In the

United States Court of Appeals

For the Seventh Circuit

Nos. 19-1734 & 19-1745

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

CHARNPAL GHUMAN and AGA KHAN,

Defendants-Appellants.

Appeal from the United States District Court for the 

Northern District of Illinois, Eastern Division.

No. 1:13-cr-00816 — John J. Tharp, Jr., Judge.

ARGUED APRIL 7, 2020 — DECIDED JULY 16, 2020

Before ROVNER, HAMILTON, and BARRETT, Circuit Judges.

ROVNER, Circuit Judge. Charnpal “Paul” Ghuman and Aga

Khan participated in a multi-million dollar bank fraud scheme

in which they helped to create fraudulent loan applications in

order to convince a bank to issue mortgages to unqualified

individuals who were purchasing gasoline stations from them.

Both men pleaded guilty to one count of bank fraud, see 18
2 Nos. 19-1734 & 19-1745

U.S.C. § 1344; Ghuman also pleaded guilty to one count of

filing a false tax return,see 26 U.S.C. § 7206. Ghumanchallenges

the district court’s decision to deny him credit for acceptance

of responsibility, see U.S.S.G. § 3E1.1, and the imposition of a

three-year term of supervised release on his false tax return

conviction. Khan challenges the restitution he was ordered to

pay. We affirm with one correction to Ghuman’s sentence.

I.

Defendants Ghuman and Khan were among several

individuals who perpetrated a scheme to defraud American

Enterprise Bank (“AEB”) beginning in 2006 and lasting until

2009. The two men had become friends in high school and

eventually went into business together. Initially, they were

partners in a chainof cellphone stores, andthenthey expanded

their investments to include gas stations. Khan devoted the

majority of his time to managing the cell phone stores, whereas

Ghuman primarily managed the gas stations. Beginning in

2006, they began to “flip” gas stations: acquiring the stations

and then re-selling them at a profit. As the scheme developed,

Ghuman would line up a buyer for a given station before he

and Khan had even purchased that station.

The charged scheme involved the resale of some 44 gas

stations in the Midwest to buyers whom Ghuman and Khan

had recruited. The buyers were in a number of instances

purchasing multiple stations (at Ghuman’s urging), and yet

they lacked the financial wherewithal to qualify for the loans

necessary to make these purchases. Knowing that their buyers

would not be approved for loans based on the facts, Ghuman

and Khan relied on the cooperation of their co-defendant, AEB
Nos. 19-1734 & 19-1745 3

loan officer Akash Brahmbhatt (to whom they gave cash,

automobiles, and airline tickets as inducement), to arrange for

the loans based on fraudulent documentation as to the buyers’

income, assets, and contributions of equity to the transactions.

Brahmbhatt, for example, after obtaining a buyer’s personal

identifying information, would typically prepare a personal

financial statement, managementresume, andpersonal history

that contained false information about the buyer’s financial

assets, citizenship status, education, and work history—all

designed to make the buyer look more qualified forloans than

he or she was in fact. Similarly, Ghuman in some instances

prepared falsified bank statements inflating the buyer’s cash

holdings to submit in support of the loan applications. And

when Ghuman was selling a number of Kum & Go gas stations,

he fashioned a set of financial statements forthose stations out

of whole cloth after Brahmbhatt told him the limited available

data on those stations was insufficient. In one or more instances, Ghuman also created fraudulent subordination

agreements, signed by non-existent gas station landlords,

purporting to give the bank priority in payments from the

stations. Finally, co-defendant Shital Mehta, an accountant,

preparedfictitious (never-filed)taxreturns inflating the buyers’

income (typically to a range of $50,000 to $60,000) that were

likewise submitted to the bank.

1

The loans were guaranteed by the Small Business Administration, and a material condition of the loans was that the

1 Mehta incorporated some of the business entities that took title to the

purchased stations and also performed payroll and tax services for certain

of the buyers.
4 Nos. 19-1734 & 19-1745

buyers provide a certain amount of equity through down

payments. The submitted loan paperwork made it appear

(falsely) that the buyers had the funds to make these contributions. In some instances, Ghuman scanned, electronically

altered, andthenre-printedchecks (occasionallychecks thatthe

buyers had previously tendered for other purposes) to make it

look as though the buyers were supplying the funds, when in

fact no such equity was ever provided. In otherinstances, Khan

and Ghuman provided the equity payments themselves, and

recouped the funds when the sales closed. In these instances,

gift letters were prepared indicating (falsely) that the buyers

had received the equity funds as gifts from relatives.

Where buyers were acquiring multiple gas stations, they

were encouraged to find family members and friends who

would co-sign and guarantee the loans. (In some instances,

Ghuman recruited his own relatives for this role.) These

individuals were then designated as the nominal buyers of the

stations, although they had no genuine intent to own, possess,

or run the stations. They were, for all intents and purposes,

sham buyers. False documentation was then prepared to make

it appear as though these individuals had the requisite wherewithal to qualify for the loans.

When the loans were issued and the gas stations were sold

to the buyers, Khan and Ghuman split the proceeds of each

sale, which of course were funded by the loans from AEB. AEB

ultimately issued more than $38 million in loans as part of the

scheme.

Not surprisingly, given the limited financial resources and

experience of the buyers, the loans went into arrears before
Nos. 19-1734 & 19-1745 5

long. The buyers were typicallyable to make loanpayments for

a year or two (in some instances with help from Ghuman)

before defaulting.

The scheme came to an end in late 2008-early 2009 whenthe

SBA began auditing the AEB loans and the FBI began looking

into suspected bank fraud. AEB ultimately incurred a loss in

excess of $14 million from the scheme.

Shortly after they learned from Brahmbhatt in April 2009

that an AEB employee had been interviewed by the FBI, Khan

and Ghuman fled to India. Neither of them returned to the U.S.

until 2011. Although both men deny having any substantial

assets in India, it appears possible that they might. There is

evidence that they discussed moving $2 million in funds to

India in advance of their flight. And personal financial statements that Ghuman prepared in 2008 and 2009 indicated that

he had more than $2 million in bank accounts there and that he

owned two properties valued at more than $7.5 million. R. 297-

12. Likewise, Khaninformedthe government inhis profferthat

he and Ghuman had invested in properties in India, including

an apartment building.

Khan and Ghuman were indicted in 2013. Both were

charged with multiple counts of bank fraud, in violation of 18

U.S.C. § 1344, and bank bribery, in violation of 18 U.S.C. § 215;

Ghuman was also charged with filing a false tax return, in

violation of 26 U.S.C. § 7206. Khan cooperated with the

government andultimatelypleadedguilty to one count of bank

fraud (Count 18) in connection with a $331,000 loan by AEB to

finance the 2008 purchase of a gas station in New Boston,

Illinois. Ghuman pleaded guilty to another count of bank fraud
6 Nos. 19-1734 & 19-1745

(Count 1) in connection with a $744,000 loan by AEB to finance

the 2007 purchase of a gas station in McComb, Illinois.

Ghuman also pleaded guilty to one count of filing a false tax

return (Count 23) which substantially understated his income

for the calendar year 2006.

At sentencing, the district court denied Ghuman credit for

acceptance of responsibility pursuant to Guidelines section

3E1.1, reasoning that Ghuman had both failed to admit his

central role in the bank fraud scheme and falsely denied

conduct manifesting that role. The court ordered Ghuman to

serve a below-Guidelines prison term of 66 months on the bank

fraud charge and a concurrent term of 36 months on the false

tax return charge, along with concurrent three-year terms of

supervised release on each of those charges. The court ordered

Khan to serve a 36-month term in prison, followed by a threeyear term of supervised release. After finding that AEB had

suffered a loss, for restitution purposes, of $14.3 million,

2

the

court also ordered Ghuman to pay $11.8 million and Khan to

pay $10.8 million in restitution, $9.8 million of which was a

joint and several obligation.

2

In a separate calculation to determine the defendants’ offense level

pursuant to U.S.S.G. § 2B1.1, the court put the net loss to AEB at $8.4

million. That calculation gave the defendants the full benefit of the market

value of the collateral that had been returned to the bank at the time of

sentencing, regardless of whether the collateral had been sold.
Nos. 19-1734 & 19-1745 7

II.

A. Ghuman – acceptance of responsibility.

Applicationnote 3 to section3E1.1 provides that “[e]ntry of

a plea of guilty prior to the commencement of trial combined

with truthfully admitting the conduct comprising the offense

of conviction, and truthfully admitting or not falsely denying

any additional relevant conduct for which he is accountable

under section 1B1.3 (Relevant Conduct) (see Application Note

1(A)) will constitute significant evidence of acceptance of

responsibility.” Ghuman argues, in essence, that because he

truthfully admitted the acts underlying the bank fraud charge

to whichhe pleadedguilty andacknowledged his participation

in the overall scheme to defraud the bank, his lawyer admitted

that he played a central and essential role in that scheme, and

he did not falsely deny any aspect of that offense or any

relevant conduct, he was entitled to a two-level credit for

acceptance of responsibility. But given the extent to which

Ghuman affirmatively downplayed his role in the bank fraud

scheme and denied culpability for certain aspects of the fraud,

the district court committed no clear error in finding that

Ghuman had not genuinely accepted responsibility.

Judge Tharp gave a lengthy and detailed account,

occupying 18 pages of the sentencing transcript, explaining

why he was denying the section 3E1.1 reduction. Judge Tharp

stressed that although Ghuman, in pleading guilty, had

admitted that he was part of the scheme to defraud the bank,

the only specific conduct he took responsibility for was

supplying false information regarding the source of the equity

payments in the loan underlying the count to whichhe pleaded
8 Nos. 19-1734 & 19-1745

guilty. That was enough to establish his guilt on that charge,

but not his full role in the scheme.

[I]t is absolutely clear to the Court that Mr. Ghuman

was at the center of this scheme. He was, if you will,

driving the car. Mr. Ghuman, along with Mr. Khan,

were the principal beneficiaries of this scheme ... .

It’s very doubtful that this crime would have

occurred, at least not on this scale, but forthe actions

of Mr. Ghuman.

R. 423 at 26–27. Ghuman was not required to affirmatively

admit relevant conduct, Judge Tharp agreed, but the scope of

the fraudulent scheme and Ghuman’s role in it were matters

encompassed by the offense to the crime of conviction.

Ghuman’s attorney represented to the court that Ghuman did

acknowledge being an integral and major playerin the broader

scheme, and if that were true, the judge agreed, Ghuman

would be entitled to credit for acceptance of responsibility. But

it was not true: Ghuman had made no real acknowledgment of

the conduct that made him a central figure in the scheme, and

had, in fact, falsely denied much of that conduct.

Judge Tharp cited a range of actions that Ghuman had

taken in furtherance of the scheme. These included:

– recruiting potential buyers, whom he

“pushed and convinced and enticed and

cajoled” to acquire multiple gas stations (R.

423 at 33);

– recruiting straw buyers as needed for the

loans;
Nos. 19-1734 & 19-1745 9

– coaching buyers to take the steps necessary to

obtain their loans;

– providing false bank statements on behalf of

the buyers;

– creating the fraudulent equity checks to make

it appear that buyers were complying with

SBA requirements;

– recruiting Mehta to prepare fictitious income

tax returns;

– with Khan, bribing Brahmbhatt with “boxes

of cash” and automobiles (R. 423 at 36);

– providing buyers withthe names of corporate

entities that would take ownership of the gas

stations,andassigning relatives as guarantors

of the loans; and

– discussing the destruction of evidence.

R. 423 at 30–38. These were the actions that exemplified

Ghuman’s central role in the scheme.

Yet, Ghuman’s statements to the Probation Officer and to

the Court, while paying lip service to his guilt, “backpedal[ed]

and backpedal[ed] and backpedal[ed]” in terms of his relative

culpability andthe specific actions he took in furtherance of the

scheme. R. 423 at 29. His version of the offense was

“emblematic of the problem.” R. 423 at 24. Not until 12 pages

into that document was there a discussion of what Ghuman

was responsible for. A substantialportionof the document was

devotedto arguing thatthe bankbore substantialresponsibility
10 Nos. 19-1734 & 19-1745

for the success of the scheme. Judge Tharp acknowledged that

there was “plenty of blame to go around,” and that the bank

indeed bore some responsibility. R. 423 at 26. Yet, the bank had

not operated in bad faith, and it had in place controls and

checks that the defendants had made efforts to work around.

More to the point, Ghuman’s version of the offense attempted

to minimize his own culpability by portraying himself as more

of a diffident, go-along participant in the fraud who did not

think it was his business to tell Brahmbhatt and his other coschemers it was wrong to use fraudulent information in order

to secure the SBA loan guarantees. But “[t]his was his business.

He was the one bringing these folks to Mr. Brahmbhatt to get

the loans.” R. 423 at 29 (emphasis ours). Similarly, Ghumanhad

told the Probation Officer that it “took [him] a while to

understand that this was a huge criminal act” (R. 423 at 31)

when Ghuman was a driving force behind the fraud. Apart

from minimizing his role, Ghuman had also falsely denied a

number of actions attributed to him by others: including

recruiting buyers, altering documents, and suggesting the use

of straw buyers. And, ultimately, he had fled to India for more

than a year after the FBI began interviewing witnesses to the

fraudulent scheme.

Judge Tharp acknowledged that Ghuman had expressed

remorse, andhadmade some preliminarypayments towardhis

restitution obligation. On the other hand, his affidavit

concerning his assets raised questions and was not, in the

judge’s view, a full and truthful accounting of his holdings.

Ultimately, the judge concluded, Ghuman had not fully

acknowledged either his degree of culpability or the scope of

harm that his actions had caused.
Nos. 19-1734 & 19-1745 11

Given the record, Judge Tharp was more than justified in

reaching this conclusion.3 A defendant merits a reduction

pursuant to Guidelines section 3E1.1 when he “clearly

demonstrates acceptance of responsibility for his offense.”

U.S.S.G. § 3E1.1(a). Truthfully admitting the conduct

underlying the offense of conviction will go some way toward

establishing a defendant’s acceptance of responsibility; a

defendant is notrequiredto admitrelevant conduct beyondthe

offense of conviction, so long as he does not “falsely den[y] or

frivolously contest[ ]“ such conduct. Id. comment. (n.1(A)). But

a timely admission of guilt does not alone entitle a defendant

to credit for acceptance of responsibility; it may, in the end, be

outweighed by other conduct that is inconsistent with a

genuine acceptance of culpability for the crime one has

committed. Id.

Ghuman pleaded guilty to the commission of bank fraud in

violation of § 1344, a key element of which is a scheme to

defraud the bank. United States v. LeBeau, 949 F.3d 334, 341 (7th

Cir. 2020), pet’n for cert. filed (U.S. June 26, 2020) (No. 19-1424);

United States v. Ajayi, 808 F.3d 1113, 1119 (7th Cir. 2015). That

same scheme underlay all 19 counts of bank fraud alleged in

the indictment, and although Ghuman pleaded guilty to only

one of those counts (the others would constitute relevant

conduct,seeU.S.S.G. § 1B1.3, comment. (nn. 3, 5(B)), the district

court couldreasonably expectGhumanto acknowledge his role

3 Given the detail and care with which the judge articulated his findings

on this point, Ghuman’s suggestion that the court did not adequately

explain his decision to deny him credit for acceptance of responsibility is

a non-starter.
12 Nos. 19-1734 & 19-1745

in that scheme. See United States v. Jones, 52 F.3d 697, 701 (7th

Cir. 1995) (“the district court was on solid ground in denying

that reduction once it found that Jones had not fully admitted

the extent of her participation in the fraudulent scheme”)

(collecting cases); United States v. Ali, 619 F.3d 713, 720 (7th Cir.

2010) (“blaming someone else for one's own actions or

minimizing one's involvement in the offense is not the sort of

genuine contrition the acceptance of responsibility reduction

seeks to reward”); United States v. Fiore, 178 F.3d 917, 925–26

(7th Cir. 1999) (“Sentencing courts must look beyond

formalistic expressions of culpability and determine whether

the defendant has manifested an acceptance of responsibility

for his offense in a moral sense.”); United States v. Zaragoza, 123

F.3d 472, 480–81 (7th Cir. 1997), retreated from on other grounds,

United States v. Blaylock, 413 F.3d 616, 620–21 (7th Cir. 2005);

United States v. Pitz, 2 F.3d 723, 732 (7th Cir. 1993). Put another

way, the district court was not requiring Ghuman to admit

conduct beyond the offense of conviction: The overall scheme

to defraud the bank, and Ghuman’s role in that scheme, were

part and parcel of the charge of bank fraud to which he

pleaded guilty.

Ghuman relies on his attorney’s statement that Ghuman

“admits that he was an integral, a major player in this scheme,

no question about that” (R. 453 at 173) as proof that he did

acknowledge his role in the scheme; but we cannot fault the

district court forfinding the attorney’s statement insufficient to

constitute agenuine acknowledgment ofGhuman’s culpability.

Ghuman’s own statements, as we discuss below, were

inconsistent with an admission that Ghuman was an instigator

and central player in the scheme. Moreover, as Judge Tharp
Nos. 19-1734 & 19-1745 13

pointed out, Ghuman expressly (and falsely) denied a number

of the actions that made him an integral part of the scheme.

Judge Tharp aptly characterized Ghuman’s version of the

offense as being “emblematic of the problem here.” R. 423 at

24. The first 11 pages of that version are devoted to the bank,

highlighting AEB’s “egregious” judgment (R. 423 at 87) in rehiring Brahmbhatt (after he briefly worked in 2007 for another

bank) and promoting him to the head of the SBA loans division

and faulting the bank for not having the oversight and

safeguards in place that might have defeated the scheme

Brahmbhatt and the other defendants perpetrated. Only after

that take-down of AEB does Ghuman turn to his own

wrongdoing. Ghuman admits that he participated in a plan to

use fraudulent information to secure SBA guarantees, “even

though he knew it was illegal.” R. 347 at 99. He admits

knowing that some gas station purchasers were submitting

loan applications that included false information, that he

signed statements indicating that the buyers were providing

equity in the purchased stations when he knew they were not,

and that in some instances, he provided the equity from his

own funds to give the false appearance that the buyers were

providing the required equity. R. 347 at 99–100. Ghuman then

goes on to dispute certain aspects of the government’s version

of the offense, asserting that it “vastly overstates Ghuman’s

role in this scheme and minimizes the conduct of

others—particularly Brahmbhatt.” R. 347 at 100. Ghuman

specifically denies that he recruited two of the buyers, Ish

Oberoi and Mohammad Ali, that he altered documents and

falsified loan applications, or advised others to use straw

buyers (including theirfamilymembers). Finally, ending where
14 Nos. 19-1734 & 19-1745

he began, Ghuman goes so far as to assert it was “unlikely AEB

relied on the information Brahmbhatt and others submitted

when issuing the loans in question, “ and that although

Ghuman and his co-defendants were guilty of a crime, the true

victim of that crime was the SBA rather than AEB. R. 347 at

101.

We reject Ghuman’s assertion that the district court

misunderstoodand mischaracterizedhis versionofthe offense.

Certainly it is true, as Ghuman has been at pains to point out,

that AEB was culpable for the nearly blind faith it placed in

Brahmbhatt andforits failure to more aggressivelymonitorthe

SBA loan approval process. But the fraud was one perpetrated

by Ghuman and his cohorts, not the bank. At best, Ghuman’s

account of the scheme represents an incomplete

acknowledgment of Ghuman’s role in the offense. Beyond

acknowledging Ghuman’s guilty knowledge that false

information was being given to the bank, the only actions in

furtherance ofthe scheme that he admits are signing statements

indicating the buyers of the gas stations were contributing the

requisite equity to the purchases and that in some instances

Ghuman was funding those equity checks himself. Much more

exposition in Ghuman’s versionis devotedto blaming the bank

for mismanaging its affairs in such a way that opened the door

to the success of the scheme that Ghuman and his codefendantsperpetrated.Ghuman, of course, bore the burdenof

demonstrating to the district court that he accepted moral

responsibility for his criminal activity. E.g., United States v.

Smith, 860 F.3d508, 516 (7thCir 2017). “[Defendant]’s grudging

and incomplete admission, accompanied by an excuse to

minimize his own culpability, does not indicate an acceptance
Nos. 19-1734 & 19-1745 15

of responsibility.” United States v. Aquilla, 976 F.2d 1044,

1053–54 (7th Cir. 1992); see also Jones, 55 F.3d at 295; United

States v. Rosalez-Cortez, 19 F.3d 1210, 1219–20 (7th Cir. 1994).

Ghuman’s version of the offense can readily be characterized

as a grudging and incomplete acceptance of responsibility for

the actions he took in furtherance of the offense, accompanied

by finger-pointing at the bank for not making it more difficult

for Brahmbhatt, Ghuman, and the other defendants to

perpetrate the multi-million dollar fraud on the bank.

Ghuman admits that he knew that buyers were including

false information in the loan applications they submitted to the

bank. “Ghuman told himself that this was not his business, but

he now understands that he should not have entered into the

transaction in such cases.” R. 347 at 99. Likewise, Ghuman told

the probation officer, “It took me a while to understand, but

this was a huge criminal act.” R. 347 at 10. These sorts of statements read as though Ghuman simply went along with the

wrongs perpetrated by Brahmbhatt, who shepherded the

fraudulent loan applications through the bank’s approval

process, andthe buyers, who submittedloanapplications laden

with false information.

But the record supports the district court’s findings that

Ghuman did much more than accede to and join in with the

wrongdoing perpetratedbyco-defendants.He recruitedbuyers

and cajoled them into buying multiple stations, which was

obviously to the benefit of himself and Khan as the sellers of

the stations. He embraced Brahmbhatt’s invitation to

circumvent the lending criteria imposed by the bank and the

SBA, and bribed him in order to do so. He coached buyers on

what they needed to do. He not only supplied equity on behalf
16 Nos. 19-1734 & 19-1745

of buyers in some instances, as he admitted in his version of the

offense, but, according to Khan, used computer software in

other instances to alter checks from the buyers (or their cosignors) in order to give the same impression. He recruited

(and encouraged the use of) straw buyers. He provided false

bank statements to inflate buyers’ assets. And he recruited

Mehta to draft false tax returns to again give a false picture of

the buyers’ financial status.

Ghuman has denied many of these actions, and given the

evidence before the district court, Judge Tharp did not clearly

err in treating these as false denials. Whether these actions are

deemed relevant conduct or inherent in the scheme which

underlay his plea of guilty, Ghuman’s false denials themselves

support the district court’s decision to deny him credit for

acceptance of responsibility.

Ghuman also told the probation officer that one of the

purposes of his 2009-11 stay in India was to seek medical

treatment. R. 347 ¶ 86. The district court found that this was a

lie, and that Ghuman had really fled this country for India in

order to evade prosecution for the crimes which were then

under investigation. R. 423 at 37. Again, the record supports

this finding. Khan, for example, told the government that

Ghuman had no medical condition which necessitated his

departure forIndia. R. 297-2 at 14. Ghuman’s statements to the

probation officer regarding his flight to India were yet another

misrepresentation of what he had done and likewise support

the district court’s finding as to acceptance.

The district court’s findings as to what Ghuman did were

based in part on the the grand jury testimony of Brahmbhatt
Nos. 19-1734 & 19-1745 17

andMehta, the proffer of his co-defendant Khan, andthe grand

jury testimony of two young gas station purchasers, Ali and

Oberoi. Noting his due process right to be sentenced on the

basis of reliable information, e.g., United States v. Helding, 948

F.3d 864, 870 (7th Cir. 2020) (citing United States v. Tucker, 404

U.S. 443, 447, 92 S. Ct. 589, 592 (1972)), Ghuman argues that he

was deprived of the opportunity to contest the credibility and

reliability ofthese materials before the court basedkey findings

upon them. We disagree.

The record indicates that the government provided copies

of the proffer and grand jury transcripts to defense counsel and

later submitted them to the probation officer in conjunction

withthe government’s sentencing memorandum;the probation

officer in turn attached them to a supplement to the presentence report. R. 296. Consequently, Ghuman had the

opportunity to address the credibility and reliability of these

materials priorto sentencing but didnot take advantage of that

opportunity.

4 On consideration of the grand jury transcripts

and the proffer, the court found them to be credible. R. 423 at

30, 35. Ghuman contends that not untilthe courtrelied on them

did he have any reason to object, but this is plainly wrong.

Ghuman had access to these materials, he knew what the

4

In his objections to the pre-sentence report, Ghuman represented that

his counsel had not been placed on notice that the government had

submitted these materials to the probation officer. R. 299 at 2. However,

the government pointed out in response that it had previously produced

the materials to defense counsel and had copied counsel on the

transmittal of the materials to the probation officer. R. 322 at 2–3. The

government’s sentencing memorandum also quoted from these materials

at some length. R. 297.
18 Nos. 19-1734 & 19-1745

government was relying on them for, and he knew that the

district court might choose to rely on them. He was bound to

object in a timely manner if he believed the district court

should not rely on them, and he was instead silent on this

point. It is too late in the day to be saying that the court could

not properly rely on these materials. Certainly there was no

plain error in the court choosing to credit them and to factor

these sources into its finding as to acceptance of responsibility.

B. Ghuman—erroneous term of supervised release.

The court imposed a term of three years of supervised

release on the false tax return count (Count 23), to be served

concurrently with the three-year term on the bank fraud count

to which Ghuman had pleaded guilty (Count 1). A three-year

term was permissible as to the bank fraud count, but one year

is the statutory maximum on the tax fraud count. Section

7206(1)is categorizedas a Class E felony because the maximum

prison term on that charge is three years, and the maximum

term of supervised release for a Class E felony is one year. See

18 U.S.C. §§ 3581(b)(5) (deeming Class E felony as one subject

to maximum prison term of three years); 26 U.S.C. § 7206

(setting three years as maximum term of imprisonment for

false tax return); 18 U.S.C. § 3583 (b)(3) (limiting term of

supervised release on Class E felony to maximum of one year).

Ghuman did not raise the issue below, so our review is for

plain error only. See Rosales-Mireles v. United States, 138 S. Ct.

1897, 1904–05 (2018). To succeed on plain error review, a

defendant must show not only that an obvious error occurred,

but that the error affected his substantialrights. Id. The district

court erred, and plainly so, in imposing a term of supervised
Nos. 19-1734 & 19-1745 19

release on the tax fraud count that exceeded the statutory

maximum. The government nonetheless argues that Ghuman

was not prejudiced by the error, because the two terms of

supervised release are to run concurrently and a three-year

term is authorized as to the bank fraud count. See United States

v. Gray, 332 F.3d 491, 493 (7th Cir. 2003). However, Ghuman

has made a plausible case that there still could be material,

adverse consequences to him in the future if the error is not

corrected– for example, in a revocation proceeding prompted

by a charge that he violated the terms of his supervised release,

which might lead to the imposition of another prison term

(including consecutive terms) imposed on both periods of

supervised release.

To foreclose that possibility, we may correct the judgment

ourselves to modify the term of supervised release on the tax

return count to a term of one year. See, e.g., United States v.

Smith, 906 F.3d 645, 651 (7th Cir. 2018). Ghuman has suggested

that we should instead remand for re-sentencing, but we are

not convinced that a remand is necessary. The district court

imposed the maximum possible term of supervised release

(three years) on the bank fraud charge and the maximum

possible prison term on the tax return charge (three years),

along with what it believed (in error) to be the maximum

probationary term of three years. We have no doubt that the

court would have imposed the maximum possible term of

supervised release (one year) on the latter charge.
20 Nos. 19-1734 & 19-1745

C. Khan restitution – refusal to offset restitution by value of

collateral still held by bank.

As the bank loans that are the subject of this case went into

default and AEB foreclosed on those loans, it took possession

of the gas stations that were the collateral on the loans; the

bank was able to sell some of those properties, but it held onto

a dozen of the stations that it was unable to sell for a

reasonable price. In calculating Khan’s restitution obligation

($10.8 million), the court gave him credit only forthe collateral

that the bank had already sold. Khan argued that he should

have additionally been given credit for the collateral that the

bankhadnot yet sold. The district courtrejectedthis argument,

concluding it lacked the authority to credit Khan for the value

of the unsold properties in view of the Supreme Court’s

decision in Robers v. United States, 572 U.S. 639, 134 S. Ct. 1854

(2014).

The district court was correct. This case is governed by the

Mandatory Victims Restitution Act of 1996 (“MVRA”), which

in relevant part provides that a defendant should be credited

for the return of stolen property in the restitution calculation.

18 U.S.C. § 3663A(b)(1)(B). Robers holds more specifically that

for purposes of determining a defendant’s restitution

obligation in a bank fraud case like this one, the defendant is

credited forthe amount of money the bank (as victim) receives

when it sells the collateral, because only then is the property

previously taken from the bank—i.e. the money obtained by

fraud— restored to the bank’s possession. Id. at 640–41, 134 S.

Ct. at 1856. The defendant in Robers contended that he should

instead be credited with the value of the collateral at the time
Nos. 19-1734 & 19-1745 21

the bank takes title to the collateral—an argument he made

because property values were falling and by the time the bank

sold the collateral, it was worth less than when the bank took

possession of the properties. But the Court rejected that

argument, concluding that the relevant value is the value at the

time the collateral is sold by the bank. Ibid., see also id. at 644,

134 S. Ct. at 1858.

In the course of its analysis, the Court adverted to the

scenario presented here, where a victim takes possession of the

collateral but is not able to sell it by the time the defendant is

sentenced, thus depriving the defendant of credit against his

restitution obligation for the value of the collateral. Robers

noted that the sentencing court was not without some tools to

address the potential unfairness to the defendant in this

scenario, including delaying the determination of the

restitution amount for a short period of time following

sentencing in order to give the victim additional time to

liquidate the collateral or crediting the defendant for the value

of the collateral if the victim has decided to keep it. Id. at 644,

134 S. Ct. at 1858 (citing 18 U.S.C. § 3664(d)(5), (f)(2), (f)(3)(A),

and (f)(4). “And the Government has conceded that the statute

(whetherthrough these or other provisions) provides room for

credits against an offender’s restitution obligation to prevent

double recovery to the victim.” Id. at 645, 134 S. Ct. at 1858

(cleaned up) (citation omitted). A concurrence by Justice

Sotomayor (joined by Justice Ginsburg) makes explicit that

because real property is an illiquid investment, it may not be

possible in every case for the bank to sell the collateral before

sentencing and the imposition of restitution; and so long as the

bank has not decided to hold onto the collateral indefinitely as
22 Nos. 19-1734 & 19-1745

an investment, a defendant is not entitled to credit at

sentencing for the value of the collateral against his restitution

obligation. Id. at 647–49, 134 S. Ct. at 1859–60 (Sotomayor, J.,

concurring). “In such cases, I would place on the defendant the

burden to show—with evidence specific to the market at

issue–that a victim delayed unreasonably in selling collateral,

manifesting a choice to hold the collateral.” Id. at 649, 134 S. Ct.

at 1861.

Here, Khan points to no evidence that the bank decided to

hold the properties in question as an investment as opposed to

being unable to sell the properties immediately at a reasonable

price—andindeed,the district courtrejectedthe notionthat the

bank had made an affirmative decision to hold onto these

properties as an investment. R. 451 at 12–14. So the court was

correct not to credit Khan forthe value of the unsold properties

in calculating his restitution obligation.

Relatedly, Khan also faults the district court for failing to

anticipate and provide for the future sales of the bank-held

collateral and corresponding reductions in his restitution

obligation. The government agrees that Khan’s restitution

obligation is subject to modification in the future if and when

the bank is able to sell the properties. Cf. United States v.

Dawson, 250 F.3d 1048, 1051 (7th Cir. 2001) (“were Dawson's

co-schemers to pay Rush Hospital any amounts in restitution,

we expect that the government would notify Dawson of that

occurrence so that she could properly file a request for

modification of restitution”) (citing § 3364(j)(2) (defendant

entitled to credit for “any amount later recovered as

compensatory damages forthe same loss by the victim” in any

federal or state civil proceeding)). The district court itself
Nos. 19-1734 & 19-1745 23

acknowledged this possibility. R. 451 at 17. But the government

argues that Judge Tharp was not required to provide for such

modifications at the time of sentencing, not knowing if orwhen

such sales will occur.

The district court did not errin omitting from the judgment

any provision addressing the parties’ obligations in the event

the unsold collateral is finally liquidated by the bank at some

date in the future. In the briefing and at argument, Khan’s able

counsel suggested that, at a minimum, the bank should have

been ordered to notify the parties of such sales so that the

parties could take appropriate steps to modify Khan’s

restitutionobligation.That certainlyis a reasonable suggestion,

but given the extent to which real property sales can be

discovered throughpublicly-available sources, we do not think

the court was obligated to incorporate such a provision in the

judgment.

D. Khan—refusal to consider his financial circumstances in

determining his restitution obligation.

No one disputes that Khan does not, at present, have the

financial wherewithal to make good on the restitution

obligation—$10.8 million—that the district court imposed.

Khan asked the district court to consider his financial

circumstances when it determined the amount ofrestitution he

owed to the bank. But the court held that full restitution was

required and that it was without the authority to consider a

lesser amount based on Khan’s individual circumstances.

The district court again was correct. Given the terms of the

statute, “[t]he economic circumstances of a defendant cannot be

considered by the court when fixing the amount of the
24 Nos. 19-1734 & 19-1745

restitution.” United States v. Sensmeier, 361 F.3d 982, 988 (7th

Cir. 2004) (footnote omitted) (emphasis in original); see §

3664(f)(1)(A). As this court recognized in United States v. Day,

418 F.3d 746 (7th Cir. 2005), the MVRA elevates the victim’s

right to full restitution over the defendant’s ability to pay:

Congress, in adopting the MVRA, believed that

the law should be concerned first with the

victim's right to full restitution and the

defendant's concomitant recognition of the duty

to pay full restitution, albeit a largely symbolic

one. This belief is given effect through § 3664(f),

whichfirstrequires the court to order “restitution

to each victim in the full amount of each victim's

losses as determined by the court and without

consideration of the economic circumstances of

the defendant.” 18 U.S.C. § 3664(f)(1)(A).

Therefore, the fact that a defendant maynever be

able to satisfy a restitution award is no longer

grounds for reversing that award.

Id. at 758 (footnote omitted). See also Dolan v. United States, 560

U.S. 605, 612, 130 S. Ct. 2533, 2539 (2010); United States v.

Malone, 747 F.3d 481, 485 (7th Cir. 2014); United States v.

Hosking, 567 F.3d 329, 333 (7th Cir. 2009), abrogated on other

grounds, Lagos v. United States, 138 S. Ct. 1684 (2018).

The district court does have the obligation to consider a

defendant’s financial obligations in determining how the

defendant willpayhis restitutionobligation—ina lump sum or

installments, for example—and on what schedule. § 3664(f)(2),

(f)(3); see Paroline v. United States, 572 U.S. 434, 485, 134 S. Ct.
Nos. 19-1734 & 19-1745 25

1710, 1742 (2014) (Sotomayor, J., dissenting); Hosking, 567 F.3d

at 335–36.

But we see no support in the record for Khan’s contention

that the court did not appropriately consider his financial

circumstances in setting a reasonable schedule for restitution

payments. The court, in fact, concluded that in view of Khan’s

circumstances, he should not be required to pay interest on his

restitution obligation. R. 395 at 2. In addition, the court, in lieu

of a lump-sum payment, ordered Khan, upon release from

prison, to commence making periodic partial payments equal

to 10 percent of his net income. R. 343 at 5. These provisions

indicate that the court was considering his economic

circumstances in laying out the manner and schedule of

restitution payments and establishing a realistic payment plan.

See Paroline, 572 U.S. at 485–87, 134 S. Ct. at 1742–43

(Sotomayor, J., dissenting) (acknowledging importance of

partialperiodic payment schedules fordefendants withlimited

financial resources).

III.

The term of supervised release on Ghuman’s conviction for

filing a false tax return is reduced to one year. His sentence is

otherwise affirmed. We likewise affirm Khan’s sentence,

including the amount and terms of his restitution obligation.

We commend Judge Tharp for the extraordinary time,

consideration, and care he devoted to resolving the sentencing

issues presented in this case.