* The Honorabl e Glen M. Wil li ams, Se ni or Un ited St ates Dis tri ct

Judge for the Western District of Virgi nia, si tting by designation.
1 RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Six

th Circuit Rul e 206

ELECTRO NIC CIT

ATION: 2003 FED App . 0254P (6th C ir.) File Name: 03a02 54p.06



### UNITED STATES COURT OF APPEALS

FOR THE SIXT H CIR CUIT

_________________
U NITED S TAT ES OF A MERICA ,

Plaintiff-Appellee,

v.

S COTT A. R EAUME , Defenda nt-Appel

lant. X - - - -
> , - - N No. 02-1112

Appeal from the United States District Court for the E astern D istrict of Michiga n at Detr oit. No. 97-81475—Gerald E. Rosen, District Judge.

Argued: June 20, 2003 Decided and Filed: July 28, 2003

Befor e: KENNE

DY and CO LE, Ci

rcuit Judg es; WILL IAMS, Senior District Judge. *

_________________ COUNSEL

ARGUED: Richa rd B. Gi nsber g, Ann Arbor, Michigan, for Appellan t. Stephen L. Hiy

ama, ASSISTA

N T UNITED 2 United States v. Reaume No. 02-1112

STATES AT TORN EY, Detroit, Michigan, for Appellee. ON BRIE F: Richard B. Ginsberg, Ann Arbor, Michigan, for Appellan t. Stephen L. Hiy

ama, ASSISTANT UNITED STATES ATTORNEY, Detroit, Michigan, for Appellee.

_________________ OPINION

_________________ R. GUY COLE, JR., Circuit Judge. Def e ndant-Appellant Scott A. Reaume was convicted by a jury of c ommitting bank fraud, in viol a tion of 18 U .S.C. § 1344 . Reaume admits to opening several checking acc oun ts at a federally insured financial institution , making an initial deposit of a small sum, writing checks f

ro m these accounts for goods and service s throughout

the country

with the knowledge that

the acc ounts did not contain sufficient funds to cover the value of th e checks, and retu

rning th e majorit

y of the items purchased by check to branches of stores in different locat ions in ex change for cash.

After proceeding to trial

on the theory that

his scheme was notintended t o de fraud a federally insured financial institution, Reaume was found guilty by a jury . The fi n al judgment of conviction and sentence was entered on January 3, 2002, and this timely appeal followed.

For the reasons that

follow, we AFFIRM the judgment of the distri ct court

. I.

On August 19, 1999, a fed er al grand jury returned a one-count indictment charging Reaume with bank fraud. The indictmentalleged that Reaume kn owingly executed a sch eme to defraud Monroe Bank and Trust (“the Bank”).

Reaume’s jury trial beg an on August 14, 2001. At tr ial, testimony wa s presented that Reaume opened two checkingNo. 02-1112 United States v. Reaume 3

accoun ts at the Bank

using the aliases Steven D. McIlvee n and Robert Sandor. Accounts also were opened at the Bank by Adam R odrigu ez and Danny K . Drummond in their own
names. Drummond opened an addition al account under the alias of John S. Woods.

Reau me, Rodriguez, and Drummond used checks draw n fromtheir accounts to p urchase merchandise at various branches of nati ona l-chain retaile rs, and su

bsequen tly returned most of the mercha

ndise f or cash refunds at other branches of the stores. The Bank flag ged the

five ac counts early on and refused to honor

the checks for which there were insufficient

funds (“NSF checks”). The losses resulting from the passing

of these NSF checks, therefore, fell on either the retailers them selves or the check-guara ntee companies that insured t he reta ilers.

On August 1 6, 2001, th e jury returne d a guilt

y ve rdict. On January 3, 2002, the district court determined that Reaume’s guideline range

was twen

ty- seven to

thirty- three mo nths, sentenced Reaume to thirty months of imprisonment and four years of supervised release, and ordere d him to pay restitution in the amount of $95,649.26.

On appeal, Reaume raise s four points of error. First, he argues that the evidence presented at trial was insuf

ficient t o maintain a convic tion under

the fede ral b ank fr aud statu

te because there was no evidence that he intended to defraud the bank itself, a s opposed

to the indiv

idual mer chants o r th eir respective insurance compa nies. Second, Reaume contends that the distri ct cou rt erre d in refu sing to a ward him a two-pointreduction in offense level for acce ptance of
re sp on si bi li ty. Third, he asserts that the district court erred i n overruling his objections at sentencing to the amount of money at issue in the fra

ud. Fourth, Reaume argues that the districtcourt erred

in order ing him to pay restitutio n in excess of $95,000 without considering his ability to pay

. 4 United States v. Reaume No. 02-1112

II. A. Sufficiency of the Evidence and Intent to Defraud

Reaume argues that there wasinsufficient evidence to find that he speci fically

intended to defraud the Bank, as opposed to the merchants or their insurers. He contends that an intent to defraud the pay

ee of an NSF check

does not provid

e a basis for a finding that ther e was an intent to su

bject the issu in g ba nk to a l os s. Ac co rd in gl y, Reaume argues that the district court erred in denying his motion for a judgme nt of acq uittal. The denial of a motion for a judgment of acquittal is reviewed de novo. United States v. Kone , 307 F.3d 430, 433 (6th Cir. 2002).

Three elements are required for a conviction

of bank fraud pu r suant to § 1344: ( 1) the de fendant must have

knowing ly executed or attempted to execute a scheme to d ef raud a financial institution; (2) the defendant must have done so wi th the intent to defraud; and (3) the financial institution mus t have been i nsured by the F ederal Deposit Insura nce Corporation. United States v. Ever ett , 270 F.3d 986, 989 (6th Cir. 2001).

Th is Co urt previously addre ssed the intent element of the bank fraud statute in United States v. Hoglund , 178 F.3d 410 (6th Cir. 1999), and Everett . While neither of these cases are directly contr olli ng, their explication here is critical because it is from these cases that we distill the p rincip le which we apply to the prese

nt case.

In Hoglund , an attorney was convicted under § 1344 after settling h is clients’ cases without their permission, forging their signatures on the s ettle ment checks he received, and depositing the money

into his own

accoun t. 178 F.3d at 411. In Hoglund
, we addressed the issue of whether the Government

must prove tha t the def endant exposed a ba

nk to
a risk of loss as part of the “sche me to def raud” e lement. Id. at 413. Hoglund resolved this question by holding t hat “riskNo. 02-1112 United States v. Reaume 5

of loss” is simply “one way of establishing intent to defraud inbank cases.” Id. Thus, this Cour t found tha t a defendant need not have exposed

a bank to a risk of loss as an element of bank fraud. Id. Instead, proof that the def endant “intended to put a bank at a risk of loss” was sufficient to maintain a bank fraud conviction. Id. Thus, Hoglund held that the bank fraud statute is violated, even when there is no actual risk of loss on the part of the bank, if th e defen dant’s in tent is to expose the bank to such a risk. While informative, Hoglund is not controlling in the present case. Here, in contrast t o Hogl u nd
, the defendant claims that, regardle ss of whether there was an

actual r isk of loss, there wa s no intent to expose the Ban k to a risk of loss.

In Everett , the defendant, a

certified public accountant, was found g ui lt y o f bank fraud by

a jury. 270 F.3d a

t 989. On appeal, the defendant argued that the Govern ment fail ed to prove the spec if

ic intent required by § 1344, na mely, the intentto defraud a federally insured bank, or at least to put the bank at a risk

of l oss. Id. at 990. The defendant acknowledged

that there was eviden ce tha t she inten ded to defraud her client, but

argued that the manner in which she defrauded her client did not impose a risk of loss on the bank inquestion. Id. In affirming the conviction, we held that the specific intent re quired f

or bank f raud doe s n o t require putting the bank at a

risk of a loss or intending to do so “in the usual sense.” Id. at 991. “It is sufficient if the defe n dant in the
course of com mi tting fraud on someone causes a federa lly insured bank to transfer funds under its possession and control.” Id. Everett

, therefore, can

be said to stand for the proposition that the bank fraud statute is violated, even if the intended victim of the fraudulent activity is a n entity other than a federally

insured financial institution, when the fraudulent

activity cause s the bank t

o transf er funds . Thus, the holding of Everett is also inst ructive but not s q uarely on point, as there was no evidence in the present c ase indicating that the Ban k actual ly d

id transf er funds in co nnection

with Reaume’ s fraudu

lent acti vities. 6 United States v. Reaume No. 02-1112

Unlike the defendant in Hoglund , Reaume contends that he harbored no intent to expose the financial institution to a risk of loss. Moreover, unlike the situation in Everett , Reaum e contends
, and the evidence substantia tes, that the Bank never transferred

any funds in c on nection with the fraudulent
ac ti vi ty. Thus, it appears that Reaume’s particular factpattern does not fall neatly under the Hoglund or Everett rubr ic, which co nsider bo th the inte nded vict im and ac tual loss.

We nevertheless affirm Reaume’s conviction. The spec ific issue that Reaume a

ppeals is the evide

nce of hi s intent to defra ud t he Bank itself. In Everett , this Court held that an intentto put the fina ncia l institution at a risk of loss is not req uired, and that the fact that the defendant defr aude d
someone was sufficient, given that the fraud ca used the bank to tran sfer fun ds. 270 F.3d at 991. In the prese nt case, the Bank was clea rly at a risk of loss. Evidence was presented at trial t o dem onstrate

that, whe

n the Ba nk rece ives an N SF check, it makes a

decisionto either honor the check any way or to dishonor the check. If th e check is dishonored, the Bank does not lose a

ny money , but if the

check is honored, and the account holder f ail s t o pay bac

k that debt to the Bank, the Ba nk suffers a loss. Therefore, it is clear that Rea ume’s f raudulent activity, reg ardless of the intended victim, co ul d have caused t

he Bank to transf er funds

. If in fact the B ank had transfe rred f

unds, then this case would clearly be governe d by E verett, because an intent to defraud someone would have caused the Bank to trans fer fu nds. The issue of Reaume’s intent simply cannot logically turn on the cou

rse of actionchosen b y th e Bank a fter re ceiving

the NSF c

hecks. Ac co rd in gl y, it is a

necessary

extension of Everett to find the intent element of § 1344 satisfied in this case.

Evere tt contains language to support this outcome. I n Everett , this Court stated that the Govern men t is proba bly better advised to proceed

under the wire or mail fraud statutes where the bank has “minimal involvement, such as where a swindler deceives someone into voluntarily writing checks t o the swindler ona good account.” Id

. Nevertheless, the CourtNo. 02-1112 United States v. Reaume 7

1 It should be no ted tha t Eve rett was decided on October 12 , 2001, and Rea ume ’s trial con clude d on Augu st 16, 2 001

. i ndicated that even such a minimal involvement of the ban k is sufficie nt to fi nd liabilit

y un der § 134 4 when the

specific intentto defra

ud someone

is prese nt. Id. Therefore, we need notaddress

the question of whether the evidence presente d at trial was sufficient for a

reasona ble jury to find tha

t Reaume intended to de fr au d t he Ba nk sp ec if ic al ly. Ap plying the reasoningof Hoglund and Everet t , we find th at intent t o defraud the federally

insured institution itself is satisfied where: (1) the intent to defraud some entity was present; and (2) that intended fraud pl ac ed a federally insured financial institution at a risk of loss. In pr oviding t he jury with instru

ctions at t he close of trial, the district c ourt state d that the Governm ent not onl

y needed to prove tha

t Reaume knowing ly

executed or partic ipated in a scheme to defraud a federally

insured financial institution, butalso that Rea

ume “did so with the intent to defraud Monroe Bank &

Trust.” T

he distr ict court later stated that “the Governm ent must

prove beyond a

reasonable doubt that the scheme to defraud was employ ed by the def

en d ant to defraud Monroe Bank & Trust.” Given our holding in Everett that the in

tent to have a bank be the victim of the fraudulent conduct i s not a prerequisite to maintaining a conviction under the bank fraud statute, the jury instructions given by the districtcourt benefitted Reaume. 1 In lig ht o f E verett, therefore, Reaume’s argument that the evidence presented at trial was insufficient to demonstrate the intent required by the bank fra ud statute fails.

B. Sente nce Red uction for Accepta nce of Re

sponsibilit

y
Reaume appeals the deci s ion of the district court refusing to grant him a two-point reduction in his offense l evel for acceptance of

respo nsibility. Because suc h a finding gener ally present s a qu estion of

fact, th is Court re

views a 8 United States v. Reaume No. 02-1112

districtcourt’s

finding that a de fendant

is not enti

tle d to a sentencingreducti on for ac ceptanc e of res ponsibility

for clear
error. United Sta tes v. Ch ilders , 86 F.3d 562, 563 (6th Cir. 1996). Howeve

r, if the only

issue pre sented is

the propr iety of applying the

reduction to t he uncontested facts, the decisionis reviewed de novo. United Stat es v. Tilford , 224 F.3d 865, 867 (6th Cir. 2000).

The United Sta

tes Sente ncing G uideli nes (the “Guideli

nes” ) provide that a two-poi nt reduc tion in off ense lev el is applicab le where the defendant clearly demonstrates accept a n ce of respo nsibility

for his of

fense. U .S. S ENTENCI

NG G UIDELINES M ANUAL § 3E1.1. Whi le a gui lty plea is or di na ri ly a prerequisite for this reduction, Application Note 2 of this provision states that conviction by trial does not automatic ally

exclude a defenda nt from considera

tion for th is reduction. U.S. S ENTENCI NG G UIDELINES M ANUAL § 3E1.1, comment. 2. The Guidelines provide that, under rare circumst ances, a defendant may clearly de

monstrate an acceptance of respo nsibility despite exercising hi s constitutional right to

trial. Id. F or instance, where a defendant goes to trial to assert issues that do not re la te to factual guilt, such as a challenge to the applicability of a statute to his conduct, a reduction may be warran

te d. Id. Even in such an instance, ho weve r, “a de terminat ion that a defendant has acc epted re sponsibilit y will be based pr

imarily upon pre-trial statements and conduct.” Id.

Reaume’s position is that he did not contest the Government’s factual allegations at trial, b ut rat her, mer ely contested the appli cabilit

y of the bank fraud statute to the conduct in which h e partic ip ated . In contrast, the Gov ernment

maintains that Reaume did in fact contest the issue of wheth er he pa

rticipat ed in the s cheme

with anintent to defrau d the Ba

nk. Accordin g to the Gove rnment, Re aume’s specific intent to defraud the Bank is a f actua l matter.No. 02-1112 United States v. Reaume 9

2 Guideline § 2F1.1 has been repea led and replaced by the consoli dated pro perty-cr ime p rovis ion s in § 2B1.1. Section 2F1.1 was repealed prior

to Re aum e’s sente ncing. N everth eless, d ue to ex po st facto

concer ns that ari se as a result of the harsher penalt ies containe d i n § 2B1 .1, the probat ion of fi cer wa s cor rect

to us e th e ver sion

of the fr aud guide line, § 2F1.1 , in effect when Reaum e’s offense occu rred

. See U.S. S ENTENCI

NG G UIDEL I NES M ANUAL § 1B 1.11 (b)(1 ). We agree with the Government. At the time of Reaume’s trial, the distri ct court a nd the parties accepted that the Government’s burden in

cluded de monstrati ng that R eaume intended to place the Ban k at a risk

of loss. Whetherthis intentis required under § 13 44 is a question of law, but whethe rRea ume actu

ally harbore d such an

intent is a question of fact for the jury to decide. Reaume e lected to put the Governm ent to its bu rden of proof at tr

ia l by deny

ing what was understood to be an e sse ntial factual element of guilt. Accordingly , the refusal of the district court to award Reaume a reduction for acceptance of responsibility was not clear error.

C. Amount o

f Loss

Reaume argues that the district court erred by s c oring hi s Guidelines range based on a finding that the relevant conduct cont ributed

to betwee

n $200,000

and $350, 000 in losse s

. This Court will only set

aside a district court’s factual finding with regar d to the amount of los s attribut ed to a defendant under Guideline s § 2F1.1(

b) if it co ncludes that the district court’s finding

of fact was clea rly errone ous. 2 United States v. W are , 282 F.3d 902, 907 (6th Cir. 2002).

Inits fi rst sentencing memorandum, the Government at tributed $211, 193.9 9 in l osses to Rea ume, c ompri sing t h e fol lowin g sums: (1) $108,328.37 for the losses caused by Reaume, Rodriguez, and Drummond through the use of NSF checks from the Bank; (2) $92,000.00 for the losses caused by the use of

NSF checks by Jamie Reaume, the defendant’s 10 United States v. Reaume No. 02-1112

younge r brother; and (3) $10,865.62 for the losses caused by Pamela Reaume, the defendant’s sister.

At the sente

ncing h earin g, t he district court expressed
concern about attributing to Reaume the losses caused by h is sib lings. Accordingly , the district court decided n ot t o impose a sentence until it had the o p portunity to hear testimony from the two siblings and make a determination as to whether

their conduct was connected to Reaume’s conduct ina manner that

was sufficient

to satisfy the releva

nt conduct criteri a for se

ntencing purposes

. Inits second sentencing memorandum, the Govern me nt abandoned

its position that the activity of Rea ume’s sibl ings should be attrib uted to Rea

ume and in stead ar

gued th at the additional relevant conduct for whichReaume sh

ould be he ld responsi ble involved Reaume’ s o wn fraudulent conduct b eyond that charged in the indictment. According to th e Governm ent, Reaume

opened numerous fraudulent checking
accoun ts at oth er financial in st it ut io ns th ro ug ho ut th e c ou nt ry. The evidenc e of this activity consisted of: (1) Rea ume’s 1991 arrest in Ill inois for a

ttemp ting to purchase clothing with a bad check; (2) Reaume’s admission, subseque nt to the 1991 arrest, that he had made as much as $70,000 per year throu gh his NSF-checking scheme; (3) Adam Rodriguez’s testimony that he an d Reaumehad been traveling the country writing bad checks for

about three ye ars, obtaining thousands of dollars a month by doing so; (4) nume rous cance led checks obtained by the FB I; (5) a number of fake identification cards possessed by Reaume; (6) Re aume’s 1993 arrest in Florida for passing bad checks; and (7) the absence of any rec ord of legitima te employment. The district court a ccepted the Government’s rationa

le and fo und Reaum

e to be responsible for between $200,000 and $350,000 in losses.

Reaume contends that this fi nd ing was in error for two
reasons

. First, Reaume argues that the district court erred by allowing the G overnm ent to change its theory on which the amount of los s was bas ed withou t providin

g him withNo. 02-1112 United States v. Reaume 11

adequate notice. Second, Reaume maintains that even if the districtcourt h ad

ruled properly

in permitting the Government to advance its new theory , the basis for hol d ing Rea ume responsi ble for m ore than $200,000 in losses was too speculative in nature to sat isf y the Governme

nt’s burden of proving Re au me ’s re sp on si bi li ty f or th at su m b y a preponderance of the evidence

. Reaume’s contenti on that the district cour t erred

in permitting the Go vernm ent to change t heories between sentencinghearings is without merit. The rationale on which the amount

of losses was calculated

was perfectly

reasonable, and Re aume re ceived noti ce of th is cha nge in position when
a copy of the Government’s second sentencing memorandum
was sent to him. There was no error in the di strict court’s decisionto permit the Gov er nment to proceed on its new theory regar ding re levant c onduct.

Si mi la rl y, Reaume’s argument that the district court erred infinding him respo nsible fo r over $2 00,000 in lo sses is als o without merit. The district court’s finding s wi th respe ct to relevant co nduct are only

disturbe d if clea

rly errone ous, United States v. Collins , 78 F.3d 1 021, 1040 ( 6th Cir. 1996), and need only be ba sed on the preponderance of the evide nce, United States v. Meacham , 27 F.3d 214, 216 (6th Cir. 1994). T h e evidenc e broug

ht forth b y th e Gover

nment to su

bstantiat e the relevant conduct is sufficient to support the district

court’s finding s. D. Order of Restitution

The district court ordered Reaume to pay restitution in the amount o f $95,649.26. Reaume was ordered to “pay any restitution obligat

ions stil l outstanding according to a monthly schedule recommended by

the proba tio n department and approved by [the dis trict] court.” Reaume argues that the districtcourt erred in imposing this amount of restitution without considering his ability to pay

. 12 United States v. Reaume No. 02-1112

This Court rev

iews de novo wheth er a re stitution or der is permitted under the law. United States v. Dunigan
, 163 F.3d 979, 981 (6th Cir. 1999). Generally , if the restitution order is legally permissible, the amount ordered is then reviewed for an abuse of discretion. Id. Howeve r, here , becau se Reaume di d not object to the restitution order at his sentencing, the sentencingdecision

is revi ewed for plain error. See United States v. Koebe

rlein , 161 F.3d 946, 949 (6th Cir. 1998). To establish plain er ror, a de fendant

must show: (1) that an error occurred inthe district

court; (2) that the error was plain, i.e., obvious or

clear; (3) that the e

rror af fected substantia

l rights of the defendant; and (4) that this adverse impa ct ser iously affected the fairness, integrity , or public reputation of the judicial proceedings. Id.

The parties agree that a re stitution order here is lega lly permissib le pursuant

to the Victim and Witness Protection Act (“VWPA”) . 18 U.S.C. § 3663. Acc ordingl y, t he only issue before this Court

with regar d to the re stitution or

der is wheth er the district court committed plain error in ordering restitution in the amount of $95,649.26.

At Reaume’s senten cing, the district court made no reference to Reaume ’s ability

to pay the resti tu tion order in full. In determining the a mount of restitution that should be ordered, a sentencingcourt is required to consider the factors listedin 18 U.S.C. § 3664(a). Dunigan , 163 F.3d at 981. The § 3664(a) factors include theeconomic circumstances of the defenda nt. The Government argues that all of the information relevant to the restitution order was contained in the Presentence Inve stigation Report.

While it is true tha t “a distr ict cour t must have , at a minimum, some indication that a de fendant will be ab le to pay the amoun

t of resti tution ord ered in order to comply with 18 U.S.C. § 3664 (a),” Dunigan, 163 F.3d at 982, this Court has also held that “[ s]pecifi c findings in the imposition of restitution ar e not required.” United Sta tes v

. Jackson-Randolph
, 282 F.3d 369, 386 (6th Cir. 2002). GivenNo. 02-1112 United States v. Reaume 13

the findings in the Prese ntence Investig ation Report that Reaume has an Associate Degree in Applied Science, lives with his pare nts when in

th e Unit ed St at es , a nd ha s o nl y a very small amount of debt, the amount of restitution ordered by t he distric t court isnotclear error. Moreover, the district court did n ot o rder that the restitution be paid during any particular period of time.

A restitution order is permissible even if the defenda n t lacks the pres ent abilit

y to pay. United Sta tes v. Faa sse , 265 F.3d 475, 494 (6th Cir. 2001) (en banc). The burden is on

the defendant to demonst

rate that a restitution order far exceeds his resources and earni ng potential, United States v. Adams
, 214 F.3d 72 4, 73 0 (6th Cir. 2000), and Reaume has not met this burden here. While it may ha ve bee n prefera

ble for the districtcourt to have engage d in a m o re explicit analysis of Reaume’s ability

to pay this restitution amount, it cannot be said that the fa ilure t o do so in this instance meets the requirements of the plain error standard.

III.

For the foregoing reasons, we AF FIRM the judgment of the distri ct court

.