United States v. Basilio Castaneda, United States of America v. Rolando Quinonez, United States of America v. Luis Navarro Casillas

Basilio Castaneda, Rolando Quinonez, and Luis Casillas appeal their sentences and convictions of conspiracy to engage in money laundering and of several substantive counts of money laundering. We affirm Casillas’s convictions and sentence. As to Quinonez and Castaneda, we affirm in part, reverse in part, and remand for resentencing.

I

In 1991, federal agents began an investigation of money laundering and cocaine trafficking in the Modesto, California area. To aid in the investigation, the agents recruited a former drug dealer, Ignacio Felix, to carry out an undercover sting operation. They set up Felix in an apartment that was outfitted with covert video and audio recording equipment, a money counting machine, a duffle bag containing bottles of lidocaine, a triple beam balance, and cash to represent the proceeds of cocaine dealing.

On June 18, 1991, Felix made his first contact with appellant Quinonez, telephoning him on instructions from the agents. At a meeting the following day at Quinonez’s real estate office, Felix explained that he had a large amount of cash he had earned in the cellular phone and beeper business. He told Quinonez that he wanted to invest this cash in…