get it to us so 23 that we can get it entered along with the judgment, assuming 24 that that's where we land. 25 MS. MURRAY: Yes. Okay? Will do. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 1 THE COURT: Thank you. 2 Now, Mr. Talkin, your issue with respect to 3 forfeiture, despite numerous adjournments of sentencing, the 4 defense had never raised any issues with respect to the 5 monetary penalties. 6 year after the original sentencing date and over four months 7 after you were appointed, I commented that no issues had been 8 raised in advance of sentencing as I require in my individual 9 rules and as I try to caution people at the time sentencing is 10 set. 11 raising for the first time one financial issue with respect to 12 forfeiture. 13 raised earlier and why isn't it untimely? 14 Filed 11/06/23 Page 17 of 69 17 I reminded you on October 4th, nearly one Two weeks after I entered that order, you filed a letter So I'd like to understand why was this issue not MR. TALKIN: Your Honor, obviously I came into this 15 case after many lawyers, there was a lot of work to be done, 16 getting reading done, getting through a whole record, trying to 17 figure out what's going on here, but obviously the financial 18 aspect of it, because we're talking about so many years here 19 and the guidelines wasn't at the forefront of my mind. 20 when I read that order, it caused me to go re-read the 21 financial aspects. 22 objection of more of a preservation of a right, because I 23 understand, in other words, the application was and we'll get 24 into that Honeycutt applies to money laundering cases. 25 noted in my letter, I've made that order before, not in this Then, And as you can tell from my letter, it's an SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 As I Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 18 of 69 1 district, but in the Eastern District, and it was denied, and 2 it's an open issue. 3 THE COURT: 4 mean by that? 5 what you mean? 6 18 When you say it's a right, what do you You're trying to preserve it for appeal, is that MR. TALKIN: In other words, I want to make sure my 7 client's -- all of his arguments are, on appeal, to the best of 8 my ability, preserved. 9 Honor and I think -- I'm sure you understand the basis of the 10 argument, but I also understand the other side. 11 since it's an open area of the law, that certainly the courts 12 have been -- they moved it from just the drug statute to 13 include fraud statutes, and there is a possibility it could 14 make it to the money laundering statute. 15 sure it was preserved for my client. 16 17 18 THE COURT: I still make that argument to your But I think So I wanted to make So your objection is preserved for the record and we'll talk about the merits of it in a moment. I'm going to turn now to the various issues, including 19 the objections that had been raised by various sides. So let 20 me start with what I hope are the easy things. 21 number of typographical, I'm going to call them errors that had 22 been raised. 23 to the typo -- I'm sorry. There were a So let me ask first, does the government object Let me start again. 24 Does Mr. Ilori object to the correction proposed by 25 the government in its June 28th, 2023 letter, specifically on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 19 of 69 19 page 2 of the PSR? 2 Do you have the PSR? 3 MR. TALKIN: I do. 4 THE COURT: Do you disagree or do you agree that the 5 statutory citations to 18 U.S.C., the last provision should be 6 3147? 7 MR. TALKIN: Yes, your Honor. 8 THE COURT: You agree? 9 MR. TALKIN: Yes. 10 THE COURT: Next, as noted in the government's 11 sentencing submission, the PSR reflects what the government 12 considers to be a correct total offense level of 40. 13 itemized offense level calculation is missing a paragraph. 14 math in the PSR just doesn't add up, and yet, there's a 15 paragraph that seems to have been dropped or it's missing about 16 the two-level enhancement pursuant to Section 2S1.1(b)(2)(B) 17 because the defendant was convicted under 18, United States 18 Code, Section 1956. 19 20 The I think you told me earlier, Mr. Talkin, you agree that that should be included in the PSR? 21 MR. TALKIN: Correct, your Honor. 22 THE COURT: Or in the guidelines calculation? 23 MR. TALKIN: Yes, and that explains one of my 24 25 The objections to the math from one of the other lawyers. THE COURT: In the following paragraphs, 21, 56, 57, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 20 of 69 20 1 and 59, the amount of the approved fraudulent loans should read 2 $1,024,625. 3 Does the defense object? 4 MR. TALKIN: 5 But I just do want to make one record, because I No, your Honor. 6 didn't -- as far as -- I'm not objecting to that being what the 7 PSR is saying, but just as an overall objection, since this is 8 not a plea bargain, it's a case after trial, I should put on 9 the record that I'm making these in a sentencing discussion 10 after trial, but we still object to the facts as a whole 11 because he has maintained his innocence and pled not guilty. 12 With that understood -- 13 THE COURT: And the jury rejected it. 14 MR. TALKIN: Correct. I think that for a Court of 15 Appeals, I just want to make sure that they understand that he 16 maintains his position. 17 THE COURT: I think they'll get it. 18 In paragraph 139 on pages 34, 36, and 39, the amount 19 of restitution should read, and this is the issue we just 20 talked about, $1,120,462.47, of which $1,072,062.47 is owed to 21 the Small Business Administration with the remaining individual 22 restitution of $48,400 owed to the other victim identified in 23 the schedule of victims. 24 Any objection, Mr. Talkin? 25 MR. TALKIN: No, your Honor. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 THE COURT: Document 149 Filed 11/06/23 page 40, is the one we just talked about. 3 withdrawing that; right? MS. MURRAY: Yes, your Honor. So you're We would ask that your 5 Honor just update the number to be correct. 6 should read: So page 40 then "Restitution in the amount of $1,072,062.47." 7 THE COURT: 8 Correct, Mr. Talkin? 9 MR. TALKIN: Yes, your Honor. 10 THE COURT: Now, Mr. Talkin has pointed out that on Yes. 11 page 39 of the PSR, there is a sentence which begins: 12 stipulated in defendant's plea agreement..." and then it goes 13 on to talk about restitution. 14 15 21 Now, your last correction, Ms. Murray, on 2 4 Page 21 of 69 "As Does the government agree that the "As stipulated in defendant's plea agreement" should be stricken? 16 MS. MURRAY: Yes, your Honor. 17 THE COURT: Now, Mr. Talkin, that's all you said about 18 that, but I had a further correction to that. 19 out the PSR. 20 it's going to read now because it's just going to begin with a 21 dollar amount. 22 under the heading "Restitution." 23 24 25 Let me just pull Page 39, so it's a little bit awkward, the way This is under the restitution section, page 39 So we're striking in the second sentence: stipulated in the defendant's plea agreement." MS. MURRAY: "As Correct? Yes, your Honor. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 22 of 69 1 MR. TALKIN: Yes, your Honor. 2 THE COURT: It goes on to read, so now it's going to 22 3 begin: 4 Administration..." but that section from probation is missing, 5 the additional language that "$48,400 is owed individually to 6 the victim" on the schedule attached to the proposed order of 7 restitution; correct? 8 MS. MURRAY: Yes, that's correct, your Honor. 9 THE COURT: Mr. Talkin. 10 MR. TALKIN: That is correct. 11 THE COURT: So we will make that notation on the 12 "$1,072,062.47 is owed to the Small Business judgment that finally gets entered. 13 And the final, what I'm calling a typographical error, 14 the government -- this is not really a typographical error item 15 I don't think, but in any event, let's just deal with it now. 16 In your October 13th, 2023 supplemental submission, the 17 government identifies an error in its own and in the probation 18 department's guidelines calculation, and the government now 19 acknowledges that the two-level enhancement under 20 2B1.1(b)(11)(A)(i) and 2, and (b)(11)(C)(ii) does not apply to 21 the combined offense level calculation because Mr. Ilori was 22 also convicted of aggravated identity theft, in violation of 23 Title 18, United States Code, Section 1028; correct? 24 MS. MURRAY: That's correct, your Honor. 25 THE COURT: Mr. Talkin, I assume no objection? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 23 of 69 1 MR. TALKIN: That's correct. 2 THE COURT: I just need one moment. 3 (Pause) 4 So that is all of what I think are, what I'm calling 5 6 7 8 23 typographical objections. A couple of other preliminaries before we get to Mr. Ilori's objections. Does Mr. Ilori object to the government's request in 9 the October 13th letter that paragraph 70 be deleted and 10 Mr. Ilori's adjusted offense level be reduced from 40 to 38? 11 MR. TALKIN: No, your Honor. 12 THE COURT: Next, does the government object to 13 defendant's request — we already talked about this — that the 14 language about the plea be stricken and that we're fixing the 15 remainder? 16 MS. MURRAY: Correct. 17 THE COURT: Mr. Talkin. 18 MR. TALKIN: Yes. 19 THE COURT: I'm sorry, I know this is tedious, but 20 there's a lot of materials flying back and forth. 21 Let's turn to Mr. Ilori's objections now. 22 So first, Mr. Ilori raised two objections with respect 23 to paragraph 67, and I have said this is the loss amount, 24 intended loss amount. 25 hearing on all of this. As I had said, I do not require a Fatico I sat through the trial, I heard all SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 24 of 69 1 of the evidence. 2 you said you wanted a Fatico hearing, I think this was one of 3 them; correct? 24 There were two issues, Mr. Talkin, on which 4 MR. TALKIN: Yes, your Honor. 5 THE COURT: On this, and I believe the second was the 6 number of victims; is that right? 7 MR. TALKIN: Actually, one second, your Honor. Well, 8 it was really -- it's more than ten victims in the access 9 device authentication feature, which is now moot anyway. 10 11 THE COURT: So there's really only one issue on which you're requesting a Fatico hearing? 12 MR. TALKIN: It was the ten or more victims. I'm 13 sorry. Also, the prior attorney had objected to the 14 $1 million -- the injury to a bank for $1 million received by 15 Mr. Ilori. 16 THE COURT: Received individually? 17 MR. TALKIN: Correct. 18 THE COURT: But he didn't request a Fatico hearing on 19 that, he just objected. I have your six objections and I'm 20 going to go through them. 21 on which of these objections were you asking for a Fatico 22 hearing, and it's only the ten or more victims; right? All I'm trying to do is figure out 23 MR. TALKIN: At this point, that's correct. 24 THE COURT: Let's talk about the actual loss amount. 25 So, Mr. Ilori raised two objections with respect to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 25 of 69 25 1 paragraph 67. 2 characteristics: 3 $9.5 million, but less than $25 million, a 20-level enhancement 4 is warranted pursuant to United States Sentencing Guideline 5 Section 2B1.1(b)(1)(K)." 6 defense position. 7 Paragraph 67 is, I'm quoting, "Specific offense Because the intended loss was more than And it does note in footnote 3 the So, as I understand it, Mr. Ilori is contending that 8 actual loss rather than intended loss should be used for 9 purposes of this enhancement; correct? 10 MR. TALKIN: That's correct, your Honor. 11 THE COURT: So any points to authority from the Third 12 Circuit in a case called United States v. Banks, 55 F.4th 246 13 (3d Cir. 2022). 14 loss only for the purpose of this enhancement. 15 defense submission is any mention of what the Second Circuit 16 says on this issue, that is the circuit which is binding on me 17 for purposes of analysis. 18 submission on what the Second Circuit instructs. 19 is because the Second Circuit has been eminently clear that 20 "for purposes of calculating the guidelines range, loss is 21 defined as "the greater of actual loss or intended loss"." 22 United States v. Powell, 831 F. App'x 24, 25 (2d Cir. 2020), 23 citing a number of other cases. 24 25 Mr. Ilori contends I should consider actual Absent from the So no discussion in the defense Perhaps that So, based on that Second Circuit binding authority, Mr. Ilori's first objection to paragraph 67 is overruled. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 26 of 69 1 Consistent with Section 2B1.1, comment No. 3A, and Second 2 Circuit precedent, I intend to sentence Mr. Ilori to the 3 greater of actual loss or intended loss. 4 26 Now, Mr. Ilori raises a second objection, as I 5 understand it, with respect to paragraph 67, objecting to the 6 inclusion of the loss amount associated with two of the 7 fraudulent loan applications listed in Government Exhibit 750. 8 He originally stated that inclusion of these items in loss 9 calculation has not been sufficiently addressed so as to 10 preclude a Fatico hearing, but he did not request a Fatico 11 hearing, and I don't understand you to be requesting a Fatico 12 hearing now; correct? 13 MR. TALKIN: That's correct. Our position is that the 14 record, as it stands, it has not been proved by a preponderance 15 of the evidence. 16 THE COURT: Mr. Ilori simply asserts that the 17 inclusion of these two loans in the loss calculation has not 18 been sufficiently addressed. 19 So I'll just note, as an initial matter, it's not even 20 clear to me what two loan applications Mr. Ilori is objecting 21 to. 22 filed by Source Four Jet Corporation under the name of William 23 Jameson, but no such loan application is reflected on 24 Government Exhibit 750; there is a loan application filed on 25 behalf of Source Four Jet Inc. filed under the name of Thomas He first objects to the inclusion of a loan application SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 27 of 69 27 1 Allen; and then there is a different loan application filed on 2 behalf of an entity called Jet Away Jets Corporation submitted 3 under the name of William Jameson. 4 So, do you wish to be heard? 5 MR. TALKIN: I can correct that, your Honor. 6 the loan identified by company name, Source Four Jets 7 Incorporated. It is 8 THE COURT: Source Four Jets Incorporated? 9 MR. TALKIN: Correct, which would be the one -- 10 looking at Government Exhibit 750, that would be the one, two, 11 three, fourth, fifth from the top. 12 THE COURT: Filed under the name Thomas Allen? 13 MR. TALKIN: That's correct, your Honor. 14 THE COURT: So my clerk is handing me a copy of 15 Government Exhibit 750. 16 Ms. Murray, do you wish to be heard? 17 MS. MURRAY: Your Honor, we noted in our submission, 18 dated June 28th, 2023 — that's at docket 130 — the specific 19 evidence the government presented at trial to justify the 20 inclusion of these two particular loans in the summary of the 21 loans the defendant was involved with fraudulently submitting. 22 Happy to answer any additional questions if the Court 23 has any. 24 THE COURT: No, I just want the record to reflect 25 where someone should look. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 28 of 69 28 1 And then I note, too, the second loan application to 2 which Mr. Ilori objects, a filing by Creative Media Software 3 Solutions under the name of Thomas Huckleberry on May 25, 2021 4 is accurately reflected on that trial exhibit. 5 6 7 Do you want to be heard with respect to that, Mr. Talkin? MR. TALKIN: Yes, your Honor. My client informs me 8 that it should be the last Thomas Huckleberry Farms product, 9 which would be the last one in the exhibit. 10 11 THE COURT: Look, the time for objections, folks, has long since passed here. 12 Does the government wish to be heard? 13 MS. MURRAY: Your Honor, I would just note that, 14 again, the evidence presented at trial justified the inclusion 15 of the loans reflected here. 16 I would also note that Government Exhibit 750 has a 17 cross-reference to Government Exhibit 167 with respect to the 18 Thomas Huckleberry Farm products loan the defendant just 19 mentioned. 20 regarding this objection. So I would just include those in the record 21 THE COURT: Thank you. 22 I do recall from presiding over this trial that the 23 government produced extensive evidence with respect to each of 24 the loan applications included on Government Exhibit 750 during 25 the course of the trial, and that evidence included loan SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 29 of 69 29 1 applications, documents recovered from Mr. Ilori's computer, 2 physical evidence recovered from the apartment that Mr. Ilori 3 shared with his codefendant, Mr. Recamier, and counterfeit 4 sources of identification. 5 pieces of evidence, to Government Exhibits 162, 163, 166, 167, 6 590, and 610. 7 presided over the trial, I am quite confident that each of 8 these loan applications are amply supported in the record and 9 were sufficiently addressed at trial. 10 paragraph 67 is overruled. 11 And I would refer, among other This is not an exhaustive list, but having So that objection to Now we turn to the objection to paragraph 68 in which 12 Mr. Ilori asserts, really with no support, that the 13 ten-or-more-victims enhancement does not apply because his 14 crime had only one victim, the Small Business Administration. 15 Now, do you want to be heard? 16 which you requested a Fatico hearing. This is the item on 17 MR. TALKIN: Yes, your Honor. 18 As I stated in my submission, I also am aware of the 19 law that exists as far as when there's an identity theft issue, 20 that victims of identity theft are also victims; however, we 21 did want to assert that objection, but I did point you to that 22 law. 23 THE COURT: 24 Is there anything by way of a Fatico hearing that you 25 want to present? Yes, you did. A Fatico hearing says you want to present SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 2 3 Document 149 Filed 11/06/23 Page 30 of 69 evidence; right? MR. TALKIN: I think the Fatico hearing more is that the government hasn't presented evidence beyond -- excuse me. 4 THE COURT: By a preponderance of the evidence. 5 MR. TALKIN: By a preponderance of the evidence in 6 7 30 order to make out the ten victims. THE COURT: That's our position. The objection is overruled. It is simply 8 not true that there is only one victim of Mr. Ilori's numerous 9 violations of the law. 10 of a piece with Mr. Ilori's continued failure to accept 11 responsibility for the extensive damage that his actions have 12 caused to numerous, unsuspecting victims of his identity theft. 13 In addition to the Small Business Administration, the The objection, in fact, is indicative 14 government introduced evidence at trial indicating that 15 Mr. Ilori and Mr. Recamier used the names of nine identity 16 theft victims in connection with their fraudulent loan 17 applications. 18 Exhibit 750. 19 And you can, again, look at Government The records at trial also demonstrate that Mr. Ilori 20 registered email accounts in the names of 18 identity theft 21 victims, and I refer specifically to Government Exhibit 730. 22 This evidence is sufficient under application note 4E to 23 Section 2B1.1 of the sentencing guidelines, which, as 24 Mr. Talkin has acknowledged, clearly states — and this is for 25 you, Mr. Ilori — that "a victim" may be "any individual whose SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 31 of 69 1 means of identification was used unlawfully or without 2 authority." 3 Based on the evidence that I saw and heard at the 4 trial of this case, I am more than satisfied, certainly by a 5 preponderance of the evidence, that the crimes committed by 6 Mr. Ilori had ten or more victims. 7 paragraph 68 is overruled and I do intend to apply this 8 enhancement. 9 So the objection to Next, defendant objects to paragraph 69, arguing that 10 Section 2B1.1(b)(10)(C), the so-called sophisticated means 11 enhancement, should not apply because sophisticated means are 12 inherent in the crimes of which Mr. Ilori was convicted. 13 31 Do you wish to be heard? I have both sides' 14 submissions on this, but if you wish to be heard, I'm happy to 15 hear you. 16 MR. TALKIN: Your Honor, just very briefly. In other 17 words, I think what the prior counsel was saying in that point 18 is basically that these means to commit this crime, by saying 19 that they're inherent in committing the crime, that they are 20 not in fact sophisticated means. 21 commit the offense of conviction or the offenses of conviction, 22 and because of that, they lack the sophistication that warrants 23 upward enhancement. 24 THE COURT: 25 It's the minimum required to I do not agree. The record at trial showed that Mr. Ilori participated in a particularly SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 32 of 69 32 1 sophisticated conspiracy involving dozens of falsified bank and 2 other records, fraudulent identification cards, the creation of 3 numerous fictitious business entities. 4 intended to and in some cases actually did trick established 5 financial institutions into awarding Mr. Ilori and his 6 codefendant tens of thousands or even millions of dollars in 7 loans, all under the mistaken belief that they were running 8 legitimate businesses and employing hundreds of employees as 9 required to qualify them. These tactics were 10 I would note, too, that comment 9B to Section 2B1.1 11 notes that "sophisticated means" may include "conduct such as 12 hiding assets or transactions, or both, through the use of 13 fictitious entities, corporate shells, or other offshore 14 financial accounts." 15 The Second Circuit has recognized that "the creation 16 and use of documents and other tactics to conceal offense 17 conduct are indicia of sophistication of an offense." 18 from United States v. Fofanah, 765 F.3d 141, 146 (2d Cir. 19 2014). 20 That's That is exactly what happened here. Moreover, the Second Circuit has found that simply 21 "moving money between several bank accounts" and using 22 "businesses as "fronts" to hide his activity" can warrant an 23 application of this enhancement. 24 Bailey, 820 F. App'x 57, 62 (2d Cir. 2020). 25 That's United States v. Mr. Ilori did not only use businesses as fronts, he SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 33 of 69 33 1 and his coconspirator entirely created fictitious businesses to 2 facilitate their fraud, and the record at trial shows the funds 3 they acquired were subsequently disbursed to purchase 4 cryptocurrency and stock among other things. 5 In an effort to avoid this binding Second Circuit 6 authority, Mr. Ilori again points to out-of-circuit precedent, 7 this time looking to authority from the Fourth Circuit, for the 8 unremarkable proposition that "sophistication requires more 9 than the concealment or complexities inherent in fraud." 10 was quoting from United States v. Adepoju, 756 F.3d 250 (4th 11 Cir. 2014). 12 Mr. Ilori because in that case, the Fourth Circuit remanded the 13 sentence only after determining that the district court had 14 failed to detail factual findings to support imposition of the 15 sentence, and that's at pages 258 and 259. 16 He That out-of-circuit case provides little help to Based on the record from the trial in this case, I 17 have no hesitation in applying the sophisticated means 18 enhancement here. 19 clearly supports that and the objection to paragraph 69 is 20 therefore overruled. 21 22 I think the preponderance of the evidence I want to discuss just one more objection and then I'm going to take a short break. 23 Defendant next objects to paragraph 70, arguing that 24 Section 2B1.1 -- this is the one that has been deleted, right, 25 so this is mooted; correct, Mr. Talkin? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 34 of 69 1 MR. TALKIN: That's correct. 2 THE COURT: So I don't need to address this. 3 MR. TALKIN: Correct. 4 34 71 is the last objection. That's the bank, $1 million of individual proceeds from a bank. 5 THE COURT: Yes, that's the one I said I want to take 6 up after the break. So why don't we take a short break now and 7 then we'll come back. 8 So for the record, the objection to paragraph 70 has 9 been mooted because the parties have both agreed that paragraph 10 70 should be deleted. 11 correct, Ms. Murray? 12 MS. MURRAY: That's correct, your Honor. 13 THE COURT: All right. That enhancement does not apply; So we'll stand in recess for a 14 few moments and we'll come back and talk about paragraph 71 and 15 then we have to talk about the forfeiture issue. 16 (Recess) 17 So the final argument that was raised by Mr. Ilori 18 with respect to the PSR is with respect to paragraph 71, and he 19 argues that the two-level enhancement under Section 20 2B1.1(b)(17)(A) should not apply because there is no basis to 21 conclude that Mr. Ilori individually derived more than 22 $1 million in gross receipts. 23 Now, before I hear from Mr. Talkin, I just want to 24 note for the record that, at least as described by probation, 25 it does appear that, initially, Mr. Ilori was making a slightly SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 35 of 69 35 1 different argument, and again, that's part of a pattern here of 2 ever-shifting, evolving, and emerging arguments. 3 I note that page 31 to 32, the PSR seems to understand 4 Mr. Ilori's argument to be a contention that the application of 5 this enhancement would involve double counting, in effect, with 6 the loss amount, which was already counted for with respect to 7 the 2B1.1(b)(1)(K) enhancement. 8 his original sentencing submission with no authority for that 9 argument, but now he seems to have shifted his argument to 10 focus more broadly on the individual receipt issue. 11 He briefly included this in So, Mr. Talkin, I'll hear from you, and I'd appreciate 12 if you can clarify that I'm correct in understanding that now 13 what you're saying is that Mr. Ilori did not individually 14 receive more than $1 million. 15 MR. TALKIN: That's correct, your Honor. The total 16 amount is only $24,000 over the $1 million threshold, and there 17 is clearly his codefendant Recamier clearly got proceeds during 18 his plea agreement. 19 government has made allegations that it was spent on items of 20 his own throughout much of the litigation, and because of that, 21 really only needing to move $24,000, I believe the government 22 has failed by a preponderance of the evidence to establish that 23 my client received over $1 million to make this apply. He said he received proceeds. The 24 THE COURT: Ms. Murray, do you wish to be heard? 25 MS. MURRAY: Your Honor, we've included information SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 36 of 69 1 about this in our submissions, but I'm happy to answer any 2 questions that the Court has. 3 THE COURT: 4 submission for the record? 5 36 Do you want to refer to a specific MS. MURRAY: Yes. So July 14th, 2023 — that's at 6 docket entry 138 — we addressed the objection to the gross 7 receipts enhancement. 8 And I would note also, in connection with that 9 submission, we indicated that, through trial evidence, 10 Mr. Ilori himself was linked to more than $1 million in gross 11 receipts through his control of his 0642 phone, and that is the 12 phone he was arrested with. 13 evidence that that phone number was connected to Chase, 14 Capital One, and HSBC accounts that, together, received more 15 than $1 million in bank funds. 16 THE COURT: Thank you. 17 MR. TALKIN: Your Honor, if I can be heard with just a 18 couple more sentences on that. 19 THE COURT: Sure. 20 MR. TALKIN: The fact that he had access to the bank Evidence at trial included 21 accounts does not mean he had control over all the dollars in 22 those bank accounts and certainly doesn't -- I have not seen 23 evidence that establishes that by any standard. 24 THE COURT: Are you finished? 25 MR. TALKIN: Yes. Thank you. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 THE COURT: Document 149 Filed 11/06/23 Page 37 of 69 37 Look, I will say I do find this one a much 2 closer call than any of the other objections that Mr. Ilori has 3 made. 4 Comment 13A to Section 2B1.1 clarifies that in order 5 for subsection (b)(17)(A) to apply, I need to determine that 6 the gross receipts to Mr. Ilori individually, rather than to 7 all participants, exceeded $1 million. 8 laid out, the contention is that the evidence at trial shows 9 that the gross receipts were received by both Mr. Ilori and his 10 codefendant, Mr. Recamier, and that there is no evidence 11 indicating what gross receipts were received personally by 12 Mr. Ilori. 13 response is that Mr. Ilori had access to and control over 14 several fraudulent bank accounts that received the fraud 15 proceeds. 16 As Mr. Talkin has just As Ms. Murray has just stated, the government's The evidence at trial indicated that both Mr. Ilori 17 and Mr. Recamier jointly possessed the proceeds from their 18 offenses. 19 evidence about at trial was leased by Mr. Recamier. 20 too, that the proceeds from the offenses involved, as 21 Mr. Talkin has pointed out, just over $1 million in 22 fraudulently received funds. 23 Mr. Ilori individually received almost every single dollar 24 acquired by both parties' fraud. 25 For example, the Mercedes that we had a lot of I note, I have no reason to believe that So, on the record before me, I cannot conclude that SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 38 of 69 1 the over $1 million in gross receipts were received by 2 Mr. Ilori individually. 3 38 I cite to United States v. Millar, 79 F.3d 338, 346 4 (2d Cir. 1996), remanding the case where the district court did 5 not find that the defendant individually derived more than 6 $1 million in proceeds. 7 in my own independent guidelines calculation, which I'll lay 8 out on the record later, I have not applied this enhancement. 9 Now, as I understand it, the final issue we need to 10 talk about is the objection, as I've noted, raised belatedly 11 with respect to forfeiture. 12 you're contending that Honeycutt v. United States, which is 13 reported at 581 U.S. 443 (2017), supports an argument that 14 Mr. Ilori should be required to forfeit only the property he 15 actually acquired, in other words the funds he personally 16 obtained. 17 portion of the proceeds, the government cannot establish that 18 Mr. Ilori actually acquired the entire forfeitable amount. 19 So I do sustain this objection. And As I understand it, Mr. Talkin, He argues that because Mr. Recamier acquired a You have acknowledged that there is no binding 20 authority saying in the first place that the Honeycutt case 21 applies in the money laundering context; correct? 22 23 24 25 MR. TALKIN: That's correct, your Honor. There's not one that says it does, there's not one that says it does not. THE COURT: In Honeycutt, the Supreme Court addressed joint and several liability in the context of forfeiture awards SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 39 of 69 1 issued under Title 21, United States Code, Section 853. 2 Specifically, the Supreme Court held that forfeiture was 3 limited to property "obtained" by a criminal defendant. 4 at 581 U.S. 454. 5 39 That's Relevant here, the court went on to explain that a 6 defendant who has "come into possession of" funds may be said 7 to have "obtained" them for purposes of forfeiture liability. 8 That's at pages 449 through 450 of the Honeycutt opinion. 9 So, against that backdrop, I'm going to note as an 10 initial matter, I don't even see that Honeycutt is relevant to 11 this case because the proposed order of forfeiture, under the 12 proposed restitution order, as I understand it, does not seek 13 to hold Mr. Ilori jointly and severally liable with 14 Mr. Recamier; is that correct, Ms. Murray? 15 MS. MURRAY: That is correct, your Honor. 16 MR. TALKIN: Your Honor, can I say one thing on that. 17 I noticed what you noticed, but I think there's a reason for 18 that. 19 ago -- It's not a factual reason, and I know it was a while 20 THE COURT: Let me look back at it. 21 MR. TALKIN: Sure. When Mr. Recamier took his plea, 22 he pled guilty under a statute that did not have a 23 forfeiture -- 24 THE COURT: Right. 25 MR. TALKIN: But that didn't mean factually. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 In other Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 40 of 69 40 1 words, that doesn't stand for the proposition that he wouldn't 2 be responsible if he was charged under that statute. 3 THE COURT: But he wasn't. 4 MR. TALKIN: I understand. He was offered a plea to a 5 lesser count and it didn't -- that count did not carry the 6 possibility for forfeiture. 7 government said he shouldn't have forfeited. 8 to a count that had a forfeiture, and I think they even said 9 this during the sentencing, if he had pled guilty to a count 10 that did have a forfeiture statute that applied to it, that 11 they would have asked for forfeiture, but because -- and I 12 remember your Honor actually brought this up with the court 13 when they came out. 14 of codefendant. 15 issue that he would be responsible for forfeiture, but it's 16 only -- and the reason it's not joint and several is because 17 not on a factual basis, but on a practical basis of how the 18 case was charged and ultimately pled out. 19 It's not that they didn't -If he pled guilty I think it was at the sentencing of this, And the reason wasn't that there was a factual THE COURT: In any event, I don't that helps you. The 20 government is not seeking to impose joint and several liability 21 for forfeiture. 22 acknowledged, Honeycutt interpreted a different forfeiture 23 statute than the one at issue in this case. 24 the evidence at the trial over which I presided clearly showed 25 that Mr. Ilori possessed and controlled the funds derived from But, in any event, as you've already And in any event, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 41 of 69 1 this fraud at various points in time, even if he didn't 2 permanently retain all of the funds. 3 And I would refer you to the following cases: 41 United 4 States v. Tanner, 942 F.3d 60, 68 (2d Cir. 2019). In 5 particular, the court there said: 6 required the full proceeds as a result of the crime, each can 7 still be held liable to forfeit the value of those tainted 8 proceeds, even if the proceeds are no longer in his 9 possession." 10 F App'x 742, 748 (2d Cir. 2019) said: 11 controlled the proceeds of the P2 and TT funds as he was able 12 to transfer the funds to shell companies and use the funds for 13 personal expenses." 14 736 F. App'x 279, 283, 84 (2d Cir. 2018), the Court found the 15 defendant "exercised "control" over both that firm and the 16 proceeds it acquired, including the proceeds acquired as a 17 result of his insider trading. 18 subsequently were distributed to investors with him personally 19 retaining only a percentage as management fees, he nonetheless 20 had authority over disbursements, and thus exercised control 21 over the proceeds at some point." "When each coconspirator Similarly, United States v. Bergstein, 788 "Bergstein effectively Similarly, in Rajaratnam v. United States, Even if those proceeds 22 So, based on the evidence that I saw and heard at the 23 trial, I do find by a preponderance of the evidence there is a 24 sufficient record that Mr. Ilori obtained the funds if 25 Honeycutt in fact is applicable here. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 42 of 69 So, the relevant statute does entitle the government 2 to a forfeiture award. 3 Section 982(a)(1), (a)(2)(A), and I do intend to impose the 4 full amount of forfeiture requested here. 5 6 42 That statute is 18, United States Code, Are there any objections that have not been addressed? Ms. Murray. 7 MS. MURRAY: No, your Honor. 8 THE COURT: Mr. Talkin. 9 MR. TALKIN: No, your Honor. 10 THE COURT: So I do adopt the PSR with all of the 11 modifications and subject to my rulings on the various 12 corrections, comments, objections, including the factual 13 findings therein. 14 I will note that my guidelines calculation is not 15 consistent with what's in the PSR. 16 guidelines calculation in a few moments. 17 suppose attached to the PSR and to the judgment or reflected in 18 the judgment and the PSR as modified with my rulings, and all 19 of the modifications and corrections we've talked about will be 20 made part of the record in this matter. 21 seal. 22 access to the modified PSR and all of the attachments to it 23 without any need for further application to the Court. 24 25 I will lay out my So that will be I It will be filed under If an appeal is taken, counsel on any appeal may have So we can turn at this point to my hearing from the parties, unless there's anything further that we need to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 2 3 Document 149 Filed 11/06/23 Page 43 of 69 43 discuss. I'm just pausing to give counsel an opportunity to talk to Mr. Ilori. 4 MR. TALKIN: Thank you. We're ready, your Honor. 5 THE COURT: You're ready? 6 MR. TALKIN: Yes. 7 THE COURT: Ms. Murray, would you like to be heard? 8 MS. MURRAY: Yes, your Honor. We've made arguments in 9 our written sentencing submissions, but I wanted to highlight 10 some of the major considerations that we think are relevant for 11 the Court's sentencing determination. 12 We believe that a significant consecutive sentence, 13 consecutive to the defendant's sentence in Judge Liman's case, 14 of at least 25 years' imprisonment is warranted here, and 15 that's to account for the nature and seriousness of the offense 16 as well as deterrence and, in particular here, individual 17 deterrence. 18 First, the nature and seriousness of the offense. 19 Mr. Ilori is a uniquely dangerous white collar 20 defendant. 21 orchestrated this broad fraud scheme for more than a year, and 22 in the course of the scheme, he took advantage of the COVID-19 23 pandemic relief programs that were set up to assist small 24 businesses in coping with an unprecedented economic crisis. 25 He is, simply put, a menace to society. He He also committed these crimes after he had been SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 44 of 69 44 1 charged with similarly serious fraud by our office and after he 2 had pled guilty and supposedly accepted responsibility for 3 those other fraud crimes. 4 The identity theft that Mr. Ilori and his codefendant 5 committed was deliberate and it was layered. 6 cellphone accounts in victims' names, then they registered 7 email accounts in the victims' names using the cellphone 8 numbers. 9 supposed businesses in the names of those victims. 10 created false IDs with individuals' names and identifiers, but 11 Mr. Recamier and, in one case, Mr. Ilori's photo. 12 Mr. Ilori himself posed as one of the identity theft victims, 13 renting an apartment and presenting himself to the leasing 14 agent as one of the identity theft victims. 15 They opened Then they opened bank accounts and they established They And The individual identity theft is equally, if not more 16 serious than the COVID-19 relief fraud conduct. 17 heard during trial, the defendant stole the identities of more 18 than a dozen individuals to set up the various accounts and to 19 steal government funds. 20 As your Honor And identity theft imposes lasting and significant 21 effects on victims. Several of the defendant's victims 22 testified at trial about the consequences of having their 23 identity stolen, which included both the practical effects such 24 as credit problems and damage resulting to their own credit, 25 and debt collectors seeking money that they didn't owe. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 45 of 69 45 But even aside from the financial impact on these 2 identity theft victims, there is the serious emotional damage 3 that results from the theft of their identities, and that 4 includes a feeling of helplessness. 5 theft are lasting and they shatter the victims for years. The effects of identity 6 Here, too, with respect to deterrence, the defendant 7 has displayed a consistent and utter disregard for his victims 8 and for the law. 9 proceeding, he continues to accept no responsibility whatsoever 10 for his conduct. 11 government and steal aid, but he did it for his own selfish 12 purposes. 13 his identity theft victims, he rented an apartment in the name 14 of an identity theft victim. 15 undeterrable, your Honor. 16 As your Honor noted earlier in today's He stole identities not just to defraud the He drove a Mercedes that was leased in the name of This defendant is effectively His substantive history of fraud makes it clear that 17 he does not take responsibility for his actions or the 18 consequences of his crime. 19 It's for these reasons, your Honor, that the 20 government respectfully submits that a substantial term of 21 imprisonment of at least 25 years is necessary here, both to 22 account for the seriousness of the conduct, to account for the 23 impact that the conduct has had on individual identity theft 24 victims, and also to ensure that Mr. Ilori is not able to 25 continue to commit crimes. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 46 of 69 46 1 And with respect to a technical issue on sentencing, 2 your Honor, we would note that Title 18, United States Code, 3 Section 3147 permits for an additional consecutive sentence of 4 up to 10 years' imprisonment on each count. 5 the Court includes a component of 3147 in its sentence, we 6 would ask the Court apportion that sentencing enhancement under 7 the various counts. 8 THE COURT: All right. To the extent that I actually had a question 9 about this, and I'd like to hear it, I'm sorry to do it at this 10 point, I should have done it earlier, but I'd like to hear from 11 both of you about this. 12 been convicted under 3147, there was the potential for 10 years 13 in addition to, but is that in addition to a guidelines 14 sentence or don't the guidelines, by saying I believe it's a 15 three-level enhancement, doesn't that negate the 3147 or how do 16 the two work together? It was my understanding that, having 17 MS. MURRAY: Can I just have a moment, your Honor? 18 THE COURT: Sure. 19 And Mr. Talkin, I'm going to want to hear from you on 20 21 that point, too. MS. MURRAY: Your Honor, with respect to the 22 guidelines calculation, it's the government's understanding 23 that, as you said, the three points does account for 3147 24 regarding the calculation of the applicable guidelines range. 25 That said, the impact of 3147 is to increase the statutory SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 47 of 69 47 1 maximum for each of the counts of conviction. 2 Mr. Ilori was convicted of 3147 on each of the six counts, the 3 impact would be to increase the statutory maximum for each of 4 those counts by 10 years. 5 as a result of 3147 conviction for that count, it would be 6 imposed consecutive. 7 THE COURT: 8 consecutive; right? 9 MS. MURRAY: Yes, that is correct. 10 THE COURT: Mr. Talkin. 11 MR. TALKIN: Yes, your Honor. 12 So here, because To the extent any of the sentence is The statute does say it has to be I believe that that paragraph, 74 and 3C -- 13 THE COURT: Are you going back to the PSR now? 14 MR. TALKIN: I'm reading it to get the statutes. The 15 enhancement in paragraph 74 of the PSR, I think it's akin to 16 when the thinking behind when you're convicted of multiple 17 counts and you get -- there's the grouping analysis, and then 18 each group gets one point and it increases it in an incremental 19 level, taking into account for criminal behavior, the 20 commission deems is more serious than just the single count. 21 think it's a similar analysis here where they've come up with a 22 way for the courts to consider as a three-point enhancement, 23 which is a significant enhancement. I 24 THE COURT: Yes. 25 MR. TALKIN: So I do think it is covered, so to speak. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 48 of 69 1 But the government is right, as everyone knows, there was 2 guidelines and they're statutory, and those are two different 3 things. 4 contemplation is satisfied by the enhancement. 5 48 As far as contemplating a sentence, I believe that THE COURT: Now you're arguing, though, by saying you 6 believe it's satisfied by the enhancement, you're arguing on 7 behalf of Mr. Ilori, but you're not disputing what Ms. Murray 8 says, that there could be up to a 10-year additional term per 9 count. 10 MR. TALKIN: Correct, that's what the law says. 11 THE COURT: And they're supposed to run consecutively 12 to any other sentence. 13 MR. TALKIN: Correct, yes. 14 THE COURT: I appreciate your candor. 15 And I should have raised that with you all earlier. 16 Mr. Talkin, would you like to address the Court? 17 MR. TALKIN: 18 I have advised my client, because he has a -- he's going to file an appeal and -- 19 20 Briefly, your Honor. THE COURT: I'm sorry. I'm not hearing you. He's MR. TALKIN: Because he's going to file appeal, I've going -- 21 22 advised my client not to address the Court. So I am going to 23 address the Court because, after a trial, I do not want him to 24 make any statements that could be used against him at a later 25 time. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 49 of 69 49 1 THE COURT: Okay. 2 MR. TALKIN: Your Honor, in essence, the sentence that 3 the government is asking for is a 30-year sentence, 30-years 4 plus, it's 25 and consecutive 63 months. 5 about a 30-year sentence on a fraud case. 6 THE COURT: I'm sorry. 7 MR. TALKIN: Sure. 8 Say that again. They've asked for 25 years consecutive to the sentence in front of Judge Liman. 9 10 So you're talking THE COURT: That's not in front of me, though, the Judge Liman. 11 MR. TALKIN: No, but they've asked for consecutive to 13 THE COURT: Yes. 14 MR. TALKIN: And that is an issue because, in essence, 12 that. 15 you have the opportunity to run it concurrent, partially 16 concurrent, or consecutive, and that's a decision this Court 17 has to make in figuring out what is a reasonable sentence, that 18 is a consideration by this court. 19 Honor that the ultimate ask by the government as far as 20 sentencing here, because it could be concurrent, but by asking 21 for it to be consecutive is a 30-year total sentence for both 22 cases. I'm just informing your 23 I have reviewed the transcript, I've read a lot of the 24 paperwork, and I understand the seriousness of the allegations 25 here. I have seen my client's criminal record, I understand SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 50 of 69 50 1 that. But what I'm asking your Honor to consider in setting a 2 sentence here that is sufficient but not more than necessary to 3 satisfy the goals of both 3553(a) and justice. 4 about someone who's 46 years old now. 5 30-year sentence will probably get him out in his lower 70s by 6 the time he's out on a fraud case that did not involve an 7 overwhelmingly large amount of money as many other fraud cases 8 with sentences that aren't even as large as that have. 9 understand the government's point about the harm that's done by 10 these particular frauds, but a lot of those other frauds also 11 have that ancillary harm that is a result of the defendant's 12 conduct. We're talking The equivalent of a I 13 But I think one thing that gets lost when we start 14 getting up in all these years is what the years really mean. 15 mean, 30 years for someone who is 46 years old is an incredible 16 amount of time. 17 sentence that's severe and sufficient, a sentence less than 18 25 years can serve those same goals. 19 which is 66 percent longer than the codefendant received in 20 this case, is a reasonable sentence because for 15 years, he's 21 not going to have his freedom, for 15 years, Mr. Ilori is going 22 to sit in jail and think about the crimes he's committed here 23 and in the past, and for 15 years, he's going to be separated 24 from society. 25 I And when the government's asking for a A sentence of 15 years, And one of the things that I've fallen victim to SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 51 of 69 51 1 sometimes in doing this for so many years is losing sense of 2 what that really means and how punitive years in jail really 3 are. 4 feeling of being totally separated from society for a period of 5 time as long as 15 years, that is a significant sentence and a 6 significant punishment. And when we think about how punitive it is and the 7 It also serves all the goals of 3553(a). The 8 individual deterrence that the government spoke of is served 9 for a long period of time as is the general deterrence showing 10 society what's going to happen if you commit a crime of this 11 sort, going to jail for 15 years. 12 What it also does is it shows some compassion, some 13 understanding of what goes through a defendant's mind in his 14 life or her life when they spend time in jail, particularly 15 when they spend, as he did, the first two years in a place such 16 as MDC, which is the most difficult, and I know your Honor has 17 read and dealt with and seen the conditions of MDC. 18 THE COURT: Yes, I've been there. 19 MR. TALKIN: And you know very well that that is an 20 accurate statement. 21 I've been around this country, it's one of the worst and 22 toughest. 23 basically a maximum security where everyone is in there 24 together in the caldron of pretrial detention, which is clearly 25 a much more intense experience than post-conviction detention. I can tell you anecdotally from the jails Part of it is because it's a pretrial detention, SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 52 of 69 52 1 But all of those things I'm asking you to consider, 2 and I understand the Court's position has been clear and the 3 government's position has been clear, he has not accepted 4 responsibility for his conduct. 5 account, your Honor, even deciding to punish that -- reasonably 6 punish that factor about Mr. Ilori, a sentence of 15 years more 7 than satisfies that. 8 year, the 17th year, the 18th year, the 20th year, even the 9 25th year, after 15 years, that message, that necessity is 10 going to be any more clear than after year 15. But even taking that into It's hard to quantify how, after the 16th 11 And because of that, your Honor, I'm asking you to 12 show mercy on my client, and when I ask for mercy, I'm not 13 saying by any stretch of the imagination that he should get 14 excessive leniency. The sentence I've suggested is very high. 15 And as far as the concurrent versus consecutive, your 16 Honor, as you know, he's been in for two years on this case, of 17 which he will not get any credit because under the BOP 18 guidelines, if the pretrial detention goes toward any other 19 sentence, which it does to Judge Liman's, so even if you wanted 20 to run this concurrent, it still would be partially consecutive 21 because those two years would count not towards this case. 22 In short, the sentence you pronounce today starts 23 today, whether it's concurrent or consecutive, and the fact 24 that there's two years that are consecutive, I'm asking your 25 Honor to run this sentence concurrent starting today. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 That Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 53 of 69 53 1 way, in essence, I'm asking for not just 15 years, but a 2 17-year sentence, and a 17-year sentence that obviously has all 3 the factors I just spoke about it because, even a concurrent 4 sentence, he will have two years of individual punishment going 5 on Judge Liman's case. 6 I know it's always a difficult thing for courts to 7 figure out what the right sentence is, especially when you sat 8 through a trial, but I'm asking your Honor just to think from 9 the point of view of somebody sitting in jail which every year 10 means, and as those years pile up year, after year, after year 11 for 17 years, if that is a sufficient punishment for the crimes 12 that occurred here. 13 THE COURT: 14 Mr. Ilori, I heard what your lawyer said, but I do Thank you. 15 want to have on the record that you do have an opportunity to 16 speak to me if you wish to do so. 17 not to and obviously you're not obligated to speak to me, but I 18 just want to confirm, do you wish to be heard before I impose 19 sentence? Your lawyer has advised you 20 THE DEFENDANT: 21 THE COURT: 22 I'd like to take just a very brief recess and then I 23 No, your Honor. Thank you. will be back and impose sentence. 24 (Recess) 25 THE COURT: I am going to now describe the sentence SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 54 of 69 54 1 that I am intending to impose and I will give you my statement 2 of reason for that sentence. 3 opportunity, obviously, to make any objections before sentence 4 is finally imposed. The attorneys will have a final 5 So, I begin, as I'm obligated to do, with and I did do 6 my own independent calculation under the sentencing guidelines, 7 and as I said at the outset, my calculation differs from what 8 was in the PSR. 9 clearly for the record because this will become part of the 10 judgment and the PSR going forward. 11 calculated that guidelines range. 12 So I'm going to go through this in some detail So I'm explaining how I To begin, I use the November 1st, 2021 guidelines 13 manual. 14 performed a grouping analysis under Section 3D1.1(a). 15 began by grouping "distinct groups of closely related counts" 16 pursuant to Section 3D1.1(a)(1). 17 Because there are multiple counts of conviction, I I first Count Five, though, the aggravated identity theft 18 count, is excluded from my grouping analysis because Mr. Ilori 19 was convicted under 18, United States Code, Section 1028A, and 20 I am instructed therefore to exclude that from the grouping 21 under guidelines Section 3D1.1(b)(2). 22 For the remaining counts, Counts One, Two, Three, 23 Four, and Six, Section 3D1.2 provides that "all counts 24 involving substantially the same harm shall be grouped together 25 into a single group." Counts involve "substantially the same SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 55 of 69 55 1 harm" whereas here, "the offense level is determined largely on 2 the basis of the total amount of harm or loss." 3 quoting from Section 3D1.2(d). 4 And I'm I therefore grouped these other five counts of 5 conviction in my analysis. 6 because "the counts involve offenses of the same general type 7 to which different guidelines apply," I used the offense 8 guideline that produces the highest offense level. 9 looked to sentencing guideline Section 2S1.1(a)(1). 10 Pursuant to Section 3D1.3(b), I therefore The base level offense for Counts One, Two, Three, 11 Four, and Six is therefore 7. 12 more than $9.5 million but less than $25 million, I added 20 13 points pursuant to Section 2B1.1(b)(1)(K). 14 involved ten or more victims, I added two levels pursuant to 15 Section 2B1.1(b)(2)(A)(i). 16 sophisticated means, I added two levels pursuant to Section 17 2B1.1(b)(10)(C). 18 United States Code, Section 1956, which involves laundering of 19 monetary instruments, I added two points pursuant to 20 Section 2S1.1(b)(2)(B). 21 release during his commission of the offenses on which he was 22 convicted, I have added three points pursuant to Section 3C1.3 23 of the sentencing guidelines. 24 offense level of 36. 25 Because the intended loss was Because the offense Because the offense involves Because Mr. Ilori was convicted under 18, Because Mr. Ilori was on pretrial That results in an adjusted With respect to criminal history category, Mr. Ilori's SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 56 of 69 1 June 2006, April 2007, and April 2021 convictions result in 2 criminal history score of IX. 56 3 I would note that criminal convictions from February 4 of 1998, May of 2000, January of 2000, and September of 2004 5 were not counted for purposes of his criminal history score 6 because the sentences on these charges were not imposed within 7 15 years of the commencement of the instant offense. 8 Now, I'm also going to just note because, as I say, 9 the calculations set forth in the PSR is basically going to 10 become irrelevant. 11 since we talked so much about an appeal, I want the record to 12 be crystal clear, although Mr. Ilori was on pretrial release 13 when he committed the offenses for which he was convicted in 14 this case, Section 4A1.1(d) of the sentencing guidelines does 15 not apply here because Mr. Ilori was not yet serving a 16 "criminal history sentence." 17 I'm going to just note for the record, A criminal history score of IX places Mr. Ilori in 18 criminal history category IV. 19 offense level of 36 and a criminal history category of IV is 20 262 months to 327 months. 21 term of 24 months of imprisonment on Count Five that must run 22 consecutive to any other term of imprisonment. 23 18, United States Code, Section 1028A, (a)(1), and 24 Section 5G1.2(a) of the sentencing guidelines. 25 The guidelines range with an Separately, there is a mandatory And I refer to None of this that I've laid out accounts for the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 57 of 69 1 potential additional 10 years under the statutory sentences 2 pursuant to Section 3147. 3 57 Now, I note for the record that these guidelines are 4 obviously not binding on me. I have carefully calculated them, 5 we have talked a lot about what provisions apply and what 6 provisions don't apply. 7 have also carefully considered all of the sentencing factors 8 set forth in Section 3553(a) of Title 18 of the United States 9 Code. 10 the offense, and the history and characteristics of Mr. Ilori, 11 the need for the sentence imposed to reflect the seriousness of 12 the offense, to promote respect for the law, and to provide 13 just punishment for the offense, to afford adequate deterrence 14 to criminal conduct, to protect the public from further crimes 15 of Mr. Ilori, and to provide the defendant with needed 16 educational and vocational training, medical care, or other 17 correctional treatment. 18 sentencing guidelines as well as the applicable policy 19 statements issued by the sentencing commission. 20 the need to avoid unwarranted sentencing disparities among 21 similarly situated defendants and the need to provide 22 restitution to the victims. I have taken them into account, but I Those factors include the nature and circumstances of As I say, I have considered the I'm mindful of 23 Now, I will say at the outset that while I don't have 24 to impose a sentence within the guidelines range, I do intend 25 to impose a guidelines range sentence. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 58 of 69 58 1 I'm going to begin by explaining my reasons for the 2 sentence I intend to impose, and I begin with the nature and 3 circumstances of the offense. 4 The conduct in this case was extremely serious, it was 5 calculating, it was brazen, and it warrants just punishment. 6 Over the course of more than a year in this case, you took 7 advantage of a national emergency to enrich yourself during a 8 time when many Americans were grieving the loss of their loved 9 ones or navigating serious illness, you saw and you seized upon 10 an illegal opportunity to get ahead personally. 11 was selfish, it was reprehensible, and it caused a sizeable 12 loss. 13 Your conduct And very troubling to the Court is that to this very 14 day, you have accepted no responsibility for your crimes. You 15 argue in your sentencing submission that your crimes were 16 nonviolent, your crimes were far from victimless, and you seem 17 to ignore or to in fact argue contrary to that. 18 recognize that you stole the identities of real people. You do not 19 I listened during the course of the trial to three of 20 those victims who testified at the trial, and I read one victim 21 impact statement submitted in connection with this sentencing. 22 Your criminal activity will have significant and lasting 23 consequences for those individuals, not only financially, but, 24 more importantly, perhaps in terms of their sense of security 25 and safety. All of that counsels in favor of a serious SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 59 of 69 59 sentence as just punishment for your offense. 2 I am not persuaded by your efforts to justify your 3 egregious conduct. 4 COVID-19, the pandemic turned your life upside down. 5 true of everyone living in this country and frankly everyone 6 around the world, and you, by your conduct, further turned the 7 lives of innocent people upside down. 8 program put in place by our government to deal with a national 9 emergency. 10 down of their lives as a result of the COVID-19 pandemic didn't 11 turn to fraud or to theft to cope with the difficulties of the 12 pandemic. 13 available by the federal government precisely because so many 14 individuals and businesses were struggling and needed aid, but 15 you chose to steal those funds for your own benefit and make 16 them unavailable to those who actually and legitimately needed 17 them. 18 You say in your sentencing submission that That was You took advantage of a Most of the people who were dealing with the upside The funds that you stole were, as I say, made I find in this case that there is a very serious need 19 for specific deterrence. You have demonstrated no respect for 20 the law and your sentence needs to promote respect for the law. 21 This is your eighth conviction as an adult, your third in 22 federal court. 23 before COVID turned your life upside down, have involved some 24 type of financial fraud. 25 which you were convicted in this case while you were on Virtually all of your crimes stemming back, way Indeed, you committed the crimes on SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 60 of 69 60 1 pretrial release for a similar crime in another case. Your 2 sentencing submission suggests that short sentences can have a 3 strong deterrent effect. 4 is certainly not true of you. 5 not twice, but eight times shown disrespect and disregard for 6 the laws of our country. Even if that were true generally, it You have repeatedly, not once, 7 I need, by the sentence I impose, to ensure you are 8 deterred from future crimes, from similar conduct, and I need 9 for the sentence to ensure that the public is protected from 10 any of your further crimes. 11 There is also a need for general deterrence here. I 12 do have an obligation to send a message that the United States 13 will not tolerate this kind of fraud and abusive behavior. 14 This is particularly so where in this case, crimes that you 15 committed were difficult to detect until the fraud gets to a 16 substantial scale. 17 fraudulently utilize the identities of others and you steal 18 from the government and, by extension, from your fellow 19 citizens, you will face significant punishment. 20 significant sentence, I am intending to promote respect for the 21 rule of law in this country. 22 I need to send a message that if you By imposing a Now, you and your lawyer have argued that you were 23 already punished for this crime in the case before Judge Liman. 24 That really is not true. 25 eminently clear when he sentenced you in his case that he was In fact, Judge Liman made it SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 61 of 69 61 1 not considering your involvement in this case and that these 2 charges that were tried before me had no impact on the sentence 3 that he imposed. 4 transcript of your sentencing by Judge Liman. 5 That's at page 26, lines 1 through 5 of the You also argue that you should receive a sentence 6 commensurate with your codefendant, Mr. Recamier. 7 of the need to avoid unwarranted sentencing disparities, but 8 that is of similarly situated defendants. 9 similarly situated to Mr. Recamier. 10 I am mindful You simply are not First, he accepted responsibility for his crimes and 11 he pled guilty to a single count of conviction. 12 had no criminal history points at sentencing, and he was 13 therefore in criminal history category I. 14 Mr. Recamier, still have not accepted responsibility for your 15 crimes, and at trial, you were convicted of six separate 16 felonies. 17 Moreover, he You, quite unlike You argue that the trial and evidence showed that 18 Mr. Recamier was more culpable than you. I sat through that 19 trial and the evidence showed no such thing. 20 found, after listening to all of the evidence and to your 21 arguments in summation, that you — and not Mr. Recamier and not 22 anyone else — were guilty of the six felonies of which you were 23 convicted. 24 by race, as you seem to suggest, but by the six serious crimes 25 of which you have been found guilty. Instead, the jury Any sentence imposed here is not either motivated SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 62 of 69 62 Now, I have also carefully looked at your history and 2 your personal characteristics as I am instructed to do when 3 considering all of the 3553(a) factors. 4 haven't had an easy life. 5 but you moved to Nigeria at age 1. 6 there. 7 upbringing and you lived in an unstable and abusive home. 8 say you suffer from untreated complex PTSD. 9 contentions and I am sorry for them, but most individuals who 10 have a difficult childhood and various traumas do not attempt 11 to defraud the federal government and their fellow citizens in 12 times of crisis. 13 weight of all of the other 3553(a) factors, including your 14 extensive criminal history. 15 You point out that you You were born in the United States, You spent your childhood And you suggest that you had a poverty-stricken You I credit those I cannot find that this history mitigates the As I mentioned earlier, you have demonstrated a 16 long-running pattern of committing fraud crimes similar to the 17 scheme at issue in this case. 18 conviction between 2010 and 2019. 19 a law abiding life during that time. 20 even built up a successful, lawful personal-training business 21 to support yourself and your family. 22 it is regrettable that you again turned to crime with the onset 23 of the pandemic. 24 businesses and individuals struggled during the pandemic. 25 cannot be an excuse for fraud, and particularly not the I do note your lack of criminal I truly hope you were living It does appear that you That was commendable, but But, as I have already mentioned, many SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 That Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 63 of 69 1 extensive, sophisticated and, as counsel has described it, 2 layered fraud that you engaged in here. 63 3 Now, I appreciate that you care deeply about your 4 family, including your children, and that your family cares 5 deeply about you. 6 hope that your family continues to support you now more than 7 ever. 8 I did read the two letters of support. I For all of these reasons, it is the intent of the 9 Court to sentence you to a term of imprisonment of 300 months. 10 That is broken down as follows: 11 months on Count Two, 37 months on Count Three, 85 months on 12 Count Four, the 24-month mandatory sentence on Count Five, and 13 37 months on Count Six, each to run consecutively, and that is 14 to run consecutively to the sentence imposed by Judge Liman for 15 separate crimes that were at issue in his case. 16 that is sufficient but not greater than necessary to serve the 17 goals of sentencing as set forth in Section 3553(a)(2). 18 32 months on Count One, 85 I find that That term of incarceration should be followed by five 19 years of supervised release — three years on Count One, five 20 years on Count Two, three years on Count Three, five years on 21 Count Four, one year on Count Five, three years on Count Six, 22 but those will run concurrently. 23 During that term of supervised release, it is my 24 intent that the mandatory standard and special conditions, 25 including the search condition and the financial conditions SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 64 of 69 64 that we discussed earlier, would be imposed. 2 There is a $100 per-count-of-conviction special 3 assessment that's mandatory per count and payable immediately. 4 Since there are six counts of conviction, I would intend to 5 impose a $600 special assessment payable, as I say, 6 immediately. 7 Now, with respect to a fine, the guidelines say the 8 court shall impose a fine in all cases except where the 9 defendant establishes he is unable to pay and is not likely to 10 become able to pay. 11 don't have the ability to pay. 12 impose a fine. 13 record what the statutory fines are. I do find on the record before me that you And so, I am not intending to I'm therefore not going to lay out on the 14 The guidelines range, for the record, is $40,000 to 15 $3.4 million in fines, but I do find, after looking over your 16 finances, including the fact that there are 10 outstanding 17 liens and judgments, that you don't have the ability to pay a 18 fine. 19 So I don't intend to impose a fine. Now, restitution, I do intend to enter the consent 20 order of restitution in the amount of $1,120,462.47, 21 $1,072,067.47 of which is a joint and several liability with 22 Mr. Recamier, your codefendant, and you individually are liable 23 for the remaining $48,400 in restitution. 24 25 The superseding indictment also contains forfeiture allegations -- by the way, that victim, with regard to the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 65 of 69 65 1 restitution, is identified on the exhibit to the proposed order 2 of restitution submitted by the government and made available 3 to defense counsel ahead of time. 4 The superseding indictment also contains forfeiture 5 allegations with respect to Counts Two, Three, and Four, and 6 with respect to Count Six, forfeiture on each of those counts 7 is permissible with respect to the first group, Two, Three, and 8 Four. 9 Section 982(a)(2)(A), and with respect to Count Six, that's 10 under 18, United States Code, Section 982(a)(1). That's under 18, United States Code, 11 So I do intend to impose the full amount of forfeiture 12 requested here, $1,024,625 -- I'm sorry. 13 addition to the right, title, and interest in the specific 14 property Coinbase account, Robinhood, and Charles Schwab 15 accounts. 16 17 18 19 $1,120,462.47 in At this time, I'm going to pause. Do you need a moment? MS. MURRAY: If we could just have one moment, please, your Honor. 20 THE COURT: 21 (Pause) 22 MS. MURRAY: Sure. Your Honor, with respect to the sentence 23 that the Court indicated it intends to impose, we would just 24 ask if the Court could indicate with respect to Counts One, 25 Two, Three, Four, and Six what portion, if any, of the stated SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 66 of 69 sentence is attributable to 3147. 2 THE COURT: I'm not adding any time for 3147. 3 MS. MURRAY: Okay. 4 5 6 7 8 Thank you, your Honor. So nothing else from the government. THE COURT: Yes. I should have made that clear. Thank you. I'm going to ask you both in a minute, but Mr. Talkin, did you need time to talk to Mr. Ilori? 9 MR. TALKIN: No. 10 THE COURT: So let me then ask each of you, does the Thank you, your Honor. 11 government know of any legal reason that sentence cannot be 12 imposed as I have outlined? 13 MS. MURRAY: No, your Honor. 14 THE COURT: Mr. Talkin, do you know of any legal 15 reason that sentence cannot be imposed as I have outlined? 16 MR. TALKIN: No, your Honor. 17 THE COURT: Mr. Ilori, would you please stand. 18 It is the judgment of the Court that you be remanded 19 to the custody of the Bureau of Prisons to serve a term of 20 incarceration of 300 months, broken down by count as I have 21 already stated on the record, and that 300 months will run 22 consecutively to the sentence that you are now serving in the 23 case before Judge Liman. 24 25 66 Your term of incarceration will be followed by a five-year term of supervised release, again, broken down count SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 Filed 11/06/23 Page 67 of 69 67 1 by count as I previously laid out on the record with those 2 terms of supervised release to run concurrently to one another. 3 You also must pay a $100-per-count special assessment 4 for a total of $600, given that there are six counts. 5 payable immediately and it is mandatory. That is 6 I am not imposing a fine. 7 I am imposing restitution and forfeiture in the 8 amounts requested in the proposed orders. Specifically, I'm 9 ordering restitution in the amount of $1,120,462.47 with 10 1,072,067.47 owed jointly and severally with Mr. Recamier and 11 the remaining $48,400 owed by you individually. 12 amount as laid out in the proposed order of forfeiture is also 13 imposed. The forfeiture 14 You may be seated, sir. 15 Are there requests from you, sir, with regard to the 16 facility or do you request that Mr. Ilori remain in the same 17 facility where he is serving the sentence in the Judge Liman 18 case? 19 MR. TALKIN: 20 he was designated to Devons. 21 same designation, FCI Devons. 22 THE COURT: 23 Your Honor, just to be clear, I believe We'll ask that you suggest the The request to Judge Liman was that he be housed near where his family is located? 24 MR. TALKIN: Correct. 25 THE COURT: Does Devons address that? SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS Document 149 1 MR. TALKIN: 2 deal with in Massachusetts. 3 THE COURT: 4 Filed 11/06/23 Page 68 of 69 It's as close as they were willing to Are there any other requests from you, Mr. Talkin, with respect to facility or programs or otherwise? 5 MR. TALKIN: No, your Honor. 6 THE COURT: And there is no motion by the government 7 with respect to any counts? 8 MS. MURRAY: Yes, we would move to dismiss any open 10 THE COURT: Are there any? 11 MS. MURRAY: On the underlying indictment, yes, your 13 THE COURT: Okay. 14 Mr. Ilori, I just need to advise you before we 9 12 15 68 counts. Honor. adjourn. 16 You don't find something funny, do you, sir? 17 MR. TALKIN: He wasn't -- 18 THE COURT: He seemed to be smiling. 19 MR. TALKIN: No, I don't believe so, your Honor. 20 THE COURT: Mr. Ilori, I advise you that you have the 21 right to appeal from your conviction and from your sentence. 22 If you're unable to pay the costs of an appeal, you may apply 23 for leave to appeal in forma pauperis. 24 get judgment entered as promptly as possible. 25 appeal must be filed within 14 days of the judgment of We will do our best to Any notice of SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 1:21-cr-00746-MKV NANCiloS 1 Document 149 Filed 11/06/23 Page 69 of 69 69 conviction. 2 Do you understand, sir? 3 THE DEFENDANT: 4 THE COURT: Is there anything else for the record? 5 MS. MURRAY: Nothing from the government. 6 THE COURT: Mr. Talkin. 7 MR. TALKIN: No, your Honor. 8 THE COURT: All right. 9 Mr. Ilori, I wish you well. 10 really think seriously about reforming your life going forward 11 when you are released from prison. 12 Yes, I do. Thank you. All that I have to say, I hope you will take this time to I need to thank especially our court reporter for your 13 patience. 14 hearing was, but I thank you, and I thank the marshals, as 15 well. 16 17 I'm sorry for how protracted and tedious today's We stand adjourned. * * * 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300
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