IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 14-51207

UNITED STATES OF AMERICA, 

 Plaintiff - Appellee

v.

RICKEY DONNELL BENNS, also known as Rickey D. Benns, 

 Defendant - Appellant

Appeal from the United States District Court

for the Western District of Texas

Before PRADO, SOUTHWICK, and GRAVES, Circuit Judges.

JAMES E. GRAVES, JR., Circuit Judge:

Rickey Benns appeals an order to pay restitution to the United States 

Department of Housing and Urban Development imposed under the 

Mandatory Victims Restitution Act. Because HUD is not a victim of Benns’s 

convicted offense, the award of restitution is VACATED.

FACTS AND PROCEDURAL HISTORY

Michael and Brenda Arnold conveyed their home, located at 1301 Red 

Deer Way in Arlington, Texas, to Rickey D. Benns. Despite the conveyance, 

the property remained in the Arnold’s name. The property was subject to a 

United States Court of Appeals

Fifth Circuit

FILED

January 6, 2016

Lyle W. Cayce

Clerk

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No. 14-51207

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mortgage loan held by Bank of America1 and insured by the United States 

Department of Housing and Urban Development (HUD).2 The mortgage was 

in arrears at the time of the transaction, but Benns promised to rent the 

property and pay the mortgage out of the rental proceeds. Benns successfully 

rented the property but failed to pay the mortgage.

Benns later sought to prevent foreclosure by attempting to refinance the 

mortgage on the Red Deer property. Since the previous owners still held the 

mortgage and were unaware that the loan continued to be in arrears, Benns 

forged the previous owners’ signatures on the loan modification application

and produced a false pay stub in an attempt to deceive the bank into believing 

that the Arnolds still owned the property and that they were more creditworthy 

than was actually the case. The application was denied and the property was 

eventually foreclosed. HUD paid Bank of America for the default and suffered 

a loss of $54,906.59, which is the difference between what HUD paid Bank of 

America following foreclosure and the later sale price of the property. 

On March 14, 2012, Benns was indicted on one count of making false 

statements relating to a credit application, in violation of 18 U.S.C. § 1014.

Benns pleaded guilty without a plea agreement. He accepted, upon entering

the plea, the accuracy of a factual resume prepared by the government. The 

resume outlined the facts of the offense and authorized “restitution to victims 

or to the community, which may be mandatory under the law, and which 

Defendant agrees may include restitution arising from all relevant conduct, 

not limited to that arising from the offense of conviction alone.” 

 

1 The mortgage was originally held by Countrywide, but was acquired by Bank of 

America when Bank of America purchased Countrywide.

2 Such insurance requires that HUD pay to the lender any loss that the lender suffers 

as a result of the transaction.

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On September 28, 2012, Benns was sentenced to twenty-seven months 

imprisonment, five years of supervised release, and ordered, in accordance 

with the Mandatory Victims Restitution Act (MVRA), 18 U.S.C. § 3663A, to 

pay restitution in the amount of $544,602.42. We vacated the sentence and 

restitution order because the district court failed to make factual findings that 

supported the loss amount considered when sentencing Benns and because 

restitution was based on conduct outside the scope of Benns’s conviction. 

United States v. Benns, 740 F.3d 370, 376-78 (5th Cir. 2014). We remanded to 

the district court for resentencing. Id. at 378. 

On remand, Benns abandoned the challenge to the imprisonment

because he had already served the entire jail term. He did, however, continue 

to oppose the restitution award. The district court, in a short bench ruling, 

made no factual findings but concluded that HUD was a direct victim of the 

false loan application and awarded HUD $54,906.59 in restitution. Benns now 

appeals.

DISCUSSION

The legality of a restitution order is reviewed de novo. United States v. 

Lozano, 791 F.3d 535, 537 (5th Cir. 2015); United States v. Hughey, 147 F.3d 

423, 436 (5th Cir. 1998). Since Benns objected to the award, the restitution 

amount is reviewed for abuse of discretion. United States v. Beacham, 774 F.3d 

267, 278 (5th Cir. 2014). 

The MVRA requires the district court, as part of sentencing, to order 

restitution payments to “victims” of certain crimes. 18 U.S.C. § 3663A. A 

“victim” is defined as “a person directly and proximately harmed as a result of 

the commission of an offense for which restitution may be ordered.” Id. at 

3663A(a)(2). Generally, restitution is limited to losses arising from underlying 

conduct of the defendant’s offense of conviction. Hughey v. United States, 495 

U.S. 411, 412-13 (1990); United States v. Espinoza, 677 F.3d 730, 732 (5th Cir. 

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2012); United States v. Maturin, 488 F.3d 657, 660-61 (5th Cir. 2007). 

Therefore, restitution may only be awarded if the government established, by 

a preponderance of the evidence, direct or proximate causation between Benn’s 

false credit application and HUD’s loss when it sold the Red Deer property. 

United States v. Reese, 998 F.2d 1275, 1282 (5th Cir. 1993). 

The MVRA broadly defines “victim” to include not only losses directly 

caused by the behavior underlying the convicted offense, but also losses arising 

more generally as a result of a conspiracy, scheme, or pattern of criminal 

activity. But, restitution may be ordered for this expanded class of victims only 

if the count of conviction includes, as a statutory element of the offense, a 

scheme, conspiracy, or pattern of activity. Maturin, 488 F.3d at 661; Espinoza, 

677 F.3d at 732. Benns pleaded guilty to one count of submitting a false credit 

application to Bank of America. There is no indication in the indictment, 

factual summary, or guilty plea that the filing of the false application was part 

of a conspiracy, scheme, or pattern of criminal activity. Nor are there any 

decisions reading such a requirement into the elements of 18 U.S.C. § 1014. 

Therefore, restitution may only be ordered under the MVRA if HUD’s loss was 

directly and proximately caused by the filing of the false credit application.

To be a victim under the MVRA, a person or organization must suffer a 

foreseeable loss as a result of the conduct underlying the convicted offense. For 

example, in United States v. Espinoza, we held that a defendant convicted of 

unlawful possession of firearms could not be ordered to pay restitution to a 

pawn shop, where he sold the unlawfully possessed weapons, because the sale 

of weapons was not based on the conduct underlying the possession conviction. 

677 F.3d at 732-33. This court also rejected the government’s argument, nearly 

identical to the argument made in this case, that the pawn shop would not 

have suffered harm “but for” the defendant’s possession of the firearms. Id. at 

733-34. Rather, we concluded that the pawn shop’s loss was not a foreseeable 

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result of the unlawful possession of firearms. Id. Similarly, in United States 

v. Mancillas, a defendant pleaded guilty to possession of counterfeit securities 

and possession of the implements to make counterfeit securities. 172 F.3d 341, 

341 (5th Cir. 1999). The district court awarded restitution to five checkcashing entities where fraudulent checks, created by the defendant, were 

cashed. Id. at 341-42. We reversed, holding that “possession of the implements 

with the intent to use them in the future can in no way be said to directly and 

proximately have caused . . . the harm to the check-cashing companies.” Id. at 

343. The restitution was unlawful because the harm suffered by the checkcashing entities was a result of the passing of counterfeit securities, not for the 

possession of counterfeit securities or possession of the implements to make 

counterfeit securities. Id.

The government argues that HUD’s loss was a direct result of the false 

application because the filing of the application delayed the foreclosure which 

resulted in HUD selling the property for a loss. But this argument is not 

supported by the record. During resentencing, the government was unable to 

produce any evidence that the application resulted in a delay or even to 

establish when foreclosure proceedings were initiated. The government also 

failed to submit any evidence that the alleged delay, instead of market 

conditions or other factors, resulted in the loss. Thus, HUD’s loss in this case, 

just like the harm in Espinoza and Mancillas, is outside the scope of the offense 

of conviction. Benns was indicted and pleaded guilty to one count of filing a 

false credit application in an attempt to refinance a mortgage. It therefore 

does not follow that the behavior underlying Benns’s offense was the cause of 

HUD’s loss.

Because the evidence is insufficient to support a finding that HUD was

directly and proximately harmed by Benns’s false credit application, we 

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conclude that HUD is, therefore, not entitled to restitution in this case under 

the MVRA.

CONCLUSION

The restitution award is VACATED.

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