“We are thrilled that the appellate court agreed with us that the government failed to live up to the promises it made in the indictment against Mr. Annamalai, at trial, and at sentencing,” Lynn Merritt, one of a team of attorneys representing Annamalai, told the Atlanta Journal-Constitution on Wednesday.
“Mr. Annamalai will continue to fight for a fair and just resolution to this case on remand.”
A spokesman for the U.S. Attorney’s Office in Atlanta declined to comment.
During Annamalai’s two-week 2014 trial, prosecutors from that office argued that Annamalai offered counseling to followers at his Gwinnett County temple in exchange for money — and then routinely charged additional, unapproved amounts to the same clients’ credit cards.
Annamalai often forged documents and doctored audio recordings to battle clients that disputed additional charges, prosecutors said. He used the ill-gotten money to maintain his lavish lifestyle, buying multiple homes and expensive cars.
The 34 charges brought against Annamalai included bank fraud, bankruptcy fraud and money laundering — and a jury convicted him on all of them. In April 2015, he was sentenced to serve 27 years and three months in prison.
The ruling returned Tuesday by the federal appeals court, however, reversed Annamalai’s conviction on 22 counts, including all of the money laundering charges and the bankruptcy fraud accusation on which they were predicated.
In essence, the appeals court found that income generated by Annamalai after the Hindu Temple of Georgia went into bankruptcy in 2009 should not have been considered property of that estate. Annamalai therefore could not be charged with bankruptcy fraud even if he misappropriated the funds, the three-judge panel wrote.
“Whatever wrongs Mr. Annamalai may have committed with respect to those receivables ... did not constitute bankruptcy fraud on the evidence presented,” the ruling said.
The appeals court also took issue with prosecutors using all 467 credit card disputes it found between worshippers and the temple as evidence of fraud. Documentation for just 85 of the disputes was presented in court.
The appeals court ruled that an estimate of between $100,000 and $400,000 in fraudulent gains should have been used in sentencing — not the larger estimate of between $400,000 and $1 million.
Federal sentencing guidelines are complex and it’s not yet clear what new sentence Annamalai could receive. But the smaller dollar figure recommended by the court means a smaller multiplier would be used in calculating the sentence.
“We are still analyzing what the range at re-sentencing will be in light of the opinion issued by the Court of Appeals,” Merritt, Annamalai’s attorney, said.