United States v. DaCorta

UNITED STATES OF AMERICA v. MICHAEL J. DACORTA /

No. 8:19-cr-605-WFJ-CPT

United States District Court, M.D. Florida, Tampa Division

September 24, 2021

REPORT AND RECOMMENDATION

HONORABLE CHRISTOPHER P. TUTTE UNITED STATES MAGISTRATE JUDGE

Before me on referral is Defendant Michael DaCorta's motion to suppress statements he made to law enforcement during the execution of a search warrant at his home in April 2019. (Doc. 43). In support of his motion, Mr. DaCorta argues that his statements were the product of a custodial interrogation conducted without the benefit of the warnings required under Miranda v. Arizona, 384 U.S. 436 (1966) and its progeny. The government opposes Mr. DaCorta's motion claiming that he was not in custody at the time he made the challenged admissions and thus did not need to be advised of his Miranda rights. (Doc. 49).

I held a full-day evidentiary hearing on the matter, during which Internal Revenue Service (IRS) Special Agent Shawn Batsch Federal Bureau of Investigation (FBI) Special Agent Richard Volp, and attorney Burton Wiand testified for the government and Mr. DaCorta's wife, Carolyn DaCorta, and his daughter, Crystal DaCorta, testified for the defense. (Doc. 62). In accordance with the Court's directive (Doc. 61), the parties thereafter submitted proposed findings of fact and conclusions of law based on the evidence adduced at the hearing (Docs. 68, 69). Following a careful review of those submissions, as well as the other pertinent portions of the record, I respectfully recommend that Mr. DaCorta's motion be denied. Below are my findings of fact and conclusions of law in support of that recommendation.

I.

Mr. DaCorta stands charged in a superseding indictment with conspiracy to commit wire and mail fraud, in violation of 18 U.S.C. § 1349; engaging in an illegal monetary transaction, in violation of 18 U.S.C. § 1957; and submitting a false and fraudulent statement on a federal income tax return, in violation of 26 U.S.C. § 7206. (Doc. 39). A trial is scheduled in this case for the February 2022 trial term. (Doc. 71).

The above charges stem from a multi-year investigation supervised by the FBI and the IRS into the business dealings of various companies operated by Mr. DaCorta and others, collectively known as Oasis International Group (Oasis). (Doc. 62 at 8, 13, 52-53, 97, 101, 162-63; Doc. 68 at 2; Doc. 69-1). Agents Volp and Batsch, both seasoned law enforcement officers, were the lead investigators on this joint effort. (Doc. 62 at 7-8, 13, 19, 52-53, 140-41, 177-78).

Based on the evidence developed during the course of its investigation, the government alleges that Mr. DaCorta and a number of his co-conspirators utilized Oasis to orchestrate a “Ponzi”-style investment fraud to swindle over $70, 000, 000 from several hundred unwitting investors. (Doc. 39 at 1-7; Doc. 62 at 7-8, 13, 52-53, 101, 231-32; Doc. 68 at 2). The government further avers that Mr. DaCorta and his cohorts used some of the proceeds from this scam for their personal benefit, including to purchase “million-dollar residential properties” and “high-end vehicles.” (Doc. 39 at 1-7; Doc. 62 at 12-14; Doc. 68 at 2).

Independent of the FBI and the IRS's investigation, the Commodities Futures Trading Commission (CFTC) performed its own examination of Oasis's financial activities. (Doc. 62 at 34, 101-02, 163; Doc. 68 at 8 n.6). As a result of that probe, the CFTC filed a complaint against Mr. DaCorta and his associates in April 2019, alleging that they violated various provisions of the Commodities Exchange Act and its implementing regulations. See Commodity Futures Trading Comm'n v. Oasis Int'l Grp., Ltd., No. 8:19-cv-886-VMC-SPF, (Doc. 1) (M.D. Fla. Apr. 15, 2019). The same day, a District Judge in this Division, the Honorable Virginia M. Hernandez Covington, issued a Temporary Restraining Order (TRO) against Mr. DaCorta's group and appointed Mr. Wiand to serve as a receiver for Mr. DaCorta's various investment entities-namely, Oasis and several related companies. Id. at (Doc. 7). Mr. Wiand's responsibilities in that role included marshalling the receivership's assets at the behest of the Court and distributing the proceeds from the sale of those assets to the victims of the alleged fraudulent scheme. Id.; (Doc. 62 at 101-03).

Shortly after the entry of the TRO, law enforcement procured a warrant to search Mr. DaCorta's two-story residence in Lakewood Ranch, Florida. (Doc. 62 at 11-13; Doc. 69-1 at 45-46, 49-50). Situated at the end of a cul-de-sac in a gated community, Mr. DaCorta's home consisted of, inter alia, five bedrooms, four bathrooms, an office, a sitting room with a fireplace, a living room, a bonus room, an exercise room, a billiards room, and a screened-in lanai and pool area that extended across the entire back of the house and part of the side. (Doc. 62 at 12-13, 221-22, 230, 257; Docs. 82-1, 82-2); Def. Exh. 6. The warrant also authorized law enforcement to seize three automobiles-a Maserati sports car and two Land Rover sports utility vehicles-which were titled in Mr. DaCorta's name and which were believed to be kept at his home. (Doc. 62 at 14, 34, 172, 258-59; Doc. 69-1 at 49-50); Def. Exh. 6.

At approximately 7:05 a.m. on April 18, 2019, agents Batsch and Volp led a team of approximately eleven law enforcement officers^[1] to Mr. DaCorta's residence to execute the warrant. Gov't Exhs. 2, 3; (Doc. 62 at 8, 14, 77, 82, 158-59, 176-78, 194, 211; Doc. 82-4). Video surveillance from outside the home shows that, by the time the search team arrived, it was already light outside, and the sun was shining. Gov't Exhs. 2, 3. Mr. Wiand and two representatives from the CFTC, Joe Mettenberg and Elsie Robinson, accompanied the search team to the house but did not participate in the initial entry into the residence. (Doc. 62 at 34-35, 88-89, 101, 110-14, 137, 159). The members of the search team wore ballistics vests bearing law enforcement insignia and had been informed in advance that Mr. DaCorta had multiple dogs, likely possessed a weapon, ^[2] and lived at the house with several other family members. Gov't Exhs. 2, 3; (Doc. 62 at 10, 77-79, 142, 159-61). All the officers possessed a firearm, and at least one carried a large battering ram. Gov't Exhs. 2, 3; (Doc. 62 at 9-10, 142, 179-80, 192, 194, 200, 208).

As evidenced by a Ring doorbell video recovered from Mr. DaCorta's residence, agents Batsch and Volp, accompanied by the other officers, approached the front porch area, knocked on the main door several times, and announced, “Police with a search warrant.” Gov't Exh. 2; (Doc. 62 at 14-15, 16, 17, 142, 190-91, 237-38). Based on the perspective provided by the surveillance video, it appears that many of the officers had their weapons drawn in a protective posture, although a few seem to have directed their firearms towards the front of the home. Gov't Exh. 2; (Doc. 62 at 10, 81-82). Moments later, Mr. DaCorta-who had been sleeping with his wife, Carolyn, in the master bedroom on the first floor-opened the front door in a tank top and boxer briefs, holding a dog by the collar, while a second dog stood nearby. Gov't Exh. 2; (Doc. 62 at 17-18, 142, 190-91). Mrs. DaCorta, who was also dressed in her sleepwear, peered out toward the front door from behind a wall in the foyer, a few feet from her husband. Gov't Exh. 2; (Doc. 62 at 18, 142, 190-91). The officers standing in and around the exterior vestibule directed Mr. DaCorta to turn around, to place his hands in the air, and to exit the residence. Gov't Exh. 2; (Doc. 62 at 82, 144). Mr. DaCorta complied with these commands and walked slowly backwards onto the porch staircase in front of the home. Gov't Exhs. 2, 3; (Doc. 62 at 82).

Several officers then passed by Mr. DaCorta to conduct a “protective sweep” of the house to ensure it was safe for the search team to enter. Gov't Exhs. 2, 3; (Doc. 62 at 83, 143-44, 161, 164).

When Mrs. DaCorta attempted to retreat to the master bedroom, a female officer retrieved her but later allowed her to change her clothes before escorting her outside to wait with Mr. DaCorta. (Doc. 62 at 191-94). Other officers inside the residence called out the name of Mr. DaCorta's daughter, Crystal, who had recently returned to live at the home after graduating from college. Id. at 1415, 18, 83, 237-38. Crystal subsequently emerged from her second floor bedroom and, with her arms raised, descended the main staircase, where waiting officers instructed her to exit the house. Id. at 238-40, 242. The DaCortas were then told by law enforcement that the officers needed a “few minutes” to make sure no other occupants remained in the residence. Id. at 19, 143, 195, 241.

As the officers dispersed throughout the home, the DaCortas remained in the driveway near the front entrance. Id. at 107-10, 195, 219-21, 245. While it appears that a few officers lingered outside with the DaCortas at various times, none of the officers handcuffed or physically restrained any of the DaCortas, nor did the officers subject the family to any harsh language, advise the family they were under arrest, or tell the family they could not leave their house. Id. at 107-10, 195, 219-21, 245. Apart from Mr. DaCorta's initial encounter with the search team, none of the officers directed or aimed their firearms at any of the DaCortas or unholstered their weapons in the family's presence. Id. at 107-10, 195, 219-21, 245.

While these events were unfolding, Mr. Wiand stood near the end of the driveway and faced the home. Id. at 105-07. From his vantage point, Mr. Wiand observed the search team approach the residence, knock on the door, greet Mr DaCorta, and direct him to wait outside while the other officers located Mr. DaCorta's wife and daughter. Id. at 105-10. Mr. Wiand...