Preview
1 GATES EISENHART DAWSON
Marc A. Eisenhart (SBN 188518)
2 Joshua J. Borger (SBN 231951)
Steven D. McLellan (SBN 311395) ELECTRONICALLY
3 125 South Market Street, Suite 1200 F I L E D
San Jose, CA 95113-2288 Superior Court of California,
County of San Francisco
4 Telephone: (408) 288-8100
Fax: (408) 288-9409 01/28/2020
5 E-mail: mae@gedlaw.com; sdm@gedlaw.com; jjb@gedlaw.com Clerk of the Court
BY: RONNIE OTERO
Deputy Clerk
6 Attorneys for Non-Parties: EzResource, Inc., Investment Property Management, LLC, and Mr.
7 Michael Flores
8 SUPERIOR COURT OF THE STATE OF CALIFORNIA
9 IN AND FOR THE CITY AND COUNTY OF SAN FRANCISCO
10 UNLIMITED JURISDICTION
11
COMMONWEALTH LAND TITLE Lead Case No. CGC-10-503332
12 INSURANCE COMPANY, (Consolidated for all purposes with CGC-11-
13 512102
Plaintiff,
14 vs. REPLY REQUEST FOR JUDICIAL
NOTICE IN SUPPORT OF NON-
15 FEDEX OFFICE AND PRINT SERVICES STATUTORY MOTION TO VACATE
16 INC.; WINSTON LUM; KAUSHAL JUDGMENT BROUGHT BY NON-
NIROULA; JAY CHANDRAKANT SHAH; PARTIES, EzRESOURCE, INC.,
17 ELVIA PALOMINO; MORAD AFRAIMI; INVESTMENT PROPERTY
MELVIN LEE EMERICH; MARTINI MANAGEMENT, LLC, AND MICHAEL
18 CHNOOGLE; GRACHELLE LANGUBAN; FLORES
19 MERCHANTS BONDING COMPANY, and
DOES 1-24, Judgment filed: 12/10/2018
20 Amended Judgment filed: 02/14/2019
Defendants.
Order Amending Judgment filed: 11/13/2019
21 ______________________________________
AND RELATED CONSOLIDATED ACTION Hearing Date: February 5, 2020
22 of Hwang v. FedEx Office and Print Services, Time: 9:30 a.m.
Inc. (CGC-11-512102) Dept.: 303
23
Judge: Hon. Newton Lam
24
25 Pursuant to Evidence Code §452(d), Non-Parties: EzResource, Inc., Investment Property
26 Management, LLC, and Mr. Michael Flores, request that the court take judicial notice of the
27 following:
28
REPLY RJN I.S.O. MOTION TO VACATE Case Nos. CGC-10-503332/11-512102
1
1 1. Court of Appeal opinion in People v. Shah, et al., case no. A138475, and
2 Order Modifying Opinion and Denying Rehearing Change in Judgment filed on August 2,
3 2016, attached hereto as Exhibit A.
4
5 Dated: January 28, 2020 GATES EISENHART DAWSON
6
7
___________________________
8 Marc A. Eisenhart,
Attorneys for Non-Parties: EzResource,
9
Inc., Investment Property Management,
10 LLC, and Mr. Michael Flores
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
REPLY RJN I.S.O. MOTION TO VACATE Case Nos. CGC-10-503332/11-512102
2
EXHIBIT A
Filed 8/2/16 P. v. Shah CA1/2
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b).
This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION TWO
THE PEOPLE,
Plaintiff and Respondent, A138475
v. (San Francisco City and County
JAY C. SHAH et al. Super. Ct. Nos. 214617, 214619)
Defendants and Appellants. ORDER MODIFYING OPINION
AND DENYING REHEARING
CHANGE IN JUDGMENT
THE COURT:
It is ordered that the opinion filed herein on July 8, 2016, be modified as follows:
On page 74, under the heading “DISPOSITION” delete remaining paragraphs after the
first full paragraph, and replace them with the following:
The sentence imposed under the section 12022.6, subdivision
(a)(2), enhancement for count 11 is stayed pursuant to section 654.
Shah’s sentence shall be reduced by eight months.
Accordingly, Shah’s sentence shall be reduced by a total of
24 months.
The section 12022.6, subdivision (a)(2), enhancement on
count 14 is stricken. Lum’s sentence shall be reduced by eight
months.
1
In all other respects, the judgment is affirmed.
This modification changes the judgment.
Appellant Shah’s petition for rehearing is denied.
Dated: __________________ _________________________
Kline, P.J.
2
Filed 7/8/16 P. v. Shah CA1/2 (unmodified version)
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b).
This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION TWO
THE PEOPLE,
Plaintiff and Respondent,
A138475
v.
JAY C. SHAH et al. (San Francisco City and County
Super. Ct. Nos. 214617, 214619)
Defendants and Appellants.
Jay Shah and Winston Lum appeal from convictions arising from fraudulent
transactions in which three luxury condominiums in San Francisco owned by Shirley
Hwang were put into Lum’s name and used to obtain loans of over $2 million. Shah was
convicted of conspiracy to commit money laundering, identity theft, grand theft, money
laundering, burglary, and filing false deeds and deeds of trust; Lum was convicted of
grand theft, attempted grand theft, filing a false deed and filing false deeds of trust. The
gist of appellants’ defenses at trial was that they were unwitting participants in a
fraudulent scheme orchestrated by one Kaushal Niroula and others.
Shah contends his federal due process rights were violated by a 27-day recess
taken during jury deliberations; the trial court erred in two of its evidentiary rulings; the
burglary conviction was based on an invalid legal theory; various enhancements were
improperly imposed; and imposition of a $14 million restitution fine violated his Sixth
Amendment right to a jury trial.
1
Lum contends the trial court erred in excluding certain evidence, and the evidence
was insufficient to support his conviction for attempted grand theft and accompanying
enhancement for causing a loss exceeding $200,000.1
We conclude that several of the sentencing enhancements were improperly
imposed and in all other respects affirm the judgment.
STATEMENT OF THE CASE
The initial information in this case was filed on February 22, 2011, charging
appellants, Melvin Emerich, Grachelle Languban, and Kaushal Niroula with various
offenses. The charges prosecuted at trial were stated in the second amended information,
filed on April 3, 2012, as follows:
Count 1 (all defendants): Conspiracy (Pen. Code, § 182, subd. (a)(1))2 between
September 1, 2008, and March 15, 2010, to commit grand theft (§ 487, subd. (a)), filing
false deeds (§ 115, subd. (a)) and money laundering (§ 186.10, subd. (a)). It was alleged
that the defendants took property of a value exceeding $3,200,000 (§12022.6, subd.
(a)(4)); the offense was committed in several jurisdictions (§ 781); and Lum and Niroula
committed the offense while on bail (§ 12022.1).
Count 2 (all except Emerich): Grand theft of real property belonging to Shirley
Hwang (§ 487, subd. (a)), with enhancements as alleged in count 1.3
Count 3 (all except Emerich): Identity theft of information belonging to Shirley
Hwang (§ 530.5, subd. (a)), with enhancements as alleged in counts 1 and 2.
Count 4 (all except Emerich): Filing a false or forged grant deed to 425 First
Street, unit 5501, San Francisco. (§ 115, subd. (a).) The above-described multi-
jurisdiction and on-bail enhancements were alleged, as well as that the defendants had
taken property of a value exceeding $1,300,000 (§ 12022.6, subd. (a)(3)) and caused a
financial loss greater than $100,000 (§ 115, subd. (c)(2)).
1
Lum also joins in Shah’s arguments “insofar as they may be beneficial to him.”
2
Further statutory references are to the Penal Code unless otherwise indicated.
3
This count was dismissed during trial on appellants’ motion for judgment of
acquittal. (§ 1118.1.)
2
Count 5 (all except Emerich): Filing a false or forged grant deed to 425 First
Street, unit 4802, San Francisco. (§ 115, subd. (a).) In addition to the multi-jurisdiction
and on-bail enhancements, it was alleged that the defendants had taken property of a
value exceeding $200,000 (§ 12022.6, subd. (a)(2)) and caused a financial loss greater
than $100,000 (§ 115, subd. (c)(2).)
Count 6 (all defendants except Emerich): Filing a false or forged grant deed to
425 First Street, unit 4902, San Francisco (§ 115, subd. (a)), with the enhancements
alleged in count 5.
Count 7 (all except Languban): Grand theft of currency belonging to DeWitte
Mortgage and Kitco Holdings. (§ 487, subd. (a).) A taking of property worth more than
$1,300,000 was alleged (§ 12022.6, subd. (a)(3)), as well as the above-described multi-
jurisdiction and on-bail enhancements.
Count 8 (all defendants): Filing a false or forged deed of trust to 425 First Street,
unit 5501, San Francisco (§ 115, subd. (a)(1)), with the enhancements alleged in count 4.
Count 9 (all except Languban): Filing a false or forged deed of trust to 425 First
Street, unit 4802, San Francisco (§ 115, subd. (a)(1)), with the enhancements alleged in
count 5.
Count 10 (all except Languban): Filing a false or forged deed of trust to 425 First
Street, unit 4902, San Francisco (§ 115, subd. (a)(1)), with the enhancements alleged in
count 5.
Count 11 (all except Languban): Money laundering on March 6, 2009. (§186.10.)
The same multi-jurisdiction and on-bail enhancements were alleged, as well as a taking
of more than $200,000. (§ 12022.6, subd. (a)(2).)
Count 12 (all except Languban): Money laundering on March 9, 2009 (§186.10),
with the enhancements alleged in count 11.
Count 13 (all except Languban): Money laundering on April 20, 2009. (§186.10),
with the enhancements alleged in count 11.
3
Count 14 (Lum only): Attempted grand theft of currency and personal property
from John Abd-El-Malek. (§§ 664, 487, subd. (a).) The on-bail enhancement was
alleged, as well as a taking of more than $200,000. (§ 12022.6, subd. (a)(2).)
Count 15 (Lum only): Filing a false quitclaim deed to 425 First Street, unit 4802,
San Francisco, dated January 12, 2010 (§ 115, subd. (a)), with the on-bail enhancement
allegation and an allegation that Lum caused a financial loss greater than $100,000
(§ 115, subd. (c).)
Count 16 (Lum only): Misdemeanor fraudulent conveyance to Corinn Rankin of
the quitclaim deed described in count 15. (§ 531.)
Count 17 (Lum only): Misdemeanor fraudulent conveyance to Corinn Rankin of
the quitclaim deed described in count 15. (§ 531a.)
Count 18 (Niroula, Shah, Lum): First degree burglary (entry into residence of
Shirley Hwang and Michael Shigezane with intent to commit grand theft, filing false
deeds and money laundering). (§ 459.) It was alleged that the offense was a
serious/violent felony (§§ 1192.7, subd. (c), 667.5, subd. (c)(21)). The multi-jurisdiction
and on-bail enhancements were alleged, as well as a taking of property exceeding
$3,200,000 (§ 12022.6, subd. (a)(4)).4
It was further alleged that all the defendants had engaged in a pattern of white
collar crime involving the taking, or resulting in the loss, of more than $500,000
(§ 186.11, subd. (a)(2)) and had committed a theft of more than $100,000 (§1203.045,
subd. (a)), and that the cumulative value of the money laundering transactions was more
than $1,000,000 but less than $2,500,000 (§ 186.10, subd. (c)).
Shah, Lum, and Emerich proceeded to jury trial beginning in March 2012, with
opening statements presented on April 18, 2012. Languban had skipped bail and fled to
4
Counts 19 through 27 were alleged against Languban only.
4
the Philippines, and Niroula’s case had been severed as he was being held in Riverside
County pending trial for murder.5
The jury began deliberations on July 9, 2012. On July 24, the jurors were
dismissed until August 20. They resumed deliberations on that date, and returned their
verdicts on September 19.
Shah was found guilty as charged (counts 1, 3-13, 18); the excessive taking
enhancement allegations were found true, as were the special findings under sections
186.10, subdivision (c), 186.11, subdivision (a)(2), and 1203.045, subdivision (a). With
respect to count 1, the jury found Shah took part only in a conspiracy to commit money
laundering.
Lum was found guilty of grand theft as charged in count 7, filing false or forged
instruments as charged in counts 8, 9, 10 (deeds of trust), and 15 (quitclaim deed to
4802), and attempted grand theft as charged in count 14, and the jury found true the
excessive taking enhancement allegations and the special findings under section
1203.045 and 186.11, subdivision (a)(2). Lum was found not guilty of filing forged
instruments (counts 4, 5, 6 (grant deeds)) and burglary (count 18), and a mistrial was
declared as to him on counts 1, 3, 11, 12 and 13, and on the special allegation under
section 186.10, subdivision (c).
On March 19, Shah was sentenced to a total prison term of 20 years and ordered to
pay a fine of $14.10 million. Lum was sentenced to a total of 12 years and ordered to pay
a fine of $4.4 million.
Shah filed a timely notice of appeal on March 28, 2013. Lum filed a timely notice
of appeal on April 10, 2013.
STATEMENT OF FACTS
In September 2008, Shirley Hwang owned three condominiums at One Rincon
Hill, 425 First Street in San Francisco, having recently purchased units 4802 and 4902 for
5
Niroula had been charged with the murder of Clifford Lambert in Palm Springs;
his case and that of one of his codefendants, Daniel Garcia, had been severed from the
case of attorney David Replogle, who had been convicted of the murder.
5
almost $1.4 million each and unit 5501, with partner Michael Shigezane, for $1.9 million.
Hwang was living in unit 4802 and trying to sell unit 4902. She authorized Shigezane
and her real estate agent, Morton Mah, to access the unit, and the keys were left at the
front office for potential viewers. Just before Thanksgiving, Hwang took the unit off the
market, planning to put it back on at the beginning of the new year.
In November 2008, real estate agent Kathy Chan went to pick up a rent check
from attorney David Replogle, who was a tenant in a building she managed. As she was
unable to find parking, Replogle sent someone down with the check. The young man
identified himself as “Sid Jones”; when later shown a photographic lineup, Chan
identified a photograph of Niroula. He asked Chan if she had anything to rent in the
building. She did not, but contacted Shigenzane, a former client, and arranged for “ones
to see Hwang’s units.
Shigenzane showed Jones unit 5501; Jones was interested in renting it but did not
follow through, then later expressed interest in purchasing unit 5501 and then in
purchasing units 4902 and 4802 as well. Jones wanted to show the units to his uncle,
Prashant Kahn, who was the decision-maker for a trust that would be financing the
purchase. The keys to the units were left with security for Jones and his uncle, who were
told to leave a letter of intent in unit 4802 for Shigenzane and Hwang. The letter of
intent, dated February 13, 2009, promised $7.5 million for the three units. Chan had told
Shigenzane that Jones had a bank account worth $100 million.
The phone number where Shigenzane called Jones’s uncle, (415) 935-9646,
belonged to an account in Shah’s name for a “magicJack,” a device that allows phone
calls to be made over the internet through a computer. The physical address associated
with the account, 504 Ross Drive, Sunnyvale, was that of a hotel owned by Shah’s
parents. Shah testified that he gave a device with this phone number to Niroula.
In early 2009, escrow agent Nga Tran was asked by Shah to run preliminary title
reports on Hwang’s Rincon condominiums. As of January 14, 2009, preliminary title
reports from Old Republic Title Company showed title vested in Hwang. Tran told Shah
that Hwang owned the condominiums “free and clear.”
6
Shah asked Tran to prepare grant deeds from Hwang to Winston Lum for the three
condominiums, saying that Hwang was Lum’s aunt and that loans were going to be taken
out on these properties in Lum’s name, and Tran prepared the deeds on January 14, 2009.
Shown the deed for unit 5501, Tran testified that she did not fill in the location of the
property or the transfer tax number, and that the deed she prepared was not signed or
notarized because Shah wanted to have it notarized and recorded “outside our
transaction.” Tran thought this was “weird”; she told Shah it would be best to have her
notarize and record the deed because otherwise she would have to get an affidavit from
Hwang confirming the transaction before the title company would insure it and she could
close escrow, but Shah did not take her advice.
Grant deeds transferring title to each of Hwang’s three condominiums from
Hwang to Lum were recorded on January 16, 2009. Each bore a signature over the
printed name “Shirley S. Hwang” that Hwang testified was not her signature. Each
reflected having been notarized by Grachelle Languban,6 whom Hwang testified she had
never met. No title company was indicated on the deeds. Languban also notarized an
affidavit concerning the properties that was purportedly from Hwang but Hwang testified
she did not sign.
Tran had the preliminary title reports updated to reflect the recorded deeds
transferring title from Hwang to Lum. The amended title report from Old Republic stated
that the deeds were recorded “unsecure,” meaning it would be necessary to get either an
affidavit from Hwang saying she signed the grant deeds, or new grant deeds signed by
Hwang.
6
When interviewed by the police about the grant deed for unit 5501, Languban
said she did not remember the transaction; asked for the relevant notary book, she said it
had been destroyed. Notaries are required to notify the Secretary of State if a notary
book is lost or destroyed. Languban had not reported this book lost or stolen, as she had
with an earlier notary book, and she had never reported a notary book destroyed.
Subsequently, when the CFO of the loan company asked Languban about the
documents, she first told him she had no information because the pages of her notary
book had been torn out, then later in the conversation said the book had been stolen.
7
Tran met Niroula when Shah brought him to her office to have a document
notarized. She identified Niroula in a photographic lineup the police showed her.
Mortgage Broker John Flores testified that in late 2008, Shah asked him about
doing a loan on a condominium at 425 1st Street in San Francisco for someone who was
out of the country. The loan was to be from a private lender, California Coastal Funding
(CCF), and was to be a “cash-out” (meaning there was enough equity in the property to
take cash out immediately) and “stated income” loan (meaning the lender did not require
income documentation). Most of the information on the application was provided by
Shah; Flores also spoke on the telephone with “Joshua Beam,” an interpreter for the
borrower, Winston Lum. Beam was in fact Niroula. Flores never met Lum, whom he
understood did not speak English. Lum’s employment was stated on the application as
“Emperors of China,” which Flores was told was a restaurant owned by Lum’s family
and actually called “Empress of China,” and teaching tennis. Flores was told that Lum
had monthly income of $32,000 from this employment and rental on the condominiums.
Flores testified that he attempted to verify Lum’s income but was not able to do so; he
also testified that he did not try to verify Lum’s income and assets because it was not
required.
Flores was told that Lum’s attorney was Replogle. He verified that Replogle was
an attorney in good standing, and spoke with him approximately three times, which gave
Flores “a certain comfort level” that the loan would in fact close.
Flores sent the loan application to Theo Hansen at CCF, who then on occasion
asked Flores for help getting needed information. Flores received a letter, purporting to
be from Lum, stating that Lum owned a tennis school and had accounts at Bank of
America with deposits of approximately $50,000, and that the rest of his family money
and assets were in Hong Kong. It was Flores’s understanding that CCF wanted to use
their own title company in San Diego rather than Tran to handle the escrow.
Robert Purdon, the former CFO of CCF, recalled that Flores referred Lum’s loan
application, and that Lum wanted the money to help a relative. Purdon listened in on a
telephone conversation between one of his employees and Lum, in which Lum was not
8
able to fully answer everything and talked to Beam on the side. Lum said he understood
English but could not speak it well. Subsequent communications about the loan were
with Beam, and Purdon also spoke with Replogle, whom he contacted by calling (415)
935-9646 (the number associated with Shah’s device). Purdon called the Empress of
China and the employee who answered the phone was not aware of Lum; upon further
inquiry, either Beam or Replogle told Purdon that Lum was not an employee but the
owner. Lum’s credit report indicated his credit was “lousy,” with “38 serious
delinquencies.”
One of Among the documents used by CCF to substantiate Lum’s income, Purdon
identified leases for the three condominiums, indicating Lum as the lessor.7 Purdon also
identified statements for a Charles Schwab account in Lum’s name that showed
consistent income. Schwab, however, had no record of Winston Lum as a Schwab client,
nor any account number matching the one listed on the statements provided to CCF. The
account number that appeared on another document in the CCF file was associated with
Cliff Lambert of 317 Camino Norte, Palm Springs. A Schwab statement in the name of
Cliff Lambert was found on a computer seized from Daniel Garcia in a different case,
under the directory “Macintosh HD/user/Danny/document/Kaushal Niroula/fake,” in a
file created on November 21, 2008.
The grant deeds were among the documents obtained by CCF in connection with
the loan application. There was also a “declaration affidavit” signed by Hwang which the
company wanted because the transfer to Lum was recent, a document “assuring” the
company that the transfer “was what it was.”
CCF obtained appraisals of the properties. On January 31, 2009, appraiser Casey
Simms went to units 4902 and 5501 with Beam, whom he subsequently identified as
Niroula. Beam had keys for two of the units but not for unit 4802, so they arranged for
Simms to return on February 14. On that date, Beam had two men with him, one of
whom Simms identified as Shah. While Simms inspected unit 4802, the two men talked
7
The lease for unit 5501 was for $15,000 per month and the leases for units 4802
and 4902 were for $7,500 per month each.
9
in a corner and Beam followed Simms around. The unit was furnished, and Beam said it
was occupied by a tenant. Simms appraised unit 4802 and unit 4902 at $1.225 million
and unit 5501 at $2.4 million.
In February 2009, Purdon and the investors funding the loan, Peter and Frans
DeWitte, went to San Francisco to see the properties with Beam, who had keys to each.
Unit 4802 looked lived-in but no one was home, unit 4902 was vacant and being painted,
and unit 5501 was empty. The group then met with Lum at the St. Regis Hotel, where
Purdon understood Lum was living. Lum answered some of the investors’ questions
directly; with others he conversed with Beam, who gave a translation. Lum told the
DeWittes that he needed the loan quickly because he was trying to help a family member
get out of foreclosure. After the meeting, the investors agreed to the deal. The loans on
units 4802 and 4902 were $550,000 each and the loan on unit 5501 was $1.1 million.
Purdon identified Lum at trial, as did Peter DeWitte. Purdon also identified Beam
on photographs taken at Rincon Tower on February 24.
Michael Hartshorn, an employee of Shah’s who lived at the Quimby ranch,
testified that he heard Shah answer the telephone as David Replogle, then have a
conversation about trying to set up an appraisal for a property.
The escrow was handled by Commonwealth Title Company (Commonwealth),
which arranged for a Cantonese-speaking mobile notary, Wai Yip, to notarize the loan
documents. Yip testified that he was directed to contact Lum’s attorney at (415) 935-
9646 (again, the number associated with Shah). He did not speak directly to Lum but,
through someone else, arranged to meet Lum at a building downtown at 10:00 p.m. on
February 27. When Yip arrived, Lum’s attorney and a younger man who appeared to be
Middle Eastern or Indian and Yip understood to be Lum’s financial advisor were present;
Lum was not and Yip was told that Lum was drunk and could not make it. One of the
two men present walked with a cane. The next day, February 28, the same group met at a
coffee shop with Lum, who signed the documents. A fingerprint expert testified that the
print in Yip’s notary book was consistent with a print the expert took from Lum.
10
The loan was funded in early March 2009, with a total of $2.2 million. After fees
deducted by Commonwealth, approximately $1.7 million was wired on March 5, 2009, to
Trans Escrow Corporation, Tran’s company, with notations indicating the funds were to
go to Lum.8 Tran testified Lum would have had to authorize Commonwealth to send
these funds to her. Tran got her information about the transaction from Shah and his
attorney, Melvin Emerich. At Shah’s direction, Tran wired $601,069 to Martini &
Chnoogle, a Nevada corporation set up by Emerich (Martini); cut a check for $225,000 to
Lum; and cut two checks for $434,422.72 each to Lum International, LLC, an off-shore
corporation set up by Shah, which she then exchanged for certified bank checks.
Endorsing information on the back of the two checks to Lum International showed they
went to Zurcher Kantonalbank in Switzerland.
Martini listed Emerich as president, secretary, treasurer and director. The
corporation, through Emerich, opened a bank account on February 6, 2009, with a check
written from Telsystems, a telecommunications company owned by Shah. The only other
money received into the account was the $601,069 from Trans Escrow on March 6.
Over the next months, payments were made from the Martini account to Shah’s
company, Telsystems, his relatives and attorneys, and a friend of Emerich’s,9 and for real
estate transactions involving Shah, his wife and his companies.10
8
For the escrow on unit 4902, $550,000 was wired into the account and
$423,742.59 was wired out to Trans Escrow; for unit 4802, $550,000 was wired into the
account, and $423,315.21 wired out; and for unit 5501, $1,100,000 was deposited into the
account on March 5 and $867,689.81 was sent out to Trans Escrow March 5.
9
Between March 6 and April 28, approximately 45 checks totaling $282,000 were
written from the Martini account to Telsystems. Checks totaling approximately $65,000
were written to Emerich. Checks totaling $22,000 were written to “cash.” Checks
totaling $14,000 were written to Shah’s wife, Elvia Palomino Shah. A $2,000 check
written to Gary Wesley bore the notation, “ ‘Jay’s . . . tell-a-day case.’ ” A check for
$3,850, payable to Richard Vantrood, an attorney representing Shah in 2009, noted,
“ ‘Legal fees . . . v . . . Shah.’ ” A $5,000 check to Craig Bassett, the attorney
representing Shah in an action against a title insurance company involving the Quimby
property noted, “ ‘Attorney for Jay.’ ” A check for $7,500 was payable to Sundowner
Inn, LP., a hotel owned by Shah’s parents. A $5,000 check was payable to Shah’s
mother. Five checks, $3,000 each, were written to Morad Afraimi, a friend of Emerich’s
11
Casey Lawrence, a bank and trust manager at 1-800-Company,11 testified that on
March 12, 2009, Shah came into the office with his wife and established Lum
International in Nevis, a small island in the British West Indies with very strong asset
protection and privacy laws.12 Shah had 100 percent ownership of Lum International and
was the only person with power to make decisions for it. Shah wanted to set up a Swiss
bank account for the company, and Lawrence put him in touch with a banker in
Switzerland, Pierre Gabris. Although the company’s normal practice was to send the
original incorporation documents to the client after scanning them into the company’s
system, Shah specifically directed that the documents be held in the office to be picked
up later. There was a sense of urgency in setting up Lum International: “[I]t was very
intense.” Shah said he was in the middle of a real estate deal and had checks he needed
to cash quickly, before his partner changed his mind. The Swiss banker told Lawrence
who allowed Emerich to use his residential address in Nevada as the address for Martini
& Chnoogle. Afraimi testified that Emerich loaned him $15,000 in connection with a
restaurant Afraimi was opening, in five payments of $3,000 per month.
10
In March, two electronic fund transfers, $6,916 and $19,999, were taken from
the Martini account for payments on loans in the name of Shah and his wife on property
at 659 S. 15th Street, San Jose, California.
On May 4, $160,000 was transferred from the account to Ocwen Financial
Corporation to pay off a loan in Shah’s wife’s name on property at 2103 South 11th
Street, Los Banos, California. The Shahs refinanced this property, resulting in $80,000
going back into the Martini account “ ‘[F]or Elvia Palomino and Jay Shah’ ” on July 24.
On July 29, $80,000 was transferred from the Martini account to a Trans Escrow account
“for the credit of Palomino/Martini & Chnoogle.” This escrow account was for the
purchase of 530 Adams Avenue, Los Banos, California. A grant deed dated August 6
transferred this property from Martini to Shah. On November 23, 2009, another grant
deed transferred the property from Shah and his wife to M & K Properties, LLC.
11
Lawrence testified that the 1-800-Company sets up limited liability companies
and corporations in the United States and offshore, as well as bank accounts for these
companies.
12
According to Lawrence, it is not necessary to go to Nevis to establish a
company there, and if someone wants to sue the company they have to post a bond in
Nevis. It is difficult to find out who owns a company because “they don’t have public
records like we do here.”
12
she needed to calm Shah down: “ ‘He’s called me 15 times today. I’ve spoken with him
three times. If he calls the bank, they’re going to decline his account. They’re going to
get suspicious.’ ” Shah asked Lawrence several times whether his wife would have
access to everything if anything happened to him, which Lawrence thought was “sweet.”
Shah also created Wine & Horses, LLC, in Nevis. Shah was the 100 percent owner and
the director of this company; he and his wife were the authorized signatories for the
company’s bank account, which was in Belize.
Funds from the Lum International account were used to purchase property in
California in the name of Shah, his wife and his companies.13 On November 26, 2009,
13
On August 31, 2009, at Shah’s direction, $171,975.50 was wired from the Lum
International account at Zurcher Kantonalbank to the account of Pickford Escrow
Company at Comerica Bank. A Pickford document showed the September 2, 2009,
purchase of property at 2071 Genoa Court, Los Banos, California, by Martini and Maria
Del-Los-Angeles Palomino, for $170,000, with a credit of $1,000 from Jesus Palomino
and Elvia Palomino and a credit of $171,957.50 from Lum International for the benefit of
Martini. A grant deed transferred this property from Martini to Elvia Palomino and
Maria Del-Los-Angeles Palomino.
On September 24, 2009, $150,000 was transferred from the Lum International
account at Zurcher Kantonalbank to an escrow account at Fidelity National Title
Company of California, in trust for Shah, for a property at 317 Crescent, Los Banos,
California. A grant deed dated September 10, 2009, transferred this property from the
prior owner to Shah and his wife as community property. Shah and his wife then
transferred ownership of the property to M & K Properties, LLC. A quitclaim deed
recorded on August 17, 2010, transferred the property from M&K Properties, LLC, to
appellant’s wife as her sole and separate property. A grant deed dated December 29,
2010, transferred the property from “Megan & Kasi . . . Properties, LLC, a Nevada
limited liability company, doing business in the state of Nevada as M & K Properties,
LLC, who acquire title as M & K Properties, LLC” to “Megan & Kasi Properties, LLC, a
Nevada limited liability company.” This deed was signed by Shah as “managing
member.”
According to a document filed with the California Secretary of State on December
23, 2010, “Megan & Kasi Properties, LLC” was formed in Nevada on November 19,
2009, listing Shah as its agent at 504 Ross Drive, Sunnyvale. A document from the
Nevada Secretary of State, dated December 22, 2010, shows “M & K Properties, LLC”
with a filing date of November 19, 2009, listing Laughlin Associates of Carson City as its
registered agent and Shah as an officer or manager with the same address as the agent.
13
Shah took $325,000 from the Lum Internation
Preview
1 GATES EISENHART DAWSON Marc A. Eisenhart (SBN 188518) 2 Joshua J. Borger (SBN 231951) Steven D. McLellan (SBN 311395) ELECTRONICALLY 3 125 South Market Street, Suite 1200 F I L E D San Jose, CA 95113-2288 Superior Court of California, County of San Francisco 4 Telephone: (408) 288-8100 Fax: (408) 288-9409 01/28/2020 5 E-mail: mae@gedlaw.com; sdm@gedlaw.com; jjb@gedlaw.com Clerk of the Court BY: RONNIE OTERO Deputy Clerk 6 Attorneys for Non-Parties: EzResource, Inc., Investment Property Management, LLC, and Mr. 7 Michael Flores 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 IN AND FOR THE CITY AND COUNTY OF SAN FRANCISCO 10 UNLIMITED JURISDICTION 11 COMMONWEALTH LAND TITLE Lead Case No. CGC-10-503332 12 INSURANCE COMPANY, (Consolidated for all purposes with CGC-11- 13 512102 Plaintiff, 14 vs. REPLY REQUEST FOR JUDICIAL NOTICE IN SUPPORT OF NON- 15 FEDEX OFFICE AND PRINT SERVICES STATUTORY MOTION TO VACATE 16 INC.; WINSTON LUM; KAUSHAL JUDGMENT BROUGHT BY NON- NIROULA; JAY CHANDRAKANT SHAH; PARTIES, EzRESOURCE, INC., 17 ELVIA PALOMINO; MORAD AFRAIMI; INVESTMENT PROPERTY MELVIN LEE EMERICH; MARTINI MANAGEMENT, LLC, AND MICHAEL 18 CHNOOGLE; GRACHELLE LANGUBAN; FLORES 19 MERCHANTS BONDING COMPANY, and DOES 1-24, Judgment filed: 12/10/2018 20 Amended Judgment filed: 02/14/2019 Defendants. Order Amending Judgment filed: 11/13/2019 21 ______________________________________ AND RELATED CONSOLIDATED ACTION Hearing Date: February 5, 2020 22 of Hwang v. FedEx Office and Print Services, Time: 9:30 a.m. Inc. (CGC-11-512102) Dept.: 303 23 Judge: Hon. Newton Lam 24 25 Pursuant to Evidence Code §452(d), Non-Parties: EzResource, Inc., Investment Property 26 Management, LLC, and Mr. Michael Flores, request that the court take judicial notice of the 27 following: 28 REPLY RJN I.S.O. MOTION TO VACATE Case Nos. CGC-10-503332/11-512102 1 1 1. Court of Appeal opinion in People v. Shah, et al., case no. A138475, and 2 Order Modifying Opinion and Denying Rehearing Change in Judgment filed on August 2, 3 2016, attached hereto as Exhibit A. 4 5 Dated: January 28, 2020 GATES EISENHART DAWSON 6 7 ___________________________ 8 Marc A. Eisenhart, Attorneys for Non-Parties: EzResource, 9 Inc., Investment Property Management, 10 LLC, and Mr. Michael Flores 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 REPLY RJN I.S.O. MOTION TO VACATE Case Nos. CGC-10-503332/11-512102 2 EXHIBIT A Filed 8/2/16 P. v. Shah CA1/2 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FIRST APPELLATE DISTRICT DIVISION TWO THE PEOPLE, Plaintiff and Respondent, A138475 v. (San Francisco City and County JAY C. SHAH et al. Super. Ct. Nos. 214617, 214619) Defendants and Appellants. ORDER MODIFYING OPINION AND DENYING REHEARING CHANGE IN JUDGMENT THE COURT: It is ordered that the opinion filed herein on July 8, 2016, be modified as follows: On page 74, under the heading “DISPOSITION” delete remaining paragraphs after the first full paragraph, and replace them with the following: The sentence imposed under the section 12022.6, subdivision (a)(2), enhancement for count 11 is stayed pursuant to section 654. Shah’s sentence shall be reduced by eight months. Accordingly, Shah’s sentence shall be reduced by a total of 24 months. The section 12022.6, subdivision (a)(2), enhancement on count 14 is stricken. Lum’s sentence shall be reduced by eight months. 1 In all other respects, the judgment is affirmed. This modification changes the judgment. Appellant Shah’s petition for rehearing is denied. Dated: __________________ _________________________ Kline, P.J. 2 Filed 7/8/16 P. v. Shah CA1/2 (unmodified version) NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FIRST APPELLATE DISTRICT DIVISION TWO THE PEOPLE, Plaintiff and Respondent, A138475 v. JAY C. SHAH et al. (San Francisco City and County Super. Ct. Nos. 214617, 214619) Defendants and Appellants. Jay Shah and Winston Lum appeal from convictions arising from fraudulent transactions in which three luxury condominiums in San Francisco owned by Shirley Hwang were put into Lum’s name and used to obtain loans of over $2 million. Shah was convicted of conspiracy to commit money laundering, identity theft, grand theft, money laundering, burglary, and filing false deeds and deeds of trust; Lum was convicted of grand theft, attempted grand theft, filing a false deed and filing false deeds of trust. The gist of appellants’ defenses at trial was that they were unwitting participants in a fraudulent scheme orchestrated by one Kaushal Niroula and others. Shah contends his federal due process rights were violated by a 27-day recess taken during jury deliberations; the trial court erred in two of its evidentiary rulings; the burglary conviction was based on an invalid legal theory; various enhancements were improperly imposed; and imposition of a $14 million restitution fine violated his Sixth Amendment right to a jury trial. 1 Lum contends the trial court erred in excluding certain evidence, and the evidence was insufficient to support his conviction for attempted grand theft and accompanying enhancement for causing a loss exceeding $200,000.1 We conclude that several of the sentencing enhancements were improperly imposed and in all other respects affirm the judgment. STATEMENT OF THE CASE The initial information in this case was filed on February 22, 2011, charging appellants, Melvin Emerich, Grachelle Languban, and Kaushal Niroula with various offenses. The charges prosecuted at trial were stated in the second amended information, filed on April 3, 2012, as follows: Count 1 (all defendants): Conspiracy (Pen. Code, § 182, subd. (a)(1))2 between September 1, 2008, and March 15, 2010, to commit grand theft (§ 487, subd. (a)), filing false deeds (§ 115, subd. (a)) and money laundering (§ 186.10, subd. (a)). It was alleged that the defendants took property of a value exceeding $3,200,000 (§12022.6, subd. (a)(4)); the offense was committed in several jurisdictions (§ 781); and Lum and Niroula committed the offense while on bail (§ 12022.1). Count 2 (all except Emerich): Grand theft of real property belonging to Shirley Hwang (§ 487, subd. (a)), with enhancements as alleged in count 1.3 Count 3 (all except Emerich): Identity theft of information belonging to Shirley Hwang (§ 530.5, subd. (a)), with enhancements as alleged in counts 1 and 2. Count 4 (all except Emerich): Filing a false or forged grant deed to 425 First Street, unit 5501, San Francisco. (§ 115, subd. (a).) The above-described multi- jurisdiction and on-bail enhancements were alleged, as well as that the defendants had taken property of a value exceeding $1,300,000 (§ 12022.6, subd. (a)(3)) and caused a financial loss greater than $100,000 (§ 115, subd. (c)(2)). 1 Lum also joins in Shah’s arguments “insofar as they may be beneficial to him.” 2 Further statutory references are to the Penal Code unless otherwise indicated. 3 This count was dismissed during trial on appellants’ motion for judgment of acquittal. (§ 1118.1.) 2 Count 5 (all except Emerich): Filing a false or forged grant deed to 425 First Street, unit 4802, San Francisco. (§ 115, subd. (a).) In addition to the multi-jurisdiction and on-bail enhancements, it was alleged that the defendants had taken property of a value exceeding $200,000 (§ 12022.6, subd. (a)(2)) and caused a financial loss greater than $100,000 (§ 115, subd. (c)(2).) Count 6 (all defendants except Emerich): Filing a false or forged grant deed to 425 First Street, unit 4902, San Francisco (§ 115, subd. (a)), with the enhancements alleged in count 5. Count 7 (all except Languban): Grand theft of currency belonging to DeWitte Mortgage and Kitco Holdings. (§ 487, subd. (a).) A taking of property worth more than $1,300,000 was alleged (§ 12022.6, subd. (a)(3)), as well as the above-described multi- jurisdiction and on-bail enhancements. Count 8 (all defendants): Filing a false or forged deed of trust to 425 First Street, unit 5501, San Francisco (§ 115, subd. (a)(1)), with the enhancements alleged in count 4. Count 9 (all except Languban): Filing a false or forged deed of trust to 425 First Street, unit 4802, San Francisco (§ 115, subd. (a)(1)), with the enhancements alleged in count 5. Count 10 (all except Languban): Filing a false or forged deed of trust to 425 First Street, unit 4902, San Francisco (§ 115, subd. (a)(1)), with the enhancements alleged in count 5. Count 11 (all except Languban): Money laundering on March 6, 2009. (§186.10.) The same multi-jurisdiction and on-bail enhancements were alleged, as well as a taking of more than $200,000. (§ 12022.6, subd. (a)(2).) Count 12 (all except Languban): Money laundering on March 9, 2009 (§186.10), with the enhancements alleged in count 11. Count 13 (all except Languban): Money laundering on April 20, 2009. (§186.10), with the enhancements alleged in count 11. 3 Count 14 (Lum only): Attempted grand theft of currency and personal property from John Abd-El-Malek. (§§ 664, 487, subd. (a).) The on-bail enhancement was alleged, as well as a taking of more than $200,000. (§ 12022.6, subd. (a)(2).) Count 15 (Lum only): Filing a false quitclaim deed to 425 First Street, unit 4802, San Francisco, dated January 12, 2010 (§ 115, subd. (a)), with the on-bail enhancement allegation and an allegation that Lum caused a financial loss greater than $100,000 (§ 115, subd. (c).) Count 16 (Lum only): Misdemeanor fraudulent conveyance to Corinn Rankin of the quitclaim deed described in count 15. (§ 531.) Count 17 (Lum only): Misdemeanor fraudulent conveyance to Corinn Rankin of the quitclaim deed described in count 15. (§ 531a.) Count 18 (Niroula, Shah, Lum): First degree burglary (entry into residence of Shirley Hwang and Michael Shigezane with intent to commit grand theft, filing false deeds and money laundering). (§ 459.) It was alleged that the offense was a serious/violent felony (§§ 1192.7, subd. (c), 667.5, subd. (c)(21)). The multi-jurisdiction and on-bail enhancements were alleged, as well as a taking of property exceeding $3,200,000 (§ 12022.6, subd. (a)(4)).4 It was further alleged that all the defendants had engaged in a pattern of white collar crime involving the taking, or resulting in the loss, of more than $500,000 (§ 186.11, subd. (a)(2)) and had committed a theft of more than $100,000 (§1203.045, subd. (a)), and that the cumulative value of the money laundering transactions was more than $1,000,000 but less than $2,500,000 (§ 186.10, subd. (c)). Shah, Lum, and Emerich proceeded to jury trial beginning in March 2012, with opening statements presented on April 18, 2012. Languban had skipped bail and fled to 4 Counts 19 through 27 were alleged against Languban only. 4 the Philippines, and Niroula’s case had been severed as he was being held in Riverside County pending trial for murder.5 The jury began deliberations on July 9, 2012. On July 24, the jurors were dismissed until August 20. They resumed deliberations on that date, and returned their verdicts on September 19. Shah was found guilty as charged (counts 1, 3-13, 18); the excessive taking enhancement allegations were found true, as were the special findings under sections 186.10, subdivision (c), 186.11, subdivision (a)(2), and 1203.045, subdivision (a). With respect to count 1, the jury found Shah took part only in a conspiracy to commit money laundering. Lum was found guilty of grand theft as charged in count 7, filing false or forged instruments as charged in counts 8, 9, 10 (deeds of trust), and 15 (quitclaim deed to 4802), and attempted grand theft as charged in count 14, and the jury found true the excessive taking enhancement allegations and the special findings under section 1203.045 and 186.11, subdivision (a)(2). Lum was found not guilty of filing forged instruments (counts 4, 5, 6 (grant deeds)) and burglary (count 18), and a mistrial was declared as to him on counts 1, 3, 11, 12 and 13, and on the special allegation under section 186.10, subdivision (c). On March 19, Shah was sentenced to a total prison term of 20 years and ordered to pay a fine of $14.10 million. Lum was sentenced to a total of 12 years and ordered to pay a fine of $4.4 million. Shah filed a timely notice of appeal on March 28, 2013. Lum filed a timely notice of appeal on April 10, 2013. STATEMENT OF FACTS In September 2008, Shirley Hwang owned three condominiums at One Rincon Hill, 425 First Street in San Francisco, having recently purchased units 4802 and 4902 for 5 Niroula had been charged with the murder of Clifford Lambert in Palm Springs; his case and that of one of his codefendants, Daniel Garcia, had been severed from the case of attorney David Replogle, who had been convicted of the murder. 5 almost $1.4 million each and unit 5501, with partner Michael Shigezane, for $1.9 million. Hwang was living in unit 4802 and trying to sell unit 4902. She authorized Shigezane and her real estate agent, Morton Mah, to access the unit, and the keys were left at the front office for potential viewers. Just before Thanksgiving, Hwang took the unit off the market, planning to put it back on at the beginning of the new year. In November 2008, real estate agent Kathy Chan went to pick up a rent check from attorney David Replogle, who was a tenant in a building she managed. As she was unable to find parking, Replogle sent someone down with the check. The young man identified himself as “Sid Jones”; when later shown a photographic lineup, Chan identified a photograph of Niroula. He asked Chan if she had anything to rent in the building. She did not, but contacted Shigenzane, a former client, and arranged for “ones to see Hwang’s units. Shigenzane showed Jones unit 5501; Jones was interested in renting it but did not follow through, then later expressed interest in purchasing unit 5501 and then in purchasing units 4902 and 4802 as well. Jones wanted to show the units to his uncle, Prashant Kahn, who was the decision-maker for a trust that would be financing the purchase. The keys to the units were left with security for Jones and his uncle, who were told to leave a letter of intent in unit 4802 for Shigenzane and Hwang. The letter of intent, dated February 13, 2009, promised $7.5 million for the three units. Chan had told Shigenzane that Jones had a bank account worth $100 million. The phone number where Shigenzane called Jones’s uncle, (415) 935-9646, belonged to an account in Shah’s name for a “magicJack,” a device that allows phone calls to be made over the internet through a computer. The physical address associated with the account, 504 Ross Drive, Sunnyvale, was that of a hotel owned by Shah’s parents. Shah testified that he gave a device with this phone number to Niroula. In early 2009, escrow agent Nga Tran was asked by Shah to run preliminary title reports on Hwang’s Rincon condominiums. As of January 14, 2009, preliminary title reports from Old Republic Title Company showed title vested in Hwang. Tran told Shah that Hwang owned the condominiums “free and clear.” 6 Shah asked Tran to prepare grant deeds from Hwang to Winston Lum for the three condominiums, saying that Hwang was Lum’s aunt and that loans were going to be taken out on these properties in Lum’s name, and Tran prepared the deeds on January 14, 2009. Shown the deed for unit 5501, Tran testified that she did not fill in the location of the property or the transfer tax number, and that the deed she prepared was not signed or notarized because Shah wanted to have it notarized and recorded “outside our transaction.” Tran thought this was “weird”; she told Shah it would be best to have her notarize and record the deed because otherwise she would have to get an affidavit from Hwang confirming the transaction before the title company would insure it and she could close escrow, but Shah did not take her advice. Grant deeds transferring title to each of Hwang’s three condominiums from Hwang to Lum were recorded on January 16, 2009. Each bore a signature over the printed name “Shirley S. Hwang” that Hwang testified was not her signature. Each reflected having been notarized by Grachelle Languban,6 whom Hwang testified she had never met. No title company was indicated on the deeds. Languban also notarized an affidavit concerning the properties that was purportedly from Hwang but Hwang testified she did not sign. Tran had the preliminary title reports updated to reflect the recorded deeds transferring title from Hwang to Lum. The amended title report from Old Republic stated that the deeds were recorded “unsecure,” meaning it would be necessary to get either an affidavit from Hwang saying she signed the grant deeds, or new grant deeds signed by Hwang. 6 When interviewed by the police about the grant deed for unit 5501, Languban said she did not remember the transaction; asked for the relevant notary book, she said it had been destroyed. Notaries are required to notify the Secretary of State if a notary book is lost or destroyed. Languban had not reported this book lost or stolen, as she had with an earlier notary book, and she had never reported a notary book destroyed. Subsequently, when the CFO of the loan company asked Languban about the documents, she first told him she had no information because the pages of her notary book had been torn out, then later in the conversation said the book had been stolen. 7 Tran met Niroula when Shah brought him to her office to have a document notarized. She identified Niroula in a photographic lineup the police showed her. Mortgage Broker John Flores testified that in late 2008, Shah asked him about doing a loan on a condominium at 425 1st Street in San Francisco for someone who was out of the country. The loan was to be from a private lender, California Coastal Funding (CCF), and was to be a “cash-out” (meaning there was enough equity in the property to take cash out immediately) and “stated income” loan (meaning the lender did not require income documentation). Most of the information on the application was provided by Shah; Flores also spoke on the telephone with “Joshua Beam,” an interpreter for the borrower, Winston Lum. Beam was in fact Niroula. Flores never met Lum, whom he understood did not speak English. Lum’s employment was stated on the application as “Emperors of China,” which Flores was told was a restaurant owned by Lum’s family and actually called “Empress of China,” and teaching tennis. Flores was told that Lum had monthly income of $32,000 from this employment and rental on the condominiums. Flores testified that he attempted to verify Lum’s income but was not able to do so; he also testified that he did not try to verify Lum’s income and assets because it was not required. Flores was told that Lum’s attorney was Replogle. He verified that Replogle was an attorney in good standing, and spoke with him approximately three times, which gave Flores “a certain comfort level” that the loan would in fact close. Flores sent the loan application to Theo Hansen at CCF, who then on occasion asked Flores for help getting needed information. Flores received a letter, purporting to be from Lum, stating that Lum owned a tennis school and had accounts at Bank of America with deposits of approximately $50,000, and that the rest of his family money and assets were in Hong Kong. It was Flores’s understanding that CCF wanted to use their own title company in San Diego rather than Tran to handle the escrow. Robert Purdon, the former CFO of CCF, recalled that Flores referred Lum’s loan application, and that Lum wanted the money to help a relative. Purdon listened in on a telephone conversation between one of his employees and Lum, in which Lum was not 8 able to fully answer everything and talked to Beam on the side. Lum said he understood English but could not speak it well. Subsequent communications about the loan were with Beam, and Purdon also spoke with Replogle, whom he contacted by calling (415) 935-9646 (the number associated with Shah’s device). Purdon called the Empress of China and the employee who answered the phone was not aware of Lum; upon further inquiry, either Beam or Replogle told Purdon that Lum was not an employee but the owner. Lum’s credit report indicated his credit was “lousy,” with “38 serious delinquencies.” One of Among the documents used by CCF to substantiate Lum’s income, Purdon identified leases for the three condominiums, indicating Lum as the lessor.7 Purdon also identified statements for a Charles Schwab account in Lum’s name that showed consistent income. Schwab, however, had no record of Winston Lum as a Schwab client, nor any account number matching the one listed on the statements provided to CCF. The account number that appeared on another document in the CCF file was associated with Cliff Lambert of 317 Camino Norte, Palm Springs. A Schwab statement in the name of Cliff Lambert was found on a computer seized from Daniel Garcia in a different case, under the directory “Macintosh HD/user/Danny/document/Kaushal Niroula/fake,” in a file created on November 21, 2008. The grant deeds were among the documents obtained by CCF in connection with the loan application. There was also a “declaration affidavit” signed by Hwang which the company wanted because the transfer to Lum was recent, a document “assuring” the company that the transfer “was what it was.” CCF obtained appraisals of the properties. On January 31, 2009, appraiser Casey Simms went to units 4902 and 5501 with Beam, whom he subsequently identified as Niroula. Beam had keys for two of the units but not for unit 4802, so they arranged for Simms to return on February 14. On that date, Beam had two men with him, one of whom Simms identified as Shah. While Simms inspected unit 4802, the two men talked 7 The lease for unit 5501 was for $15,000 per month and the leases for units 4802 and 4902 were for $7,500 per month each. 9 in a corner and Beam followed Simms around. The unit was furnished, and Beam said it was occupied by a tenant. Simms appraised unit 4802 and unit 4902 at $1.225 million and unit 5501 at $2.4 million. In February 2009, Purdon and the investors funding the loan, Peter and Frans DeWitte, went to San Francisco to see the properties with Beam, who had keys to each. Unit 4802 looked lived-in but no one was home, unit 4902 was vacant and being painted, and unit 5501 was empty. The group then met with Lum at the St. Regis Hotel, where Purdon understood Lum was living. Lum answered some of the investors’ questions directly; with others he conversed with Beam, who gave a translation. Lum told the DeWittes that he needed the loan quickly because he was trying to help a family member get out of foreclosure. After the meeting, the investors agreed to the deal. The loans on units 4802 and 4902 were $550,000 each and the loan on unit 5501 was $1.1 million. Purdon identified Lum at trial, as did Peter DeWitte. Purdon also identified Beam on photographs taken at Rincon Tower on February 24. Michael Hartshorn, an employee of Shah’s who lived at the Quimby ranch, testified that he heard Shah answer the telephone as David Replogle, then have a conversation about trying to set up an appraisal for a property. The escrow was handled by Commonwealth Title Company (Commonwealth), which arranged for a Cantonese-speaking mobile notary, Wai Yip, to notarize the loan documents. Yip testified that he was directed to contact Lum’s attorney at (415) 935- 9646 (again, the number associated with Shah). He did not speak directly to Lum but, through someone else, arranged to meet Lum at a building downtown at 10:00 p.m. on February 27. When Yip arrived, Lum’s attorney and a younger man who appeared to be Middle Eastern or Indian and Yip understood to be Lum’s financial advisor were present; Lum was not and Yip was told that Lum was drunk and could not make it. One of the two men present walked with a cane. The next day, February 28, the same group met at a coffee shop with Lum, who signed the documents. A fingerprint expert testified that the print in Yip’s notary book was consistent with a print the expert took from Lum. 10 The loan was funded in early March 2009, with a total of $2.2 million. After fees deducted by Commonwealth, approximately $1.7 million was wired on March 5, 2009, to Trans Escrow Corporation, Tran’s company, with notations indicating the funds were to go to Lum.8 Tran testified Lum would have had to authorize Commonwealth to send these funds to her. Tran got her information about the transaction from Shah and his attorney, Melvin Emerich. At Shah’s direction, Tran wired $601,069 to Martini & Chnoogle, a Nevada corporation set up by Emerich (Martini); cut a check for $225,000 to Lum; and cut two checks for $434,422.72 each to Lum International, LLC, an off-shore corporation set up by Shah, which she then exchanged for certified bank checks. Endorsing information on the back of the two checks to Lum International showed they went to Zurcher Kantonalbank in Switzerland. Martini listed Emerich as president, secretary, treasurer and director. The corporation, through Emerich, opened a bank account on February 6, 2009, with a check written from Telsystems, a telecommunications company owned by Shah. The only other money received into the account was the $601,069 from Trans Escrow on March 6. Over the next months, payments were made from the Martini account to Shah’s company, Telsystems, his relatives and attorneys, and a friend of Emerich’s,9 and for real estate transactions involving Shah, his wife and his companies.10 8 For the escrow on unit 4902, $550,000 was wired into the account and $423,742.59 was wired out to Trans Escrow; for unit 4802, $550,000 was wired into the account, and $423,315.21 wired out; and for unit 5501, $1,100,000 was deposited into the account on March 5 and $867,689.81 was sent out to Trans Escrow March 5. 9 Between March 6 and April 28, approximately 45 checks totaling $282,000 were written from the Martini account to Telsystems. Checks totaling approximately $65,000 were written to Emerich. Checks totaling $22,000 were written to “cash.” Checks totaling $14,000 were written to Shah’s wife, Elvia Palomino Shah. A $2,000 check written to Gary Wesley bore the notation, “ ‘Jay’s . . . tell-a-day case.’ ” A check for $3,850, payable to Richard Vantrood, an attorney representing Shah in 2009, noted, “ ‘Legal fees . . . v . . . Shah.’ ” A $5,000 check to Craig Bassett, the attorney representing Shah in an action against a title insurance company involving the Quimby property noted, “ ‘Attorney for Jay.’ ” A check for $7,500 was payable to Sundowner Inn, LP., a hotel owned by Shah’s parents. A $5,000 check was payable to Shah’s mother. Five checks, $3,000 each, were written to Morad Afraimi, a friend of Emerich’s 11 Casey Lawrence, a bank and trust manager at 1-800-Company,11 testified that on March 12, 2009, Shah came into the office with his wife and established Lum International in Nevis, a small island in the British West Indies with very strong asset protection and privacy laws.12 Shah had 100 percent ownership of Lum International and was the only person with power to make decisions for it. Shah wanted to set up a Swiss bank account for the company, and Lawrence put him in touch with a banker in Switzerland, Pierre Gabris. Although the company’s normal practice was to send the original incorporation documents to the client after scanning them into the company’s system, Shah specifically directed that the documents be held in the office to be picked up later. There was a sense of urgency in setting up Lum International: “[I]t was very intense.” Shah said he was in the middle of a real estate deal and had checks he needed to cash quickly, before his partner changed his mind. The Swiss banker told Lawrence who allowed Emerich to use his residential address in Nevada as the address for Martini & Chnoogle. Afraimi testified that Emerich loaned him $15,000 in connection with a restaurant Afraimi was opening, in five payments of $3,000 per month. 10 In March, two electronic fund transfers, $6,916 and $19,999, were taken from the Martini account for payments on loans in the name of Shah and his wife on property at 659 S. 15th Street, San Jose, California. On May 4, $160,000 was transferred from the account to Ocwen Financial Corporation to pay off a loan in Shah’s wife’s name on property at 2103 South 11th Street, Los Banos, California. The Shahs refinanced this property, resulting in $80,000 going back into the Martini account “ ‘[F]or Elvia Palomino and Jay Shah’ ” on July 24. On July 29, $80,000 was transferred from the Martini account to a Trans Escrow account “for the credit of Palomino/Martini & Chnoogle.” This escrow account was for the purchase of 530 Adams Avenue, Los Banos, California. A grant deed dated August 6 transferred this property from Martini to Shah. On November 23, 2009, another grant deed transferred the property from Shah and his wife to M & K Properties, LLC. 11 Lawrence testified that the 1-800-Company sets up limited liability companies and corporations in the United States and offshore, as well as bank accounts for these companies. 12 According to Lawrence, it is not necessary to go to Nevis to establish a company there, and if someone wants to sue the company they have to post a bond in Nevis. It is difficult to find out who owns a company because “they don’t have public records like we do here.” 12 she needed to calm Shah down: “ ‘He’s called me 15 times today. I’ve spoken with him three times. If he calls the bank, they’re going to decline his account. They’re going to get suspicious.’ ” Shah asked Lawrence several times whether his wife would have access to everything if anything happened to him, which Lawrence thought was “sweet.” Shah also created Wine & Horses, LLC, in Nevis. Shah was the 100 percent owner and the director of this company; he and his wife were the authorized signatories for the company’s bank account, which was in Belize. Funds from the Lum International account were used to purchase property in California in the name of Shah, his wife and his companies.13 On November 26, 2009, 13 On August 31, 2009, at Shah’s direction, $171,975.50 was wired from the Lum International account at Zurcher Kantonalbank to the account of Pickford Escrow Company at Comerica Bank. A Pickford document showed the September 2, 2009, purchase of property at 2071 Genoa Court, Los Banos, California, by Martini and Maria Del-Los-Angeles Palomino, for $170,000, with a credit of $1,000 from Jesus Palomino and Elvia Palomino and a credit of $171,957.50 from Lum International for the benefit of Martini. A grant deed transferred this property from Martini to Elvia Palomino and Maria Del-Los-Angeles Palomino. On September 24, 2009, $150,000 was transferred from the Lum International account at Zurcher Kantonalbank to an escrow account at Fidelity National Title Company of California, in trust for Shah, for a property at 317 Crescent, Los Banos, California. A grant deed dated September 10, 2009, transferred this property from the prior owner to Shah and his wife as community property. Shah and his wife then transferred ownership of the property to M & K Properties, LLC. A quitclaim deed recorded on August 17, 2010, transferred the property from M&K Properties, LLC, to appellant’s wife as her sole and separate property. A grant deed dated December 29, 2010, transferred the property from “Megan & Kasi . . . Properties, LLC, a Nevada limited liability company, doing business in the state of Nevada as M & K Properties, LLC, who acquire title as M & K Properties, LLC” to “Megan & Kasi Properties, LLC, a Nevada limited liability company.” This deed was signed by Shah as “managing member.” According to a document filed with the California Secretary of State on December 23, 2010, “Megan & Kasi Properties, LLC” was formed in Nevada on November 19, 2009, listing Shah as its agent at 504 Ross Drive, Sunnyvale. A document from the Nevada Secretary of State, dated December 22, 2010, shows “M & K Properties, LLC” with a filing date of November 19, 2009, listing Laughlin Associates of Carson City as its registered agent and Shah as an officer or manager with the same address as the agent. 13 Shah took $325,000 from the Lum Internation