case 18-3546, document 121, 09/03/2019, 2645669, page1 of … · we are going to resume the direct...

UNITED STATES OF AMERICA,

Appellee,

v.

RAHEEM BRENNERMANAKA Jeferson R. Brennerman, AKA Ayodeji Soetan,

Defendant-Appellant.

18-3546(L)Consolidated with 19-497

LANTAGNE LEGAL PRINTING801 East Main Street Suite 100 Richmond, Virginia 23219 (804) 644-0477

ON APPEAL FROM THE UNITED STATES DISTRICT COURTFOR THE SOUTHERN DISTRICT OF NEW YORK

IN THE

United States Court of AppealsFOR THE SECOND CIRCUIT

APPENDIXVolume V of IX

John C. MeringoloMeringolo & Associates, P.C.375 Greenwich St., Fl. 7New York, NY 10013(212) 397-7900Counsel for Defendant-Appellant

Danielle Renee Sassoon, Assistant U.S. AttorneyRobert Sobelman, Assistant U.S. AttorneyNicolas Tyler Roos, Assistant U.S. AttorneyUnited States Attorney’s Officefor the Southern District of New York1 St. Andrew’s PlazaNew York, NY 10007212-637-2421Counsel for Appellee

Case 18-3546, Document 121, 09/03/2019, 2645669, Page1 of 292

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TABLE OF CONTENTS Page

Volume I Docket Entries ........................................................................................................1 Indictment (dkt. 1), filed 6/5/17 ............................................................................ 38 Memorandum in Support of Motion to Dismiss, Motion to Suppress and Motion for Return of Property (dkt. 32), filed 9/19/17 ................................ 50 Search Warrant and Affidavit (filed as Exhibit 2 to Declaration of Brian D. Waller) (dkt. 33-2), filed 9/19/17 ......................................................... 79 Memorandum in Opposition to Motion to Dismiss, Motion to Suppress, and Motion for Return of Property (dkt. 36), filed 10/10/17 ............................ 107 Reply Memorandum in Support of Motion to Dismiss, Motion to Suppress and Motion for Return of Property (dkt. 38), filed 10/17/17 ............................ 146 Hearing Transcript, 11/9/17 ............................................................................... 165 Memorandum in Support of Motion in Limine (dkt. 59), filed 11/13/17 .............. 237 Trial Transcript, Volume I, 11/27/17 .................................................................. 250 Volume II Trial Transcript, Volume II, 11/28/17 .............................................................. 290 Testimony of: RICHARD ALAN COLLINS Direct By Mr. Sobelman .................................................................... 350 Cross By Ms. Fritz ............................................................................. 369 CHRISTOPHER NIEVES Direct By Ms. Sassoon ...................................................................... 416 Cross By Ms. Fritz ............................................................................. 447 JUSTIN ELLARD Direct By Mr. Sobelman .................................................................... 459 Cross By Ms. Fritz ............................................................................. 471 Redirect By Mr. Sobelman ................................................................ 484 Recross By Ms. Fritz .......................................................................... 486


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MASON POSILKIN Direct By Mr. Roos ............................................................................ 488 Cross By Ms. Fritz ............................................................................. 507 JAMES HAGEMEIER Direct By Ms. Sassoon ....................................................................... 514 Cross By Ms. Fritz ............................................................................. 561 Volume III Continued Trial Transcript, Volume II, 11/28/17: Testimony of: JAMES HAGEMEIER Redirect By Ms. Sassoon .................................................................. 588 Recross By Ms. Fritz .......................................................................... 594 Redirect By Ms. Sassoon .................................................................. 594 Trial Transcript, Volume III, 11/29/17 ............................................................. 600 Testimony of: KEVIN BONEBRAKE Direct By Ms. Sassoon ...................................................................... 602 Cross By Mr. Steinwascher ............................................................... 632 Redirect By Ms. Sassoon .................................................................. 654 Recross By Mr. Steinwascher ........................................................... 658 JULIAN MADGETT Direct By Mr. Roos ............................................................................. 660 Cross By Mr. Waller .......................................................................... 800 Trial Transcript, Volume IV, 11/30/17 ............................................................. 863 Testimony of: JULIAN MADGETT Cross By Mr. Waller .......................................................................... 888


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Volume IV Continued Trial Transcript, Volume IV, 11/30/17: Testimony of: JULIAN MADGETT Cross By Mr. Waller .......................................................................... 888 Redirect By Mr. Roos ......................................................................... 935 Recross By Mr. Waller ........................................................................ 951 SCOTT STOUT Direct By Ms. Sassoon ...................................................................... 958 Cross By Mr. Steinwascher ............................................................... 996 MATTHEW PASCHKE Direct By Ms. Sassoon .................................................................... 1026 Cross By Ms. Fritz ........................................................................... 1040 RICHARD KELLY PLATO Direct By Mr. Sobelman ................................................................... 1045 Cross By Mr. Waller ........................................................................ 1073 Redirect By Mr. Sobelman .............................................................. 1095 SCOTT Y. WOOD Direct By Mr. Sobelman .................................................................. 1105 Cross By Mr. Waller ........................................................................ 1127 WILLIAM ROHAN CULLEY Direct By Mr. Sobelman ................................................................... 1142 Cross By Ms. Fritz ........................................................................... 1149 Redirect By Mr. Sobelman .............................................................. 1151 Recross By Ms. Fritz ....................................................................... 1152 ENRIQUE SANTOS Direct By Mr. Roos .......................................................................... 1153


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Volume V Trial Transcript, Volume V, 12/04/17 ............................................................ 1178 Testimony of: ENRIQUE SANTOS Direct By Mr. Landsman-Roos ........................................................ 1181 Cross By Ms. Fritz ........................................................................... 1203 Redirect By Mr. Roos ...................................................................... 1217 Recross By Ms. Fritz ....................................................................... 1219 JANELL BORRISON Direct By Mr. Roos .......................................................................... 1222 Cross By Ms. Fritz ........................................................................... 1230 HELEN MEMAR Direct By Ms. Sassoon .................................................................... 1232 Cross By Ms. Fritz ........................................................................... 1234 Redirect By Ms. Sassoon ................................................................ 1238 JAMES LEWIS Direct By Mr. Sobelman ................................................................... 1241 Cross By Ms. Fritz ........................................................................... 1249 BARRY KANE Direct By Mr. Sobelman .................................................................. 1258 Cross By Mr. Steinwascher ............................................................. 1263 THOMAS KIERNAN Direct By Mr. Sobelman ................................................................... 1265 Cross By Ms. Fritz ........................................................................... 1277 Redirect By Mr. Sobelman .............................................................. 1297 BARRY GONZALEZ Direct By Mr. Sobelman .................................................................. 1298 Cross By Mr. Steinwascher .............................................................. 1303 GARDNER WALKUP Direct By Mr. Sobelman ................................................................... 1312 Cross By Mr. Waller ........................................................................ 1356 RONALD FITZPATRICK Direct By Ms. Sassoon .................................................................... 1395 Cross By Mr. Waller ........................................................................ 1412 THOMAS BOLUS Direct By Mr. Landsman-Roos ......................................................... 1416 Cross By Ms. Fritz ........................................................................... 1427 Redirect By Mr. Landsman-Roos ..................................................... 1428 LISA CHARLES Direct By Ms. Sassoon .................................................................... 1429 Cross By Ms. Fritz ........................................................................... 1442 Redirect By Ms. Sassoon ................................................................. 1450 Recross By Ms. Fritz ........................................................................ 1451


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Volume VI Trial Transcript, Volume VI, 12/05/17 ........................................................... 1463 Testimony of: HOWARD BERKOWITZ Direct By Mr. Landsman-Roos ........................................................ 1506 Cross By Ms. Fritz ........................................................................... 1570 Redirect By Mr. Landsman-Roos .................................................... 1609 Recross By Ms. Fritz ....................................................................... 1613 Volume VII Trial Transcript, Volume VII, 12/06/17 .......................................................... 1740 Jury Verdict (dkt. 89), filed 12/7/17 .................................................................. 1931 Pro se Motion for a New Trial (dkt. 120), filed 2/28/18 .................................... 1932 Volume VIII Revised pro se Motion for a New Trial (dkt. 128), filed 3/28/18 ...................... 1934 Supplemental Defense Sentencing Submission (dkt. 197), filed 11/5/18 ....... 2008 Sentencing Transcript, 11/19/18 ..................................................................... 2017 Amended Judgment (dkt 223), dated 11/19/18, amended 2/12/19 ................. 2088 Notice of Appeal to Original Judgment Order (dkt. 204), filed 11/27/18 .......... 2096 Notice of Appeal to Amended Judgment Order (dkt. 224), filed 2/25/19 ........ 2097


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Volume IX – SEALED Presentence Report, filed 7/13/18 ................................................................... 2098


929

SOUTHERN DISTRICT REPORTERS, P.C.

(212) 805-0300

HC4KBRE1

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

------------------------------x

UNITED STATES OF AMERICA,

v. 17 CR 337 (RJS)

RAHEEM J. BRENNERMAN,

Defendant.

------------------------------x

New York, N.Y.

December 4, 2017

9:30 a.m.

Before:

HON. RICHARD J. SULLIVAN,

District Judge

and a Jury

APPEARANCES

JOON H. KIM

Acting United States Attorney for the

Southern District of New York

DANIELLE SASSOON

EMIL BOVE, III

NICOLAS LANDSMAN-ROOS

ROBERT SOBELMAN

Assistant United States Attorneys

THOMPSON HINE LLP

Attorneys for Defendant

MARANDA FRITZ

BRIAN WALLER

BRIAN STEINWASCHER

ALSO PRESENT:

Ariella Fetman, USAO Paralegal

Justin Ellard, Special Agent, U.S. Department of State

Dwayne A. Lunde, Thompson Hine LLP Paralegal

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Case 1:17-cr-00337-RJS Document 98 Filed 12/13/17 Page 1 of 285

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HC4KBRE1

(In open court; jury not present)

THE COURT: We're all set?

Who is our next witness?

MR. LANDSMAN-ROOS: Enrique Santos. Should we bring

him in?

THE COURT: Yes.

MS. FRITZ: Judge, I wonder, before we to that, could

we talk scheduling a little bit?

THE COURT: Sure.

MS. FRITZ: It sounds as if there is a real

possibility that the government is going to be able to blast

through their remaining witnesses today.

THE COURT: Really? I thought we weren't going to

finish the government's case until tomorrow.

MR. LANDSMAN-ROOS: I think it's much more likely that

it's tomorrow, but we were preparing to have everyone testify

today, so we can fill a full day, if that's what we get to, but

I think there's a decent chance, if I were to bet, that there

will be at least a few witnesses left for tomorrow morning.

THE COURT: Okay. I was planning to get you a charge

tonight, so that we could have a charge conference, presumably,

tomorrow sometime.

MS. FRITZ: That's what I wanted to ask: I wonder if

we could discuss today perhaps bringing the jury in later

tomorrow, so that we could --

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THE COURT: Maybe let's see where we are. I think

we'll probably have a better idea by lunchtime. So, for now,

it's 9:30, and I want to get the jury out, so they know 9:30

means 9:30, and we won't delay them. Let's revisit this around

lunch hour.

MS. FRITZ: Aye aye. Yes, sir.

THE COURT: Okay. Great. Let's bring them in.

I like that attitude, Ms. Fritz.

I guess, just for the record, I got a letter from

Ms. Fritz on Friday and a response from the government on

Saturday that relate to the charge. So we'll deal with that.

MS. FRITZ: And so that your Honor is aware, we

prepared a letter over the weekend that is being filed even as

we speak.

THE COURT: Okay. A response to their response?

MS. FRITZ: Correct.

Plus it raises another issue. But, by the way, Judge,

Mr. Roos and I have spoken about that issue. I think that

issue is going to be -- may be resolved.

THE COURT: Okay.

MS. FRITZ: I'm just giving you a heads-up.

THE COURT: Great. Thanks.

(Continued on next page)

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HC4KBRE1 Santos - Direct

(Jury present)

THE COURT: Good morning, ladies and gentlemen. I

hope you had a nice weekend. Welcome back and thanks for week

two of your service. It's greatly appreciated by all of us. I

really mean that.

We are going to resume the direct examination of

Mr. Santos by Mr. Roos.

ENRIQUE SANTOS, resumed.

DIRECT EXAMINATION CONTINUED

BY MR. LANDSMAN-ROOS:

Q. Good morning, Mr. Santos.

A. Good morning.

MR. LANDSMAN-ROOS: Ms. Fetman, can we please publish

Government Exhibit 602, which is now in evidence.

Q. Mr. Santos, is that up on your screen?

A. Yes.

THE COURT: Everybody's screen working?

JURY MEMBERS: Yes.

THE COURT: Let me know if they're not. I'll assume

everything is hunky-dory unless you tell me, okay?


Q. Mr. Santos, have you listened to the recordings that are

now in evidence as 450-A, 450-B, 451-A, 451-B, and 452?

A. Yes.

Q. I'm showing you what's marked for identification as 450A,

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450-B, 451-A, 451-B, and 452.

What are these documents? I'm sorry, each of those,

is that number dash T.

THE COURT: Dash T.

A. These are transcripts of those recordings.

Q. And are they accurate transcriptions of the portions of the

telephone calls that you reviewed that are referenced on

Government Exhibit 602?

A. Yes.

Q. How do you know that?

A. I reviewed them before coming here today and agreed that

they were accurate.

MR. LANDSMAN-ROOS: The government offers Exhibits

450-A-T, 450-B-T, 451-A-T, 451-B-T and 452-T as aids to the

jury.

MS. FRITZ: Your Honor, point of clarification on voir

dire?

THE COURT: All right.

VOIR DIRE EXAMINATION

BY MS. FRITZ:

Q. Mr. Santos, you just said a moment ago the documents you're

looking at are transcripts of the conversations that you

listened to. So I just want to clarify: These are not

transcripts of the tape-recorded conversations, correct?

A. They're transcripts of just the portions that I listened

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to.

Q. So, somebody selected pieces, and then you listened to

them?

A. Yes.

Q. And then these are just transcripts of those pieces?

A. Correct.

MS. FRITZ: Okay. No objection, your Honor.

THE COURT: So, 450-A-T and B-T, 451-A-T and B-T, and

452-T are received in evidence.

(Government's Exhibits 450-A-T, 450-B-T, 451-A-T,

451-B-T, and 452-T received in evidence)


Government Exhibit 1-12, which is in evidence, and please put

up page 56.


Q. Mr. Santos, do you see signatures on this page?

A. I do.

Q. And take a look at the second signature on page 56.

A. Okay.

Q. And what's the name for that signature?

A. It says Michael Sloanes.

Q. What's the person's title?

A. Secretary.

Q. Mr. Santos, in connection with your testimony today, did

you review transcripts of Government Exhibits 10-H and 10-J,

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which are marked as 10-H-T and 10-J-T?

A. I'm sorry, which exhibits are those?

Q. Did you review transcripts that are marked as 10-H-T and

10-J-T?

A. Is that this exhibit that I'm --

Q. No, that's not. I'll walk them up to you.

A. Thank you.

Yes, I reviewed these.

Q. Are there any comments in those exhibits about a person

named Michael Sloanes?

A. Yes.

MS. FRITZ: Objection, your Honor. There's no

connection between those transcripts and this exhibit other

than the fact that he may have read them at some point.

THE COURT: I'm going to allow it. Just to the extent

that Michael Sloanes is referenced, I'm going to allow that.

So you can answer.

THE WITNESS: Yes.

MR. LANDSMAN-ROOS: Ms. Fetman, please play Government

Exhibit 10-H and put the display alongside it, 10-H-T.

MS. FRITZ: Same objection. This witness has no

connection with those exhibits.

THE COURT: I just want to make sure. These are

10-H-T and 10-J-T? I have 10-H-T. I don't think I have

10-J-T.

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MR. LANDSMAN-ROOS: They came in on Tuesday, the 30th,

your Honor. Or 29th.

MS. FRITZ: The witness was Mr. Ellard.

THE COURT: 10-J-T?

MR. LANDSMAN-ROOS: That's right.

THE COURT: Sorry.

Okay, I see it. All right. Go ahead.

MR. LANDSMAN-ROOS: Can you play and run the

transcript along.

THE COURT: Hold on one second.

Ladies and gentlemen, these transcripts are just an

aid to you. It's helpful sometimes to have a transcript while

you're listening to a recording or a video because it just can

help your ear to sort of inform your ear.

That's the only reason it's being offered. It's not

evidence, right?

MR. LANDSMAN-ROOS: That's correct.

THE COURT: If you hear something that's different

than what's on the transcript, it's what you hear that matters.

So it's just an aid to your listening to an exhibit that is in

evidence. All right?

MS. FRITZ: And, your Honor?

THE COURT: Yes.

MS. FRITZ: I just want to interpose a clearer

objection with respect to the playing of these without the

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witness on the stand who is associated with this document

because I didn't have an opportunity to question the witness

about these additional pieces.

THE COURT: All right. Well, that's fine. You can

recall him if you want, but, otherwise, I'm going to allow it.

So go ahead.

(Video playback)

MR. LANDSMAN-ROOS: Ms. Fetman, can you please play

Government Exhibit 10-J and display alongside it 10-J-T as an

aid to the jury.

(Video playback)


Exhibit 4-51-A and display alongside it 4-51-A-T.

MS. FRITZ: Your Honor, if we could get some

specification about where these tapes are coming from, dates,

times, anything?

THE COURT: I think there's already been some

testimony about that. So you can develop that on cross.

But go ahead.

(Audio playback)


Q. Mr. Santos, what's this a recording of?

A. It's a phone conversation. It looks like it cuts off

after, "look, hi," but it appears to be a conversation between

someone named Aderinwale and Brennerman.

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MR. LANDSMAN-ROOS: Ms. Fetman, can you put back up on

the screen Government Exhibit 602.


Q. Mr. Santos, do you know where this recording, the 4:50

through 4:52 recording, came from?

A. Yes.

Q. Where do they come from?

A. The Bureau of Prisons.

Q. What are that?

A. It's the federal prison system.


Exhibit 451-B and display alongside as an aid 451-B-T.

(Audio playback)


Exhibit 452 and display alongside it Government Exhibit 452-T

as an aid.

(Audio playback)


Exhibit 450-B and play alongside it or display alongside it

450-B-T.


Q. Mr. Santos, where was that last recording made?

A. I believe it's also the Bureau of Prisons.

Q. Let's take a look at Government Exhibit 4-73, which is in

evidence, and we were looking at it on Thursday.

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What is this?

A. This is an excerpt of that cell phone report that I

produced for this case. Specifically this is a section of the

contacts.

Q. Whose contacts is it?

A. The entry is listed as Raheem.

MR. LANDSMAN-ROOS: Now, Ms. Fetman, please zoom in on

the first four cells, the top row.

Q. Mr. Santos, what are the first three phone numbers

attributable to Raheem in this entry?

A. The first few phone numbers are labeled as work, mobile and

iPhone.

MR. LANDSMAN-ROOS: Ms. Fetman, can you display

alongside Government Exhibit 4-73 the second page of Government

Exhibit 600.

Q. Mr. Santos, I'll walk a copy of each of these up to you,

473 and 600. And, Mr. Santos, do you see on there paragraphs 5

and 6, it says, "Government Exhibits 3, 5, and 6 are cell

phones that were seized in Brennerman's apartment"?

A. Yes.

Q. Do you see below there, there are some phone numbers listed

for various exhibits?

A. Yes.

Q. Can you compare those phone numbers for the phones that

were seized to the phone numbers on 4-73?

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A. Sure. The phone number that appears in item number 7 of

this stipulation matches the phone number on the report that is

labeled as mobile, the phone number listed in item number 8 of

the stipulation matches the number that's listed as work on the

report, and the phone number that's listed in item number 9 of

the report is listed as an iPhone on the cell phone report.

Q. So let's talk about the first number that's on there,

that's (713)775-6535.

MR. LANDSMAN-ROOS: Ms. Fetman, publish to the jury

what's in evidence as Government Exhibit 1-40. And please zoom

in on the header information on the email.

Q. Now, Mr. Santos, what's the name that's listed on the from

field of this email?

A. R.J. Brennerman.

MR. LANDSMAN-ROOS: Let's zoom out, Ms. Fetman.

Q. Mr. Santos, can you read the last sentence in the email?

MS. FRITZ: Your Honor, I continue to object to having

a witness simply read documents that he bears no relationship

to.

THE COURT: Overruled.

Go ahead.

A. "I wait to hear from you. I am contactable either via

email or cell phone."

And there's two phone numbers: One is (917)699-6430

or area code (713)775-6535.

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Q. Who is this email signed by?

MR. LANDSMAN-ROOS: Please zoom out, Ms. Fetman.

A. R.J. Brennerman.

MR. LANDSMAN-ROOS: Ms. Fetman, can you please move

Government Exhibit 1-40 to one of the sides of the screen and

put up alongside it Government Exhibit 1-39.

Q. Mr. Santos, on Government Exhibit 1-39, what's the name on

the from field?

A. Annisa Rodriguez.

Q. Now let's look at the text. And, Mr. Santos, can you read

the text of the email?

A. "Mr. Sloanes has not been in the office as he has been

traveling between Asia and Africa, and there has been some

delays with his travels. His cell phone contact number is

(713)775-6535. You can leave him a message and allow about 48

hours for him to respond. Warm regards, Ms. A. Rodriguez,

Senior Executive Assistant."

Q. And, Mr. Santos, can you compare the phone number

attributable in that 1-39 to Mr. Sloanes to the phone numbers

in the 1-40 exhibit?

A. It's the same phone number.

Q. When you say "It's the same phone number," which phone

number is the same?

A. The number ending in 6535.

Q. Is that phone number ending in 6535 listed in the contacts

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page for Raheem?

A. Yes.

MR. LANDSMAN-ROOS: Ms. Fetman, you can take down

Government Exhibit 1-39. And please put up 1-13 in its place.

Q. Mr. Santos, who does this email indicate it's from?

A. M. Kelly.

MR. LANDSMAN-ROOS: Let's take a look at the body of

the email, please. Now, let's zoom in on the signature block.

Go all the way down. Thank you.

Q. So, Mr. Santos, who is this email signed by?

A. M. Kelly.

Q. What does it say his title is?

A. Senior vice president, acquisitions.

Q. Do you see where it lists -- it says "M." --

A. Yes.

Q. -- in the footer?

And what's the phone number next to "M."?

A. (713)775-6535.

Q. How does that phone number for M. Kelly compare to the

second phone number for R.J. Brennerman?

A. It's the same number.

MR. LANDSMAN-ROOS: Ms. Fetman, can you take off 1-40,

which is on the left side of the screen, and put back 1-39.

Q. Mr. Santos, how does the number for Mr. Sloanes, on the

left side of the screen, compare to the number for Mr. Kelly in

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his footer on the right side of the screen?


Q. I'm showing you now, for identification, what's been marked

as Government Exhibit 4-71, 4-72, 4-76, 4-77, and 4-78. I'll

walk these up to you so you can take a look.

Mr. Santos, what are these?

A. These are excerpts of different conversations that were

recovered from that iPhone.

Q. The iPhone you testified about on Thursday?

A. Yes.

Q. Are they true and accurate copies of text messages or other

messages that were extracted from the cell phone?

A. Yes.

Q. And how do you know that?

A. I remember reviewing these before I came here today, and I

recognize them.

MR. LANDSMAN-ROOS: The government offers 4-71, 4-72,

4-76, 4-77, and 4-78.

THE COURT: When you reviewed the text, you compared

them to what?

THE WITNESS: I compared them against the full

extraction report that I did and that had my name on it, and I

compared the IMEI number on the reports of the actual cell

phone that I extracted.

THE COURT: Okay. Any objection?

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MS. FRITZ: Yes. Objection; hearsay.


So, 4-71, 4-72, 4-76, 4-77, and 4-78 of the government

exhibits are received.

(Government's Exhibits 4-71, 4-72, 4-76, 4-77, and

4-78 received in evidence)

MR. LANDSMAN-ROOS: Ms. Fetman, please publish on the

main screen 4-73, which is in evidence.


Q. Mr. Santos, what's the phone number attributable to iPhone

under the Raheem contact?

A. (310)210-0919.

MR. LANDSMAN-ROOS: Ms. Fetman, you can take that off

the screen and please publish for the jury what's now in

evidence as 4-72. Let's start at the top of this exhibit.

Q. Mr. Santos, what are we looking at here?

A. This is an iMessage conversation between a contact named

Raheem and another contact labeled as Jamie Sanderson.

Q. What's an iMessage?

A. It's Apple's proprietary messaging system.

Q. What's the date on these messages?

A. Different date ranges, but the conversation starts on

September 26, 2012, and extends through March 31st, 2017.

Q. For the record messages that are captured on this exhibit,

what's the date range?

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A. Conversation starts on December 28th, 2013, and the last

conversation is 12/28/2013 of the same -- one day.

Q. Mr. Santos, who are the participants to the conversation?

A. Raheem and the contact name that's Jamie Sanderson.

Q. Can you please read the conversation for the jury?

A. Sure. It starts with: "Jamie."

He or she says: "Yep."

And then again says, "What's the number again?"

Raheem responds: "You awake?"

And Raheem says, "Call my other phone."

And then gives the number: "(310)210-0919."

MR. LANDSMAN-ROOS: Ms. Fetman, please publish

Government Exhibit 4-71, which is in evidence.

Q. Mr. Santos, what's this?

A. This is a WhatsApp conversation between a contact saved as

Raheem and a contact named as Najia Pasche.

Q. What's a WhatsApp conversation?

A. It's a chat application that let's users send messages

across different devices.

Q. Mr. Santos, can you please read the conversation for the

jury?

A. The conversation starts with an incoming messaging from

Najia. It says: "Hey you, HB have another number?"

And Raheem responds: "Yes."

Najia says: "Ha-ha, okay. Do I get the other

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number?"

Najia responds: "I'm on Inner Circle," winky face.

Raheem responds: "Yes. I need to charge this phone,"

and then gives the number "(310)210-0919."

MR. LANDSMAN-ROOS: Ms. Fetman, move Government

Exhibit 4-71 to the left side of the screen and put up next to

that what's in evidence as Government Exhibit 1-9.

Q. Mr. Santos, looking at Government Exhibit 1-9, who is the

email signed by?

A. Ms. A. Rodriguez.

Q. Do you see the sentence that begins "if you require"?

A. Yes.

Q. Can you read that for the jury?

A. "If you require any additional information, please do

contact me at Ms. A. Rodriguez, (310)210-0919, or by email at

[email protected]."

Q. Mr. Santos, can you compare the phone number provider by

Raheem in 4-71 to the number provided in the email signed by

A. Rodriguez in 1-9?


MR. LANDSMAN-ROOS: Ms. Fetman, can you take down

Government Exhibit 1-9, which is on the right side, and put up

next to 4-71 Government Exhibit 1-8.

Q. Mr. Santos, who signed the email in Government Exhibit 1-8?

A. Ms. A. Rodriguez.

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Q. Can you read the text of the email?

A. "Dear Ravi Toora: Thank you for your email. Please call

my colleague, Mr. Kelly, at (310)210-0919 at 2:00 p.m. U.K.

time to progress the account opening. Warm regards, Ms. A.

Rodriguez."

Q. How does the number listed for Mr. Kelly compare to the

number listed on the WhatsApp conversation for Raheem?


MR. LANDSMAN-ROOS: Let's take down 4-71, which is on

the left side of the screen, and put up next to 1-8 Government

Exhibit 1-9.

Q. Mr. Santos, how does the number provided for Ms. A.

Rodriguez on the left side of the screen compare to the number

provided for Mr. Kelly on the right side of the screen?


MR. LANDSMAN-ROOS: Ms. Fetman, you can take down both

of those exhibits. And can you please publish what's in

evidence as 1-43.

Q. Mr. Santos, who is this email from?

A. R.J. Brennerman.

Q. Who is it to?

A. Peter.

Q. What's the address for Peter?

A. [email protected].

Q. What's the subject line?

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A. "Regarding additional questions."

MR. LANDSMAN-ROOS: Can we please look at the text.

Q. And, Mr. Santos, can you please start at the top and read

through what's marked as paragraph 1 up to the point of

paragraph 2?

A. "Peter, below are the other questions: How should we

respond to Mike Nouril of Mischon de Reya asking whether we

still want to engage him following the email from Mortgage

Trust lawyers? Shall I just send an email from Annisa that

Mr. Brennerman is currently away due to family matters? Shall

I email Mortgage Trust lawyer from Annisa advising them that we

have a different lawyer?"

MR. LANDSMAN-ROOS: Can we publish for the jury what's

in evidence as 1-32.

Q. And, Mr. Santos, who is this email from?

A. R.J. Brennerman.

Q. Who is it to?

A. Peter.

Q. What's the date on the email?

A. April 19th, 2017.

MR. LANDSMAN-ROOS: Can we look at the text.

Q. Mr. Santos, what's the top line of the text?

A. "Peter: See below email which I want to send to Mortgage

Trust."

Q. And then, Mr. Santos, can you read what's below that, the

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word "dear" and the next sentence?

A. "Dear Mr. Bloom: Your witness statement was forwarded to

me by Ms. Rodriguez. First, I enclose a copy of previous

notice, which confirms that I will be dealing with matters

relating to this property on behalf of the defendant. As you

are aware from my statement, he is currently away due to

medical reasons (kidney transplant)."

MR. LANDSMAN-ROOS: Ms. Fetman, can you please go to

the next page, the signature line on this email.

Q. Mr. Santos, who is this email signed by?

A. Mike Kelly.

MR. LANDSMAN-ROOS: Ms. Fetman, can you please display

alongside Government Exhibit 1-32 Government Exhibit 1-38.

Q. So you can compare them, also, Mr. Santos, I'll walk you up

a copy. It's 1-32 and 1-38.

Mr. Santos, what's the sender's name on 1-38?

A. M. Kelly.


A. April 19th, 2017.

Q. What's the subject line?

A. "Regarding Mortgage Trust Limited - Account Number 2160072

- Private and Legally Confidential."

Q. Who is on the to line of the email?

A. Anthony Bloom.

Q. Mr. Santos, can you compare the sender name on 1-32 to

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1-38? Are they the same or different?

A. Are you asking about the from?

Q. Just the from line.

A. Different email addresses.

Q. And who is it on the left side?

A. R.J. Brennerman.

Q. How about on the right?

A. M. Kelly.

MR. LANDSMAN-ROOS: Let's zoom out from these.

Q. Now, Mr. Santos, can you compare the text of the emails,

1-32 and 1-38?

A. With the exception of the first line on 1-32, it appears to

be the same email.

Q. Who signed the email on 1-38 at the bottom?

A. Mike Kelly.

MR. LANDSMAN-ROOS: Ms. Fetman, you can take these

exhibits down. And can you please publish 2-9.

Q. Who is this email from, Mr. Santos?

A. R.J. Brennerman.

Q. Who is it to?

A. Peter Abiodun.

Q. What's the email address?



A. October 4, 2013.

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Q. Can you please read the first sentence of this email?

A. "Peter: What do you think about the email below and my

response?"

Q. Then can you read from "Dear Ms. Suzy Parsons" downward?

A. "Thank you for your email. The payment details has been

provided, and we are just waiting on confirmation of payment

from them. I will follow up with them again on Monday to check

on the status of the refund payment. Mr. Brennerman is getting

better; however, still in the ICU (Intensive Care Unit).

"PS: In case we send the full refund to you, I will

provide you an account to send the excess payment. Thank you

and warm regards, Ms. A. Rodriguez."

Q. Is the email address for the sender on this email an

account that indicates it belongs to A. Rodriguez?

A. No.

MR. LANDSMAN-ROOS: Can we publish 2-12, which is in

evidence.

Q. Who is this email from, Mr. Santos?

A. R.J. Brennerman.

Q. Who is it to?

A. Peter Abiodun.

Q. What's the date on it?


Q. I'm sorry, what's the date on it?

A. October 17, 2013.

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Q. Can you read the first line of the email?

A. "Dear Peter: See the email below which I want to send from

Mike to Julian and his colleagues. What do you think?"

Q. Who is the email signed by?

A. M. Kelly.

Q. How does the name M. Kelly compare to the sender on the

email?

A. It doesn't.


Government Exhibit 2-1.

Q. Mr. Santos, who is this from?

A. Raheem.

Q. And who is it to?

A. Peter Abiodun.


A. October 29th, 2013.

Q. Can you read the first line?

A. "Peter, what do you think?"

Q. And then can you read the email?

A. "Dear Mr. Justin Hayward: Mr. Brennerman is currently away

due to medical reasons and expected to be discharged from the

hospital by mid-November. I was intending to respond to your

earlier message; however, have been away. Warm regards, Ms. A.

Rodriguez."

Q. How does the name A. Rodriguez correspond to or compare to

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the name of the sender?

A. It doesn't. It's not there.

Q. Mr. Santos, I'd like to show you Government Exhibit 2-10,

which is in evidence.

Who is this email from?

A. R.J. Brennerman.

Q. Who is it to?

A. Peter Abiodun.


A. October 8, 2013.

Q. Can you read the first line?

A. "Peter: I know the email below is childish and harsh;

hence, why it is from Mike and not me."

Q. Who is the email signed by?

A. M. Kelly.

Q. How does that name compare to the sender of this email?

A. It doesn't. It's not there.

Q. Who is the sender of the email?

A. R.J. Brennerman.

MR. LANDSMAN-ROOS: No further questions.

THE COURT: Okay.

Cross-examination?

MS. FRITZ: Yes. Thank you.

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HC4KBRE1 Santos - Cross

CROSS-EXAMINATION

BY MS. FRITZ:

Q. Mr. Santos, I would like to go back and talk about the

things that you actually did do.

You said that you received an iPhone and extracted

data, correct?

A. Correct.

Q. And other than reading documents, was that really the

extent of the tasks that you performed in relation to this

case?

A. I extracted the phone, I produced a report that I gave to

the investigators and the prosecutors, and I read -- I listened

to some recordings and just confirmed that the transcript was

accurate.

Q. So that's what you have done in relation to this case?

A. Yes, ma'am.

Q. Mr. Roos asked you, at the very beginning of your direct

examination, about what you did after you received the phone.

Do you have a recollection of telling him that you received an

iPhone, and you received a search warrant?

A. Yes.

Q. Was it your job to then take material off of the iPhone

consistent with that?

A. Yes.

Q. Can you just remind me, Mr. Santos, what provision of that

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warrant authorized you to take a picture of a shoe from a

store?

MR. LANDSMAN-ROOS: Objection.

THE COURT: I'm not sure I even understand the

question.

MS. FRITZ: I can rephrase, your Honor.

THE COURT: Okay.

BY MS. FRITZ:

Q. Do you have any recollection of what provision in a search

warrant --

MS. FRITZ: If we could pull up -- Dwayne, do we have

the ability to pull UP 4-14?


THE COURT: 4-14 is in evidence, right?

MR. LANDSMAN-ROOS: Yes.

THE COURT: I'll allow him to look at the exhibit.

Go ahead.

THE WITNESS: So, with a forensic device --

MS. FRITZ: Excuse me, did we get it up?

MR. LUNDE: Yes.

MS. FRITZ: And to the jury? Okay.

BY MS. FRITZ:

Q. So, this is an item -- let me just understand. You were

the one that made the decision about what things could be taken

off of Mr. Brennerman's cell phone, correct, and taken by the

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government?

A. With a forensic examination, the goal is to try to get as

much data as possible from a --

Q. I apologize. That's not my question, though.


MS. FRITZ: It's not responsive.

THE COURT: Well, I think it was a sentence. He was

not even a sentence into it.

So you can answer. Go ahead.

THE WITNESS: So I can't pick and choose what comes

off the device. The goal is to try to get a forensic image of

the device, which means just getting everything that's on

there. There are limitations of the actual software that limit

me from saying, all right, let me just get this, but not that.

THE COURT: All right. Let's stop. So the question

was: You were the one that made the decision about what things

to take off of Mr. Brennerman's cell phone, correct? Is that

true? Is that your decision?

THE WITNESS: No. The software limits what I can and

cannot remove off the cell phone.

THE COURT: Okay. Next question.

BY MS. FRITZ:

Q. Okay. So there are some difficulties parsing the forensic

images, is that what you were just saying?

A. I wouldn't say difficulty. The software is designed to

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remove as much information as possible. I can't cherrypick

what comes off the device.

Q. But isn't that exactly what the warrant tells you to do,

cherrypick that which is --


Q. -- within its scope?


You can answer.

THE WITNESS: Yes.

BY MS. FRITZ:

Q. Okay. So, going back to my original question: Is there

anything in that warrant that would have authorized the seizure

of a picture of a shoe in a store?

A. Specifically, no.

Q. Is there anything in that warrant that was issued by the

Court that would authorize the seizure -- is there anything in

there that would authorize a picture of a hotel room?



You can answer.

THE WITNESS: No specific mention, no.

Q. So you just took -- let me just understand: You just took

everything off the phone irrespective of the terms of the

warrant?


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THE COURT: Ladies and gentlemen, I've already ruled

on the admissibility of this evidence, so it's properly before

you. So I'm not sure what else the point of the cross is, but,

certainly, the evidence has been received, and you can consider

it.

Go ahead. Next question.

BY MS. FRITZ:

Q. I'm just trying to clarify. Was everything that was on the

iPhone removed by you?

A. Everything that the software allowed me to remove was

removed.

Q. And that includes every single photograph that was on

there?

A. That I know of, yes. And we recovered some deleted items.

As with every cell phone model, our ability to recover certain

amounts of data is different, so the model of the iPhone may

complicate things, as well as the operating system.

Q. Okay.

A. So, we are able to recover more data from some phones than

others.

Q. Did you at any time make an effort to ensure that what you

were taking from that cell phone corresponded to the court

order that allowed this search?

A. I'm sorry, can you repeat the question?

Q. Did you at any time make an effort to ensure that what you

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were taking off of the cell phone corresponded to what the

judge said you could take?

A. You mean to limit the data that I was producing?

Q. Correct.

A. No.

Q. Okay. So you took, as far as you know, every picture off

the cell phone, correct?

A. Yes.

Q. Every text message off the cell phone, correct?

A. Yes.

Q. Every email off the cell phone?

A. Email contents, we can't recover from iPhones, we can only

recover the metadata. So I recovered the metadata, but not

content, correct.

Q. All the metadata?

A. Yes.

Q. For example, we just look a moment ago at a communication

that occurred with somebody named Jamie. Do you remember that?

A. Are you referring to the WhatsApp conversation?

Q. Yes.

A. Yes.

Q. Did you have any reason to believe that Jamie had anything

at all to do with this case?

A. No.

Q. Did you have any knowledge of whether Jamie just happened

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to be a friend of Mr. Brennerman's?

A. I don't know who that person is.

Q. All right. Let me ask you: Since you took everything that

you could get off of this thing, what was -- let's talk about

it. What was the volume of what you got?

A. In terms of pages of the report, I believe it went into the

thousands of pages and several gigabytes worth of data. I

don't remember the exact number.

Q. Do you know whether it actually exceeded a terabyte?

A. No.

Q. You don't know or, no, it didn't?

A. No, it didn't.

Q. Do you know what the approximate volume was of the data off

of this one device?

A. Less than 16 gigabytes, I believe.

Q. You said it covered what, a thousand pages in your

extraction report?

A. Several thousand, I believe.

Q. Several thousand pages.

Can you ballpark the number of photos that were

recovered from that phone?

A. It was probably in the thousands. I don't remember the

exact number.

Q. Probably a thousand or more?

A. Yes.

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Q. So the photos that we looked at in the courtroom earlier

today, those were certainly just a sliver of what was on there,

correct?

A. Yes.

Q. Were those selected by you to show to the jury or somebody

else?

A. Somebody else.

Q. Who selected those photos to show the jury?

A. The prosecution team.

Q. And there were lots and lots of other things on that phone

regarding Mr. Brennerman, correct, in the photos section?

A. Yes.

Q. There were articles about Mr. Brennerman; is that correct?

A. Yes.

Q. Articles about Mr. Brennerman as an up-and-coming

entrepreneur?


THE COURT: Ms. Gorgone, are you okay?

JUROR: Yes, kind of.


BY MS. FRITZ:

Q. Do you recall an article, for example, called "Bucking the

Trend"?

A. I don't remember --


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THE COURT: The question is do you recall what was on

the phone? Is that the question? Is that the question, what

was on the phone?

MS. FRITZ: Does he recall seeing articles about --

THE COURT: Do you recall seeing articles, period?

THE WITNESS: I recall seeing at least one article.

BY MS. FRITZ:

Q. But those items, those were not among the ones that the

prosecution selected to put into evidence here today?

A. No.

Q. What about various articles about an organization called

the BLV Group, do you remember those being on the phone?



You can answer.

THE WITNESS: I recall mention of the BLV Group, but I

don't recall exactly where I saw that.

Q. And do you recall lots and lots of material with respect to

Blacksands Pacific?

A. Yes.

Q. And did you at any time organize and provide specific

images -- did you select certain images to show to the

prosecution, or did they simply pick the images they wanted

from all of the photos that were on there?

A. I believe the prosecution team selected the images they

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wanted.

Q. Okay. You were asked a number of questions with respect to

certain phone numbers, correct?

A. Yes.

Q. And so you were able to read from Mr. Brennerman's phone

that there is a -- in his contacts, there is an iPhone number,

correct, that starts with 310?

A. Yes.

Q. And that was the phone from which you were extracting data;

is that correct?

A. I would need the first few pages to recall which phone

number was assigned to that iPhone that I examined. That

number that you are asking me about, can you just remind me

what the number is again?

Q. Let's do it the other way. How many phones did you look

at?

A. For this case, a few. I believe it was four phones.

Q. Four phones.

And do you know whether all of those phones were taken

from Mr. Brennerman's hotel room?

A. According to the warrant that I received, yes.

Q. And do you have any idea the extent to which Mr. Brennerman

has any other individuals using any of those phones at any

given point in time?

A. No, I don't know.

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HC48BRE2 Santos - Cross

Q. Let me just ask you, with respect to the excerpted

conversations, the messages that Mr. Roos showed you, would the

same thing apply, the phone was full of messages and

communications like the ones that were shown here before the

jury, correct?

A. Yes.

Q. And the only ones that were seen by the jury are the

ones -- I think four of them -- handpicked by the prosecution,

correct?

A. Yes.

Q. Do you know how far back the data on the phone went? Did

it go back ten years, five years?

A. I believe the data went back -- are you referring to

individual pieces of data that may have been synced with that

phone?

Q. Let me try again.

Information that's contained on the phone, much of it

contains a date, correct?

A. Yes.

Q. Like the messages that have dates, correct?

A. Yes.

Q. And some of the images have metadata that had dates,

correct?

A. Yes.

Q. So do you recall with respect to all of those dates,

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whether it was a message or a photo, how many years of data was

on there?

A. Several years. Just off the top of my head, 2013 seems

like a year that sounds about right, but I could be wrong. I

don't have the full report in front of me so I can't tell.

You might have data that's earlier than that if a

database was synced with that phone. So you might have data

that's older than the device itself.

Q. Your best recollection is we are talking probably about

four years worth of data, correct?

A. Yes.

Q. Now, you were also asked by Mr. Roos to I guess review

transcripts of a couple of conversations that occurred with

someone named Peter, telephone conversations, correct?

A. Yes.

Q. And had you had anything to do with those conversations

before Mr. Roos asked you to review those transcripts?

A. No.

Q. So he says, look, review those transcripts and then you

guys went through it here in the courtroom, correct?

A. Yes.

Q. Again, do you have any knowledge of how many similar

conversations might be in the possession of the government?

A. No.

Q. Do you have any knowledge of how long those conversations

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were?

A. No.

Q. So let's just be clear. Do you know how many different

conversations you read transcripts from? Did that make any

sense?

A. Like how many different excerpts?

Q. No. I am trying to get to how many conversations were

involved which were then excerpted by the government.

A. No, I don't know.

Q. Do you know whether it was two conversations?

A. No.

Q. With pieces?

A. No.

Q. So do you know if -- let me just give you an example.

MS. FRITZ: Can you pull up 450AT and 450BT.

Can you put them next to each other.

Q. So Mr. Roos showed you both of these, correct?

A. Yes.

Q. Do you know if both of these, 450A and 450B, are part of a

single conversation that occurred on one particular day?

A. No.

Q. OK.

MS. FRITZ: Can you flip to the first page of each of

those?

Q. Do you know whether the one on the left is just the first

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few lines of that conversation and the one on the right is

something that is said later in the conversation?

A. I don't know.

Q. Do you know how many minutes of conversation there actually

were in this conversation?

A. No.

Q. Do you know how many seconds of that were excerpted by the

government?

A. No.

MS. FRITZ: If we can go to 451. Same thing.

So 451A is on the left. 451B. OK.

If you could go to the text, the conversation of both.

Q. Same question. Do you know whether this is another single

conversation?

A. No.

Q. Do you have any idea how long that conversation was?

A. No.

Q. Do you have any idea how many seconds of it were selected

now and presented by the government?

A. No.

Q. OK. In the middle of the page that's on the right side, it

appears that Mr. Brennerman is talking about "the fact of the

assets."

Do you see that?

A. Yes.

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HC48BRE2 Santos - Redirect

Q. And saying that "somebody needs to put the information

together, put every detail together," correct?

A. Yes.

Q. Does it appear that what he is talking about there is these

assets?

MR. ROOS: Objection.

THE COURT: Sustained. He doesn't need to say what it

appears to be.

Q. Is it correct that in the middle of the page Mr. Brennerman

says, "The fact is these assets, we need to really, really pull

it together, pull it together?"

Does he say that?

A. Yes.

MS. FRITZ: One second, your Honor.

Nothing further.

THE COURT: Redirect.

MR. ROOS: Briefly, your Honor.

REDIRECT EXAMINATION

BY MR. ROOS:

Q. Mr. Santos, is there a difference between extracting data

from a cell phone and the review of that data?

A. Yes.

Q. What is the difference?

A. Well, as a forensic examiner when you're extracting data,

your goal is to try to extract as much data as possible,

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HC48BRE2 Santos - Redirect

because you may not get a second chance to extract that data if

later on you need it. You may destroy data just by the simple

act of distraction. So we want to try to get as much of it as

possible on the first try.

Q. Ms. Fritz asked you a bunch of questions about the

selection of different pieces of the data from the cell phone.

Do you remember that?

A. Yes.

Q. Were you involved in any of those selection decisions?

A. No.

Q. Ms. Fritz asked you about your knowledge of the contents of

some of the materials on the phone.

Do you remember that?

A. Yes.

Q. Do you remember her asking about some of the articles that

were on there?

A. Yes.

Q. She didn't show you any of those articles, right?

A. No.

Q. Do you know whether those are real articles?

A. No.

Q. Do you have any knowledge of the content of those articles?

A. I vaguely remember the title of one of them, but I don't

remember much beyond that.

Q. Do you know whether or not the content in those articles

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HC48BRE2 Santos - Recross

are true or not?

A. No.

Q. Do you have any knowledge about whether those are even real

articles or could they be forged?

MS. FRITZ: Oh -- what I meant is objection.

THE COURT: You can answer.

A. No.

Q. No what?

A. I don't know if they are real or not.

MR. ROOS: No further questions.

MS. FRITZ: Your Honor, I would like to mark and enter

into evidence two of the articles on the phone, but I would

need a moment to make a copy of these exhibits.

MR. ROOS: Objection to testimony.

MS. FRITZ: It was just a suggestion.

MR. ROOS: She is testifying to what she is holding in

her hand, which is not in evidence.

THE COURT: She is referring to the articles.

In any event, don't do that. You should just give

them numbers.

MS. FRITZ: Your Honor, it will take a moment for us.

These will be Defense GT and GU.

RECROSS EXAMINATION

BY MS. FRITZ:

Q. Mr. Santos, I would like to show you what has been marked

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for identification as Defense GT and GU and I am going to ask

you, do you recall seeing those among the things that were

present in the images on the phone?

A. I remember seeing this specific image.

Q. OK.

A. I don't recall this one.

THE COURT: Which is which? Use the numbers.

THE WITNESS: These aren't marked.

Excuse me. I can't make out this handwriting.

That's the one I recognize.

THE COURT: This is GU, I guess.

You recognize GU, you don't recognize GT?

THE WITNESS: Correct.

Q. Taking a look at GT, does that appear to be an image that

you extracted from the phone and provided to the government?

A. I don't recall seeing this image, but I can describe what

it is.

THE COURT: Don't describe what it is. The question

was, do you recall seeing it.

THE WITNESS: No, I don't remember seeing this.

MS. FRITZ: I offer into evidence GU.

MR. ROOS: Objection. He doesn't recall seeing it.

MS. FRITZ: Then I said the wrong one. Whichever.

THE COURT: GU he recognized.

MR. ROOS: OK. No objection.

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THE COURT: Any objection to GU?

MR. ROOS: Hearsay to the extent it's being offered

for its truth; otherwise no objection.

THE COURT: I don't know why it's being offered

candidly.

You have no objection to it coming in but not for the

truth.

MR. ROOS: We have a hearsay objection. There may

also be a relevance objection.

THE COURT: Is there or is there not? Are you

objecting or not objecting?

MR. ROOS: I don't have a copy of it.

THE COURT: Take a look at it.

MR. ROOS: Your Honor, we object. It's hearsay if

it's being offered for the truth. We object on relevance

grounds, and also the exhibit itself is unreadable.

THE COURT: I don't see any reason for this to come

in. So sustained.

Next question.

MS. FRITZ: Nothing further.

THE COURT: Any redirect?

MR. ROOS: No.

THE COURT: You can step down.

(Witness excused)

THE COURT: Next witness.

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HC48BRE2 Borrison - Direct

MR. ROOS: The government calls Janell Borrison.

JANELL BORRISON,

called as a witness by the government,

having been duly sworn, testified as follows:

THE COURT: Can you state your name and spell your

name for the record.

THE WITNESS: Janell Borrison, J-A-N-E-L-L,

B-O-R-R-I-S-O-N.

DIRECT EXAMINATION

BY MR. ROOS:

Q. Good morning. Where do you work?

A. I work for the Social Security Administration, Office of

the Inspector General.

Q. How long have you worked there?

A. About ten years.

Q. What are your duties and responsibilities in your current

position?

A. I investigate fraud waste and abuse regarding Social

Securities benefits programs and Social Security number misuse.

Q. Are you familiar with the process by which a person obtains

a Social Security number?

A. Yes, I am.

Q. Can you please describe for the jury the ways a person

obtains a Social Security number?

A. A person can fill out a Social Security number application

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and submit it to a Social Security office, or they can go

directly to a Social Security office and speak with a Social

Security representative providing the information to them

directly.

Q. What happens after a person submits an application and

provides the information?

A. The information is processed and that person will receive a

Social Security card through the mail.

Q. Where is that Social Security card mailed?

A. It's mailed to the address the applicant provides at the

time of the application being submitted.

Q. Can a person who is not born in the United States obtain a

Social Security number card and number?

A. Yes, they can.

Q. What types of documents does a noncitizen have to provide

to obtain a Social Security number?

A. If they are not a U.S. citizen, they would supply their

foreign passport with a visa and current U.S. immigration

documents, such as an I-94, which is an arrive and departure

record, a green card, work authorization forms, documents such

as that.

Q. Why are identification documents like visas necessary

during this process?

A. To prove your identity and also your status in the U.S.

Q. Before testifying today did you have an opportunity to

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review certain Social Security Administration records and

documents to prepare for your testimony?

A. Yes, I did.

Q. I show you now for identification -- so this is not for the

jury -- what has been marked as Government Exhibit 45.

The font is a little small so I will bring you a copy.

Ms. Borrison, do you recognize this document?

A. Yes.

Q. What is this document?

A. This is a Social Security number for Raheem Jefferson

Brennerman.

Q. Have you seen this application before?

A. Yes.

Q. Are records like this regularly made and maintained by the

Social Security Administration?

A. Yes, they are.

Q. Was this record made at or around the time the information

was supplied?

A. Yes.


A. From the date on the bottom that was entered by the Social

Security representative.

Q. How has this record been stored since that time?

A. In Social Security's computer databases.

MR. ROOS: Government offers 45.

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MS. FRITZ: Voir dire, your Honor?

THE COURT: I am not sure for what purpose. Do you

object to this or not?

MS. FRITZ: If I may just ask a couple of questions, I

think it will be clear.

MR. ROOS: There is cross.

THE COURT: If there is an objection that can be

qualified by voir dire, that's fine, but it's not a preview of

a cross.

MS. FRITZ: I have leveled an objection to this. The

government is aware of this and, yes, I would like to ask --

THE COURT: So you're objecting to it?

MS. FRITZ: Yes, I am.

THE COURT: Overruled. The exhibit is received.

(Government's Exhibit 45 received in evidence.)

MR. ROOS: Can you publish this to the jury, Ms.

Fetman.

A. I'm sorry?

Q. Ms. Borrison, please take a look at the top of this

document.

MR. ROOS: Ms. Fetman, if you would zoom in on the top

where it says "Retrieved Enumeration Detail Printout" down to

this first line.

Ms. Borrison, take a look at the top of this document.

Who was the applicant for the Social Security number here?

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A. Raheem Jefferson Brennerman.

Q. Who filed the application?


Q. Where do you see that on the document?

A. Where it says "in-person interview," and there is a "Y"

indicating yes.

Q. Address as provided by the applicant?

A. 245 Park Avenue, 24th floor, New York, New York 10167.

Q. What citizenship does the application say the applicant

has?

A. Lawful alien, allowed to work.

Q. Where do you see that?

A. Next to citizenship.

Now, Ms. Fetman, can you zoom out from this and please

highlight the next section where it says "Proof of Identity."

Q. Ms. Borrison, what proof of legal status in the United

States did the applicant provide?

A. His foreign passport and an I-94 arrival/departure record.

Q. Do you see where it says "admission class or status?"

A. Yes.

Q. What does it say there?

A. An L-1 visa.

Q. Now looking back at the top of this document, the address

you read, 245 Park Avenue, do you have an understanding whether

this is a home or business?

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A. I'm not aware.

Q. Generally, is there a practice as to what type of address

should be listed on a visa application?

A. On a visa application?

Q. I'm sorry. On a Social Security Administration

application.

A. It would be a location where the individual who is applying

would either reside or have some affiliation with since the

Social Security cards are mailed. So they would need to

retrieve the cards once they are mailed.

Q. I am showing you what is in evidence as Government Exhibit

11.

Ms. Borrison, can you open up what I have handed you,

Government Exhibit 11.

What is it?

A. This is Mr. Brennerman's passport.

Q. What is the number on the passport?

A. 508212253.

Q. Looking at Government Exhibit 45, what is the number on the

passport that was used to apply for the Social Security card?

A. 508212253.

Q. How do those numbers compare?

A. They are the same number.

Q. Now, flip to about the fourth page in the document.

THE COURT: Fourth page in the passport?

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MR. ROOS: In the passport she is holding.

Q. Did you find it?

A. Yes.

Q. What's there?

A. Mr. Brennerman's visa.

Q. What is the name on the visa?


Q. What type of visa it?

A. An L-1 visa.

Q. What class or status of visa was used to get the Social

Security card number?

A. An L-1 visa.

Q. Was the defendant issued a Social Security card number?

A. Yes, he was.

Q. I show you what is in evidence as Government Exhibit 12.

What is this?

A. A Social Security card.

Q. Is there a name on the card?


Q. How about a number?

A. Would you like me to read the number?

Q. How about the last four digits.

A. 2470.

Q. How does the number on the card compare to the number on

Government Exhibit 45?

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Q. Now, when Mr. Brennerman was issued -- let me first ask,

when was Mr. Brennerman issued a Social Security number?

A. December 10, 2012.

MR. ROOS: Now, Ms. Fetman, can you zoom in on the

last section of Government Exhibit 45.

Q. Ms. Borrison, do you see where it says "FO code?"

A. Yes.

Q. What does that stand?

A. That is the field office code for the Social Security

office that handled the application.

Q. What field office does that code correspond to?

A. This is an office on William Street in Manhattan, New York.

Q. Where was the Social Security card mailed in this case?

A. It was mailed to the address the applicant provided, 245

Park Avenue, 24th floor, New York, New York 10167.

Q. You referenced an interview. Does the application indicate

where that took place?

A. It would be at the field office that handled this

application, that processed the application.

Q. And that was in Manhattan, New York.

A. That was on William Street in Manhattan, New York, correct.

MR. ROOS: No further questions.

THE COURT: Cross-examination.


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HC48BRE2 Borrison - Cross

CROSS-EXAMINATION

BY MS. FRITZ:

Q. Good morning Ms. Borrison. I am Maranda Fritz. I

represent Mr. Brennerman. Just a few questions.

You indicated early on in your direct examination by

Mr. Roos, I believe you identified the document that we are

looking at, Government Exhibit 45, as an application.

Do you recall describing it that way?

A. Correct.

Q. If we could just take a look at it. This is a printout, a

computer printout, correct?

A. Correct.

Q. So in the traditional sense of someone filling out an

application, that's not what this is?

A. No. It's not a handwritten application.

Q. In fact, it's called a Retrieved Enumeration Detail

Printout, correct?

A. Yes.

Q. This was something that was printed out from Social

Security that includes information that was provided by an

applicant?

A. Correct.

Q. You indicated that the applicant presented a passport,

508212253, is that correct?

A. Yes.

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HC48BRE2 Borrison - Cross

Q. Do you know whether that's a passport issued by the UK?

A. By the United Kingdom, yes.

Q. And you indicated that the applicant also spoke with

someone with respect to the information contained in here?

A. Yes.

Q. And the applicant presented evidence that he had obtained

an L-1 visa, is that correct?

A. Yes.

MS. FRITZ: That's it. Nothing further.


MR. ROOS: No.

THE COURT: You can step down.

Thank you, Ms. Borrison.

(Witness excused)


MS. SASSOON: Helen Memar.

HELEN MEMAR,



THE COURT: If you could state your name and spell

your name for the record.

THE WITNESS: Helen Memar, H-E-L-E-N, M-E-M-A-R.

THE COURT: Ms. Memar, keep your voice up nice and

loud.

You may proceed, Ms. Sassoon.

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HC48BRE2 Memar - Direct

DIRECT EXAMINATION

BY MS. SASSOON:

Q. Good morning, Ms. Memar.

A. Good morning.

Q. Where do you live?

A. Las Vegas, Nevada.

Q. Where do you work?

A. I'm a mobile notary for A1 Document Services.

Q. How long have you been a mobile notary?

A. Five years.

Q. What does that mean to be a mobile notary?

A. A mobile notary, if someone needs a notarization done, they

can call up and you will come to them to get the notarization

done. They don't have to leave their home or wherever they

want to meet.

Q. What does it mean to do a notarization?

A. When you're notarizing a document, you're verifying the

identity of the person who is signing the documents to make

sure that that is the one who is supposed to be signing.

Q. When you notarize something, how do you typically indicate

you have notarized on it the document?

A. When you go to notarize someone, first you're going to

check their ID, and then when you actually write it in your

book, you have a notary log, then when you notarize the

document itself, you're going to sign it, that you witnessed

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HC48BRE2 Memar - Direct

it, and then you will put your stamp.

Q. Did there come a time when you met Raheem Brennerman?

A. Yes.

Q. Approximately when was that?

A. November 2013.

Q. What were the circumstances?

A. He had called our office to get a notarization done.

Q. Where did you go?

A. I went to the Mandarin Oriental in Las Vegas.

Q. I would like to show you Government Exhibit 1-5, which is

already in evidence.

MS. SASSOON: Please display it for the jury.

Q. Looking at the first page, this is a Blacksands Pacific

loan agreement dated as of October 25, 2013.

Let's turn to page 6.

Do you recognize this?

A. Yes.

Q. What do you recognize this as?

A. This is definitely something that I signed and I stamped.

Q. Is that your stamp on the left side of the page?

A. Yes, it is.

Q. Zooming back out, what signature or signatures does your

notary stamp correspond to?

A. My stamp corresponds to the Raheem Brennerman.

Q. When you notarized this, who was there?

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HC48BRE2 Memar - Cross

A. Raheem J. Brennerman was the only one there.

Q. Looking above that, just to be clear, was a person named

Michael Sloanes there too?

A. No.

MS. SASSOON: No further questions.


MS. FRITZ: Thank you, your Honor.

CROSS EXAMINATION

BY MS. FRITZ:

Q. Good morning Ms. Memar. My name is Maranda Fritz.

You met with Mr. Brennerman in Las Vegas on many

different occasions, correct?

A. No.

Q. Have you previously spoken with the government in relation

to this matter?

A. When you say government --

Q. Any of these folks at this table.

A. I was asked to come here.

Q. But before you were asked to come here, did you talk to

folks from the Department of Justice who asked you a series of

questions about your notarizations for Mr. Brennerman?

A. I've only done a notarization one time for Mr. Brennerman.

Q. Do you have any recollection of telling Mr. Ellard and

others that -- maybe it wasn't you -- that A1 Document Services

has done many different document notarizations?

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A. Yes. Yes. The company, different notaries.

Q. So different individuals had dealt with Mr. Brennerman in

Las Vegas?

A. Yes.

Q. Do you know approximately how many instances there were?

A. I have no idea.

Q. So in one of those instances you went over to the hotel and

notarized the signature?

A. Correct.

Q. When you did that, you would have had information that was

then written into your book?

A. Yes.

Q. With respect to that process, correct?

A. That's correct.

Q. What is the information that goes into your book?

A. Normally it would be a driver's license, unless the person

didn't have one. So you would write in their name, the

driver's license number, their address, all of that, when it's

issued, when it expires. You would also put in what type of

notarization you did, and generally they would sign and they

would actually do a thumbprint.

Q. In your book?

A. Yes.

Q. If there was more than one individual that was present with

a notarization, that would be reflected in your book?

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987


(212) 805-0300


A. Correct.

Q. Were you able to provide a copy of the book entries

relating to this notarization?

A. OK. Normally I would be able to, but I had a house fire in

2015 and my house burned down to the foundation. So I do not

have my book to show.

However, after I do a notarization, I also do, for the

tax purposes, I have a gas mileage log and also I want to make

sure I get paid correctly too. So I keep track of everything I

have done. And I did send a copy of the gas log that shows

that I went to the -- well, shows where I went on that date,

who I notarized for, and the fees that would have been owed to

me and gas mileage.

If there was another person, I would have put both

names on that as well.

The only reason that I have that log still is because

actually when the end of the year came, I didn't know how to do

Excel, so I asked my boss to put a new year in for me, for

2014, so she had a copy. Otherwise, I wouldn't have had that

information either.

Q. So that reflects your visit to the Mandarin that day?

A. Yes.

MS. FRITZ: If we could pull up 1-5.

Q. Page 6 of that document is the page where there are two

signature blocks, correct?

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A. Yes.

Q. Ordinarily, where there are two signature blocks and a

notarization at the bottom, does that ordinarily reflect

notarizing of the signatures above?

A. Well, to me this shows that I notarized the signature on

the bottom because it's right across from that signature. I

would have wrote that I was doing both names had I signed both

people.

Q. Where would you have written that?

A. I would have written it -- underneath where it says "County

of Clark," I would have written it in.

Q. Have you ever written in things below County of Clark with

respect to your notarization of signatures on a page?

A. Yes.

Q. What would you write in?

A. You could write in that it was acknowledged or it was sworn

to. You can put notarial language in there.

Q. But as it stands, what we have is the signatures of the two

individuals and then your notarization below it. OK.

When did the government first contact you about this?

A. I think it was about a couple of weeks ago.

Q. OK. Do you recall who contacted you?

A. Mr. Ellard.

Q. How many notarizations have you done in between the time of

this years ago and sitting here today?

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1237


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(212) 805-0300

HC48BRE2 Memar - Redirect

A. Probably hundreds.

Q. OK. So Mr. Ellard called and asked you about this

particular notarization?

A. Yes.

Q. You were able to recall this particular event years ago?

A. Well, let me just explain. Normally 98 percent of the work

I do is refinance documents, reverse mortgages, first-time

homebuyers. Very rarely do I do private signings like this

one. So I actually did remember that -- something this big

must have been, I was thinking, at the City Center because I

did go to the Cosmopolitan, the Mandarin Oriental a few of

times. So it stuck out. It's not a normal thing I do.

Q. Do you recall meeting and dealing with Mr. Brennerman that

day?

A. Yes.

MS. FRITZ: Nothing further. Thank you.


MS. SASSOON: Brief.


BY MS. SASSOON:

Q. Let's keep 1-5 up on the screen, please, page 6.

Do you recall on cross-examination Ms. Fritz asked you

whether if you were notarizing both signatures you would have

indicated that in some fashion?

A. Yes.

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(212) 805-0300


Q. Can you describe what you have written underneath your

stamp had this been a notarization for both signatures?

A. Yes. I would have just said that this has been

acknowledged before me, Helen Memar, notary public, by, and the

two names would have been there.

Q. I would like to show you what has been marked for

identification only as Government Exhibit 1000.

Ms. Memar, do you recognize this?

A. Yes.

Q. What is it?

A. This is my gas mileage and record of notarizations that I

keep in the computer.

MS. SASSOON: The government offers Exhibit 1000.

THE COURT: Any objection? Have you seen it?

MS. FRITZ: I do have it.

No objection.

THE COURT: So Government Exhibit 1000 is received.

Show the jury.

(Government's Exhibit 1000 received in evidence)

BY MS. SASSOON:

Q. Can you walk us through who is reflected in this record?

A. Yes. The first thing I put down is the signing date, which

says November 20, 2013. The last name of the borrower, which

is Brennerman. Usually there is a PO number if it's for a

company, but it was just for a person, so it says private.

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(212) 805-0300


The mileage start, which was 101,812, and the mileage

end, 101,850. So the total mileage was 38 miles. And the

value of the fees was $20, but the moneys due is 40 because

there is also a $20 fee for traveling. And then I was paid

$40.

Q. If you were notarizing a document for more than one person,

would you list all of the names under borrower's last name?

A. Yes.


THE COURT: Recross?


THE COURT: Thank you very much. You may step down.

(Witness excused)


MR. SOBELMAN: The government calls James Lewis.

JAMES LEWIS

called as a witness by the Government,


THE COURT: State your name and spell your name for

the record.

THE WITNESS: James Lewis, J-A-M-E-S, L-E-W-I-S.

THE COURT: Mr. Lewis, much louder. It's a cavernous

courtroom. So stay close to the mic, but don't trail off at

the end.

Go ahead.

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1240


992


(212) 805-0300

HC48BRE2 Lewis - Direct

DIRECT EXAMINATION

BY MR. SOBELMAN:

Q. Good morning.

A. Good morning.


A. I work for Citibank in Buffalo.

Q. For approximately how long have you worked at Citibank?

A. I have been there for 12 years.

Q. What is your position with Citibank?

A. I am vice president of global payment operations.

Q. Approximately how many employees do you manage?

A. Around 30.

Q. Are you familiar with wire transfers?

A. Yes.

Q. As part of your role as vice president of global payment

operations, do you deal with wire transfers?

A. Every day.

Q. What is a wire transfer?

A. It's an electronic movement of cash.

Q. Generally, how do wire transfers work?

A. Somebody would have to initiate with their bank that they

want funds moved to some other bank or a beneficiary, family

friend.

MR. SOBELMAN: Ms. Fetman, please display for the

witness what are marked for identification Government Exhibit

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1241


993


(212) 805-0300


534 and 535.

Q. Mr. Lewis, do you recognize these?

A. Yes.

Q. What are they?

A. These are records that are held by Citibank for every wire

that comes through.

Q. Have you reviewed these particular records previously?

A. Yes.

Q. Are records like these made by Citibank for absolutely

every wire transfer it sends or received?

A. Yes.

Q. Are they kept in a database by Citibank?

A. That's correct.

Q. Are these two records true and accurate copies of wire

transfer records maintained by Citibank?

A. Yes.

MR. SOBELMAN: Government offers 534 and 535.

MS. FRITZ: No objection.

THE COURT: Government Exhibits 534 and 535 are

received.

(Government's Exhibits 534 and 535 received in

evidence)

MR. SOBELMAN: Ms. Fetman, would you please display

what are now Government Exhibits 534 and 535.

BY MR. SOBELMAN:

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1242


994


(212) 805-0300


Q. Mr. Lewis, generally what does this show?

A. This shows that $4.4 million was transferred on December 3,

2013.

Q. Let's take a look at some of that information.

MR. SOBELMAN: If you can highlight the top left

quadrant.

Q. What does "transaction" mean?

A. That's the date the transaction went complete.

Q. Can you say what the date is listed here?


Q. What does "FTN in time" mean?

A. FTN means the fund transfer network and that's us receiving

the instructions at 10:29 a.m.

MR. SOBELMAN: Ms. Fetman, let's take a look at the

top right quadrant.

Actually, you can include the status line above that.

Q. What does "status: final" mean?

A. That's just showing the transaction is complete.

Q. Here under debit amount and credit amount, the amounts

listed are $4.4 million. What do those amounts mean?

A. It means the funds were sent by a party and they were

debited for them, and the credit was the final beneficiary

receiving the funds.

Q. Just to be clear, $4.4 million came out of one bank account

and then $4.4 million was deposited in another bank?

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995


(212) 805-0300


A. Correct.

MR. SOBELMAN: Ms. Fetman, let's turn to the next page

and please highlight the top half.

Q. From what bank did the money come from in this particular

wire transfer?

A. JP Morgan Chase in New York.

Q. Does that mean the account it came from was held in New

York, New York?

A. It could be. I can't tell off of this screen.

Q. Just to be clear, this is the bank that the money came

from, correct?

A. Correct.

Q. It was JP Morgan Chase Bank in New York, New York?

A. Correct.

Q. What bank account was the money sent to?

A. It was sent to an account Blacksands Pacific Alpha Blue,

LLC, and that's in Texas.

Q. Is that a Citibank account?

A. That's correct.

MR. SOBELMAN: Let's take a look at the next page.

Ms. Fetman, if you can highlight the top half.

Q. This part is a little difficult to follow. Maybe you can

help us walk us through it.

Looking at this page, can you tell who initiated the

wire transfer?

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1244


996


(212) 805-0300


A. ICBC London initiated the wire through their bank JP Morgan

Chase in New York.


A. You will see up at the top the sender, third line, sender

is JP Morgan Chase, and on the previous page we saw that was in

New York. And the line beginning with 512 is the originator.

They asked to have the funds transferred.

Q. After ICBC London requested the transfer, where was the

money sent from?

A. So it was sent from that account, ICBC, which is 40095192,

which could be held on JP Morgan Chase's books in New York, and

was sent to Citibank New York. Line 221 shows the receiver,

Citibank.

Q. Where was the money ultimately deposited?

A. Just like the previous page, line 422, the beneficiary was

deposited into that account number, Blacksands Pacific Alpha

Blue, LLC.

Q. Where was that bank account located?

A. In Texas.

Q. Just to be clear, money came on behalf of ICBC to JP Morgan

New York, and then to Citibank New York, and then ultimately

ended up in Citibank Texas, is that right?

A. That's correct.

Q. When we are talking about New York both for JP Morgan and

Citibank, are we talking about Manhattan?

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997


(212) 805-0300


A. Correct.

Q. By the way, is Citibank insured by the FDIC?

A. Yes.

MR. SOBELMAN: Ms. Fetman, can you please display what

is in evidence as Government Exhibit 535.

Let's take one step back and look at 534 again.

If we highlight the top left quadrant.

Q. It says "in source CHIPS. Can you explain what CHIPS is?

A. CHIPS is another way that people can send electronic wire

transfers and send funds. CHIPS stands for clearing house

interbank payments system.

Q. Is Citibank a member of that system?

A. Yes.

Q. Is JP Morgan a member of that system?

A. Yes.

Q. When wires come through internationally through Citibank in

the CHIPS system, are they routed for a particular place?

A. Everything that comes through Citibank U.S. goes through

CITIUS33, which is 111 Wall Street.

Q. In Manhattan, New York?

A. Yes.

Q. Just to be clear, every one of those CHIPS payments comes

through Manhattan?

A. Correct.

Q. Including this one?

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A. Correct.

Q. Let's take a look at Government Exhibit 535.

MR. SOBELMAN: If you can highlight the top left part

of the page.

Q. What is the transaction date on this one?


Q. And in source here it says CDEX. What is that?

A. It's CitiDirect. It's our own platform that the clients

use.

THE COURT: CitiDirect?

THE WITNESS: CitiDirect, yes.

Q. Is that similar to the CHIPS system?

A. It's an in-house platform for clients where they can go

initiate or start their wires without having to call the bank

or go into the bank if they wanted to.

Q. What time was this wire transfer received?

A. This was received at 1452, which is 2:52 p.m.

Q. Is this the same day as the prior wire transfer we looked

at?

A. Yes.

Q. Roughly four and a half hours later?

A. Yes.

MR. SOBELMAN: Ms. Fetman, if you can highlight the

top right quadrant now, including the status.

Q. Here is says "status final." Can you remind us what that

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(212) 805-0300


means?

A. It means the wire is complete.

Q. Here it lists 1.445 million for both debit amount and

credit amount. What do those amounts mean?

A. One bank account was debited for that amount, sent the

money out of that account, and the other one received the

funds.

Q. Let's take a look at the next page.

MR. SOBELMAN: You can highlight the top half of the

page, please.

Q. From what bank did the money come from?

A. Citibank Texas.

Q. To be clear, that means the account is located in Texas, is

that right?

A. Correct.

Q. To what bank account was the money sent to?

A. It was sent to another account on Citi's books in New York

for Raheem J. Brennerman.

Q. When you say "New York," do you mean Manhattan?

A. Yes.

Q. Let's take a look at the final page of the document.

MR. SOBELMAN: Highlight the top half of the page.

Q. In looking at this page, can you tell who initiated the

wire transfer?

A. Blacksands Pacific Alpha initiated the wire through

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1248


1000


(212) 805-0300

HC48BRE2 Lewis - Cross

Citibank Texas.

Q. Does this show where the money was sent from?

A. Did you say sent from?

Q. Yes.

A. It was sent from their bank account, Blacksands'.

Q. OK. Where is it sent to?

A. Line 57 shows Citibank New York.

THE COURT: Line 57?

THE WITNESS: You will see -- there we go.

MR. SOBELMAN: No further questions.

THE COURT: Cross.


CROSS EXAMINATION

BY MS. FRITZ:

Q. Hi there, Mr. Lewis.

A. Hi.

Q. My name is Maranda Fritz and I represent Raheem Brennerman.

I just need to try to clarify a few things.

This particular transaction where we are seeing money

moving, do you know where the transaction was initiated?

MR. SOBELMAN: Objection. Vague.

THE COURT: Do you understand what she means by

initiated?

MR. SOBELMAN: My objection is it's not clear which

transaction Ms. Fritz is referencing.

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(212) 805-0300


THE COURT: In your view there are two different

transactions here?


Q. Let me try again.

You have talked about a transfer of $4.4 million,

correct?

A. Correct.

Q. And you have shown us some records having to do with

Citibank, correct?

A. Correct.

Q. And JP Morgan, correct? Correct?

A. The records were just Citibank, not JP Morgan.

Q. That's fine.

Where did this transfer come from? Whose $4.4 million

was it?

A. ICBC sent funds, initiated the funds through JP Morgan

Chase New York.

Q. And ICBC is located in London, correct?

A. I don't --

THE COURT: If you don't know.

A. I don't know that.

Q. On the document that was, I believe, 535, you were shown

who the sender was. I believe if we can pull that up, it shows

the address of the sender.

MS. FRITZ: 534 I am told. Sorry. Or I can show the

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1250


1002


(212) 805-0300


witness.

THE COURT: 534?

MS. FRITZ: Just one second, Judge.

Mr. Sobelman, can you confirm the exhibit number for

the document that's on the screen right now.

534, page 3.

Q. So if we can look at that page. If we could look at the

sender information. If you could just read the information

regarding who it was who was transferring this money.

A. 512 shows ICBC London Ltd. London Ltd., 81 King Street,

United Kingdom.

Q. It's actually ICBC London PLC, right?

A. There's two listed there.

Q. OK. So you're looking at the one further down.

What is the difference between the listing that I was

looking at, the first one that says ICBC London PLC, and the

one that's further down?

A. It says the originator bank information and that's the

originator information.

Q. The one that's next to the 502, that tells us who is

sending the money, and then 512 tells us what bank is sending

the money?

A. Correct.

Q. So what we see from this is, the funds that we are talking

about here were sent from ICBC London, a bank, correct?

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1251


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(212) 805-0300


A. According to this, yes.

Q. And the funds, as we have seen, were going to a bank

account called Blacksands Alpha Blue in Texas, correct?

A. Final beneficiary, yes.

Q. Now, somewhere in between, as I understand it from your

testimony, funds end up New York, correct?

A. Correct.

Q. Now, when Mr. Sobelman asked you that question about

whether the funds were actually located in New York, or existed

in New York, you indicated you can't tell.

Do you recall that?

A. I don't remember.

Q. OK. So if you could just explain the reason why a bank in

London sending money to a Citibank account in Houston, why

these funds move through, if they do, the New York area?

A. I can't answer how JP Morgan Chase New York got the funds

because I don't have their paperwork. But it was sent to JP

Morgan Chase, who then further credited it on to Citibank New

York, who furthered it on to our customer in Texas.

Q. Do you have any idea whether any of that was requested by

or known by the individual who is receiving the money?

A. I would not know that.

Q. Do you have any idea whether the sending bank actually was

specifically and deliberately engaging in whatever those

transfers are that occur in between?

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(212) 805-0300


A. I would not know that.

Q. Do the funds that are coming from ICBC London to JP Morgan

Chase, do you know where those funds reside? Do they actually

come to New York?

A. I don't know what you're asking there.

Q. It's a kind of an artificial question because it's a wire

transfer, right?

A. Yes.

Q. There is no money that is actually moving from London and

then landing here in New York, correct? It's a wire transfer?

A. Correct.

Q. The only time the funds exist is they are in a bank account

in London and then ultimately they are deposited into a bank

account in Texas, correct?

A. Correct.

Q. So what we have seen here are sort of wire transfers that

occur somewhere in between?

A. Well, this is one wire transfer. I don't know that there

are many. This is one and the funds in New York are debited

from JP Morgan Chase.

Q. Again, do you know where those funds were held?

A. I don't have JP Morgan's information.

Q. And with respect to Citibank, Citibank served as the entity

that was receiving this deposit, correct?

A. Correct.

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1005


(212) 805-0300


Q. No funds were being disbursed from Citibank's own accounts,

correct?

A. Correct.

Q. And so the funds then land in this account in Houston,

Texas, correct?

A. Correct.


THE COURT: Redirect?

MR. SOBELMAN: No, your Honor.

THE COURT: You can step down. Thank you.

(Witness excused)

THE COURT: Why don't we take our morning break now

and we will pick up again in 10 to 15 minutes.

Don't discuss the case. Take your books with you, and

we will see you in a minute.

All rise for the jury.

(Jury exits courtroom)


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1006


(212) 805-0300


THE COURT: Let's just take stock now. We can do this

again at lunch. How are we doing? How many more witnesses?

What is the ETA on the government's concluding its case?

MR. SOBELMAN: We have approximately nine more

witnesses. We are moving pretty quickly. Only a couple of

them will take a significant amount of time. I think we are in

the same place we were this morning, either sometime today or

first half of tomorrow.

THE COURT: Who is next as a witness?

MR. SOBELMAN: Barry Kane.

THE COURT: How long?

MR. SOBELMAN: Very short.

THE COURT: After that?

MR. SOBELMAN: After that we are looking at Thomas

Kiernan.

THE COURT: How long is he?

MR. SOBELMAN: A little longer than Mr. Kane, but not

very long.

THE COURT: And then?

MR. SOBELMAN: Barry Gonzalez, also fairly short,

followed by Michael Thompson.

THE COURT: Is that going to take us through lunch?

MR. SOBELMAN: I imagine it will.

THE COURT: If they are pretty short, it's only 11:30

now.

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(212) 805-0300


MR. SOBELMAN: We have more if you want me to

continue.

THE COURT: I am just trying to figure out who is on

the horizon.

So let's see where we are at the lunch hour.

You guys can take a break.

(Recess)


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HC4KBRE3

(In open court; jury not present)

THE COURT: Let's get the jury.

Actually, in doing the charge, the government, in one

of their recent submissions, indicated that they wanted me to

instruct the jury on two separate definitions of bank fraud

under the statute. So I wanted to know, is that still the

case, or are you going with just one?

MR. LANDSMAN-ROOS: Based on what we just heard, I

think that's appropriate.

THE COURT: You think what?

MR. LANDSMAN-ROOS: That's appropriate, to instruct

both definitions based on the testimony we just heard.

THE COURT: I'm not sure what the testimony has to do

with it, but you want both.

MS. FRITZ: And, obviously, we object.

THE COURT: Okay. Let's get the jury.


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HC4KBRE3 Kane - Direct

(Jury present)

THE COURT: At this time the government will its next

witness.

MR. SOBELMAN: The government calls Barry Kane.

THE COURT: Okay. Mr. Kane, would you please stand

and raise your right hand.

BARRY KANE,



THE COURT: Please have a seat. State your name and

spell your name for the record.

THE WITNESS: Sure. Barry Kane, B-a-r-r-y K-a-n-e.

THE COURT: Mr. Kane, just keep your voice up nice and

loud.

You may proceed, Mr. Sobelman.

DIRECT EXAMINATION

BY MR. SOBELMAN:

Q. Good morning, Mr. Kane.

A. Good morning.

Q. What organization do you work for?

A. I work for Columbia University in the City of New York.

Q. For approximately how long have you worked for Columbia

University?

A. It will be seven years this January.

Q. What is your position with Columbia University?

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A. It's associate vice president and university registrar.

Q. What are your duties and responsibilities as the university

registrar for Columbia University?

A. It's a broad portfolio. In general, supporting the

administrative and academic needs of the teaching faculty and

all of our students, and with particular emphasis on the

maintenance of all academic records.

Q. How many employees do you manage?

A. About 25.

Q. What kinds of records does your office maintain?

A. We maintain all enrollment, as well as all degree records.

Q. In what form are those records maintained?

A. The older ones, prior to the advent of computers, are

paper, and then the more recent ones are electronic.

Q. Let's take a look at a couple of documents that are already

in evidence.

MR. SOBELMAN: Ms. Fetman, could you please display

what's in evidence as Government Exhibit 1-67.

Q. And if we look at the top, this is an email from the

defendant to Julian Madgett dated May 16, 2013, and there are a

few attachments to the email. Let's take a look at one of the

attachments, which is Government Exhibit 1-67C.

MR. SOBELMAN: Ms. Fetman, if you could please turn to

the fifth page of this document. And if you could highlight

the portion of the second paragraph that reads, "prior to

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returning to New York to attend Columbia University in New York

to study for Master's in finance."

Let's take a look at one other email. Ms. Fetman,

could you please display what's in evidence as Government

Exhibit 1-64. And if you could go to the fourth page of this

document.

BY MR. SOBELMAN:

Q. Looking at the bottom half of the page, this is an email

from the defendant to Scott Stout dated May 15th, 2013.

MR. SOBELMAN: Ms. Fetman, if could you go to the next

page and highlight the portion in the middle of the page that

reads, "prior to returning to New York for a Master's degree in

finance from Columbia University."

Q. Mr. Kane, does Columbia University have a Master's in

finance program?

A. No, no program with that particular name.

Q. Does Columbia University have any Master's degree programs

related to finance?

A. Yes.

Q. What are those?

A. One is offered through the School of Engineering that is a

Master of Science in -- Master of Science in financial

engineering.

Q. Is there any other degrees that are in the finance area

that Columbia offers?

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A. There is one other in the Graduate School of Arts and

Sciences that is a Master of Arts in mathematical finance.

Mathematics and finance.

Q. If an individual received either of those degrees, would

the office of the registrar have a record for that person?

A. Yes.

Q. If an individual simply registered for a class in one of

those programs, but did not receive a degree, would the office

of the registrar have a record for that person?

A. Yes.

Q. In fact, did the office of the registrar have a record for

any person who registered for any class at Columbia or received

any degree from Columbia?

A. Yes. If there was an official registration, even for one

day, we would have a record of that.

Q. Are those records able to be searched for a particular

name?

A. Yes.

Q. Mr. Kane, were you asked to take any steps to evaluate

whether Raheem Brennerman earned a degree or attended classes

at Columbia University?

A. Yes, we were.

Q. What steps did you take?

A. We searched our entire electronic database, both enrollment

and degree.

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Q. When did you conduct that search?

A. Recently.

Q. What were the results of your search for Raheem Brennerman?

A. There were no records associated with that name.

Q. Were you also asked to search for those records for the

name Jefferson Brennerman?

A. Yes.

Q. What were the results of that search?

A. There were no records associated with that name.

Q. Were you also asked to search for those records for the

name Raheem Soetan?

A. Yes.

Q. And what were the results of that search?

A. There were no records with that name.

Q. Were you also asked to search those records for the name

Ayodeji Soetan?

A. Yes.


A. There were no records with that name.

Q. Are those records also able to be searched for a particular

Social Security number?

A. Yes.

MR. SOBELMAN: I just want to grab an exhibit.

Q. I'm going to be displaying what's in evidence as Government

Exhibit 12.

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HC4KBRE3 Kane - Cross

Mr. Kane, were you asked to search for an individual

with the Social Security number 335-67-2270?

THE COURT: 355.

MR. SOBELMAN: Sorry, your Honor.

Q. 355-67-2270?

A. Yes, we were.


A. There were no records attached to that Social Security

number.

Q. Just to be clear, if a person with one of the four names I

listed or the Social Security number that's on the screen right

now registered for any classes or earned any degree from

Columbia University, would that have appeared in your search?

A. Yes, it would.


THE COURT: Okay. Cross-examination?

MR. STEINWASCHER: Yes, your Honor, very briefly.

CROSS-EXAMINATION

BY MR. STEINWASCHER:

Q. I guess it's still good morning, Mr. Kane. My name is

Brian Steinwascher. I represent, along with my colleagues,

Mr. Brennerman.

Let me ask: Does Columbia have any association with

the London School of Economics?

A. We do, yes.

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HC4KBRE3 Kiernan - direct

Q. Is there a program offered by the London School of

Economics that permits students to attend classes at Columbia?

A. There is a joint program, yes.

Q. Do you know what type of program that is?

A. It's offered through our business school, so it would have

to do with business administration.

Q. And in that program, the student is registered through the

London School of Economics?

A. It depends on the year and the program.

Q. But they could be?

A. Yes. But we would have a record of that.

MR. STEINWASCHER: Thank you, your Honor.

THE COURT: Okay. Any redirect?


THE COURT: Okay.

Thank you, Mr. Kane. You may step down.

THE WITNESS: Thank you.

(Witness excused)


MR. SOBELMAN: The government calls Thomas Kiernan.

THOMAS KIERNAN,



THE COURT: Could you move a little closer to that

microphone?

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HC4KBRE3 Kiernan - Direct

THE WITNESS: Sure.

THE COURT: And state your name and spell your name

for the record.

THE WITNESS: Thomas Kiernan, K-i-e-r-n-a-n.

THE COURT: All right. Mr. Kiernan, I guess it's noon

on the nose.

So, go ahead, Mr. Sobelman.

DIRECT EXAMINATION

BY MR. SOBELMAN:

Q. Good afternoon, Mr. Kiernan.

A. Good afternoon.

Q. What's your educational background?

A. I have a computer science degree from St. John's

University.

Q. What organization did you work for after graduating from

St. John's University?

A. I worked for the Federal Bureau of Investigation, FBI.

Q. How long did you work at the FBI?

A. 23 years.

Q. What positions did you hold at the FBI?

A. I started as an ITS, information technology specialist, and

then became a computer scientist.

Q. What were your duties and responsibilities as a computer

scientist with the FBI?

A. I worked for the New York office's cyber division, where I

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did cyber investigations. That included laptop, media,

forensics.

Q. What does forensics mean in the context of electronic

devices?

A. Sure.

Computer analysis. So we take images of drives,

analyze the drives, review the drives.

Q. What organization do you work for now?

A. I currently work for BRG, Berkeley Research Group.

Q. What kind of organization is BRG?

A. A consulting firm.

Q. Do you work at a particular department at BRG?

A. I do.

Q. What is that department?

A. I work for the cyber group at BRG. Cyber practice.

Q. Approximately how long have you worked at BRG?

A. Two years.

Q. What position do you hold there?

A. Associate director.

Q. What are your duties and responsibilities as an associate

director with BRG?

A. Again, we do computer analysis, computer intrusions.

Q. In total, for approximately how many years have you worked

in computer analysis?

A. About 25 years.

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Q. In total, approximately how many computers and other

electronic devices have you examined during your career?

A. Oh, hundreds.

MR. SOBELMAN: Your Honor, I ask that Mr. Kiernan be

deemed qualified as an expert in computer analysis.

THE COURT: Any objection?

MS. FRITZ: No.

THE COURT: Okay.

So Mr. Kiernan is deemed an expert in computer

analysis.

BY MR. SOBELMAN:

Q. Mr. Kiernan, generally, what are the steps you take to

analyze an electronic device?

A. Sure.

After receiving the device, after it's inventoried,

we'll take that device and make a forensic image of it. So,

basically a perfect clone of what we are actually looking at,

so we can put the original away and then review the image

that's created.

Q. I'm now approaching you with what's been marked as


A. Sure.

MR. SOBELMAN: Ms. Fetman, if you could put up on the

monitor Government Exhibit 600. And if you could highlight

paragraph 2.

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BY MR. SOBELMAN:

Q. Mr. Kiernan, do you recognize this exhibit?

A. I do.

Q. Just to reference what's on the screen, this reads, "The

stipulation which was entered previously reads: Government

Exhibit 1 is a Sony VAIO laptop that was seized from the

Brennerman apartment on April 19, 2017."

Mr. Kiernan, what do you recognize this item to be?

A. A Sony laptop.

Q. Did you have an opportunity to analyze this laptop?

A. I did.

Q. How did you go about analyzing it?

A. Again, after receiving the image of it, I was able to use

forensic tools to analyze and review the machine.

Q. By "forensic tools," do you mean pieces of software?

A. Yes.

Q. You don't mean physical tools?

A. No. Software tools to actually look through the image that

was created.

Q. Were you able to determine whether there were any user

profiles associated with the computer?

A. I was.

Q. Was there a user profile by the name of Mike Kelly?

A. No.

Q. Was there a user profile by the name of Michael Sloanes?

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A. No.

Q. Was there a user profile in the name of Annisa Rodriguez?

A. No.

Q. Was there a user profile in the name of Lisa Charles?

A. No.

Q. How many active user profiles were on the computer?

A. One.

Q. What was that profile called?

A. Owner.

Q. In the course of your analysis, were you able to determine

whether any email accounts were accessed from this computer?

A. I was.

Q. And how were you able to determine that?

A. Again, doing some keyword searches, came across email

addresses. The addresses were associated with user -- email

user accounts that were on the laptop.

Q. Did any of those email accounts end in

@blacksandspacific.com?

A. Yes.

Q. Was there any particular program set up on the laptop to

access those accounts?

A. There was.

Q. What was that program?

A. Windows Live Mail, which is a client software. It's kind

of like Outlook, if you ever used Outlook, that allows you to

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log into your mail server, pull down your mail to your local

machine, where you can create mail, delete mail, read mail,

draft mail.

Q. Is it similar to logging into a Gmail account online?

A. No.

Q. Could you explain the difference?

A. Sure.

So, Gmail is Web-based. When you log into your Gmail,

you'll go to the Web and log into your account. With the

Windows Live Mail setup, it still reaches out, but it pulls

your contents down to your local machine, where you can, again,

view them.

Q. When you say "pull down," you mean it saves copies of

emails that are sent and received onto the computer itself; is

that right?

A. Yes.

Q. Were you asked to conduct an analysis of the

@blacksandspacific.com email accounts?

A. I was.

Q. In total, approximately how many emails were there on that

laptop in the @blacksandspacific.com email accounts?

A. Thousands of emails.

Q. What was the approximate time range of those emails?

A. 2010 to 2017.

Q. Were you able to determine how those emails got onto the

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computer?

A. No.

Q. Could you just explain again how Windows Live Mail works?

A. Sure.

MS. FRITZ: Objection; asked and answered.

THE COURT: You're just going to explain it again?

Can you do it in a sentence?

THE WITNESS: Sure.

THE COURT: Okay. Go ahead.

THE WITNESS: Logs in and pulls the email down.

BY THE WITNESS:

Q. And in order for that email to get onto the computer, would

one have to enter a user name and a password for that account?

A. Yes.

Q. Were you able to determine which @blacksandspacific.com

email accounts were accessed on that laptop?

A. I was.

Q. And when the user -- withdrawn.

Was the account R. Brennerman accessed from this

computer?

A. Yes.

Q. Was the account A. Rodriguez accessed from this computer?

MS. FRITZ: Objection to the leading, your Honor.

THE COURT: Sustained.

Go ahead.

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BY MR. SOBELMAN:

Q. Do you recall the email accounts that were accessed from

this computer?

A. I do.

Q. Could you list, to the best of your recollection, which

@blacksandspacific.com accounts were accessed from this

computer?

A. Sure. [email protected],

[email protected], [email protected], mkelly, I

believe, @blacksands.com.

Q. To be clear, was Windows Live set up on the computer for

each of these accounts?

A. Yes.

Q. Were you able to determine the exact dates when each of

these email accounts was accessed on the computer?

A. No, I was not.

Q. Why not?

A. When you log into your email or you access your email,

those records are stored up at your provider's account,

usually. Well, not usually, that's where they're stored. So I

did not have access to get those and look at that data.

Q. So, to be clear, that data is not on the laptop?

A. It's not.

Q. In conducting your analysis, were you able to determine

whether there were any emails between the four email accounts I

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referenced earlier?

A. I was.

Q. Were there any emails on the computer just between the R.

Brennerman account and the M. Sloanes email account?

A. No.


Brennerman email account and the A. Rodriguez email account?

A. No.


Brennerman email account and the M. Kelly email account?

A. No.

Q. Now showing you what's marked for identification as


MR. SOBELMAN: Ms. Fetman, if, on the monitor, you

could highlight the paragraph 3 in Government Exhibit 600,

which reads: "Government Exhibit 2 is a Porsche design

external hard drive that was seized from the Brennerman

apartment on April 19, 2017."

Q. Mr. Kiernan, do you recognize Government Exhibit 2?

A. I do.

Q. What is it?

A. An external drive.

Q. Did you have the opportunity to analyze this drive?

A. I did.

Q. Could you explain external drive, generally what is that?

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A. A drive outside of your main computer that you stored data

on.

Q. Generally, what does this hard drive contain?

A. Backups.

Q. What do you mean by "backups"?

A. Copies of files that aren't from the original machine that

were moved over by the user to this secondary drive.

Q. Do the backups include Web histories?

A. They did.

Q. What is a Web history?

A. It's the places that you visited. So, again, to make your

experience quicker when you're on the Web, you have a history

of the files -- the sites that you have been to, so in Windows,

it's stored, so next time you go to the site, you have -- it

populates faster.

MR. SOBELMAN: Ms. Fetman, if you could just show the

witness what's been marked as Government Exhibit 426.

Q. Mr. Kiernan, do you recognize this document?

A. I do.

Q. What is it?

A. Files downloaded from the Web.

Q. Where did you find this document?

A. On our -- on the external drive.

Q. Is this a fair and accurate copy of a document that was

contained on the hard drive?

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A. It is.

MR. SOBELMAN: Your Honor, the government offers



THE COURT: Government Exhibit 426 is received.



Government Exhibit 426 for the jury. And if you could just

kind of flip through the pages briefly. If you're not able to,

I can move on.

THE COURT: Is it on the jury's screen? Do you have

it?

JURY MEMBERS: Yes.

THE COURT: Is that the size of it?

MR. SOBELMAN: We can come back to that.

BY MR. SOBELMAN:

Q. Were you able to determine how the user obtained this file?

A. Downloaded from browsing it.

Q. What kind of website was it from?

A. Morgan Stanley website.

Q. Were you able to determine the date or approximate date it

was accessed?

A. November 2012.

Q. Does the hard drive contain any emails?

A. Yes, it did.

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Q. Were you able to determine whether the hard drive contains

any emails sent from or to email addresses ending in

@blacksandspacific.com?

A. I was.

Q. Were you asked to conduct an analysis of those emails?

A. I was.

Q. In total, approximately how many emails sent to or from an

@blacksandspacific email address were on this hard drive?

A. Thousands.

Q. What was the approximate time range of those emails?

A. Again, 2010 to 2017.

Q. In conducting your analysis, were you able to determine

whether there were any emails on the hard drive just between

the R. Brennerman email account and the A. Rodriguez email

account?

A. Yes.

Q. Were there any?

A. No.

Q. Are there any emails on the hard drive just between the R.

Brennerman email account and the M. Sloanes email account?

A. No.

Q. Are there any emails on the hard drive just between the R.

Brennerman email account and the M. Kelly email account?

A. No.


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HC4KBRE3 Kiernan - Cross


MS. FRITZ: Thank you, your Honor.

CROSS-EXAMINATION

BY MS. FRITZ:

Q. Mr. Kiernan, just starting where Mr. Sobelman left off, he

was just asking you a number of questions about the hard drive.

Do you recall that?

A. External hard drive?

Q. Yes.

A. Yes.

Q. And the questions were the same as the ones he asked you

about the computer, correct, in terms of the number of emails

and what was there?

A. Yes.

Q. Didn't you tell us earlier that the hard drive was a copy

of what was on the computer?

A. External drive?

Q. Yes.

A. Yes, it contains a backup of it.

Q. So, when Mr. Sobelman was asking you those questions, it is

the same data that you had already looked at on the computer,

correct?

A. I can't say a hundred percent because I'm sure there were

files on one that weren't the same as the other.

Q. Okay. But it appears to essentially be a copy of the

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material contained on the laptop itself?

A. Basically.

Q. Okay.

A. It's not everything. Again, it's just a backup of what was

on the original.

THE COURT: Just so I'm clear, a person -- not

Mr. Brennerman, any person would get a backup to -- would get

that -- what are we calling that?

THE WITNESS: External drive.

THE COURT: -- an external drive to back up their old

documents, so they don't clutter up a new computer?


THE COURT: Okay.

BY MS. FRITZ:

Q. Mr. Kiernan, do you know whether that was the case, that

this was historical data that didn't exist on the laptop?

A. I don't know if it was on the laptop. I just know that

some of the files were, some weren't.

Q. Do you know the percentage of files that were on the hard

drive that weren't on the laptop?

A. No.

Q. Do you know whether this is an external hard drive that

somebody used to periodically back up their machine because

that's considered good practice?

A. I can't state for sure. That's the only reason that was

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there.

THE COURT: But that's why people get these?

THE WITNESS: That's why they do, correct.

BY MS. FRITZ:

Q. Now, I want to go back to -- forget the hard drive, okay?

I want to go back to the laptop itself.

You said that you conducted an analysis with respect

to information that was retrieved or extracted from the laptop,

correct?

A. Correct.

Q. The information that you were using for your analysis, was

it the sum total of that which had existed on the laptop?

A. I don't think I understand that. Can you ask that again?

I'm sorry.

Q. Okay. The analysis that you conducted --

A. Right.

Q. -- were you using, when you conducted that analysis,

everything that existed on the laptop, or had someone sliced

and diced data that you would then be able to see?

A. Oh. Everything. So, everything.

Q. Everything?

A. Yes.

Q. Every email that was on there was part of your analysis,

correct?

A. Correct.

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Q. Every document that was on there was part of your analysis?

A. Yes.

Q. Let's go on.

I just want to talk about the sheer volume of that

material. I know you said a couple of times that there were

thousands of emails that existed. Can you quantify that for

the jury? Can you tell us bytes, gigas, teras, whatever?

A. External drive is two terabytes.

Q. It's -- okay.

A. If that helps.

Q. Two terabytes is a whole lot of data, correct?

A. Yeah.

Q. Is there any way that you can just describe for the jury

how much data is two terabytes of data?

A. It's everything you see in front of you, all this paper.

Q. Oh, it's way more than that, right? It would fill the

whole courtroom, wouldn't it?

A. That's something I can't quantify.

Q. Let me try it this way. How many gigabytes is a terabyte?

A. Thousands.

Q. And so how many -- so, a terabyte is a thousand gigabytes?

A. Yes.

Q. So this was two terabytes worth of data that existed just

looking at the hard drive, correct?

A. Correct.

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Q. Can you just generally categorize for us the kind of

material that existed on there?

A. Documents, emails, spreadsheets, PDFs, operating system

files.

Q. Okay. Is it correct that you located on that computer

roughly 30,000 different documents?

A. I don't have a number for you.

Q. All right. Have you previously spoken with the government

in connection with this case?

A. Previously --

Q. Have you been communicating with the government?

A. Yes.

Q. And for how long a period have you been communicating with

the government in relation to this case?

A. Six months, I guess.

Q. Your firm -- which is called Berkeley, correct?

A. Correct.

Q. Your firm was hired to do the work that you're talking

about here in the courtroom, correct?

A. That's correct.

Q. So you don't work for the government, correct?

A. Correct.

Q. The government has to come, and it hires Berkeley, and it

pays you guys money to do whatever you're doing?

A. Yes.

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Q. Any idea, by the way, ballpark, how much it costs to do

what you did?

A. No.

Q. Okay. So you were among the people at Berkeley that was

hired by the government in order to participate in this

analysis, as you put it, correct?

A. Correct.

Q. And during the course of your work with the government, you

have been communicating with, among others, Mr. Roos and

Mr. Sobelman, correct?

A. Mr. Sobelman, yes. I mean, I don't know everybody else on

the list but, yes.

Q. And did you advise those gentlemen at some point back in

May that you had located approximately 30,000 documents on the

computer?

A. I don't recall.

MS. FRITZ: If we could just show the witness

3504-001.

Q. Can you take a look at that, Mr. Kiernan, and tell me if

that refreshes your recollection that you have identified

approximately 30,000 documents?

A. Yes, it does.

Q. Does that refer to email-type documents or document-type

documents?

A. It would be -- well, that's a good question. It would be

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documents, meaning Excel -- most often the OfficeSuite of

documents.

Q. So that would include Word documents, PDF-type documents,

Excel documents?

A. Correct.

Q. But that wouldn't include all of the emails, which are a

different kind of file?

A. It wouldn't.

Q. Okay. And 30,000 documents, by the way, doesn't mean

30,000 pages, right?

A. Correct.

Q. 30,000 documents, each one of those 30,000 documents could

have any number of pages within it, correct?

A. Absolutely, yes.

Q. Did you also determine that you had found on the computer

blacksandspacific.com emails for the time period 1999 to 2017?

A. I don't recall.

MS. FRITZ: If we could take a look at 3504-18.

Q. And while Dwayne is doing that, do you have a recollection

of Mr. Sobelman asking you a question, and you saying that the

Blacksands Pacific emails were for the period 2010 to 2017?

A. Yes.

Q. Now, if you could take a look at this.

MS. FRITZ: This is not 18, is it? 3504-18.

Your Honor, if I may, if I could just show this to the

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witness?

THE COURT: All right. Show it to Mr. Sobelman.

MS. FRITZ: Sure.

BY MS. FRITZ:

Q. The one that's coming up electronically has that same

marking, but different content.

A. Thank you.

Q. Okay?

A. Yep.

Q. Does that refresh your recollection with respect to whether

the blacksandspacific.com emails covered a time range of 1999

to 2017?

A. It does.

Q. Okay. Now, when you took a look at this computer, were you

able to identify a folder structure on the computer?

THE COURT: A folder structure?

MS. FRITZ: Correct.

THE WITNESS: That's your question?

Q. That is my question.

A. I'm sorry. Yes.

Q. Was it a very clearly laid out folder structure?

THE COURT: Is there a reason why this is up?

MS. FRITZ: I don't know.

THE COURT: Let's take that down.

THE WITNESS: I'm sorry, can you repeat that?

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BY MS. FRITZ:

Q. Was it a very clear, organized folder structure on the

computer?

A. Compared to?

Q. Compared to mine.

A. Everyone has folders. There's nothing I can say that says,

yes, that this is a structured -- everyone uses their hard

drives differently.

Q. Were you able to -- or did you see a folder structure that

laid out a series of corporate names, and then within that,

projects or issues associated with that corporate entity?

A. Yes.

Q. And you just said -- very, very briefly, can you just

explain how that folder structure comes to exist on the

computer? Very briefly.

A. The user creates them.

Q. That was --

A. Pretty brief, right?

THE COURT: I didn't hear what you said.

THE WITNESS: I'm sorry. The user creates the folder

structure.

THE COURT: The user creates them?

THE WITNESS: Yeah.

THE COURT: Okay.

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BY MS. FRITZ:

Q. So, now, if we could take a look at Defendant's Exhibit EH.

You know what, let's go, I'm sorry, to EJ first.

A. Got it.

Q. When you were looking at the computer, did you actually

create screenshots that are reflections of, or images of, the

folder structure that existed on the computer?

A. Yes, I did.

Q. The screenshots that you created, do those have, across the

bottom, an identification of the path that you're on that

reflects this folder's structure?

A. The bottom -- what you're pointing out, the bottom reflects

what's in that right pane on the file list. So, the directory

is the bottom, and then on the right pane, that file lists the

files that are in that structure.

Q. And these were created by you during the course of your

work in relation to that Sony laptop in front of you, correct?

A. The screenshots were.

Q. Yes.

A. Yes.

Q. And these are accurate pictures of the folder structure

that exists on that Sony laptop?

A. Yes.

MS. FRITZ: Okay. I offer into evidence EJ.


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MR. SOBELMAN: No objection.

THE COURT: All right. Defense Exhibit EJ is

received.

(Defendant's Exhibit EJ received in evidence)

MS. FRITZ: So it goes to the jury.

THE COURT: This is from a laptop?

THE WITNESS: Laptop.

THE COURT: Or the image of the laptop?

THE WITNESS: Image of the laptop, yes.

BY MS. FRITZ:

Q. If you could just walk us through, what is it that we're

looking at in the left-hand column, and then just explain for

us what's on the right side?

A. Sure.

The left-hand column is where the folder structure is

if you're looking at your hard drive, and you are clicking on

different folders. In this case, it's users, owners,

documents, Blacksands Pacific oil and gas --

Q. Wait, slow down, slow down. Oh, you're dropping -- so,

you're going to owner and then documents?

A. Correct. User's owner's documents. My apologies.

Q. And within documents, you find a series of folders,

correct?

A. That's correct.

Q. And that includes the Blacksands Pacific oil and gas

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folder, correct?

A. Yes.

Q. And if we look down, that would include BLV real estate

folder, correct?

A. BL --

Q. Yes, because I'm not --

A. Yeah, I see --

Q. Is that correct?

A. I don't see it.

Q. What I did was I skipped the subfolders, so I went from

Blacksands Pacific oil and gas to the next folder. Does that

make sense?

A. No.

Q. Okay. The Blacksands Pacific oil and gas folder has a

bunch of subfolders in it?

A. Yes, it does.

Q. And on this particular screenshot, that Blacksands Pacific

oil and gas is open, so that the folders are visible?

A. Correct. The subfolders are visible under Blacksands, yes.

Q. Right. If we go down to the next main folder, BLV Group,

real estate -- do you see that?

A. I do.

Q. -- there's a little plus sign next to it, correct?

A. Yes.

Q. And what does that signify?

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A. There's subdirectories under it.

Q. But those -- for this particular screenshot, those are not

open?

A. Correct.

Q. And then if we go to the next one, it's BLV operating

companies; is that correct?

A. It is.

Q. And the same thing, next to that signifies that if we

clicked on that, we'd see subfolders under that?

A. Yes.

Q. If we continue down, by the way, if you go to below

"Downloads," do you see the word "Dropbox"?

A. Yes.

Q. And there are three folders there all with the word

"Dropbox," correct?

A. Yes.

Q. Each -- two of those, likewise, have a signifier that

there's material within that folder, correct?

A. Yes.

Q. And could you just briefly explain for the jury, what is

Dropbox?

A. A file-sharing service.

Q. So material is uploaded by one individual, so that it can

then be reviewed by other individuals who have access; is that

correct?

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A. Whoever has access to it.

Q. Okay. Now, taking that out, I want to go back up to the

Blacksands Pacific oil and gas folder. Within that folder, we

have various subfolders that include -- the first one is

agreements, correct?

A. Yes.

Q. And so within that one, again -- oh, thank you. Within

that one, we see that there are -- the plus sign on the left,

does that mean that there are documents within that folder, or

does it mean that there are subfolders within that folder or

either one?

A. Either one.

Q. So we know that there's material within that folder,

correct?

A. Correct.

Q. And then we continue down, for example, we see energy

trading and marketing, correct?

A. Yes.

Q. And we've got material that exists within that folder,

correct?

A. Yes.

Q. And then we go down to oil and gas assets - blocks. Do you

see that?

A. Yes.

Q. If we zoom out, and if we look at the bottom, if you look

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at the indicator, can you identify for us what appears on the

right-hand side?

A. The contents of the oil_gas assets - blocks folder.


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HC48BRE4 Kiernan - Cross

Q. And there is no magic to that. It just so happens that

when you took this screenshot, that was the subfolder, the

contents of which you were displaying?

A. Correct.

Q. So within that, we have things like agreements for Africa

farming. Do you know how to pronounce that? Does that refer

to the Ivory Coast?

A. I don't know.

Q. Then we have got Gaffney Cline proposal at the top, right?

A. Yes.

Q. If he then go back to the main listing, there are other

categories -- partnership agreement, vendor list -- correct?

A. Yes.

Q. So would you describe this as a very carefully organized,

clear folder structure that is found in this computer?

A. It's just folders. Again, I couldn't describe what someone

has to make these folders. I don't know the thought process

into it. They are just folders on the computer.

Q. But you do know that in order to have a structure like

this, one has to have established each of those folders,

correct?

A. Correct.

Q. Created them and name them with the various topics or

projects, correct?

A. Name them any way you want, but yes.

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Q. And then populated them with documents that relate to those

particular topics, correct?

MR. SOBELMAN: Objection.

THE COURT: Whether they relate to the particular

topics?

Do you have any way of knowing?

THE WITNESS: I have no idea.

Q. Do you have any knowledge of whether this computer, by the

way, was seized from Mr. Brennerman's apartment?

A. I don't.

Q. As opposed to being simply requested and handed off by him?

A. No.

Q. There was also on this computer tons of financial analysis.

Do you recall that?

A. No.

Q. Do you recall having identified and reviewed with the

government various folders and sub-folders containing lots and

lots of financial analysis?

A. I don't. No, I don't.

Q. You don't recall going through that with the government?

A. Not with the government.

Q. Creating charts for the government of that data?

A. No.

THE COURT: Keep your voice up nice and loud.

Q. If we can take a look at Defense Exhibit EI.

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Is this another screenshot of the folder structure as

well as additional materials that were found on the laptop?

MS. FRITZ: This should not be for the jury.

Q. Is this another screenshot?

A. Yes.

Q. Does this accurately reflect the contents of the laptop,

the folder structure of the laptop that you analyzed?

A. Yes.

MS. FRITZ: I offer into evidence Defendant's EI.


MR. SOBELMAN: No objection.

THE COURT: Defendant's EI is received.

(Defendant's Exhibit EI received in evidence)

Q. OK. Now, having seen this screenshot, is this something

that you actually created?

A. The screenshot, yes.

Q. This was part of the analysis that you did in relation to

the computer?

A. Yes.

Q. And this was part of the analysis that you provided to the

government and went over with the government, correct?

A. The screenshot, yes.

Q. The screenshot, meaning that you had identified these

materials as existing on the laptop, correct?

A. These files were on the laptop, yes.

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Q. And this was a matter that was discussed as between you and

the prosecution, correct?

A. Yes.

Q. Now, can you explain how this folder structure that we are

looking at here compares to the one that we looked at just a

moment ago?

A. Again, just folders and documents. I can't explain the

difference between --

Q. Here is what I am getting at. Under documents, three lines

down it says "Blacksands Pacific Oil and Gas." Do you see

that?

A. Yes.

Q. The one that we looked at a moment ago, that folder was

open, is that correct?

A. Yes.

Q. But the other folder is closed?

A. Correct.

Q. Now, this one has that folder closed and what folder open?

A. Profile corporate structure.

Q. Under profile corporate structure it says -- can you just

explain that folder structure for me? Because it looks like

there is sub and then sub and then sub.

A. That seems correct. Yes, that is correct. It's a primary

folder with sub-folders underneath it.

Q. And this references, for example, Blacksands Pacific

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expenses, correct?

A. Those names, yes.

Q. And there is a whole folder -- OK. And that one clearly

has things within it, correct?

A. Yes.

Q. It also references Blacksands Pacific Nigeria, correct, and

material within there?

THE COURT: Correct?

A. Yes.

Q. Now, if we go back, I just want to take a look very quickly

at what was on the right.

What is contained on the right-hand side?

A. The financial statements folder.

Q. Under Blacksands Pacific, the folder that says "financial

statements" on this picture has a negative sign next to it

instead of a positive sign, correct?

A. Yes.

Q. And that's an indicator that this is the particular folder

that's open?

A. Yes.

Q. And we also know that because it says so across the bottom?

A. Correct.

Q. So these are documents that existed within that folder?

A. Yes.

MS. FRITZ: That's it. Nothing further.

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HC48BRE4 Kiernan - Redirect

Thank you very much.


MR. SOBELMAN: Yes, your Honor, briefly.


BY MR. SOBELMAN:

Q. Mr. Kiernan, do you recall being asked by Ms. Fritz about

whether there were things within certain folders?

A. Yes.

Q. And I believe you indicated that the plus next to them

meant that there were certain things within the folders?

A. Items within the folders.

Q. When you say "items," does that simply mean there are

folders or does that indicate that there are actually

substantive documents?

A. It could be folders or documents.

Q. You don't know whether any of the folders she asked you

about actually have documents in them?

A. No.


THE COURT: Any recross?

MS. FRITZ: No.

THE COURT: Thank you very much. You can step down.

(Witness excused)


MR. SOBELMAN: The government calls Barry Gonzalez.

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HC48BRE4 Gonzalez - Direct

BARRY GONZALEZ,




the record.

THE WITNESS: Barry Gonzalez, B-A-R-R-Y,

G-O-N-Z-A-L-E-Z.

THE COURT: Mr. Gonzalez, just keep your voice up nice

and loud.

DIRECT EXAMINATION

BY MR. SOBELMAN:

Q. Good afternoon, Mr. Gonzalez.

A. Good afternoon.


A. FDIC, Federal Deposit Insurance Corporation.

Q. For approximately how long have you worked at the FDIC?

A. 31 years.

Q. What is your position with the FDIC?

A. Commissioned bank examiner.

Q. What are your duties and responsibilities as a commissioned

bank examiner?

A. Review and analyze the financial condition of a bank, as

well as assess the bank's compliance with applicable laws,

regulations, rules and statutes.

Q. Does the FDIC provide deposit insurance?

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A. Yes, it does.

Q. What is deposit insurance?

A. We insure depositors' accounts up to the maximum amount

allowable by the Federal Deposit Insurance Act.

Q. What is the purpose of deposit insurance?

A. In case the bank fails, the FDIC makes good on depositors'

accounts.

Q. Does the FDIC keep records which banks are insured by the

FDIC?

A. Yes.

Q. What types of records?

A. Certificate of deposit insurance.

Q. Are there also databases that keep information?

A. Yes.

Q. Are those databases electronic?

A. Yes.

Q. I am now going to show you four exhibits, Government

Exhibits 530, 531, 532 and 533. Please take a look at those.

Do you recognize these?

A. Yes.

Q. What are they?

A. These are certificate of deposit insurance.

Q. Are certificates like these made by the FDIC for every bank

the FDIC insures?

A. Yes.

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Q. Are they kept on file by the FDIC?

A. Yes.

Q. Are they created by FDIC employees who have knowledge of

whether an institution is FDIC insured?

A. Yes.

Q. Are these four exhibits true and accurate copies of

certificates issued by the FDIC?

A. Yes.

MR. SOBELMAN: The government offers Government

Exhibit 530, 531, 532 and 533.


MR. STEINWASCHER: No objection.

THE COURT: Government Exhibits 530 through 533 are

received.

(Government's Exhibits 530, 531, 532 and 533 received

in evidence)

MR. SOBELMAN: Ms. Fetman, can you display what is now

in evidence as Government Exhibit 532.

Q. Mr. Gonzalez, can you describe what this exhibit shows?

A. Certificate of deposit insurance for Morgan Stanley Bank

National Association.

Q. What date was this issued?

A. September 23, 2008.

MR. SOBELMAN: Ms. Fetman, would you please put this

side by side with Government Exhibit 529, which is in evidence.

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529 is a bank statement for Morgan Stanley issued to

Raheem Brennerman, dated January 31, 2013.

Ms. Fetman, can you please turn to the fourth page of

529.

Can you please highlight the section below "cash

deposits and money market funds."

It's still fairly small, but I will read a portion of

it.

This shows $200,000.88 held at Morgan Stanley Bank NA.

Q. Mr. Gonzalez, what does NA mean?

A. National Association.

Q. Then there is a pound or hash symbol after that. And if

you look a couple of lines lower, it has that symbol again and

it says, "Bank deposits are at either (1) Morgan Stanley Bank

NA and Morgan Stanley Bank Private Bank National Association,

or (2) Citibank NA, each a national bank FDIC member and an

affiliate of Morgan Stanley Smith Barney LLC."

Mr. Gonzalez, was Morgan Stanley Bank insured by the

FDIC in 2012 and 2013?

A. Yes.


A. I checked with the certificate number to our electronic

database and confirmed it.

MR. SOBELMAN: Ms. Fetman, can you now put up

Government Exhibit 530 and leave up 529.

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Q. Was Morgan Stanley Private Bank insured by the FDIC in 2012

and 2013?

A. Yes.


A. I verified it with our electronic database using the

certificate number.

MR. SOBELMAN: Ms. Fetman, can you please display

Government Exhibit 531 next to Government Exhibit 529.

Q. Was Citibank insured by the FDIC in 2012 and 2013?

A. Yes.


A. I verified it with the electronic database using the

certificate number.


is in evidence as Government Exhibit 534.

I am sorry. Just that.

Could you please highlight on the second page what is

listed under debit party, JP Morgan Chase Bank, New York, New

York 10004.

Now, next to that, can you please display what is in

evidence as Government Exhibit 533.

Q. Mr. Gonzalez, was JP Morgan Chase insured by the FDIC in

2012 and 2013?

A. Yes.


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HC48BRE4 Gonzalez - Cross

A. I verified it using the electronic database with the

certificate number.



CROSS-EXAMINATION

BY MR. STEINWASCHER:

Q. Good afternoon, Mr. Gonzalez. My name is Brian

Steinwascher, and I am here representing Mr. Brennerman.

You testified just a few minutes ago that the FDIC

insures depository accounts, is that correct?

A. Yes.

Q. Does it insure any other types of accounts?

A. No.

Q. Does it insure corporate financing transactions?

A. No.

Q. So it wouldn't insure debt transactions for financing

sought by a corporation?

A. I'm not sure I understand the question.

MR. STEINWASCHER: I will withdraw it.

Q. Does it insure securities accounts?

A. No.

Q. Does it insure any type of investment account?

A. No.

Q. Does it basically only insure what we know as checking and

savings accounts?

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A. Deposit accounts.

Q. Now, we looked at several exhibits that Mr. Sobelman put up

on the screen that reflected certificates of the FDIC

pertaining to Morgan Stanley, is that correct?

A. Yes.

Q. I believe it was Exhibits 530 and 532.

Do I have the numbers right?

A. Yes.

Q. Now, the FDIC insures only that entity listed on that

certificate, correct?

A. Yes.

Q. So are you aware that Morgan Stanley is a large

corporation?

A. Yes.

Q. That Morgan Stanley has different business lines and

different -- withdraw that.

Are you familiar with Morgan Stanley, the fact that it

has an investment bank?

A. No.

Q. Are you not familiar with that because it's not insured by

the FDIC?

A. I need a certificate number in order for me to validate

that.

Q. Were you asked to run searches for all Morgan Stanley

insured accounts with the FDIC for today?

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A. To confirm four institutions.

Q. So it's safe to say that the only entities that have the

name Morgan Stanley in them are reflected on those two

certificates?

A. I'm not sure I understand the question.

Q. That was a little confusing.

As far as the FDIC is concerned, the only two Morgan

Stanley entities that you're aware of that bear the name Morgan

Stanley in them are reflected in those two certificates, 530

and 532?

A. I don't know.

Q. Are there other -- withdrawn.

I guess my question is, if there is a Morgan Stanley

entity that doesn't hold depository accounts, would the FDIC

insure it?

A. I'm not sure I am understanding the question.

Q. Maybe I can rephrase it. I don't have to use Morgan

Stanley.

If there is a bank, right, but it doesn't have any

depository accounts for its customers, would the FDIC be

involved with that bank in any way?


THE COURT: You can answer it. Go ahead.

A. It would have to file for deposit insurance, and we would

have to opine on the application, on whether we approve it or

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don't.

Q. If it had no depository accounts, would there be any reason

for it to need FDIC insurance?

A. I'm not certain.

Q. Does FDIC insurance cover anything else other than

depository accounts?

A. No.

Q. So if there is a company that has many different

sub-entities, some of those that hold depository accounts and

some of those that don't, a financial institution I should say,

it's safe to say the FDIC would only offer insurance to those

portions of the company that handle depository accounts?

A. You kind of lost me. Can you repeat that?

Q. If there is a financial institution that has one division

that covers investments and another division that covers

depository accounts, would the FDIC insure the division that

covers investment banking?

A. If it does not have a certificate of deposit insurance it

would not.

Q. If it had no depository accounts, there was no reason for

that institution to seek a certificate of insurance?

A. I can't opine on what someone would want to do, in terms of

seeking insurance or not seeking insurance.

Q. Well, there would be nothing for the FDIC to insure in that

instance, is that correct?

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Move on.

MR. STEINWASCHER: Can we go to Exhibit 529.

Can I ask the government's indulgence. I don't think

we have an electronic version of this. The same page that Mr.

Sobelman showed the witness, page 4.

Thank you. I appreciate that.

Q. Mr. Gonzalez, you looked at this with Mr. Sobelman a few

minutes ago, correct?

A. Yes.

Q. I think he directed you to the kind of italicized text,

almost toward the bottom of the page under "cash deposits and

money market funds," correct?

A. Yes.

Q. Then he put up on the screen next to this statement the two

certificates of insurance from the FDIC that pertain to Morgan

Stanley Bank NA and Morgan Stanley Private Bank National

Association, correct?

A. Yes.

Q. Morgan Stanley Bank NA and Morgan Stanley Private Bank

National Association, are those the same entity?

A. The same entity as what?

Q. As each other.

A. No. They have distinct certificate numbers.

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Q. OK. I am not sure it's reflected on this page, but maybe

on the first page of this exhibit.

You see at the bottom here, on the bottom left, there

is an italicized text that reads "Morgan Stanley Smith Barney

LLC"?

A. It's hard for me to see.

Q. Do you see that text now?

A. Yes.

Q. Are you aware if Morgan Stanley Smith Barney LLC is insured

by the FDIC?

A. I'm not aware of that.

Q. Did you conduct any search to confirm that?

A. No.

Q. The rest of this text, it has "member SIPC." Do you see

that?

A. Yes.

Q. Are you familiar with that acronym SIPC?

A. I'm not familiar with that acronym.

Q. Does that, as far as you know, pertain to the FDIC in any

way?

A. No.

Q. Does the FDIC insure banks outside of the United States?

A. No.

Q. So if there is a bank located in London, in the United

Kingdom, that would not be covered by the FDIC?

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A. Not without a certificate of deposit insurance.

Q. I just want to clear this up. Your answer to my previous

question was the FDIC does not insure banks outside of the

United States.

A. A foreign bank?

Q. Correct.

A. No.

Q. So if there is a foreign bank located in London, even if it

held depository accounts, the FDIC could not insure it, is that

correct?

A. That is correct.

Q. I apologize for this. I want to go back to one point.

Those two Morgan Stanley banks that we looked at,

those two entities that had certificates of insurance with the

FDIC, if an entity is a subsidiary of a parent in a financial

institution, does the fact that the subsidiary is FDIC insured

also mean that the parent is FDIC insured?

A. Can you repeat that? I'm not sure I understand.

Q. Does FDIC insurance for a financial institution, which is a

subsidiary of another financial institution, so the FDIC has

issued a certificate to that subsidiary, does that certificate

somehow also cover the parent corporation?

A. No.

Q. So the parent entity would need a separate certificate of

insurance?

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HC48BRE4

A. Yes.

Q. The same thing for an affiliate within a company or

affiliates between companies, each entity would require a

separate certificate of insurance in order to be FDIC insured?

A. That is correct.

MR. STEINWASCHER: We are just about approaching lunch

and I am done with this witness.



THE COURT: Why don't we break then. We will pick up

at 2.

Don't discuss the case and bring your books with you

into the jury room, but don't take them outside of the jury

room. Have a good lunch.

All rise for the jury, please.


THE COURT: You can step down. Thank you very much,

Mr. Gonzalez.

Have a seat. Let's talk about what we have left and

an ETA.

MR. ROOS: We have six witnesses remaining, two of

them are on the longer side and the other ones are about the

length that some of these shorter witnesses have been today.

And we also have three stipulations to read into the record at

some point. We can do it right after lunch.

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HC48BRE4

THE COURT: So we might finish today.

MR. ROOS: Our sense is that we will either finish

today or the last witness, which will be a longer one, we will

either start tomorrow morning or carry us into tomorrow

morning.


Then, Ms. Fritz, are you planning on putting on a case

at this point?

MS. FRITZ: That decision is still being made.

THE COURT: With respect to any witnesses at all or

just with respect to Mr. Brennerman?

MS. FRITZ: With respect to Mr. Brennerman.

Now, we do have a couple of issues that we still are,

I think, ironing out, having to do with, for example, the I-129

petition. But I think we have got those sort of resolved, so I

don't think there would be any other need to call document

custodians.

THE COURT: Let's see where we are after the break

this afternoon.

Anything else we should chat about now before we break

for lunch?

MR. ROOS: Nothing else from the government.

THE COURT: Let's take a break. I will see you a

little before 2. Thank you.

(Luncheon recess)

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HC48BRE4 Walkup - Direct

AFTERNOON SESSION

2:00 p.m.



(Jury present)

THE COURT: Government is going to call its next

witness.

MR. SOBELMAN: The government calls Gardner Walkup.

GARDNER WALKUP,




the record.

THE WITNESS: My name is Gardner Walkup, that's

G-A-R-D-N-E-R, last name is W-A-L-K-U-P.

THE COURT: Go ahead, Mr. Sobelman.

DIRECT EXAMINATION

BY MR. SOBELMAN:

Q. Mr. Walkup, would you pull the microphone close to you.

Good afternoon, Mr. Walkup.

A. Good afternoon.

Q. What organization do you work for?

A. I work for Berkeley Research Group, BRG.

Q. What is BRG?

A. It's a consulting firm.

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Q. What is your position with BRG?

A. I'm a managing director.

Q. What your duties and responsibilities as a managing

director with BRG?

A. So I have mainly two. Firstly is with regards to business

development, and secondly, that's providing consulting services

for my clients.

Q. What types of consulting services do you provide?

A. There's two types. One is what we call advisory services,

and this is providing management consulting to clients. And

the other is in dispute matters, providing expert testimony

work.

Q. Do you focus on a particular industry?

A. I do.

Q. What industry?

A. Generally, energy, but with a specific focus in oil and

gas.

Q. Are you being paid in connection with this case?

A. I am.

Q. What is your hourly rate?

A. It's $725 an hour.

Q. Does that rate vary at all depending on the outcome of this

case?

A. No, it does not.

Q. Let's take a step back. Can you describe your educational

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background?

A. I have an undergraduate degree in chemical engineering from

the University of California, Davis, and I have a master's in

petroleum engineering from Stanford University.

Q. What is petroleum engineering?

A. Petroleum engineering is the study and practice of

extracting hydrocarbons, hydrocarbons being oil or natural gas,

and extracting those from the subsurface and bringing them up

and delivering them to market.

Q. What is the subsurface?

A. Hydrocarbons are found typically underground, and so when I

say subsurface, I mean where they are located, deep

underground.

Q. Generally, what types of jobs have you had since earning

your degrees in chemical and petroleum engineering?

A. After leaving Stanford, I joined Chevron, where I worked in

their upstream research organization, which was in the LA, Los

Angeles area. I was there for about five years. I then took

an operations job in Indonesia, in Sumatra, where I lived for

about five years, and worked as a senior reservoir engineer on

a large oil field in Indonesia. I came back to the United

States and worked in New Orleans as the senior petroleum

engineer for a large exploration project offshore in the Gulf

of Mexico.

Q. What types of jobs have you had since then?

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A. After that period of time, I left Chevron and got into

management consulting and have worked at a number of consulting

firms, small, big ones, providing advice to oil and gas

companies, making investments in upstream oil and gas projects.

Q. What do you mean by upstream?

A. Upstream is that part of the business that has to do with

the exploration and production of hydrocarbons.

Q. Have you previously testified as an expert on the oil and

gas industry?

A. Yes, I have.

Q. Approximately how many times?

A. Five times.

Q. Have you ever testified for the defense?

A. So most of the work I do is in international arbitrations.

So in those cases, there are claimants and respondents, and I

have worked for both sides of those.

Q. Where have you testified?

A. In New Orleans, London, Paris, New York, and Washington,

D.C.

MR. SOBELMAN: The government requests that Mr. Walkup

be deemed an expert in the oil and gas industry.


MR. WALLER: No objection.

THE COURT: Mr. Walkup is recognized as an expert in

the oil and gas industry.

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Q. Mr. Walkup, are you familiar with leases for oil production

operations?

A. Yes.

Q. What does it mean to have a lease for an oil production

operation?

A. So the lease gives you the right to conduct an oil field,

oil operations, exploration, development or production of the

actual hydrocarbon.

Q. Were you asked to research whether Raheem Brennerman leased

any oil production operations in the United States?

A. Yes, I was.

Q. What types of research did you do?

A. So, really, the type of research took three different

forms. One, I have access to databases of all the leases in

the United States, because those are part of the regulatory

requirements that the government has that information and

commercial companies sweep that into databases. That was the

first piece of research I did. The second piece of the

research I did was I reviewed the technical literature around

different assets and different plays. And the third element

was looking within the general business literature that's

available publicly.

Q. What do you mean by technical literature?

A. Available to the upstream oil and gas business is really

very technical. There is a lot of information that is shared

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between companies at a technical level, in case studies, about

how operations are run, how new technologies are employed, and

that's the technical literature that I referred to.

Q. What do you mean by business literature in your third

category?

A. The business literature has to do -- I searched that,

firstly, through the Internet, and it has to do -- what I focus

on are the legacy of particular businesses or particular assets

in different places in the world.

Q. What do you mean by the legacy of a particular business or

asset?

A. So the life cycle of an asset follows a pretty natural

progression. It starts with exploration, and then it goes

through a period of what we call delineation, where the

companies are trying to decide how big it is and what they

might do with it. Then it goes into development, and then it

goes into production. And at each of those main steps, there

is usually a good bit of information that is shared, and you

can find out about those properties in that way.

Q. For Raheem Brennerman, what were the results of your

research?

A. I didn't find any indications of their owning any leases.

Q. Were you asked to research whether Jefferson Brennerman

leased any oil production operations in the United States?

A. Yes, I did.

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Q. What were the results of your research?

A. Similar. I didn't find any indication that they owned any.

Q. Were you asked to research whether Raheem Soetan leased any

oil production operations in the United States?

A. Yes.


A. The same.

Q. Were you asked to research whether Ayodeji Soetan leased


A. Yes, I was asked.


A. No indication that they owned any leases.

Q. Do oil production operations sometimes have operators who

do not hold the lease?

A. It's possible, but it's pretty uncommon.

Q. What does it mean to be the operator of an oil production

operation?

A. So most oil and gas properties have multiple owners, they

all have some share of that property, and they elect one of

them to be the operator of that property, and that operator

then conducts all the operations at the different life cycles

of the process.

Q. Were you asked to research whether Raheem Brennerman

operated any oil production operations in the United States?

A. Yes.

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Q. What were the results of that research?

A. I found no indications that they were operators.

Q. What type of research did you do to reach that conclusion?

A. The same kind of research that I referred to before.

Q. Were you asked to research whether Jefferson Brennerman


A. Yes.


A. I found no indication that they were operators in the

United States.

Q. Were you asked to research whether Raheem Soetan operated


A. Yes.


A. Again, no indication that I could find that they were

operators.

Q. Were you asked to research whether Ayodeji Soetan operated


A. Yes.


A. Similar to your other question, I could not find any

evidence that they were operators.

Q. Mr. Walkup, were you asked to conduct similar research for

a group of corporations?

A. Yes.

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Government Exhibit 1-1B.

Can we flip to page 9, please.

Q. Mr. Walkup, did your research include all the company names

listed here?

A. Yes.

MR. SOBELMAN: Ms. Fetman, could you please put up

page 9 of Government Exhibit 1-58A.

Q. Did your research also include all the company names listed

here?

A. Yes.

Q. For the remainder of my questions, I am going to refer to

all of the companies listed on these two pages that I just

showed you as the Blacksands companies.

Were you asked to research whether the Blacksands

companies leased any oil production operations in the United

States?

A. Yes.


A. I could not find any evidence that they did.

Q. Were you asked to research whether the Blacksands companies


A. Yes.


A. I could find no indication that they were operators.

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Q. Are you familiar with how oil production operations are

financed?

A. Yes, I am.

Q. What are the main types of financing?

A. There's really three kinds of ways people finance oil field

operations. The first and most common is self-funding. You

use your own money, and that's the most common way big oil

companies will pursue and fund and finance their operations.

The second -- another common way is with what is

called reserves-based lending, and this is where banks loan

money based on the particular reserves that are part of

whatever transaction that they are involved in. That's more

common for smaller companies.

Another becoming a more common way is through private

equity funding of operations.

Q. Let's focus on the second one you mentioned, reserves-based

lending.

Can you briefly describe a typical reserves-based

lending deal or arrangement?

MR. WALLER: Objection.


You can answer. Are you familiar with how it works in

the oil and gas industry?

THE WITNESS: It's pretty common, and I am familiar

with the general elements of it. I am not a banker, but I am

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familiar with the nature of the deals.

THE COURT: Go ahead. You can answer it.

A. Could you repeat the question? I'm sorry.

Q. Of course. Would you please describe a typical

reserves-based lending deal or transaction?

A. So the reserves-based lending deals that I am aware of

have -- the key feature of them is that there will be some

reserves, and these are going to be proved reserves, that are

used as the collateral for the loan. And I am very specific in

using the term "reserves." Reserves is a very technical

subject within petroleum engineering. And proved reserves are

a very special kind of reserves that have very small

uncertainty around their ability to be produced. And so

reserves-based lending has to do with that high of a quality

asset that has very little uncertainty associated with them.

Q. What are the risks, if any, associated with reserves-based

lending?

A. So in the oil and gas industry there's many risks, but we

tend to put them into two buckets. The first bucket is our

technical risks, and they have to do with the ability to get

the oil and gas out of the ground.

The second group of risks have to do with commercial

risks, and have to do with things like title to the property,

regulatory risks. Commercial risks can also include things

like the ability to get the product to the market and any

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possible disruptions to getting it to the market. It's also

what we call aboveground risks, to separate it from the

technical risks, which tend to be belowground risks.

Q. In reserves-based lending, in your opinion, how are a

borrower's revenues relevant in the context of reserves-based

lending?

A. So in the commercial risk, the capability of the company to

execute the operations necessary to produce safely those

hydrocarbons is a real key feature to any of the deals. Oil

field operations are not easy and they are dangerous. So you

need to have the strong capabilities to do this. So the prior

revenues, prior production even I guess, demonstrates your

capacity as a operator to do these things well, and that would

be important to the lending process.

Q. How are a borrower's other assets relevant in the context

of reserves-based lending?

MR. WALLER: Objection. He is not an expert in

finance. We are getting far afield.

THE COURT: I think it's true he is not an expert in

finance.

Are you familiar with how borrowers go about assessing

risk and determining whether and how to go about borrowing or

lending?

THE WITNESS: So I can speak to some of the risks that

they consider. I am not sure I understood the question as it

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was asked.

THE COURT: The question was, how are a borrower's

other assets relevant in the context of reserves-based lending?

Do you know the answer to that question, based on your

experience in the industry?

THE WITNESS: I would probably say that was a broader

question than I think I can answer.

THE COURT: So don't answer that.

Next question.

Q. How is a borrower's management team and their experience

relevant in the context of reserves-based lending?

MR. WALLER: Same objection.

THE COURT: I guess it's the same question.

Are you comfortable answering that question?

THE WITNESS: That one I am comfortable dealing with.

I think it's similar to the previous question I already

answered.

THE COURT: Which question you previously answered?

THE WITNESS: The one that asked about the history of

a company. And I responded the company's ability to actually

produce, having the technical capabilities, having the

management capabilities would be important to understanding the

commercial risks.

THE COURT: So the question about the borrower's

assets being relevant you felt able to answer that. That was

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the one you answered before, a borrower's assets versus a

borrower's management team and experience versus --

MR. SOBELMAN: Your Honor, for clarification, I

believe Mr. Walkup answered my question concerning a borrower's

revenues, and on that he may have touched the question that I

am now asking, but it's a slightly different question.

THE COURT: So the question now is what, a borrower's

management team?

MR. SOBELMAN: Correct. And their experience, whether

they are relevant, and if so, how, in the context of

reserves-based lending.

THE COURT: Are you an expert in reserves-based

lending?

THE WITNESS: I am familiar with reserves-based

lending.

THE COURT: You have been qualified as an expert in

the oil and gas industry. Is reserves-based lending just a

subset of the oil and gas industry, or do you have that kind of

expertise? That's my question.

THE WITNESS: I believe that, yes, there are important

elements to reserves-based lending for which petroleum

engineers are the key inputs for reserves-based lending.

THE COURT: Have you been involved in reserves-based

lending in your professional capacities?

THE WITNESS: I have never gotten reserves-based

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lending in any of the operations that I have been personally

involved in.

THE COURT: Have you consulted on reserves-based

lending?

THE WITNESS: Not that I am aware that the results of

my work were used in reserves-based lending. I have had people

report to me who have been involved in putting together

technical reserves for reserves-based lending.


Q. Let's look at some documents.


is in evidence as Government Exhibit 1-58.

If you could highlight the header.

This is an e-mail from the defendant to Scott Stout,

dated January 15, 2013.

Let's take a look at one of the attachments -- sorry,

the attachment to this e-mail, which is Government Exhibit

1-58A.

If you could you please turn to the third page and

highlight the first sentence. It begins "during the next

year."

This reads, "During the next year, four new projects

in onshore United States, Canada, and shallow water West Africa

are expected to come on stream, among which the incremental

peak production in the Williston Basin project is expected to

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reach around 35,000 barrels per day in 2015."

BY MR. SOBELMAN:

Q. Mr. Walkup, what is the Williston Basin?

A. The Williston Basin is a highly prolific oil-producing

area, it's large, but most of it is in North Dakota.


A. I have worked in Williston Basin.

Q. Were you asked to research whether Raheem Brennerman,

Jefferson Brennerman, Raheem Soetan, or Ayodeji Soetan ever

leased part of this oil field?

A. Yes.


A. No indication that they had.


Jefferson Brennerman, Raheem Soetan, or Ayodeji Soetan ever

operated part of this oil field?

A. Yes.


A. I found no indication that they were operators in this

field.

Q. Were you asked to research whether Blacksands companies

ever leased part of this oil field?

A. Yes.


A. I found no evidence that they did.

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ever operated part of this oil field?

A. Yes, I did.


A. I found no evidence that they operated there.

Q. Could you please explain what 35,000 barrels per day means?

A. So a barrel of oil is the standard measurement of volume in

the oil and gas industry. It's actually 42 gallons. So 35,000

barrels is a significant amount of production per day.

Q. In 2013, approximately how much would that have been worth?

A. So in 2013, the price of oil varied between 85 and $100.

So that would have been worth three and a half, let's say three

to three and a half million dollars a day.

Q. What would an operation of that size look like?

A. In the Williston Basin, this is going to require likely

hundreds of wells and a significant organization to support a

fairly high level of activity, by which I mean is constantly

drilling wells, so you will need a field office, you will need

a staff, just to sustain that level of operations.

MR. SOBELMAN: Ms. Fetman, could you turn to page 7 of

this document.

If you could highlight the bullet point on the left

side that begins "39 plus."

Q. Mr. Walkup, in the oil and gas industry, what does 39 plus

lease or licenses mean?

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A. So if you have a lease or if you have a license, then you

have the right to conduct operations; the exploration

operations could be production operations.

So I interpret this, from an industry perspective, as

saying they own 39 leases or licenses.

Q. What is the difference between a lease and a license?

A. The terms can be used interchangeably commonly. In the

United States, we have leases. Outside the United States, it's

common to have licenses. But both of them, in general, give

you the ability to perform those operations.


Jefferson Brennerman, Raheem Soetan, or Ayodeji Soetan had any

leases or oil production operations?

A. Yes.


A. I found no indication that they had any leases.


had any leases for oil production operations?

A. Yes.


A. I found no evidence that they held any licenses.

Q. I'm sorry. I asked about leases.

A. Neither leases nor licenses.

Q. And does that go for both the individuals I mentioned and

the companies?

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A. Yes.

MR. SOBELMAN: Ms. Fetman, please display what is in

evidence as Government Exhibit 1-67.

If you could please highlight the header.

This is an e-mail from the defendant to Julian

Madgett, dated May 16, 2013. It has three attachments.

Let's take a look at the first attachment, which is

Government Exhibit 1-67A.


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HC4KBRE5 Walkup - Direct

MR. SOBELMAN: Ms. Fetman, could you please turn to

the first page. Could you please highlight where it begins

122.62. Thank you.

BY MR. SOBELMAN:

Q. This reads: "122.62 million BOE proved reserves and in

excess of 1.6 billion BOE prospective reserves."

Mr. Walkup, what does "BOE" mean?

A. So BOE stands for barrels of oil equivalent. It's a means

of taking a reserves base that's made up of oil and natural gas

and communicating that in a single number. So you convert the

gas, based on its energy content, to be equal to oil. And so

BOE is -- that's how you come up and determine the BOEs of

somebody's reserves base.

Q. What are "proved reserves"?

A. So, proved reserves are -- reserves are a measurement of

oil that is expected to be produced. Proved reserves is that

segment of the reserves that has the highest confidence of

being produced. And to qualify as proved reserves, you have to

essentially have zero commercial risk and have greater than a

90 percent confidence on the technical risk that those volumes

will be produced.

Q. In 2013, approximately how much would 122.62 million BOE

proved reserves have been worth?

A. So, there's always a range because it depends on where the

reserves are, but it tends to range between 10 and 20 dollars,

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and that would have certainly been the case. It might have

even been higher than that in 2013 because the prices were

higher in 2013. So, at $15 of BOE, this would be close to

$2 billion.

Q. What are prospective reserves?

A. It's a little difficult to respond because the words

prospective and reserves really don't go together. Reserves

are for something that's been discovered. A prospective

resource is an exploration potential. So, to say something is

prospective and reserves is not actually industry language, nor

is it the official reserves language.

But a prospective resource is an area where there's

the potential, but nobody's drilled wells to prove that it's

there yet.

MR. SOBELMAN: Let's take a look at another one of the

attachments to the same email from the defendant to Julian

Madgett. Ms. Fetman, if you could please display what's in

evidence as Government Exhibit 1-67-C. If you could please

turn to the sixth page. If you can highlight the second

sentence of the first paragraph. It begins, "oil, natural gas

and NGL."

Q. This reads, starting with the second sentence: "Oil,

natural gas and NGL assets in the Gulf of Mexico shallow water

currently in production with exploration activities. To

increase the proved reserves and production, the North Dakota

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Bakken asset in Williston Basin currently undergoing drilling

and development activities with near-term production, and the

California Monterey shale asset currently in the advanced

exploration phase." I'm going to stop there.

Mr. Walkup, what does "California Monterey shale"

mean?

A. So the California Monterey shale is a type of rock that

holds considerable oil resources. It's spread over a lot of

Southern California.


Jefferson Brennerman, Raheem Soetan, or Ayodeji Soetan leased

any part of the California Monterey shale?

A. Yes, I was.

Q. And what were the results of your research?

A. I found no indication that they did.


Jefferson Brennerman, Raheem Soetan, or Ayodeji Soetan operated

any oil production operations on the California Monterey shale?

A. Yes.


A. I didn't find any evidence that they were operators.


leased any part of the California Monterey shale?

A. Yes.


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A. I found no indication that they had any leases in this

area.


operated any oil production operations on the California

Monterey shale?

A. Yes.


A. I found no evidence that they were operators.

MR. SOBELMAN: Ms. Fetman, if we could zoom back out.

And if you could please highlight the second paragraph on this

page.

Q. Mr. Walkup, could you please explain what this paragraph

means?

A. This is dealing with oil sands. Oil sands are another kind

of hydrocarbon deposit, usually in North America, found in

Canada, in the provinces of Alberta and Saskatchewan, and this

is stating that they have close to 100 million barrels of

proved reserves -- that's, again, that category, very high

confidence -- and that that asset is currently producing

3,000 barrels a day.

Q. What would an operation of that size look like?

A. The production per well in oil sands is relatively low

because these are very difficult wells to operate -- I mean to

flow. So first off, you'd have to have a lot of production

wells. 3,000? It depends on where in their life, but, again,

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at some point, you've had probably greater than a hundred

wells.

Additionally, oil sands don't flow by themselves, they

need to be heated up by injecting steam to get them to flow,

and so you'd have to have a significant aboveground industry

infrastructure to produce that steam and get it into the oil

field to inject.

Q. If Raheem Brennerman, Jefferson Brennerman, Raheem Soetan,

or Ayodeji Soetan leased this quantity of proved reserves in

that area, would you have expected your research to find that?

A. Yes, I would have.

Q. Did your research find any indication of that?

A. No, it did not.

Q. If the Blacksands companies leased that amount of proved

reserves in this area, would you have expected your research to

find that?

A. Yes.


THE COURT: Wait, there's an objection.

Overruled.

You did answer. You did answer, you said no?

THE WITNESS: I said --

THE COURT: Would you have expected your research to

find that? Yes, you would have expected that. Okay.

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BY MR. SOBELMAN:


A. No, it did not.

MR. SOBELMAN: Ms. Fetman, let's turn to the following

page. And if you could please highlight the third paragraph.

Q. This says: "The group strategy is to finalize the sale of

19 percent interest following the conclusion of the acquisition

of the California Cat Canyon asset and the 35 percent interest

in the ConocoPhillips Nigeria assets," and it goes on.

What does "ConocoPhillips Nigeria assets" mean?

A. So ConocoPhillips is a large oil producer globally, they

work across the globe. They had a fairly long-producing

history in Nigeria, and in 2012, they indicated they wanted to

sell those assets.

Q. Did they sell those assets?

A. They did.

Q. To whom did they sell them?

A. I don't remember the name of the company right now, but it

was an indigenous Nigerian firm.

Q. Were you asked is to research whether Raheem Brennerman,

Jefferson Brennerman, Raheem Soetan, or Ayodeji Soetan acquired

these ConocoPhillips Nigeria assets?

A. Yes.


A. There was no indication in any of the research I did that

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they acquired any of these assets.


acquired these ConocoPhillips Nigeria assets?

A. Yes.


A. That they -- I found no indication that they were involved

in any acquisition of these assets.



these ConocoPhillips Nigeria assets?

A. Yes.


A. There was no evidence that they were operators of these

assets.


operated these ConocoPhillips Nigeria assets?

A. Yes.


A. I have no evidence that they did.


what's in evidence as Government Exhibit 1-1. If you can

highlight the header.

Q. This is an email from the defendant to Julian Madgett,

dated June 20, 2011. It has two attachments. Let's take a

look at one of them.

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MR. SOBELMAN: Ms. Fetman, if you could please display

what's in evidence as Government Exhibit 1-1-B. Ms. Fetman, if

you could please turn to page 3. And highlight the second

paragraph.

Q. This reads in part: "Our operations include the trading

and marketing of petroleum and petroleum products, in addition

to our core exploration and production operations."

In the oil and gas industry, what does the trading and

marketing of petroleum and petroleum products mean?

A. So, most commonly, it acts as sort of the midstream or a

middle phase where you take oil from the upstream, and you have

to get oil to customers. And the trading and marketing groups

will be responsible for moving that physical product to -- from

one -- from the supplier to the people who need it.

Q. In the way these terms are used in the oil and gas

industry, could this mean just a person sitting with their

laptop and trading petroleum commodities?

A. That's not the understanding that I have as an industry

participant of what trading and marketing is.

MR. SOBELMAN: Ms. Fetman, could we go to page 5 of

this document, please. If you could please highlight the

sentence that begins "in excess."

Q. This reads: "In excess of 5 million acres of combined

proven and prospective acreage."

Mr. Walkup, what is acreage?

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A. So, when we -- when you have a lease, it's of a certain

size, and it's of so many acres, an acre being a measure of

surface area. So, the acreage is the size of your lease

position. And this is saying that their lease position is

5 million acres.

Q. Could you please describe how large 5 million acres is?

A. 5 million acres is very large. In a common sense, it's

bigger than the State of Connecticut, but in an oil and gas

sense, if you take in the federal waters of the Gulf of Mexico,

which is a very large producing area. The total acreage

lease -- under lease right now is about 15 million acres. So

this would be about a third of the entire Gulf of Mexico

business in federal waters.


or Ayodeji Soetan leased that amount of acreage, would you have

expected your research to find that?



You can answer.

THE WITNESS: Yeah, I would have expected to have

identified that.

BY MR. SOBELMAN:


A. No, it did not.

Q. If the Blacksands entities leased that amount of acreage,

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would you have expected your research to find that?

A. Yes.


A. No.


or Ayodeji Soetan operated that amount of acreage, would you

have expected your research to find that?

A. Yes.


A. No.

Q. If the Blacksands entities or companies operated that

amount of acreage, would you have expected your research to

find that?

A. Yes.


A. No.

MR. SOBELMAN: Ms. Fetman, please highlight the next

sentence, which begins "189.15."

Q. This reads: "189.15 MMBOE of proven reserves and in excess

of 2,092.5 MMBOE of prospective reserves."

Mr. Walkup, what is "MMBOE"?

A. So, the BOE part is the barrels of oil equivalent we spoke

about earlier. The MM means million, so it would be million

barrels of oil equivalent.

Q. So, to be clear, the early part of this, 189.15 million

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barrels of oil equivalent, and later in the sentence, it's

2,092,500,000 barrels of oil equivalent; is that right?

A. That's correct.

Q. In 2013, approximately how much would 189 million barrels

of proved oil equivalent reserves have been worth?

A. Again, it can vary, but, as a rule of thumb, that would

have been worth over a couple -- over $2 billion.


or Ayodeji Soetan leased oil production operations with

189 million barrels of proved reserves, would you have expected

your research to find that?

A. Yes.


A. No.

Q. If the Blacksands companies leased oil production

operations with 189 million barrels of proved reserves, would

you have expected your research to find that?

A. Yes.


A. No.


or Ayodeji Soetan operated oil production operations with

189 million barrels of proved reserves, would you have expected

your research to find that?

A. Yes.

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A. No.

Q. If the Blacksands companies operated oil production

operations with 189 million barrels of proved reserves, would

you have expected your research to find that?

A. Yes.


A. No.

MR. SOBELMAN: Ms. Fetman, can we please turn to page

11 of this document.

Q. Mr. Walkup, are you familiar with Torrance Field in

California?

A. Yes.

Q. What is it?

A. It's an oil field in Southern California, in Los Angeles

area.


A. I've worked in the Los Angeles area, the L.A. Basin, on a

number of fields. I haven't worked on this field, but I've

worked on adjacent fields to here.

Q. In the oil and gas industry, what does working interest

mean?

A. So, it's common in oil and gas that there are multiple

parties that own assets, and so your working interest is the

percentage ownership of the asset that you own.

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Q. So, just to be clear, here it says, "Working Interest:

50 percent." What do you understand that to mean?

A. That this company owns 50 percent of the Torrance Field

asset.



oil leases in Torrance Field?

A. Yes.


A. I didn't find any leases in this field that they owned.


had any oil leases in the Torrance Field?

A. Yes.


A. The same, I didn't find any indication.



any oil production operations in the Torrance Field?

A. Yes.


A. I didn't find any indication that they did.


operated any oil production operations in the Torrance Field?

A. Yes.


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A. I found no indication of operations.

MR. SOBELMAN: Ms. Fetman, let's turn to page 14 of

this document.

Q. Mr. Walkup, are you familiar with White Pine County,

Nevada?

A. Yes.

Q. What is it?

A. It's a county in Nevada that has exploration potential.


A. In my research, I had not worked in this area myself, but I

was able to identify the activity in this area.

MR. WALLER: Objection; move to strike.

THE COURT: Overruled. Go ahead.

Q. What is the working interest listed here?

A. 50 percent.



leases in White Pine County?

A. Yes.


A. I didn't find any indication that they had leases here.


had any oil leases in White Pine County?

A. Yes.


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any oil production operations in White Pine County?

A. Yes.




operated any oil production operations in White Pine County?

A. Yes, I did.



MR. SOBELMAN: Ms. Fetman, could we please turn to

page 17 of this document.

Q. Mr. Walkup, are you familiar with Bakersfield, California?

A. Yes, I am.

Q. What is it?

A. Bakersfield is not only just a city in California, but it's

one of the most prolific oil-producing regions in all of

California.


A. I've worked in a number of Bakerfield's -- fields in and

around Bakersfield.



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oil leases in Bakersfield, California?

A. Yes.

Q. What was the results of your research?

A. I didn't find any indication that they had any.


had any oil leases in Bakersfield, California?

A. Yes.


A. I didn't find any evidence that they had any leases.



any oil production operations in Bakersfield, California?

A. Yes.


A. No indications that they operated.


operated any oil production operations in Bakersfield,

California?

A. Yes.


A. I didn't find any indications that they operated.

MR. SOBELMAN: Ms. Fetman, let's turn to page 19 of

this document.

Q. Mr. Walkup, are you familiar with the Halton oil sands,

Saskatchewan?

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A. I'm familiar with the oil sands in Saskatchewan, but I am

not familiar with a project called Halton.

Q. Were you asked to research whether there is a project

called Halton?

A. Yes.


A. I didn't find a project by that name.

Q. Where is Saskatchewan?

A. Saskatchewan is in Canada. It is one of the provinces that

borders the United States.

Q. Here, what working interest is listed for this oil asset?

A. 50 percent.



oil leases in Saskatchewan?

A. Yes.


A. I didn't find any indication they had leases in

Saskatchewan.


had any oil leases in Saskatchewan?

A. Yes.


A. I found -- I could not find any leases that they owned.


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any oil production operations in Saskatchewan?

A. Yes.


A. I could find no indication that they were operators in this

area.


operated any oil production operations in Saskatchewan?

A. Yes.


A. I could not find any indication that they were operators in

Saskatchewan.

MR. SOBELMAN: Ms. Fetman, can you please turn to page

21 of this document.

Q. Mr. Walkup, are you familiar with Oil Mining Lease 13?

A. Yes.

Q. What is it?

A. It's a lease in Nigeria, so named by the government who

parcels out all the different leases.

Q. What is this next to it, Qua Ibo Marginal Field?

A. My understanding is that's a more vernacular name for the

project on OML -- for the Oil Mining Lease 13.

Q. How did you learn about Oil Mining Lease 13?

A. This, I learned about through my research. I've worked in

Nigeria in a number of OMLs, but not this one, but, again, the

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ones I've worked at are around this one.

Q. What's the working interest that's listed here?

A. 50 percent.



ownership interest in Oil Mining Lease 13?

A. Yes.


A. I found no indication that they had any ownership interest

in OML 13.


had any ownership interest in Oil Mining Lease 13?

A. Yes.


A. I couldn't find any evidence that they had any interest in

this lease.



any oil production operations where Oil Mining Lease 13 is

located?

A. Yes.


A. I found no indication that they were operators in OML 13.


operated any oil production operations where Oil Mining

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Lease 13 is located?

A. Yes.


A. I found no evidence that they were operators.

MR. SOBELMAN: Ms. Fetman, could we please turn to

page 24. And could you please highlight the first of the three

listings on this page that reads "Utah/Wyoming asset, United

States."

Q. Mr. Walkup, were you asked to try to identify Utah/Wyoming

asset based on the information provided here?

A. Yes.

Q. Were you able to identify it?

A. I was not able to identify it, given this information.

Q. Why not?

A. It's just not precise enough to identify where -- in Utah

and Wyoming, there are tens of thousands of wells and dozens

and dozens of fields. I just wasn't able to identify where

this was.


Jefferson Brennerman, Raheem Soetan, or Ayodeji Soetan had an

oil lease in Utah?



THE WITNESS: Yes.


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A. I could not find that they owned any leases in any fields

in Utah.


had an oil lease in Utah?

A. I'm sorry, could you ask that question again?


had an oil lease in Utah?

A. Yes.


A. I found no indication that they had any leases in Utah.



any oil production operations in Utah?

A. Yes.


A. I found no indication that they had operated in Utah.


operated any oil production operations in Utah?

A. Yes.


A. I found no indication that they operated in Utah.



oil lease in Wyoming?

A. Yes.

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had an oil lease in Wyoming?

A. Yes.





any oil production operations in Wyoming?

A. Yes.


A. I could find nowhere where they operated.


operated any oil production operations in Wyoming?

A. Yes.


A. I couldn't find any place where they operated in Wyoming.

MR. SOBELMAN: Ms. Fetman, could you please highlight

the second listing on this page.

Q. Mr. Walkup, are you familiar with Ororo field, OML 95,

Nigeria?

A. Yes.

Q. What is it?

A. It's another lease in Nigeria with production on it.

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A. Well -- I'm sorry?


A. Because it's an OML, it's gone through discovery already.

It's an oil mineral lease as opposed to an oil prospecting

lease, so just by its name, I know that there's been activity

on it, and so that's the indication.

I should be -- to be more precise, OML means that

there has been a discovery. It doesn't necessarily mean

there's production. It could be soon to happen, but it has

been discovered.



oil lease or operated any oil production operations in Ororo

field?

A. Yes.


A. I didn't find any evidence that they did.

Q. Were you asked to conduct that same research regarding the

Blacksands companies?

A. Yes.


A. The same results.

MR. SOBELMAN: Ms. Fetman, could you highlight the

third listing on this page.

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Q. Mr. Walkup, are you familiar with Oil Block OPL 2012?

A. Yes.

Q. What is it?

A. Again, it's a lease, and because it's an OPL, it's in

prospecting mode, so it's yet to have established commercial

reserves.

Q. What's the working interest listed here for Oil Block

OPL 2012?

A. 60 percent.



oil lease or operated oil production operations for Oil Block

OPL 2012?

A. Yes.


A. I didn't find any indication that they did.


had the same things?

A. Yes.


A. It was the same result, I could not find any evidence that

they did.

MR. SOBELMAN: Ms. Fetman, could you please turn to

page 25.

Q. Mr. Walkup, are you familiar with PetroQuest Seychelles?

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A. Yes.

Q. What is it?

A. So this is another area -- in the Seychelles, there are a

string of islands off of East Africa in the Indian Ocean, and

so this is a region, it indicates here, made up of 35 blocks.

Each block would likely be -- frequently a block is also then,

ultimately in the future, will be a lease. But, at this point,

this is preleasing, and you've just got blocks and prospects,

as I understand it from this slide.

Q. What's the working interest that's listed here?

A. 50 percent.



oil lease or oil production operations in PetroQuest

Seychelles?

A. Yes.



Q. Were you asked to conduct similar research concerning the

Blacksands companies?

A. Yes.


A. I could find no indication that they had any lease or

operations.


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HC4KBRE5 Walkup - Cross

THE COURT: Okay. Cross-examination.

CROSS-EXAMINATION

BY MR. WALLER:

Q. Good afternoon, Mr. Walkup.

A. Good afternoon.

MR. WALLER: Give me one second.

Q. You testified that to do the searches that the government

asked you to do, you did three types of research, right? You

accessed databases?

A. Yes.

Q. What kind of database was it that you -- what kind of

databases were that you were accessing?

A. They're provided by a firm called Drillinginfo, which is a

commercial provider of these databases.

Q. So, they host the database; is that what it is?

What is Drillinginfo? Is it a private company?

A. It's a private company.

Q. How do they get their information?

A. They collect it from the different state governments, who

have this information.

Q. When is the owner of an oil field required to disclose a

lease?

A. It varies state by state.

Q. So, you said that every lease in the United States would be

in this database?

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A. Every -- that's its purpose, yes.

Q. But not every lease in the United States is required to be

disclosed, correct?

A. My understanding is, if the lease is for operations, then,

yes, it needs to be disclosed.

Q. In every state?

A. In every state, to the best of my knowledge.

Q. So you assumed, though, when you accessed the database, if

you didn't see a lease that was provided to a Blacksands

company, that it didn't exist?

A. That -- when you say it didn't exist, do you mean that they

didn't -- they didn't own the lease?

Q. Correct.

A. I'm trying to understand your question. I'm sorry.

Q. Correct.

A. Then, yes, that's how I interpreted it.

Q. Okay. Because you're making an assumption that every lease

in the United States has been provided to this company called

Drillinginfo for their database?

A. Correct.

Q. Are there types of leases that you would not expect to find

in the database?

A. By -- no, there's -- I'm not sure I know what you mean by

"types of leases."

Q. Are there different types of leases?

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A. There can be different forms state by state of leasing

because the laws are controlled by the states.

Q. What types -- what are the different types that you might

contemplate? What are the different types of leases that there

might be?

A. So, there might be -- the important ones that I am familiar

with are those that provide you the right to explore, produce,

and by produce, that means drilling wells.

Q. Now, what about just exploration, is that required by all

states to be disclosed?

A. I don't -- I don't have that --

Q. A lease that gives the right to a company to explore, would

that be required by all states to be disclosed?

A. If the exploration were to require the drilling of a well,

my understanding is yes. Not all exploration requires the

drilling of a well.

Q. Correct. So, if there's just a right to do exploration

that doesn't require the drilling of a well, then it would not

be required to be disclosed?

A. I don't have that knowledge.

Q. So then, again, there are some leases that might not be in

this database?

A. I'm not -- I don't know if those leases exist -- that that

type of lease exists, so I don't know if -- since I don't know

if it exists, I don't know if it's not in the database.

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Q. What about an operation agreement, like -- what about a

joint venture agreement between two companies, what type of

mandatory disclosure is that, that those agreements be

disclosed?

A. A joint venture agreement is actually quite uncommon in the

United States.

Q. Okay. But my question is: If there's a joint venture

agreement between two companies, would that be in the database?

A. No.

Q. Okay. And a joint venture agreement is an agreement to

work together with -- between two companies, correct, jointly?

A. Again, the agreements between parties in the United States,

that I'm familiar with, are not joint venture agreements.

Q. All of those -- the last exhibit that you were looking at

with the various assets that were listed, do you recall that,

the one that you did at the end of your direct testimony?

A. Yes.

Q. So, Mr. Sobelman went through a whole bunch of different

assets, some in the United States, some in Canada, some in

Nigeria. Those were all -- what those stated were that

Blacksands had a joint venture agreement with another company,

correct?

A. That's what they stated.

Q. But if there were joint venture agreements between

Blacksands and various different companies, those would not be

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in the database, correct?

A. The joint venture agreements would not be in the database.

Q. Now, the second type of research you said you did was you

reviewed technical literature?

A. Correct.

Q. What does that mean?

A. For a number of the assets that were named -- so, for

example, the Torrance Field. There are a number of technical

papers, technical case studies, about fields like the Torrance

Field, and I reviewed those that I could find on the fields

that were mentioned. It is very common practice. So that's

the technical literature that I referred to.

Q. Does that means -- are these trade magazines, or is it just

Google?

A. No. There are a number of professional organizations - the

Society of Petroleum Engineers, there's associations for

geologists, and for geophysicists, and other professional

organizations in oil and gas. They've all cooperated to put

all of their technical papers in a single location, so that the

community -- the technical community can search them.

Q. When you're searching the technical literature, though,

you're looking for technical data like reserves, things like

that?

A. What I was looking for were the specific assets that were

mentioned.

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Q. The specific assets. And what aspect of those assets?

A. I didn't limit my search to any specific aspects of the

assets. I just really searched the assets to see what

technical literature was available.

Q. But that wouldn't reveal, necessarily, if there were

leases, correct? You're talking about the specifications and

the reserves for the asset?

A. So, the case studies for the assets will include the

ownership of those assets, not just the operator, but who

actually owns them. That would be the group of people who --

if there's a JV, it would include all the members of the JV.

Q. The third type of research you did was general business

literature. Now, is that just basic Googling?

A. Yes.

Q. So you just went on the Internet looking for information?

A. Using my knowledge of the terms that are common in the

industry and the other information that I have general

knowledge of in many of these areas.

Q. For operator, you said that most companies have multiple

owners, but one of them generally acts as the operator, right?

A. I think I meant -- if I said most companies have multiple

owners, I meant to say that most assets, most oil fields, or

most projects have multiple owners --

Q. Right.

A. -- not companies.

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Q. Right. So the oil field asset has multiple owners, and,

generally, one of them acts as the operator, right?

A. That's the most common arrangement.

Q. So, there could be certainly arrangements where there's a

joint venture agreement between two companies, and one of those

companies will act as the operator, correct?

Both parties -- let me withdraw it.

There are certainly situations where there was

multiple companies that have a working interest in an asset,

but one of them will be the operator, will actually do the

operation, correct?

A. Yes, that's correct.

Q. And aren't there also situations where two parties can be

referred to as joint operators, but then they also, between

them, have an operating agreement where one of them is going to

actually do the operations?

A. That's common.

Q. That's common, right?

So the fact that a party is listed on a lease or in a

joint venture agreement as a joint operator doesn't necessarily

mean that they are going to be doing the actual operations,

correct?

A. Oh, I'm sorry, can we -- that was -- can you repeat that,

please?

Q. Is it possible that two companies have a joint venture

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agreement and are referred to as joint operators, but between

them, they have an operating agreement where one of them is

going to do the actual operations?

A. Joint -- I'm pausing because the term "joint operators" is

not really a term of art that I'm familiar with. They're

joint -- so, when we -- I'm just not that familiar with that

term, but it is correct that there are multiple owners,

multiple interest owners, and one of them will be the operator.

Q. But the term "joint operator" doesn't have any specific

meaning to you? Like industry --

A. Not with a sufficiently high confidence. I could guess at

its meaning, but I don't want to.

Q. Do companies that have an interest in an oil field

oftentimes hire a consulting company to do -- to run the

operations or assist them with operations?

A. It's possible. It's done. It's not common.

Q. Have you heard of a company called InterAct?

THE COURT: Have you?

THE WITNESS: Not to the top of my mind.

Q. So you don't whether or not InterAct is a consultant who

specializes, among other things, in operating oil fields or

assisting in the operation of oil fields?

A. I am aware that there are companies who do that, but

whether InterAct is one of them is not something I can remember

right now.

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Q. Are you familiar with oil fields in California called Cat

Canyon -- an oil field in California called Cat Canyon?

A. Yes.

Q. Did you research Cat Canyon?

A. Yes.

Q. Is Cat Canyon a real oil field?

A. Yes.

Q. Who owns Cat Canyon?

A. Multiple people have interests in Cat Canyon.

Q. Can you name who they are?

A. ERC owns some of Cat Canyon.

Q. Is it ERG?

A. ERG, thank you.

There is a joint venture of Shell and Exxon that owns

part of Cat Canyon. There are some smaller operators as well.

Q. Are you aware that ERG, in 2015, went bankrupt?

A. Yes.

Q. So they're not still an owner of Cat Canyon?

A. There is -- I think I did check. This is -- I know they

went through bankruptcy, and they're outside of bankruptcy, and

that there is an entity called ERG currently operating in Cat

Canyon.

Q. Did you ever speak to anyone at ERG about the asset?

A. In the con -- no, not that I'm aware of. Maybe sometime in

the past, I've talked to somebody from ERG, but not having

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anything to do with this matter.

Q. Did you do any technical research in the trade magazines

you discussed about Cat Canyon?

A. Yes.

Q. Cat Canyon is a real oil field, right?

A. Yes.

Q. Has proven reserves?

A. Yes.

Q. Is that the reserves that are the high standard, proven?

A. Yes.

Q. So it has proven reserves?

A. My understanding is that it does, yes.

Q. And it has the capability of producing oil?

A. Yes.

Q. You mentioned, also, earlier about reserves-based lending.

One of the things you said was that there are technical risks,

and that's the ability to get the oil out of the ground, and

commercial risks, correct?

A. That's a common grouping of risks.

Q. And the commercial risks, what would be a commercial risk?

A. A common commercial risk is whether you have the -- a

proper regulatory approval to execute the operations that are

planned.

Q. When you say commercial risks, though, are you talking

about a risk to the company that has an interest in the asset?

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A. Technical risks also impact the owners. It just -- they're

grouped this way to discriminate between what's -- you know,

what has to do with the physics of being able to extract soil

from the subsurface to general business risks that have -- that

impact the operations.

Q. Now, you testified about a whole bunch of different areas

or oil fields. One of them was Williston Basin, right?

A. Yes.

Q. You said that was a high-producing area in North Dakota?

A. Mainly in North Dakota. It covers other areas as well.

Q. But it's a big area, right? It's not a specific oil field

or a specific asset?

A. It's a big area, with multiple fields.

Q. So, how many fields would you say are in the Williston

Basin?

A. It would be a guess at this moment. I don't know.

Q. More than a hundred?

A. That would surprise me.

Q. What's your best estimate? Less than -- more than 50?

MR. SOBELMAN: Objection. He already said he doesn't

know, your Honor.

THE COURT: Well, he can ask. He can explore it.

Go ahead. More than 50?

THE WITNESS: I would -- it's possible it's more than

50. That sounds a little high to me. I know there's more than

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three. Certainly in the -- I wouldn't be all surprised if it

was -- if you said it was 20 or more.

BY MR. WALLER:

Q. Now, were you able to ascertain, in your research, who owns

all the wells in Williston Basin?

A. I have access to that information.

Q. But did you look to see who the owners were?

A. Of the leases, the wells, and the -- yes, I looked within

who the operators were on the production wells. And I looked

to see who the -- whoever -- on the leases, there's the leasee

and the leasor, so it was the leasor, the person who acquired

the lease, I looked at those names as well.

Q. I think you said oftentimes there could be multiple leases

for a particular field?

A. Oh, within a field, there will be many leases. In the

United States, the oil rights are owned by frequently the --

are owned by private people, not the government, and so there

can be thousands of leases in a field.

Q. And you're saying that every one of those would be in the

database that you were searching?

A. Yes.

Q. Every one?

A. Within practical limits, every one. I anticipate that this

is the list of all the leases in the Williston Basin.

Q. Are there scenarios where a company signs a lease or has an

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agreement to do exploration, but it's contingent on some factor

like financing?

A. I'm not aware of that arrangement. You --

Q. So anytime that there's a leases, that it's been -- how

much does a lease typically cost?

A. It varies widely from area to area. So, it can -- a lease

has multiple payments, I can tell you that. There's usually an

upfront payment, in cash, and then there are terms set that

give the person who owns the mineral rights payment over time

if, in fact, production occurs. But the terms can vary widely,

the upfront payment can vary widely.

Q. Okay. Now, you talked about the Torrance Field?

A. Yes.

Q. And the exhibit that you were shown by Mr. Sobelman said

that Blacksands had a 50 percent working interest in the

Torrance Oil Field, right? Is that right?

A. Yes.

Q. Now, it said on that exhibit that Blacksands had a joint

venture agreement with another company, right?

A. My recollection is it said something about a JV.

MR. WALLER: Can we pull up 1-1-B.

Q. So this is what we were talking about before that I was

just asking you about. This says that Blacksands has a working

interest of 50 percent, correct?

A. Yes.

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Q. And it has a JV partner with Oil and Gas Technology Fund

Incorporated, right?

THE COURT: Right? Is that what it says on the

document?

THE WITNESS: Can you point to me where -- oh, it says

JV partner, yeah. I see that it says Oil and Gas Technology

Fund is the JV partner.

BY MR. WALLER:

Q. Right. That would indicate to you that Blacksands had a

joint venture agreement with Oil and Gas Technology Fund Inc.,

correct?

A. That's a little further than I would interpret this.

Q. Well, what does JV partner mean to you?

A. I mentioned this briefly before. JVs are actually not very

common in the United States. In fact, they're pretty rare.

But the terminology JV is used. What's the appropriate

relationship is one of a nonoperating working interest party

governed by a joint operating agreement, and that's, by far,

the more common.

So I wouldn't actually interpret this as saying that

they have a JV agreement. I would -- because that's just very

rare. I would think that they were following a more standard

approach.

Q. What's the more standard agreement that you're talking

about?

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A. It's a -- the agreement is one of being a nonoperating

working interest party.

Q. What does that mean?

A. That means you own the asset together, but you don't have

any -- as from an industry perspective, not a lawyer, you don't

have any fiduciary responsibilities to the other party. In a

JV, you have a much different arrangement with returns in the

governance of the joint assets because this is common in the --

outside the United States, in places like Nigeria, where they

do set up a JV.

THE COURT: Wait, you said judiciary responsibilities

or fiduciary?

THE WITNESS: Fiduciary.

THE COURT: Fiduciary?

THE WITNESS: Fiduciary. So it's to the common good,

and you don't have that requirement. I'm telling you as

somebody who's worked and has an understanding of this

agreement, but not as a lawyer.

But the way these agreements, the way that these --

and we even call them partnerships, right, but they're

definitely not partnerships. The way it works in the United

States is very different than it is outside the United States.

BY MR. WALLER:

Q. So your -- what this would mean to you, most likely, is

that Blacksands had an agreement with Oil and Gas Technology

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Fund Inc. for a 50 percent working interest, but that one of

the parties most likely would have been responsible for

operating the field?

A. If by agreement, you mean a signed -- not a signed joint

operating agreement, yes.

Q. That's what the JV partner means to you?

A. When I see it in the United States, yes.

Q. Now, that's different than a lease agreement?

A. Yes.

Q. So, you said before that the database that you were -- the

database that you were accessing does not list JV, joint

venture, agreements, right?

A. I said that.

Q. So, if there was a joint venture agreement between

Blacksands and Oil and Gas Technology Fund Inc., that would not

be in the database, correct?

A. The joint -- the nonoperating -- the joint operating

agreement is not something I would expect to see in the

database.

Q. And that's -- this, you said, is not a lease agreement,

this is a joint venture agreement, what we're talking about

here in this Torrance Field?

THE COURT: Is that correct?

THE WITNESS: That line, the JV partner part of it.

THE COURT: Okay.

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THE WITNESS: And the working interest part of it,

yeah. Yes.

BY MR. WALLER:

Q. And that's what's being represented -- that's your

understanding of what's being represented here, correct?

A. My understanding of what's being represented here with

regards to the first two lines is that there is a

nonoperating -- there's a joint operating agreement, which has

been established between OGTF, Oil and Gas Technology Fund, and

Blacksands Pacific here on the bottom.

Q. Now, did you ever call Oil and Gas Technology Fund to see

whether or not they owned the field -- whether they owned the

field?

A. Whether they owned -- the field is a gigantic field, so no

one company would own the whole field. The question -- so I

wouldn't expect them to own the field.

Q. But they might own a piece of the field?

A. Correct.

Q. Did you ever call them or contact Oil and Gas Technology

Fund to inquire as to whether or not they had a joint venture

agreement with Blacksands?

A. No.

Q. Or whether or not they owned a piece of the Torrance Field?

A. I did not call them.

Q. Or contact them in any other way?

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A. Or contact them in any way.

MR. WALLER: Can we go to page 14.

Q. So, this is for White Pine County, right?

A. Yes.

Q. Now, again, this indicates -- the representation here, is

it your understanding that Blacksands is saying that it has a

JV, joint venture, agreement, again with Oil and Gas Technology

Fund, for a 50 percent working interest in White Pine?

A. My interpretation of this is, again, that they likely have

a joint operating agreement with Oil and Gas Technology Fund

because of the JV partner issue we just spoke about, and that

their share within that agreement is 50 percent.

Q. And "their share" means that they would share in the

revenue of any oil produced by that asset, correct?

A. That's my understanding of -- and it's industry standard --

of what working interest means.

Q. It doesn't say here that Blacksands leased from Oil and Gas

Technology Fund to explore that asset, right?

A. No, I would not interpret this as saying that Blacksands

leased from Oil and Gas Technology Fund.

Q. Right. That they have a working interest where they shared

in the revenue, and one of the partners, maybe Oil and Gas

Technology Fund, would operate the field?

A. I wouldn't -- that would be really far in the future. This

is an exploration activity that's described on this page. So,

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with the exception that I would interpret this as they would

share in the costs of 50 percent for this exploration activity.

This is an exploration activity.

Q. And, again, this would not -- this is not a lease -- this

is not a representation that this is a lease, so it would not

be in the database that you consulted?

A. No. This one is pretty clear that it is a lease.


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HC48BRE6 Walkup - Cross

Q. Where does it say that?

A. Federal oil lease of 1280 acres expiring in 2020. That

means it had to have been in the federal oil lease auction in

2010.

Q. That doesn't mean that Blacksands had a lease --

MR. SOBELMAN: Objection, your Honor.

THE COURT: Let him ask the question.

Q. That doesn't mean that Blacksands had a lease from Oil and

Gas Technology Fund?

THE COURT: What doesn't mean that?

MR. WALLER: What the witness just talked about with

the federal oil lease.

A. I am concerned that the way the question is articulated it

would be confusing. When you jointly own an asset, the person

who comes into that agreement doesn't lease from the other

person, you together own the lease. So it would be -- what I

would understand this to be is that there's one lease, it comes

from the federal government, they own it 50/50. That's how I

would interpret this. But when you're a partner, and I use

that term loosely, when you're a non-operating working interest

party, there has to be a lease. You don't lease it from the

other party, or you don't lease it from the operator; you lease

it from whoever owned the mineral rights in the first place.

Q. But the lease could be between Oil and Gas Technology Fund

and the government, right?

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A. It could be, but it's not, because they were so specific

here I could look up the auction and the results of the

auction.

THE COURT: You could or you did?

THE WITNESS: I did.

Q. So does Oil and Gas Technology Fund have a lease?

A. Not one of 1280 acres expiring in 2020.

Q. Do they have a lease?

A. Do they have any leases?

Q. For White Pine County?

A. Not that's consistent with these attributes.

Q. Again, what is being represented here is it's a working

interest of 50 percent in a joint venture agreement between

Blacksands and Oil and Gas Technology Fund.

MR. SOBELMAN: Objection. We have been over this a

couple of times.

MR. WALLER: I will move on.

THE COURT: I was going to overrule the objection.

Do you want to withdraw it and move on or do you want

him to answer the question?

Q. Do you know the question?

A. Yes. I don't view this as a joint venture agreement. I

view it in the context of a joint operating agreement.

Q. Right. Again, that's a shared working interest in the

asset, right; a sharing of the revenue, right?

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A. Yes.

Q. And that one of the partners to the agreement would the

operator of the field?

A. That's the usual situation.

Q. OK.

THE COURT: But you said you checked and Oil and Gas

Technology Fund, Inc. doesn't have such a lease, is that what

you said.

THE WITNESS: That's what I said. That meets these

attributes of 1280 acres that expires in 2020.

Q. Does it have a lease for White Pine County?

A. I can't answer that right now. I don't remember.

Q. You just remember that it doesn't have a lease with these

specifications?

A. That's right. I downloaded all the leases that were part

of that sale, and I looked for the 1280 acres spacing, and

there's only two of them, and Oil and Gas Technology Fund

wasn't either one of those.

Q. Now, in terms of assets that are outside the United States,

the database that you were consulting would not -- leases in

Canada or Nigeria would not be in the database, correct?

A. That's correct.

Q. So all the research that you did for a Canadian asset or

Nigerian asset or any other foreign asset was just basically

Googling?

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A. Well, it was -- I split it into -- it was searching.

Q. Searching on Google?

A. For the business literature, but not for the technical

literature. The technical literature, I use the access to the

database, the technical database, that is called One Petro,

which I access through the Society of Petroleum Engineers' Web

site.

Q. Now, would you agree that it's more difficult to find

information about assets in Nigeria, for example?

A. Not necessarily.

Q. Would you agree there is less transparency in arrangements

in Nigeria?

A. No, not necessarily.

Q. Would you agree it's hard to obtain production data from

Nigeria?

A. Production data?

Q. Yes.

A. So by that I interpret the barrels of oil per day and

allocated to a specific well or project or OML. Yes, that is

harder to get.

Q. Now, when you do a search in your database, what is the

time frame that you search?

A. On most of the searches I didn't limit it to any time

frame.

Q. So you went back -- there is no time frame whatsoever?

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THE COURT: Answer the question. There is no time

frame whatsoever? Yes, no?

A. On some of the searches I did restrict the time frame,

because, for example, in the ConocoPhillips asset sale, I knew

when they were selling it so I wanted to zero in on the sale

process of ConocoPhillips' assets. So that one I would have

constrained, but that was the minority of the searches that I

did where I constrained any kind of time.

Q. If a company has a lease and then it relinquishes the lease

or it sells it to another company, it would no longer be in the

database?

A. Are we talking about U.S. wells or U.S. leases again?

Q. Yes.

A. That will be a multiple -- leases you will find in the

record have multiple -- leases have a specific term, usually

three years, and if you don't start producing you lose the

lease, so then you have to re-lease. And people will also give

up leases, and then they get re-leased. So you will see the

sequence of leasing activity.

Q. Will you see the whole history of them?

A. Yes.

Q. Can you explain what a strategic alliance agreement is?

A. So an SAA, a strategic alliance agreement, is, my

understanding, a term of art in Nigeria specific, I think it's

Nigerian, and I have not worked directly with these. I have

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learned of this through my research. So I have a general

understanding of it, not a detailed understanding.

Q. What is your understanding of a strategic alliance

agreement?

A. The strategic alliance agreements occurred as a result of

the government of Nigeria desiring the oil and gas industry to

have a greater participation by indigenous firms. So upon the

ending of certain leases that large non-Nigerian companies,

like Shell, had -- in Nigeria, when Shell owns a lease, the

national oil company of Nigeria will also own a lease. I am

just using Shell as an example because they did give up one of

their leases that led to a number of assets that this SAA thing

was relevant for.

So when Shell's 20-year term was up, they didn't want

to participate in those leases anymore. And so my

understanding was that the -- but the national oil company

still retained their ownership, and to get money to develop

those, they would bring in companies to help fund further and

continue development of those leases, and they brought those in

through these SAAs. But there was a desire to ensure that, my

understanding, that those were indigenous Nigerian firms, to

increase the local participation in their industry.

Q. Are you familiar with a company called Atlantic Energy?

A. Only through --


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THE COURT: Let's take an afternoon break and we can

chat about that on our time.

Ladies and gentlemen, there should be snacks and stuff

for you back there. We will see you in about ten minutes or

so. We will go to 5:30 today as usual.




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THE COURT: You can step down. Thanks, Mr. Walkup.

In ten minutes or so be back.

(Witness exits courtroom)

THE COURT: The objection is what, beyond the scope?

MR. SOBELMAN: Yes, your Honor. This particularly

pertains specifically to a topic which the government

previously agreed not to introduce evidence of because the

defendants objected to it. It's related to the Britannia-U

fraud that the government agreed not to put in after the

defense objected to that evidence being admitted. They also

tried to get this topic in with James Hagemeier and your Honor

sustained an objection as well.

THE COURT: To beyond the scope?

MR. SOBELMAN: Correct.

THE COURT: Mr. Waller, what is the response to that?

MR. WALLER: Atlantic Energy is a company, I believe,

that Mr. Brennerman acquired and owned interest in various

Nigerian assets.

THE COURT: All right. Why is it not beyond the

scope?

MR. WALLER: The issue is his knowledge of the assets

that Blacksands had, oil assets. He is saying he found no

assets. I was going to ask him if he knew anything about those

assets.

MR. SOBELMAN: Your Honor, this is clearly beyond the

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scope. It pertains directly to the topic which the defense

pushed pretrial for us to keep out of the trial.

THE COURT: It is opening the door to that. So do you

want it all back in?

MR. SOBELMAN: Your Honor, we think at this point it's

simply beyond the scope, and it would prejudice the government

to allow the defense to get into this with one of our last

witnesses on cross-examination, when at their request we had

excluded exhibits and witness testimony from this trial of this

very topic.

THE COURT: Mr. Waller, you're being accused of a

sandbag here. So what is the response to that?

MR. WALLER: I will just withdraw it.

THE COURT: OK. Anything else we need to cover before

we take a break?

How much more do you have, Mr. Waller?

MR. WALLER: Not much, maybe ten minutes.

THE COURT: Then maybe a little bit of redirect.

Then what, or who?

MR. SOBELMAN: Next is Ronald Fitzpatrick.

THE COURT: How long a witness is that?

MR. SOBELMAN: Short. And we are going to read a few

stipulations before that, which will take a few minutes.

After Fitzpatrick is Thomas Bolus from the IRS. It

may take us to the end of the day. If not, we have Lisa

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Charles.

THE COURT: Is she long or short?

MR. SOBELMAN: Also fairly short.

THE COURT: Let's see where we are. See you in about

ten minutes.

(Recess)




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(Jury present)

GARDNER WALKUP, resumed.

THE COURT: We are going to resume the

cross-examination of Mr. Walkup by Mr. Waller.

Mr. Waller, you may proceed.

BY MR. WALLER:

Q. Mr. Walkup, just a few more questions.

OPL 2012, you testified about it on direct, right?

A. Yes, I did.

Q. You're aware that OPL 2012 was a strategic alliance

agreement?

A. I think I remember that.

Q. The SAAs are not necessarily recorded, correct?

A. I would be surprised if that were the case.

Q. You would be surprised if they were recorded or not

recorded?

A. If they were not recorded.

Q. So you believe you would be able to access all Nigerian

SAAs on the Internet?

A. I believe so because -- yes, I believe so, because they are

actually pretty highly contested at the moment.

Q. But each one is actually recorded, you think?

A. I'm pretty confident that they are. There have been some

considerable disputes within Nigeria as to whether or not the

SAAs had contributed the full funds that they were required to

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have contributed, and so there has been in the industry

literature discussions about SAAs. And so I would be surprised

if there were SAAs that were not public.

Q. Do you know where they are recorded?

A. In a legal sense, I do not know where they are legally

recorded.

Q. Do you know if that's something that is a public record for

someone to find by Googling it?

A. Again, I think that the SAAs would be public information,

certainly known by NNPC, the national oil company of Nigeria.

Q. I am talking about known to general members of the public.

A. I think -- I think I am repeating myself by saying I

believe they would be made public. They were a success story

by NNPC, certainly at the beginning.

Q. You were shown an exhibit that was literature from

Blacksands that said that they had in excess of 5 million acres

in the Gulf, something to that effect. Do you recall that?

And you testified about that?

A. Yes.

Q. And you said that 5 million acres constitutes about half of

the entire Gulf, right?

A. I said it was a third of the current leased properties in

the federal waters of the Gulf of Mexico, predominantly what is

called deepwater.

Q. So you're saying that you believe that there are only 15

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million acres in the Gulf for -- maybe you can explain that

again.

A. I am not saying there is only 15 million acres in the Gulf

of Mexico; the Gulf of Mexico is much larger than that.

Q. It's about 160 million acres, right?

A. I wouldn't know. I haven't researched that.

What is on the EIA, which is the government energy

information agency, provides all the leases in the federal

waters of the Gulf of Mexico, and it's about 15 million acres.

So one third -- 5 million is about one third of the 15 million

acres.

Q. Isn't it true that just in this October and November the

government granted a 77 million acre lease in the Gulf of

Mexico?

A. I am not familiar with a 77 million acre lease in the Gulf

of Mexico.

Q. Are you saying that wouldn't be possible?

A. No. The Gulf of Mexico is, as we just said, bigger than 77

million acres.

Q. If the government granted a 77 million acre exploration

lease, then the available acreage to be explored for leases is

far greater than 15 million, correct?

A. The acreage to be explored in the Gulf of Mexico is much

larger. The acreage of the deepwater leases in the Gulf of

Mexico right now is the 15 million acres identified in the EIA

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report; that's where I got that number.

Q. How many times did you meet with the government to prepare

for your testimony?

A. I met with them physically?

Q. Yes.

A. Three times.

Q. Were there other times on the phone?

A. Three times.

Q. Three and three?

A. Yes.

Q. During the course of any of your meetings with the

government, did they show you any leases between Blacksands and

any other companies?

A. No.

Q. Did they show you any joint venture agreements between

Blacksands and any other company?

A. No.

Q. Or operating agreements?

A. No.

Q. Did they show you any agreements between Blacksands and

OGTF, which is Oil and Gas Technology Fund, right?

A. I saw none.

Q. What about any agreements between Blacksands and Highland

Capital?

A. I did not see any.

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Q. Have you ever had any communications with OGTF, which is

Oil and Gas Technology Fund, or Highland Capital?

A. No.

Q. So, basically, your testimony is that you did many, many

searches for Blacksands corporations, or variations of

Blacksands corporations and Mr. Brennerman and various names

associated with him, correct? And your testimony is that you

did not find any evidence of leases held by him or any

operation agreements, is that right? That's basically what

your testimony is?

A. I think my testimony was that, in addition, I said that I

would have expected to have found it, given the magnitude of

the acreage production specific to particular projects, you

know, Cat Canyon has a long record, Nigerian offshore leases

and onshore leases have a long record. So it isn't that I just

didn't find it. I would have expected to have found it given

the magnitude of the reserves and production.

Q. But you don't know for sure that any of those agreements

exist?

A. Which agreements are you referring to?

Q. Any agreements between, for example, Blacksands and Oil and

Gas Technology Fund?

A. I haven't seen any of those.

MR. WALLER: Thank you. Nothing further.

THE COURT: Redirect?

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HC48BRE6


THE COURT: Thank you very much, Mr. Walkup. You can

step down.

(Witness excused)


MR. SOBELMAN: At this time, the government would like

to read a couple of stipulations.

MR. ROOS: The first is a stipulation marked

Government Exhibit 601, which reads at the end of it:

It is further stipulated and agreed that the

stipulation may be received into evidence.

The government offers stipulation 601.

THE COURT: OK. You're not going to read it?

MR. ROOS: Once it's received, I want to publish it to

the jury.

THE COURT: 601 is, by stipulation, admissible in

evidence, so the Court receives it.


THE COURT: Go ahead.

MR. ROOS: The stipulation reads, the parties agree

that:

1. Government Exhibits 200 to 206 are true and

accurate copies of business records that were created and

maintained by Christian Louboutin, that were made at or near

the time of their creation by, or from information transmitted

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HC48BRE6

by, a person with knowledge of the matters set forth in the

records, and were kept in the course of a regularly conducted

activity of Christian Louboutin as a regular practice of that

activity.

2. Government Exhibit 213 are true and accurate

copies of business records that were created and maintained by

Tom Ford, that were made at or near the time of their creation

by, or from information transmitted by, a person with knowledge

of the matters set forth in the records, and were kept in the

course of a regularly conducted activity of Tom Ford as a

regular practice of that activity.

3. Government Exhibit 207 is a true and accurate copy

of business records that were created and maintained by Vicci

Fine Jewelry, that were made at or near the time of their

creation by, or from information transmitted by, a person with

knowledge of the matters set forth in the records, and were

kept in the course of a regularly conducted activity of Vicci

Fine Jewelry as a regular practice of that activity.

4. Government Exhibit 210 is a true and accurate copy

of business records that were created and maintained by Hermes

of Paris, Inc., that were made at or near the time of their

creation by, or from information transmitted by, a person with

knowledge of the matters set forth in the records, and were

kept in the course of a regularly conducted activity of Hermes

of Paris, Inc. as a regular practice of that activity.

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HC48BRE6

5. Government Exhibits 400 to 402 and 404 are true

and accurate copies of business records that were created and

maintained by Regus, that were made at or near the time of

their creation by, or from information transmitted by, a person

with knowledge of the matters set forth in the records, and

were kept in the course of the regularly conducted activity of

Regus as regular practice of that activity.

It's signed by the parties.

The government offers 200 to 206, 213, 207, 210, 400

to 402 and 404.

THE COURT: So Government Exhibits 200 to 207, 210,

213, 400 to 402 and 404 are received.

(Government's Exhibits 200 to 207, 210, 213, 400 to

402 and 404 received in evidence)

THE COURT: You have got a witness or are you reading

more stips?

MR. ROOS: More stips.

Government Exhibit 603 reads at the end:

It is further stipulated and agreed that this

stipulation may be received in evidence.

The government offers 603.

THE COURT: 603 is received.


MR. ROOS: I am happy to read the stipulation, but

with the Court's permission, we can just publish it and then I

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will offer the exhibits that are in the stipulation.


MR. ROOS: The government offers Exhibits 209, 211,

212.

THE COURT: Government Exhibits 209, 211 and 212 are

also received.

(Government's Exhibits 209, 211 and 212 received in

evidence)

MR. ROOS: Next, Government 604 reads at the end:

It is stipulated and agreed that this stipulation may

be received in evidence.



MR. ROOS: Ms. Fetman, would you please publish this

to the jury.

The government now offers Government Exhibits 460 to

479, 495 to 513, 487 to 494, 522.

THE COURT: So it's really 460 to 479, 487 to 513, and

522, right?

MR. ROOS: Yes, your Honor.

THE COURT: Those are received.

(Government's Exhibits 460 to 479, 487 to 513, and 522

received in evidence)

MR. ROOS: Lastly, Government Exhibit 606, which at

the end indicates the parties stipulate and agree the

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stipulation may be entered into evidence.


(Government's Exhibit received in evidence)

MR. ROOS: May we publish this to the jury?

THE COURT: Yes.

MR. ROOS: My apologies. This one is a new addition

so I don't think you have a copy, your Honor.

The stipulation indicates that the parties agree, if

called to testify, a representative of the United States

Citizenship and Immigration Services would testify as follows:

1. Government Exhibit 51B is a true and accurate copy

of documents provided by The Blacksands Pacific Group, Inc. to

United States Citizenship and Immigration Services in support

of the I-129 petition marked as Government Exhibit 51.

2. The representative of the United States

Citizenship and Immigration Services does not know if the

information contained in Government Exhibit 51B is truthful or

accurate. The witness also does not know whether the documents

contained in Government Exhibit 51B are genuine, and if they

are, what they purport to be.

It's signed by the parties.

THE COURT: So you're offering 51 and 51B?

MR. ROOS: 51B.

THE COURT: Just 51B. All right.

(Government's Exhibit 51B received in evidence)

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HC48BRE6 Fitzpatrick - Direct

THE COURT: That's it for the stips?

MR. ROOS: Yes.

THE COURT: Now you're going to call another witness?

MS. SASSOON: Yes. Ronald Fitzpatrick.

RONALD FITZPATRICK,




the record.

THE WITNESS: Ronald Bruce Fitzpatrick II,

R-O-N-A-L-D, B-R-U-C-E, F-I-T-Z-P-A-T-R-I-C-K.

THE COURT: Mr. Fitzpatrick, keep your voice up nice

and loud.

Go ahead, Ms. Sassoon.

DIRECT EXAMINATION

BY MS. SASSOON:

Q. Good afternoon, Mr. Fitzpatrick.

A. Good afternoon.


A. I work for Regus Management Group.

Q. How long have you been working there?

A. I'd say about six years, since 2011.

Q. What is Regus?

A. Regus provides office solutions for people, basically,

small businesses, large businesses, anybody who needs a place

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to work, we provide phone services, Internet services. It's

basically a business center.

Q. What are some of the types of contracts that Regus offers?

A. We have mailbox plus contracts, where clients are able to

use our address for business purposes. We have telephone and

answering services, where rather than just take the address, we

provide clients with a phone number, in which case they could

use that number for business purposes. We'd answer the phone

calls and transfer them wherever they needed to go.

Q. What else beyond a mailbox service or a phone answering

service?

A. We also have the virtual office options, which are

literally a combination of both the mailbox and the telephone

answering services.

Q. Does that virtual office agreement include the ability to

use any physical space that Regus owns?

A. The virtual office agreements come as a virtual office and

virtual office plus. The virtual office agreement comes with

two days a month of standard day office usage. The virtual

office plus option comes with five days a month.

Q. What is an in-house agreement, is that something that Regus

offers?

A. Yes. That's for clients who wish to take full-time space

as opposed to just virtual space, meaning they would have 24/7

access to the center. We provide them with keys to the office,

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access cards to the building. They would be full tenants.

Q. What is the benefit of the Regus business model for

clients?

A. It provides a convenient place for people to go when they

don't necessarily want to work out of a coffee shop, some

clients want to work in a quiet environment where they can get

enough work done, make phone calls and whatnot, so Regus

provides that.

Q. How does the monthly pricing of a virtual office agreement,

for example, compare to leasing a permanent space for an

office.

A. It depends on which location you're signing up at, but

generally office agreements are much more expensive than

virtual office agreements.

Q. Where does Regus have offices?

A. Currently, they have got about 3,000 locations worldwide.

Q. Where is the Regus office at which you work?

A. I work at the 245 Park Avenue location. That's in

Manhattan, between 46th and 47th on Park.

Q. Around how many clients does this particular Regus office

have?

A. In-house, I'd say at least 20. If you add on the virtual

clients, that's probably another 100.

Q. Based on your experience, what is the significance, if any,

of the 245 Park Avenue, Manhattan address?

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A. It's a prestigious address.



You can answer.

A. The 245 Park Avenue address, from my experience, tends to

be more of a prestigious address. In the time that I worked

there, I have learned our building has the presidential

railroad underneath, and people tend to like having a Park

Avenue business address to do business with.

Q. What is your title at Regus?

A. I am currently the community manager.

Q. What are your responsibilities as the community manager?

A. I'm pretty much the point of contact for all in-house and

virtual office clients. If they have any questions, I am the

first person that they come to, in which case if I can't answer

them, then I field it out to my supervisors. I assist in

handling mail for clients, answering phone calls for clients,

basically all types of admin services, down to copying,

printing and scanning.

Q. Have you held any other positions at Regus?

A. Yes. When I started with the company in 2011, I was a

community associate. I think they called them client service

representatives back then. Right now the term is community

associate.

Q. What were your responsibilities in that role?

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A. Predominantly just mail handling. I'd do a little bit of

phone answering here and there, but I was stationed primarily

in the mailroom at 245 Park Avenue.

Q. When were you promoted to your current role?

A. About a year or so ago.

Q. During your time at Regus, did you come into contact with

Raheem Brennerman?

A. Yes, I did.

Q. When was that?

A. It was a few times over the course of my time at Regus.

Q. What was the nature of your relationship with Mr.

Brennerman?

A. Just like every other virtual office client, we would

handle phone calls, we would accept mail for him, notify him of

any specialty packages, and he would let us know if he wanted

us to hold them or forward them to him directly.

Q. Was there a particular business associated with Mr.

Brennerman's Regus account at 245 Park Avenue?

A. Yes. That was BLV Realty organization.

Q. Did you ever meet him in person?

A. I have met with him a couple of times before.

Q. In what context?

A. He would come in, utilizing the center, whether or not he

needed to make phone calls or picking up his mail, if he had

any and we hadn't forwarded it at the time. Beyond that,

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nothing else.

Q. As far as you can remember, did you ever receive mail for

Mr. Brennerman's BLV account addressed to any other person?

A. To any other person, no.

Q. Where did you forward this mail that came in for Mr.

Brennerman?

A. Generally, he had them all going to a Las Vegas address.

It was a hotel. I can't remember the name.

Q. Did you ever receive calls from BLV for anyone else other

than Mr. Brennerman?

A. No.

Q. Was the mail that came for Mr. Brennerman ever addressed to

a company other than BLV?

A. Technically we are not allowed to accept mail addressed to

different companies. However, in my time there, I had seen

mail come in under a Blacksands company name, in which case we

would notify Mr. Brennerman that we would not be able to accept

mail under this company name since his 245 Park Avenue account

was with BLV Realty.

MS. SASSOON: Ms. Fetman, can you please display to

the jury Government Exhibit 402, which is in evidence.

Q. Do you recognize what is up on your screen there?

A. Yes, I do. This is a Regus virtual office agreement.

Q. How do you recognize it?

A. It's actually from my center. It's for the 245 Park Avenue

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location. This is when we had the 24th and 39th floors in that

building. Currently, we just have the 39th floor.

Q. Zooming in on the agreement date at the top, what is the

date on this agreement?

A. August 15, 2008.

Q. Let's take a look at the two boxes below that. Who is this

agreement between?

A. So this is between the Regus Center at 245 Park Avenue and

BLV Realty Corporation at 432 Park Avenue South, in New York.

Q. Looking at the bottom, who signed this agreement on behalf

of BLV Realty?

A. Raheem Brennerman.

Q. Zooming back out, does this contract specify what type of

Regus agreement this is?

A. Yes. This is a standard virtual office agreement.

Q. What is the cost per month specified for this virtual

office agreement?

A. $375 per month.

Q. Is that the entire cost per month for the services of a

virtual office agreement?

A. Yes.

Q. Turning to the second page, do you recognize this page?

A. Yes. These are the terms and conditions for a Regus

agreement.

MS. SASSOON: Ms. Fetman, can you please zoom in on

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the paragraph "product definition," which is on the upper

left-hand side.

Q. What is the purpose of this section of the terms and

conditions?

A. It offers some details to the client of the types of

agreements that Regus offers and gives them a little bit of

information as far as what each one provides.

Q. Take a look at 1.3, virtual office and virtual office plus.

Can you summarize what this type of agreement would

contain?

A. So virtual office and virtual office plus is a combination

of both mailbox plus and telephone answering service, in which

case we would accept mail for clients, notify them of any sort

of specialty delivery items -- couriers, FedEx, UPS and

whatnot -- and they would inform us as to whether or not they

want us to hold those documents or items or forward them to

whatever address they request.

The telephone answering option here also allows the

client to have a phone number provided by Regus, in which case

that phone number would be answered by Regus staff and

forwarded over to a cell phone, if they prefer, or to a voice

mail box that Regus provides.

Q. What does it say in the second half of 1.3 about physical

office usage?

A. The virtual office and virtual office plus agreements each

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provide a set number of days per month for the client to come

in and utilize a private office for business purposes. The

virtual office option offers two days a month of private day

office usage, and the virtual office plus option offers five

days a month.

Q. Which type of contract was this, virtual office or virtual

office plus?

A. Virtual office.

Q. That would mean two days of physical office space a month?

A. Correct.

Q. Does this agreement allow Mr. Brennerman or BLV to use a

Regus physical office on a daily basis?

A. It does not, no.

Q. Under this agreement would Mr. Brennerman be allowed to

keep any belongings overnight inside a Regus office?

A. No.

Q. Let's go back to the first page of this document.

I would like to put it side by side with Government

Exhibit 1-57A, which is also in evidence.

Now, zooming in, we will see that at the top of this

document it says, "Morgan Stanley Smith Barney. Kindly provide

all personal information."

Now, let's zoom in on the name and address at the top

of this document.

Can you read that for us?

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A. Full name is Raheem Jefferson Brennerman, address at 245

Park Avenue, 39th floor, New York, New York 10167.


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HC4KBRE7 Fitzpatrick - Direct

BY MS. SASSOON:

Q. Do you recognize that address?

A. Yes. That's my work address.

Q. Were clients of Regus at 245 Park Avenue allowed to rent

residential space on the 39th floor --

A. No.

Q. -- of the office?

A. They were not, no.

Q. Would a contract allow a client to represent 245 Park

Avenue as a residential address?

A. It would not, no.

MS. SASSOON: Ms. Fetman, please show only the witness

what has been marked for identification as Government Exhibit

403.

Q. Do you recognize this?

A. I do. This is a floor plan for the 39th floor for Regus at

245 Park.

Q. Is that a true and accurate copy of that floor plan?

A. Yes, it is.

Q. Will it aid in your testimony today?

A. It will.

MS. SASSOON: The government offers Exhibit 403.


MR. WALLER: No objection.

THE COURT: All right. So Government Exhibit 403 is

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received.


MS. SASSOON: I'd like to display it now for the jury,

please.

BY MS. SASSOON:

Q. Does this floor plan on your screen represent the entire

Regus office space at 245 Park Avenue?

A. Currently, yes.

Q. Was that always the case?

A. No. We used to have the 24th floor as well.

Q. How does the layout of the 24th floor compare to this

layout?

A. It's a similar layout. It had a reception area in front of

the main elevator bank. It had several conference rooms on the

floor along with various offices. So, it was very similar.

Q. Using this floor plan as an aid, can you describe the

layout of the 39th floor?

A. So, we have our reception area kind of right in the middle

there, directly in front of the main elevator lobby here. To

the -- I guess would be my left is our large boardroom, which

seats about 12 people. To the right, we have our business

lounge area, along with two smaller conference rooms, each

which would seat four people. From there, you can kind of make

your way out to the various offices on the floor.

Q. How many individual offices are there on the 39th floor?

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A. A little over a hundred.

Q. Where did you typically spend the workday?

A. My main post is right at reception.

Q. At reception, would you see clients coming in an office

floor?

A. I would, yes.

Q. Is that generally where you have been based in your years

at Regus?

A. With the exception of when I started, yes, I would --

again, I was in the mailroom initially when I started with the

company, but, yes, when we kind of transitioned everything up

to the 39, I was at reception.

Q. Around how many times in your time working at Regus did see

Mr. Brennerman walk in or out of the office?

A. Maybe five times.

Q. In your experience, did Mr. Brennerman ever arrive or leave

with anyone else at the Regus?

A. Not that I can recall, no.

Q. In your experience, did any other BLV employee ever use the

Regus office space?


Q. Turning back to the individual offices, on average, about

how big is each office?

A. I'd say the average office spans about 100 to 150 square

feet.

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Q. What is provided to a client in each of these individual

offices?

A. A standard furniture, depending on how many desks it's

supposed to be set up for. They have a set number of desks,

phone, ethernet cable for Internet access, and basic

decorations, you know, picture, lamp, whatnot.

Q. Are clients able to personally decorate their office space?

A. Only if they have a full-time agreement with Regus.

Q. For those clients like Mr. Brennerman with a virtual office

agreement of providing two days of physical space a month, on

those days, how many offices would it entitle that person to

use?

A. One office.

Q. As far as you are aware, did Mr. Brennerman ever pay extra

to use additional physical space?


MS. SASSOON: Ms. Fetman, can you please display

Government Exhibit 1-59-A, which is in evidence.

Q. Had you ever seen this document before I showed it to you?

A. No. No, I haven't.

Q. You'll see on the first page, it says, "Blacksands

Pacific."

Do you recognize that name?

A. Just on the misdelivered mail to 245 Park Avenue.

Q. Let's turn to page 8. This says "Blacksands Pacific

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Overview" at the top. Do you see where it says "Trading

Offices" toward the bottom of the page?

A. Yes, I do.

MS. SASSOON: Let's zoom in on those two addresses.

Q. Can you please read the first address?

A. 11601 Wilshire Boulevard, Suite 500, Los Angeles,

California. The zip code is 90025.


A. I believe that's a Regus location.

Q. Let's put this exhibit side by side with Exhibit 401, which

is in evidence.

Do you recognize Exhibit 401?

A. Yes. This is another online virtual office agreement.

Q. Who is this office agreement between?

A. This is between the Regus Center at 11601 Wilshire

Boulevard in Los Angeles, California, and the Blacksands

Pacific Energy Corporation at 2711 Centerville Road in

Wilmington, Delaware.

Q. What is the email address provided for the client on this

Regus contract?


Q. As far as you are aware, do the terms and conditions of

virtual office agreements vary across United States Regus

locations?

A. No. They're standard, I believe.

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Q. Looking back at the left side of the screen, can you please

read the second address listed there?

A. 9595 Six Pines Drive, Suite 8210, The Woodlands, Texas.

The zip code is 77380.


A. I believe that's also a Regus location.

MS. SASSOON: Let's put up on the right-hand side,

Government Exhibit 404, which is in evidence.

Q. Do you recognize this document?

A. Yes. This is another online virtual office agreement.

Q. Who is this agreement between?

A. This is between the Regus center at 9595 Six Pines in The

Woodlands, Texas, and Blacksands Energy -- Blacksands Pacific

Energy Corporation at 325 North End Avenue in New York.

MS. SASSOON: Let's put up next Government Exhibit

1-57-A, page 2. We can put that up on the whole screen.

Q. Looking at the top, this is a Morgan Stanley Smith Barney

document. Can you please read the name and address at the top

of this document?

A. Sure. The full name is Jefferson III Holdings LLC, address

is 3960 Howard Hughes Parkway, Suite 500, Las Vegas, Nevada.

89169 is the zip code.

Q. Do you recognize this address?

A. I don't, actually.

MS. SASSOON: Well, let's put up Government Exhibit

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400.

Q. Do you recognize this document on the right-hand side?

A. I do. It's another virtual office agreement.

Q. Can you please read what address -- what Regus address is

on the left-hand side?

A. It's Regus center at 3960 Howard Hughes Parkway, Suite 500,

in Las Vegas, Nevada. Zip code is 89169.

Q. How does that address compare to the address we saw in the

document on the left?

A. It looks to be exactly the same.

Q. Zooming back out on the document on the right-hand side,

can you please read what virtual office type agreement it is

that's at the center of the page?

A. Sure. This is a standard Mailbox Plus agreement.

Q. How does that compare to the virtual office agreement?

A. This would not provide a client with any days -- any free

days allotted to him for use at the center. This also would

not provide him with a phone number as well. It only

handles -- it only covers mail handling.

Q. Based on your understanding of the various agreements that

Mr. Brennerman had with Regus, did he ever have a Regus office

with a permanent physical space?

A. Based on this, no.

Q. Based on your understanding of the various agreements we

have looked at and Mr. Brennerman had with Regus, did he ever

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HC4KBRE7 Fitzpatrick - Cross

have a staff or employees with a permanent physical presence at

a Regus office location?

A. No.


THE COURT: Cross-examination, Mr. Waller?

CROSS-EXAMINATION

BY MR. WALLER:

Q. Good afternoon, Mr. Fitzpatrick.

A. Good afternoon.

Q. Regus is a publicly traded corporation, right?

A. Yes.

Q. It's a multinational corporation?

A. Yes, it is.

Q. It has about $2 billion in revenue every year?

A. I wouldn't know the exact figure on that, but it sounds

about right.

Q. Is it a billion dollar company?

A. I would believe so, yes.

Q. Now, Regus is in the business of providing alternatives to

traditional office space, right?

A. Correct.

Q. And there are benefits of having a virtual office space?

A. Yes.

Q. It provides flexibility to a company --

A. Yes, it does.

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Q. -- right?

It allows a company to establish a presence in any

market, right?

A. Yes.

Q. In fact, isn't that something that's promoted on Regus'

website?

A. I believe so, yes.

Q. And it's also less costly to have a virtual office, right?

A. Yes.

Q. And more efficient?

A. In comparison to having a full office, yes.

Q. Yes. You don't have to manage and operate a traditional

office, correct?

A. Correct.

Q. How many companies did you say used the Regus office space

in New York?

A. In New York or at my center alone?

Q. How many offices are in New York?

A. I'd say about 40.

Q. Okay. So at your location?

A. At my location, about 20 in-house clients. If you add in

the virtual office clients, I'd say that tacks on about another

hundred.

Q. Some of those are large companies?

A. Yes.

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Q. What types of companies?

A. All types. We have law firms, we have financial

institutions, hedge funds. It really spans the gamut.

Q. Would you expect that if a company rents a Regus office,

whether it's virtual or in-house, that they would use that

address on their own website as their office address?

A. As their office address, yes.

Q. That's expected, that that's the address that the company

is going is to use, is the Regus office, correct?

A. Correct.

Q. You said you're aware that Regus -- that Mr. Brennerman

signed leases for Texas, California, and Las Vegas?

A. Based on the documents here, yes.

Q. The prices that were shown, $375 a month for a virtual

office, that was in 2008, right?

A. Uh-huh.

Q. Has the price gone up since then?

A. It has, yes.

Q. If a person has a virtual office that allows them two days

of actual office space per month, are they able to call and

say, I'd like to use -- I've used my two days, I'd like more

space and more time in the office for an additional fee?

A. They are able to request that, yes.

Q. So, the person -- someone or a company that has a virtual

office space has flexibility to use it more than two days if

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they just pay extra money, correct?

A. Correct, if they pay extra.

Q. And Regus is very flexible about that?

A. Yes.

Q. There are conference rooms available if someone in a

company wanted to meet with a client?

A. Yes, there are.

Q. And there's desks available to do work, right?

A. Of course, yes.

Q. The purpose of Regus is not to allow companies a fraudulent

way to represent themselves, is it?

A. No. No, it's not.

MR. WALLER: Thank you. I have nothing further.


MS. SASSOON: No, your Honor.

THE COURT: Okay. You can step down. Thank you very

much, Mr. Fitzpatrick.

THE WITNESS: No problem.

(Witness excused)

THE COURT: Next witness?

MR. LANDSMAN-ROOS: The government calls Thomas Bolus.

THOMAS BOLUS,



THE COURT: Please state your name and spell your name

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HC4KBRE7 Bolus - direct

for the record.

THE WITNESS: Thomas Bolus, B-o-l-u-s.

THE COURT: Okay. Mr. Bolus, you don't have to eat

the mic, but just probably about four inches would do it.

Right there, I think, is where --

THE WITNESS: Thank you.

THE COURT: Good. Thank you.

Go ahead, Mr. Roos.

DIRECT EXAMINATION


Q. Good afternoon, Mr. Bolus.

A. Good afternoon, sir.


A. I work at the Internal Revenue Service Criminal

Investigation Division in Scranton, Pennsylvania.

Q. What's your title there?

A. I am a court witness coordinator.

Q. How long have you worked at the IRS?

A. For 13 years.

Q. What are your duties and responsibilities in your current

position?

A. Well, as a court witness coordinator, I represent the

commissioner of the Internal Revenue Service in his custodial

duties as the record custodian for trials. So I gather,

retrieve, download, and prepare certifications of true original

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copies of tax documents to bring in those copies to be

introduced as evidence in federal criminal trials.

Q. Now, are companies required to file taxes with the IRS?

A. Yes, they are.

Q. What types of tax filings must a company file?

A. Well, a corporation can file an 1120 Form, which is a

corporate United States tax form. Partnerships can file a Form

1065, which would be a partnership between multiple people or

two people. And then there's the FUTA Form, there's a Form

940, which is a Federal Unemployment Tax Act form, which is

required to be filed yearly, annually, for a company to show

any unemployment that may have been paid. And there's also a

quarterly tax return for the company and/or corporation to show

their quarterly income and submit payment vouchers along the

way, so they don't get hit at the end of the year with one big

payment, and that's a Form 941.

Q. How frequently must a Form 1120 be filed?

A. They're filed annually.

Q. I'm showing you what's in evidence as Government Exhibit

157-A. Do you see that document on your screen?

A. Yes, I do.

MR. LANDSMAN-ROOS: Ms. Fetman, will you zoom in on

the top portion of the document, the top half.

A. I'm sorry, your question, sir?

Q. I was asking the paralegal to zoom in.

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Now, Mr. Bolus, do you see on your screen where it

says "Estimated Annual Compensation"?

A. Yes, I do.

Q. What's the estimated annual compensation on this document?

A. $720,000 base salary.

Q. By the way, had you seen this document before I showed it

to you at some point?

A. No.

Q. Now, based on your training and experience with the IRS, do

you know whether a person with an annual salary of $720,000 is

required to file a tax return?

A. Yes, they would be.

MR. LANDSMAN-ROOS: Okay. You can take that document

down. And can you put up what's in evidence as Government

Exhibit 1-2-A. And, Ms. Fetman, will you take us to page 6 of

this document.

Q. Mr. Bolus, before I showed you this document, had you seen

it?

A. No, I had not.

Q. Do you see on the screen where it says "Net Income

Revenues"?

A. Yes, I do.

Q. And you see above it, there are three zeros?

A. Yes.

Q. Now, what does this document say net income revenues are?

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A. $87,337,000.

MR. LANDSMAN-ROOS: Ms. Fetman, if you could zoom out.

Q. And, Mr. Bolus, do you see at the bottom of the screen

where it says "Pretax Profits"?

A. Yes, I do.

Q. And what are the pretax profits that are listed?

A. 26,959,000.

Q. Now, based on your training and experience with the IRS, do

you know whether a company with approximately $26,959,000 in

pretax profit is required to make a tax filing?


Q. Before testifying today, did you have the opportunity to

review certain IRS records and documents to prepare for your

testimony?

A. I did. As part of the ex parte order from the United

States Attorney for the Southern District of New York to the

Internal Revenue Service to request disclosure of certain tax

documents.

Q. So let me ask you about what you just said. First of all,

what is an ex parte order?

A. Well, an ex parte order is a direction to the Internal

Revenue Service to disclose tax information, which we normally

don't do because of privacy and personal identifying

information. And it directs the Internal Revenue Service to

disclose for a particular information that may be relevant to a

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trial.

Q. And what party makes the request?

A. So the U.S. Attorney's Office would make the request to the

Disclosure Office of the Internal Revenue Service.

Q. And then what happens after that?

A. The Disclosure Office would then research and gather

information that was requested, that particular information

just in the scope of that request, and then provide that

information further to the U.S. Attorney's Office.

Q. Have you reviewed the records that were collected by the

Disclosure Office?

A. Yes, I did.

Q. I'm showing you what's marked for identification as


MR. LANDSMAN-ROOS: This is not for the jury.

Q. Mr. Bolus, do you recognize this document?

A. Yes, I do.

Q. And what is it?

A. So this document was prepared by the U.S. Attorney's Office

to -- basically reconciliation or a comparison of the documents

that the IRS Disclosure Office provided to the U.S. Attorney's

Office.

Q. Let me ask you a few questions about it.

The documents that were provided by the IRS to the

U.S. Attorney's Office, were they made and maintained by the

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IRS in its regular operations?

A. Yes, they are.

Q. Does the IRS keep the information asked about by the U.S.

Attorney's Office in its regular activities?

A. Yes.

Q. Are those records voluminous?

A. Yes, they are.

Q. Have you reviewed the information in Government Exhibit 31?

A. Yes, I have.

Q. Have you been able to verify whether it correctly and

accurately reflects the information in the IRS records that you

looked at?

A. I did verify it, and it is correct.

MR. LANDSMAN-ROOS: The government offers Exhibit 31

pursuant to Rule 1006.


MS. FRITZ: No, no objection.

THE COURT: Okay. Government Exhibit 31 is received.


MR. LANDSMAN-ROOS: May we publish it to the jury?

THE COURT: Yes.


Q. Now, Mr. Bolus, I'm going to ask you some questions about

this chart. First, what years did you review tax records for?

A. From 2012 through to 2016.

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Q. And when you say through 2016, up to what point in 2016?

A. So January 1st of 2012 through December 31st of 2016.

Q. At this point, does the IRS have records for the year 2017?

A. Not yet.

Q. Now, do you see the company names that are listed on this

chart?

A. I do.

Q. Let's start at the top one. Did the Blacksands Pacific

Group, Inc. file any taxes from 2012 to 2016?

A. No.

THE COURT: Can I ask a question: What's the

significance of a red X as opposed to the letters N-O? You

write no in some columns, you write a red X in other columns.

Do they mean the same thing?

THE WITNESS: That's correct, it's a no.

THE COURT: So red X means no.

Okay. Go ahead.


Q. Now, Mr. Bolus, Blacksands Pacific Group, did it pay any

taxes?

A. No, there's no record of it.

Q. And looking at the next three columns, during this time

period, did it file any Form 1120s?

A. No.

Q. What about any Form 941s or 940s?

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A. No, they did not.

Q. Based on your review, is that true for all of the other

Blacksands Pacific entities listed here?

A. Yes, it is.

Q. For the entire time period?

A. Yes.

Q. What about Jefferson III Holdings?

A. And for Jefferson III Holdings LLC, also.

Q. Now, if a company didn't make any profit in a year, would

it be required to file a tax return?

A. Yes, they would.

Q. Why is that?

A. Because there's liabilities and assets that a company needs

to report.

Q. What if a company only had contractors, would it need to

file one of these Form 941s or 940s?

A. Yes, they would.

Q. Why is that?

A. Because they would be submitting Form 1099s on the

contractors.

Q. I'm showing you now what's in evidence --

MR. LANDSMAN-ROOS: And can we publish it to the jury.

Q. -- Government Exhibit 58.

Mr. Bolus, do you see at the top here, it says it's a

letter, it's dated August 15, 2014?

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A. Yes, I do.

Q. It's addressed to U.S. Department of Homeland Security,

U.S. Citizenship and Immigration Services. Do you see that?

A. Yes, I do.

Q. Mr. Bolus, before I showed you this document in preparation

for your testimony, had you ever seen it?

A. I had not.

Q. Let me hand you a copy. I'd just ask you to flip through

it.

MR. LANDSMAN-ROOS: Ms. Fetman, if you'd flip, for the

jury, through the pages of the document.

Q. And, Mr. Bolus, let me know when you've had a chance to

look through it.

Okay. I want to direct your attention to the first

exhibit attachment to this letter. And let's look at page 6.

Do you see where it says 941 at the top?

A. Yes, I do.

Q. What's a Form 941?

A. So this is a quarterly employer's tax form.

Q. Why is this filed?

A. This is filed quarterly so that the employers can tell the

IRS what taxes they paid, or for employment. And it also gives

them a chance to submit a voucher of payment along the way.

Q. In this particular Form 941, what entity does it say the

form is for?

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A. So this is for the Blacksands Pacific Group, Inc., 11601

Wilshire Boulevard, Suite 500, Los Angeles, California 90025.

Q. Is this form signed? You can go to the next page.

A. Yes, it is.

Q. Who is it signed by?

A. To the right of the signature, it says Raheem J.

Brennerman, CEO.

Q. Have you reviewed the tax filings and records related to

the Blacksands Pacific Group, Inc.?

A. Yes, I have.

Q. Did the Blacksands Pacific Group, Inc. ever file a Form

941?

A. There is no record of it with the IRS records.

Q. Let's talk about Raheem Brennerman. First, if a person is

paid by a company, do they receive a tax form?

A. Yes, they would.

Q. And what form is that?

A. They could receive a W-2 or a 1099 form.

Q. What determines if a person received a W-2 or a 1099 form?

A. If a person is a regular employee of that corporation or

that company, they would receive a W-2. If they're a

contracted or seasonal or temporary employee, they would

receive a Form 1099.

MR. LANDSMAN-ROOS: Now, Ms. Fetman, if you could take

us to the eighth page of this exhibit.

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Q. Do you see that, Mr. Bolus?

A. Yes, I do.

Q. And what type of form is this?

A. So this is a Form W-2 wage and tax statement.

Q. And who is the W-2 form for?

A. This is issued by the Blacksands Pacific Group, Inc. to

Raheem J. Brennerman for the tax year 2013.

Q. Did you have a chance to review tax records or records in

the IRS's possession relating to the Blacksands Pacific

Group, Inc. and Raheem J. Brennerman?

A. Yes, I did.

Q. Did the Blacksands Pacific Group, Inc. ever file this W-2?

A. No. That was never received by the IRS.

Q. What about Raheem J. Brennerman, did he ever file this W-2?

A. No, he did not.

Q. Let's look at Exhibit 31 again.

MR. LANDSMAN-ROOS: Ms. Fetman, can you put that up on

the screen.

Q. Mr. Bolus, did the IRS conduct a search relating to Raheem

Brennerman and also that Social Security number that's listed

there?

A. Yes, they did.

Q. From 2012 to 2016, did Raheem Brennerman ever pay any

taxes?

A. There is no record of it.

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HC4KBRE7 Bolus - Cross

Q. And did he ever file any tax forms?

A. No, he did not.


THE COURT: Okay. Any cross?


CROSS-EXAMINATION

BY MS. FRITZ:

Q. Good afternoon, Mr. Bolus.

A. Good afternoon, yes, ma'am.

Q. In connection with the review that you undertook in this

case, did you determine whether or not Raheem Brennerman is

actually a citizen of the U.K.?

A. I did not.

Q. There was nothing that you saw that alerted you to the fact

that he is not a U.S. citizen?

A. The records that I saw indicate that he has a Social

Security number, and those -- and that he does have a tax

module open with the IRS but no tax filings.

Q. Okay. If an individual is actually a resident of the U.K.,

do you have any knowledge of what, if any, filings were done

where they live?

A. I would not have knowledge of that.

Q. Let me ask you a different question.

MS. FRITZ: If we could put up Government Exhibit 31.

Q. On here, there are a couple of companies listed. Alpha

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HC4KBRE7 Bolus - Redirect

Blue LLC is one of them. Do you see that?

A. With Blacksands Alpha blue?

Q. Yes.

A. Yes.

Q. If a company -- not with respect to a filing, but if a

company has received a loan, does that loan create a tax

obligation? Putting aside the filing obligation, does it

create an obligation to pay taxes?

A. The loan itself would not.

MS. FRITZ: That's it. Thank you.


MR. LANDSMAN-ROOS: Redirect.



Q. Mr. Bolus, if a person is a citizen or resident of another

country but makes income in the United States, are they

required to file taxes?



THE COURT: Nothing?

Mr. Bolus, you can step down. Thank you. Give those

papers back to Mr. Roos.

THE WITNESS: I'm excused, sir?

THE COURT: You're excused, yes. Thank you very much.

THE WITNESS: Thank you very much.

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HC4KBRE7 Charles - Direct

THE COURT: You want to stay longer?

(Witness excused)

THE COURT: Next witness?

MS. SASSOON: Lisa Charles.

LISA CHARLES,




the record.

THE WITNESS: Lisa Charles L-i-s-a, C-h-a-r-l-e-s.

THE COURT: Ms. Charles, just keep your vice up nice

and loud.

Ms. Sassoon, you may proceed.

DIRECT EXAMINATION

BY MS. SASSOON:

Q. Good afternoon, Ms. Charles. Do you know Raheem

Brennerman?

A. I do know Raheem Brennerman.

Q. How would you describe your relationship with him?

A. It originally started out as a hopeful relationship, but it

went towards more of a friendship.

Q. How did you meet him?

A. A dating site.

Q. Around when was that?

A. 2011.

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Q. Where did you live at the time that you met Mr. Brennerman

on this site?

A. Richmond Hill, Queens.

Q. Where did he live at the time, if you know?

A. It was between California, London, and New York.

Q. After you met online, did you keep in touch?

A. I did we did.

Q. In what way?

A. Emails, phone calls, and meeting each other.

Q. As you were getting to know Mr. Brennerman, what, if

anything, did he tell you about where he was from?

MS. FRITZ: Objection.


A. He told me he was from originally Park Avenue, New York.

Q. What, if anything, did he tell you about his educational

background?

A. He originally went to Columbia University and then London

School of Finance.

Q. Did he tell you anything about what he did for a living?

A. He told me that he did oil, real estate and gas.

Q. Did he explain to you what his role was in that sector?

A. That he was the CEO.

Q. What are some of the things that he told you about his

company?

MS. FRITZ: Objection; can we get any kind of time

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frame reference anything?

THE COURT: You said you met him in 2011?


THE COURT: How long did you speak with him?

THE WITNESS: Until March 2017.

THE COURT: Okay, so a long time. So, maybe we should

specify a time period. Go ahead.

BY MS. SASSOON:

Q. As you were getting to know him in 2011-2012, what are some

of the things he told you about his company?

A. A few things that he told me about the company? Let's see.

I'm trying to think about this. I know that they were supposed

to be moving to New York. He was moving from Texas to -- well,

I had several locations of his company -- California, Texas,

London -- and that they were going to be moving all of the

employees to the New York office that he was building.

Q. Did he tell you the name of this company?

A. It was black -- I forget BLV and Blacksands.

Q. As you were getting to know him, did he tell you anything

about how he became involved in the oil and gas business?

A. His paternal grandfather got him involved.

Q. You mentioned something about moving his employees. Did he

give you a sense of how many employees he had?

A. Well, he mentioned that -- we had a conversation about

Christmas holiday parties once, and also we had conversated

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about gym, gym membership for his employees.

Q. What kind of impression did that give you of how many

employees there was?


A. That it was a larger --

THE COURT: Did he ever say how many employees?

THE WITNESS: Not exactly.

THE COURT: Okay. Go ahead next question.

Q. I think you mentioned that there came a time when you met

Mr. Brennerman in person. Do you remember around when that

was?

A. That would have been -- let's see, December 2011.

Q. Where did you meet?

A. We met at the Time Warner building.

Q. In what city?

A. In New York.

Q. After that, how often were you in touch with

Mr. Brennerman?

A. We pretty much spoke every day.

Q. What times of day would you talk?

A. It would be all -- around, all day long, texting, hey,

what's up, how you doing.

Q. When you spoke on the phone, did he ever indicate to you

that he was at his office?

A. No.

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Q. What was he usually doing when you spoke on the phone?

MS. FRITZ: Objection; your Honor, this is very vague,

and, objection, relevance.

THE COURT: Was he usually doing one thing when you

called him on the phone?

THE WITNESS: Usually watching TV.

THE COURT: All right. So most of the time when you

called, he was watching TV; that's what you're saying? Okay.

BY MS. SASSOON:

Q. How many times would you estimate you've seen

Mr. Brennerman in person?

A. About five times; five, six times.

Q. When is the last time that you spoke to him?

A. I would say March.

Q. Around March?

A. March or April.

THE COURT: Of this year?

THE WITNESS: Of this year.

Q. Do you remember what you talked about that last time you

spoke?



You can answer the subject, you can state the subject

that you spoke about.

THE WITNESS: Okay.

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Well, we spoke about several things, because he was

having health issues and his mother was having health issues

and I didn't hear from him for a couple of weeks before that,

and I was concerned and I asked him what's going on. And then

he started talking about those issues, and then he started

saying that he was having court situations, where he had this

large bill of 5 mil to pay, and it stressed him out.

Q. Just to make sure I heard, how much was the bill?

A. It was 5 mil.

Q. When you say mil?

A. Million.

Q. Did he explain to you the source of that bill or what was

going on with it?

A. There was -- no, he did not explain to me what it was, but

I kind of like shrugged it off because, in my head, I'm like,

you have money, what's the big deal, why is this bothering you

so much?

Q. Did he say that it was bothering him?

A. I can tell -- yeah, it was bothering him. It was bothering

him, like, to the point where he was, like, you know what -- he

was so stressed out, that he was, like, I feel like just

turning in my passports and leaving.

Q. Did he say where he wanted to leave from or to?

A. No.

Q. Did he say whether he wanted you to come with him?

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MS. FRITZ: Objection, your Honor. I don't know --

THE COURT: Sustained as to the last one.

Go ahead next question.

Q. Where do you work now?

A. Barclays Bank.

Q. What do you do there?

A. I'm a project assistant.

Q. Do you remember where you worked around the time that you

met Mr. Brennerman?

A. Guardian Life Insurance.

Q. Have you ever worked for Mr. Brennerman?

A. Never.

Q. Did you ever work at Blacksands Pacific?

A. I have never.

Q. Did you ever work at a company called BLV Realty?

A. I have not.

Q. Did you ever discuss with Mr. Brennerman going to work for

him?

A. He mentioned it. He asked me to name how much I would need

to work for him.

Q. Did you?

A. No, I didn't.

Q. Did he describe to you what kind of job he was offering

you?

A. Basically, he was -- he explained to me that he just needed

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someone to travel with him for when he's entertaining his

clients or clients' wives or his prospects' wives.

Q. Did you ever accept a job offer from him?

A. I have never.

Q. Did he ever pay you a salary?

A. Never.

Q. Did he ever gift to you any money?

A. No.

MS. SASSOON: Ms. Fetman, I'd like to show the witness

Government Exhibit 1-33, which is in evidence.

Q. Prior to my showing you this document that's on your

screen, had you ever seen it before?

A. No, I have not.

Q. Let's take a look at the bottom email, which is from M.

Kelly to Scott Wood and Larry Smith on September 23rd, 2012.

Can you read the first two lines of this email right beneath

that?

A. "Further to the correspondence with Mr. Smith below, we may

be interested to acquire up to 50 percent in the asset for

approximately 295 million to 325 mil."

Q. Let's turn to the next page and zoom in on the signature

block of this email. Can you read that for me, please?

A. "Written by Ms. L. Charles, executive assistant, on behalf

of Mr. M. Kelly, Blacksands Pacific."

Q. Did you write this email?

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A. I did not.

Q. Did you send this email?

A. I did not.

Q. Did you ever work as an executive assistant for Mike Kelly

at Blacksands?

A. I never.

Q. Did Mr. Brennerman ever ask you to work as an executive

assistant for Mike Kelly?

A. Never.

Q. Have you ever met Mike Kelly?

A. Never.

Q. Had you ever heard of him before you saw this email?

A. No.

MS. SASSOON: Ms. Fetman, please show the jury and the

witness Government Exhibit 1-35, which is in evidence.

Q. Prior to my showing you that document, had you seen it

before?

A. No, I have not.

MS. SASSOON: Let's zoom in at the top.

Q. This is a letter dated August 20th, 2015, addressed to

Peter A. Aderinwale. Can you please read the first paragraph

of this letter?

A. "We confirm your discretionary compensation bonus at

$850,000 as your share of the total compensation bonus

available to your team for the Atlantic Energy Acquisition

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Transaction."

MS. SASSOON: Let's zoom in on the signature block.

Q. Can you read that for me?

A. "Dated August 20, 2015, California USA, Lisa Charles,

employee benefits, business/business operations group."

MS. SASSOON: Let's zoom out. Right beneath that it

says, "Blacksands Pacific Energy Corporation."

Q. Did you write this letter?

A. I did not.

Q. Have you ever heard of Peter Aderinwale before you saw this

letter?

A. I have not.

Q. Did you ever work in the employee benefits business

operations group --

A. No.

Q. -- of Blacksands?

A. No, I have not.

MS. SASSOON: Ms. Fetman, please display Government

Exhibit 1-36, which is in evidence.

Q. Before I showed you this document, had you seen this

document before?

A. No, I had not.

Q. This is a letter dated December 1, 2012, addressed to the

U.K. border agency referencing Mr. Peter Abiodun Aderinwale.

MS. SASSOON: Let's zoom in on the first paragraph.

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Q. It says, "We, Blacksands Pacific International Limited, are

acting on behalf of Mr. Peter Aderinwale and Ms. Cidalia Maria

de Deus Varela. We are very interested in employing

Mr. Aderinwale as chief country project officer for our African

operations managed from the London office. We are an

international oil and gas corporation with over $4.7 billion in

assets and expanding daily crude oil production. We have

undertaken the position to assist both Mr. Peter Aderinwale and

Ms. Cidalia Maria de Deus Varela with their residency card

application, which will enable Mr. Aderinwale to settle in the

United Kingdom and become eligible to work in the United

Kingdom."

Did you write that?

A. No, I did not.

Q. Let's turn to the next page of this letter. Let's look at

the signature block. This says Mr. L. Charles, Blacksands

Pacific Energy Corporation.

Did you write this letter?

A. Did not.

Q. Let's look now at Government Exhibit 1-37, which is in

evidence. Prior to my showing you this document, had you seen

it before?

A. I had not seen it.

Q. This is a letter dated December 29th, 2016, on BLV Realty

Organization letterhead. You'll see at the top it says Lisa D.

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Charles, human resources department. Beneath the date, it says

Ayodeji Raheem Soetan, legal and compliance, California office.

And I will read the first paragraph of this letter,

"Dear Mr. Soetan: In compliance with your employment

compensation, we confirm your 2016 annual cash incentive of

$798,000, which includes your guaranteed annual cash incentive

of $400,000 and the discretionary annual cash incentive of

$398,000."

Let's take a look at the signature block of this

letter. It says, "Lisa Charles, employee compensation and

incentives, human resources department, BLV Realty

organization."

Did you ever work at BLV Realty?

A. I have never.

Q. Is that your signature?

A. That is not my signature.

Q. Did you write this letter?

A. I did not.

Q. Before you saw this letter, had you ever heard of Ayodeji

Raheem Soetan?

A. No, I had not.

Q. You'll see at the bottom it says BLV Realty Organization,

245 Park Avenue, floor 39. Had you ever been there?

A. No, I have not.

Q. One more document to show you: This is Government Exhibit

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1-5. This is in evidence. This is a loan agreement,

Blacksands Pacific, dated October 25, 2013, between Blacksands

Pacific Alpha Blue LLC and the Blacksands Pacific Group, Inc.

Let's go now to page 10 of this document. Prior to my

showing you this document, had you seen it before?

A. No, I have not.

Q. This is a letter October 28th, 2013, and I will read the

first paragraph. "We confirm, on behalf of the Blacksands

Pacific Group ('the company' or 'lender') that all conditions

precedent pursuant to the loan agreement between Blacksands

Pacific Alpha Blue LLC, as borrower, and the Blacksands Pacific

Group, Inc., as lender, has been satisfied."

MS. SASSOON: Now, let's zoom in on the signature

here.

Q. What does the signature block say?

A. Lisa E. Charles.

THE COURT: Could you say that louder? Sorry.

THE WITNESS: Ms. L.E. Charles.

Q. Can you read the three lines beneath that as well?

A. "Treasury/accounting and tax group, Blacksands Pacific

Energy Corporation, Inc. on behalf of the Blacksands Pacific

Group, Inc."

Q. The signature there, is it your signature?

A. That is not my signature.

Q. Did you ever work in the treasury, accounting and tax group

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HC4KBRE7 Charles - Cross

at Blacksands?

A. I did not.

Q. I've shown you a number of documents today with a variation

on Lisa Charles -- L. Charles, Mr. L. Charles -- and a variety

of positions on them. Before your preparation for testimony in

this case, were you aware of the existence of any of these

documents?

A. No, I was not.

Q. Did you ever give Mr. Brennerman permission to send

correspondence in your name?

A. I did not.

Q. Did he ever tell you that he sent business correspondence

in your name?

A. He did not tell me.



MS. FRITZ: Thank you.

CROSS-EXAMINATION

BY MS. FRITZ:

Q. Hello, Ms. Charles.

A. Hello.

Q. My name is Maranda Fritz. We actually spoke yesterday, I

think, right?

A. Right.

Q. And yesterday I called, I asked if you were willing to

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speak with me; and you weren't?

A. That's my Sunday.

Q. Other than that, you and I have never spoken, correct?

A. Correct.

Q. But just to put this in sort of a timeline, you met

Mr. Brennerman in 2011 and you maintained a friendship with him

year after year after year, all the way until March or April of

this year, correct?

A. Correct. Correct.

Q. You can say -- okay.

Back when you first met Raheem, one of your initial

sort of dates or times that you spent with him was a 24-hour

trip to London, correct?

A. Correct.

Q. And did you see where Mr. Brennerman was living in London?

A. I did.

Q. Was that nice?

A. Yeah. It's Knightsbridge; it's nice.

Q. And Mr. Brennerman paid for all of the expenses to fly you

over to London, correct?

A. Correct.

Q. Now, this was in 2011; am I right?

A. Yes.

Q. And during that period, 2011 and 2012, were there other

instances where he paid for your travel, for example?

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A. No.

Q. Were there any instances in which he gave you gifts?

A. No.

Q. Back to the 2011: This was years before Mr. Brennerman

ever told you that this issue existed with respect to a bank

loan, right?

A. Never told me.

Q. Well, you mentioned that earlier this year he was upset

about a loan?

A. Okay, that loan, yes. I thought you were talking about

something else.

Q. So this kind of thing of flying you to London and showing

you where he lived, that was years prior to any issue with

respect to that loan, correct?

A. Correct. Correct.

Q. Back in the 2011 period, you dealt with his assistant

Annisa; is that correct?

A. Correct.

Q. And you dealt with her in terms of travel, things like

that?

A. Just travel, yeah.

Q. Let me ask you also: You were asked by Ms. Sassoon where

you worked during the period 2012 and 2013. Do you recall

that?

A. 2011, she asked.

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Q. Okay. And what was your answer to that question?

A. Guardian Life Insurance.

Q. So I just want to be clear: During the period 2012 and

2013, where did you work?

A. I did a lot of temporary work, so I can't really, off the

top of my head, remember.

Q. Okay. For example, if we could pull up 1-36. This was an

exhibit that was shown to you a few minutes ago. And the date

on this document is December 2012. And this is a document that

was shown to you by Ms. Sassoon, and the signature line has

some variation on L. or Lisa Charles. Do you recall that?

A. Can you show me the signature line?

Q. Okay?

A. Mr. L. Charles.

Q. Okay. As of August of 2012, you were no longer working at

Guardian Life Insurance, correct?

A. Correct.

Q. And for the next year or so, is it correct that you really

had your own company?

A. That's incorrect.

Q. Did you work for a company called United Business Media?

A. Yes, I did.

Q. And at that company, did you provide temporary assistance

to executives in connection with their correspondence, their

travel, things like that?

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A. Yes, I did.

Q. For example, part of your job for this entire period, 2012

and 2013, was maintaining daily calendars and meeting

schedules; is that correct?

A. Correct.

Q. Answering correspondence and dealing with correspondence;

is that correct?

A. I was the executive assistant, so that's what they always

do, that's basically what we do.

Q. You were doing this sort of on a temporary basis; is that

correct?

A. Correct; full-time temp position, from 8:30 to 6:00,

7:00 o'clock.

Q. Okay. And going to Exhibit 1-5, and if we go to the -- oh,

sorry, this is a document that's dated October of 2013. During

this same period of time, 2012 and 2013, were you in the

business of providing sort of executive assistant services to

executives?

A. Yes, I was.

Q. Same period of time?

A. Yes, I was.

Q. But --

A. To legitimate executives.

Q. Yeah, well, sure. And at any time when you were dealing

with Raheem Brennerman, did you decide that he was not a

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legitimate --

A. While I was dealing with him? No, because I mean, we

didn't really speak about his --

Q. So now --

THE COURT: Wait. You didn't speak about his what?

THE WITNESS: I didn't speak about what exactly he was

doing until -- now that I know that he's not legitimate, that's

the reason why he said that.

MS. FRITZ: Objection; move to strike.

THE COURT: Just answer the question.

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BY MS. FRITZ:

Q. Now, this is what I wanted to talk about. As of March 17

of this year, you were still friends with Mr. Brennerman,

correct?

A. Correct.

Q. Okay. But now, a few months later, you come in here and

you're saying, oh, maybe after all of those years, that he's

not legit? That's what you just said, correct?

MS. SASSOON: Objection.


You can answer. Is that what you're saying?

THE WITNESS: Well, as of what I know now, that's what

I'm saying. I thought we already struck that.

MS. FRITZ: Okay. Unstrike.

BY MS. FRITZ:

Q. So now, you're saying as of what you know now.

How many times have you dealt with one of the folks at

this table?

A. Maybe twice.

Q. And when did they first contact you?

A. Maybe September.

Q. Okay. And how much time have you spent with them?

A. Not long. Maybe altogether half an hour, hour.

Q. Have they provided you with information regarding some of

the things that they are saying with respect to Mr. Brennerman?

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A. The only things that I've seen is what you -- you're

pulling up yourself.

Q. Okay. But for six years, dealing with him and talking with

him about his company -- and you said to Ms. Sassoon, oh, yes,

we talked about his company, his oil and gas business, you were

at his home in London, correct?

A. Correct.

Q. -- for six years, you did not view Mr. Brennerman as

anything other than a business executive?

A. I viewed him for what he told me he was.

Q. But you spent time with him, right?

A. Six times in, what, six or seven years.

Q. And communicated continuously, messaging back and forth,

phone calls, all of that?

A. Correct.

Q. So, with all of that contact, at no time did you view him

as anything other than someone that you wanted to continue to

be friends with?

A. Correct.


THE COURT: Okay.

Redirect?

MS. SASSOON: Very quick.


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HC4KBRE7 Charles - Redirect


BY MS. SASSOON:

Q. Ms. Charles, can you remind me about how many times you met

Mr. Brennerman in person?

A. About six times. Maybe even less.

Q. Do you remember Ms. Fritz asked you, during

cross-examination, about the period of time you were doing

temporary work?

A. Yes.

Q. That was as an executive assistant?

A. Correct.

Q. At any point during that period, did Mr. Brennerman hire

you --

A. No.

Q. -- as an executive assistant?

A. No.

Q. Did he ever ask you to help with any temp work?

A. Never.

Q. Ms. Fritz asked you about your view of Mr. Brennerman as a

legitimate business executive. I'd like to ask you, how, if at

all, did learning that Mr. Brennerman used your name without

your permission affect your view of his legitimacy as a

business executive?

A. How it affected my views? I'm just offended that he would

use my name, just -- that's it. Like, you know, I work in

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HC4KBRE7 Charles - Recross

finance myself, and I was a little worried that this would

affect me at my job.


THE COURT: Anything? Okay.

MS. FRITZ: Yes, a couple of follow-ups.

RECROSS EXAMINATION

BY MS. FRITZ:

Q. So you got a phone call -- you're just minding your own

business, right, and you get a phone call from who representing

the Department -- who contacted you from this group here?

A. Justin did.

Q. Okay. So Justin is someone that you have dealt with a

number of times?

MS. SASSOON: Objection; beyond the scope.


You can answer.

A. Twice.

Q. So, Justin, when he contacts you, does he say, I'm working

for the Department of Justice?

A. Correct.

Q. And did he explain that he was calling in relation to a

case against Raheem Brennerman?

A. Yes, he did.

Q. And has that ever happened to you before, that someone that

you know is actually now being pursued by the U.S. Government?

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Has that ever happened to you before?

A. No.

Q. And so now they want to talk to you about things that they

say you did, right?

A. No. That's what -- that's not what happened.

Q. They want to interview you, and suddenly they show you

things that have your name on them, right?

A. Correct.

Q. And you say, I had nothing to do with that?

A. Absolutely.

MS. FRITZ: Okay. Nothing further.

THE COURT: Okay. Nothing?

MS. SASSOON: Nothing, your Honor.

THE COURT: All right. Do you have the next witness?

MS. SASSOON: It's now 5:30.

THE COURT: I know that. Do you have a next witness?

MS. SASSOON: Oh.

MR. LANDSMAN-ROOS: Our next witness is Howard

Berkowitz.

THE COURT: All right. So, sit there.

Ladies and gentlemen, I'm going to do this: I'm going

to excuse you now. Go back to the jury room. I'm going to

talk to the lawyers just about scheduling, because we may do a

slightly different schedule tomorrow. So don't leave, but it

will be two minutes before I come back and just tell you when

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to come back tomorrow. Okay? Great. Thank you.

All rise.

Don't discuss the case. Leave your books in the jury

room, but don't leave until Mr. Kazam comes back and tells you

what the deal is for tomorrow.


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HC4KBRE7

(Jury not present)

THE COURT: Ms. Charles, you can step down. Thank

you.

(Witness excused)

THE COURT: The government has one witness left?

MR. LANDSMAN-ROOS: Your Honor, we have two witnesses.

One is someone from the DMV, which would be about a

ten-minute-long direct, if that. And we've discussed a

stipulation, so we may be able to remove him.

The other one is Howard Berkowitz. My direct will be

over an hour.

THE COURT: So we have over an hour to go tomorrow.

And then we don't know if the defense is putting on a case at

this point? Or do you know at this point?

MS. FRITZ: I can't say with certainty, but what I can

say is that he is a bit of a monkey wrench because, your Honor,

as I think I made clear, we are continuing the conversation

with respect to a defense case, but today I was handed a

subpoena that says that if Mr. Brennerman is going to testify,

he would have to produce one day prior to his testimony a

lengthy list of documents.

THE COURT: Well, anyway, I'm just trying to figure

out what I'm telling the jury about tomorrow. It sounds like

we're going to sum up tomorrow, right?

MS. FRITZ: Your Honor, as I just indicated, I cannot

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say that. Mr. Brennerman has not and is not prepared to tell

you that he's made that decision.

THE COURT: Okay.


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THE COURT: So I am just going to wait and then

tomorrow I will give you guys an extra day if he decides he is

not going to?

If he doesn't testify, we are going to go into

summations, right?

MS. FRITZ: Yes.

THE COURT: And if he does testify, then we will have

testimony. If there is a dispute about this subpoena, then we

will talk about that. But I am just saying we may have

summations tomorrow, in which case we will need to do a charge

conference tomorrow. So do we do that between 9 and 10 and

have the jury come at 10, and that way we are sort of covered

the rest of the day?

MR. ROOS: That's our preference.

THE COURT: Do you have any objection to that, Ms.

Fritz?

MS. FRITZ: I would ask that we start at 9:30, but

other than that, no.

THE COURT: I don't want to waste a day with him. If

we are going to have summations and a charge and an hour of

testimony, I think it could get tight in the afternoon. That's

my reason for starting at 9.

MS. FRITZ: Understood.

THE COURT: So I am just going to send Mr. Kazam back

to tell them to come tomorrow at 10. Does anybody have any

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objection to just having him tell them to be ready to go at 10?


MR. ROOS: No.

THE COURT: Then I will tonight send you the charge,

which we can chat about for an hour, and then you will have an

idea what we are shooting at for summations. Then we will see

how the testimony goes tomorrow.

I don't know if we need to talk about the subpoena or

not. I don't know anything about it. This is the first I am

hearing it.

MS. FRITZ: Your Honor, here's the issue. It is a

virtual impossibility, obviously, for there to be compliance

with this subpoena. Mr. Brennerman is incarcerated. The

government is in possession of every single byte or megabyte or

terabyte of data. It just feels as if this is intended to try

to prevent testimony, as if the government wants to

cross-examine him and say, well, we demanded that you give us

this material and you didn't.

So I don't know. To me, it interferes with our

ability to make a decision as to whether he would testify,

particularly given the fact that it would have to occur

tomorrow.

THE COURT: What are you asking me to do?

MS. FRITZ: Quash it.

THE COURT: You're asking me to quash the subpoena? I

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haven't even seen the subpoena. You can hand it up, but send

me a letter tonight attaching the subpoena and telling me the

bases for quashing.

Government, you're standing by the subpoena, you're

not backing off of the subpoena?

MS. SASSOON: We will see what the arguments are and

we will respond to them, but we are certainly not intending to

interfere with Mr. Brennerman's right to testify.

MS. FRITZ: Your Honor, there is nothing fancy about

this. My argument is I am getting it today. We all knew the

schedule that we were operating under. It makes it a virtual

impossibility. The government, I think, knew that. And the

government has had the ability, if they wanted to ever issue a

subpoena like this, to do it before today. So I am not making

any fancy arguments. Those are my arguments for seeking to

have this thing quashed so that this doesn't interfere with our

ability to make a decision.

THE COURT: All right. I would like to see some

authority. I will look at it myself. But go ahead, you or Mr.

Waller, divide it up as you think best, but I would like to see

the subpoena and I would like to just get a sense of what the

arguments are.

MS. FRITZ: OK.

THE COURT: Anything else we should chat about today?

MS. SASSOON: Nothing from the government.

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THE COURT: So I will see you tomorrow and then we

will see where things land. 9:00 for the charge conference.

Thanks.

(Adjourned to December 5, 2017, at 9:00 a.m.)

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INDEX OF EXAMINATION

Examination of: Page

ENRIQUE SANTOS

932Direct By Mr. Landsman-Roos . . . . . . . . .

954Cross By Ms. Fritz . . . . . . . . . . . . . .

968Redirect By Mr. Roos . . . . . . . . . . . . .

970 Recross By Ms. Fritz . . . . . . . . . . . . .

JANELL BORRISON

973Direct By Mr. Roos . . . . . . . . . . . . . .

981Cross By Ms. Fritz . . . . . . . . . . . . . .

HELEN MEMAR

983Direct By Ms. Sassoon . . . . . . . . . . . .

985Cross By Ms. Fritz . . . . . . . . . . . . . .

989Redirect By Ms. Sassoon . . . . . . . . . . .

JAMES LEWIS

992Direct By Mr. Sobelman . . . . . . . . . . . .

1000Cross By Ms. Fritz . . . . . . . . . . . . . .

BARRY KANE


1014Cross By Mr. Steinwascher . . . . . . . . . .

THOMAS KIERNAN


1028Cross By Ms. Fritz . . . . . . . . . . . . . .

1048Redirect By Mr. Sobelman . . . . . . . . . . .

BARRY GONZALEZ

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1054 Cross By Mr. Steinwascher . . . . . . . . . .

GARDNER WALKUP


1107Cross By Mr. Waller . . . . . . . . . . . . .

RONALD FITZPATRICK


1163Cross By Mr. Waller . . . . . . . . . . . . .

THOMAS BOLUS

1167Direct By Mr. Landsman-Roos . . . . . . . . .

1178Cross By Ms. Fritz . . . . . . . . . . . . . .

1179Redirect By Mr. Landsman-Roos . . . . . . . .

LISA CHARLES


1193Cross By Ms. Fritz . . . . . . . . . . . . . .

1201Redirect By Ms. Sassoon . . . . . . . . . . .

1202Recross By Ms. Fritz . . . . . . . . . . . . .

GOVERNMENT EXHIBITS

Exhibit No. Received

934 450-A-T, 450-B-T, 451-A-T, 451-B-T, and . . .

452-T

944 4-71, 4-72, 4-76, 4-77, and 4-78 . . . . . .

45 976 . . . . . . . . . . . . . . . . . . . .

1000 990 . . . . . . . . . . . . . . . . . . .

993 534 and 535 . . . . . . . . . . . . . . . .

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426 1026 . . . . . . . . . . . . . . . . . . . .

1051 530, 531, 532 and 533 . . . . . . . . . . .

601 1141 . . . . . . . . . . . . . . . . . . . .

1143 200 to 207, 210, 213, 400 to 402 and . . . .

404

603 1143 . . . . . . . . . . . . . . . . . . . .

1144 209, 211 and 212 . . . . . . . . . . . . . .

604 1144 . . . . . . . . . . . . . . . . . . . .

1144 460 to 479, 487 to 513, and 522 . . . . . .

1145 . . . . . . . . . . . . . . . . . . . . . .

51B 1145 . . . . . . . . . . . . . . . . . . . .

403 1157 . . . . . . . . . . . . . . . . . . . .

31 1172 . . . . . . . . . . . . . . . . . . . .

DEFENDANT EXHIBITS

Exhibit No. Received

EJ 1038 . . . . . . . . . . . . . . . . . . . .

EI 1045 . . . . . . . . . . . . . . . . . . . .

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