The Ho norable J am es E. Shad id, Un it ed Stat es D is tr ic t Court  f or the Ce nt ra l Dis t ri c tofI l l i noi s , s i t t i ng by des i gna t i on.



## In the 

# U n ited S ta tes Co urt o f Ap p ea ls

F o rth eS e v e n th C ir cu it

N o. 11

- 1347 U NI T ED S TATE SOF A MERI CA, P la intif f-A pp ellee, v. J I N H UA D ONG, D ef endant-Appellant.
Appeal from the United States District Court fo r the N o rthernDi stricto f Illino is, Eas tern Div isi on. No . 08 C R 371-2

—Jam es B. Z agel, Judge
.

A RG UE D F EB RU AR Y 23, 2012

— D ECI DE D M AR CH 27, 2012

Befo re F L A U M an d T INDER, C ircu it Judges , a nd S HA D ID , D istrict Judge.  S HA D ID , D i s t r i ctJudg e . Jin H ua Dong pl ed gui l ty to p a r t i c i p a t i n gw i th h i s c o - de fe n d a n t s i n a s c h e me to co m m it b an k fra u d b y k n ow in gly ob ta in in g m u ltip le e q u i t y l i n e s o fc r ed i ts e c u r e d b y th e s a me p r o p e r t y . He2 N o. 11

- 1347

w as sen ten ced to a term o f 5 1 m ont hs and three yea rs of su p ervi sed r el eas e, as wellas o rder ed to pay $337, 250 i n re sti tuti on. On app eal, Dong chal l enges o nl y the pro

pri etyo fthe re sti tuti on a w ar d , ar gui ng tha t he cannot b e ordered t o pay r est i tuti on f orthe re l evantco nd uct ofo therco - defe nd ants. W e di sag re e that thi s i s the cas e.

I. B ACK GR OUN D InA p ril 20 08 , D on g w a s in t h e U n ite d Sta te s illeg ally w hen he t ra vel ed fro m Los A ngel es to Ch i cago to m eet w ith Y o o n Sa e K im . D on g a gr ee d to h elp K im ob ta in hom e equi ty l i nes o fcr edi t ( H EL OC ) forpro perti es to b e p ur c ha s e d t o s e r v e a s col l a t e r a lf o r the l o a ns . On A pri l3, 20 08, at t h e dir ecti on o fKim , Dong purchas ed a s i ngl e- f am i l y hom e loc ate d at 4 066 So uth Lake Park, Chi ca g o , I l l i no i s, f o r $6 75 , 00 0 f o r th e pur po se of us i ng th e p r o p e r ty to o b t a i n mu l t i p l e HE L O C l o a n s . He m ade a $200 , 000 dow n-paym ent o n the proper ty after r ec eiv in g t h e m on ey from K im . D on g t h en h elp ed K im su bmi t a m o r tg ag e appl i ca ti o n t o Co unt ryw ide Ba nk to fi na nc e th e pur ch as e o fthe La k e Pa r kpr o per ty

. The a pp l i c a t i o n c o nt a i ne d s e v e r al f a l s e s t a t e men t s ma de wi th th e i nt en t to i nduc e Cou nt r y wi de to appr o ve the l oan, i ncl ud i ng: ( 1) thatDong was the tr ue purchase r wh e n i n f a c th e w a s a n o mi ne e p u r c h a s e rf o r K i m; ( 2) that D ong i ntended to occupy the pro perty ; and ( 3) that Dong had cer tain em plo ym ent, i ncom e, and ass et s. Countrywide ul ti m ate l y a pp ro ved the m or tgage l oan f or$4 72, 250. D ong si m ult aneously a pp l i ed f orH EL OC l oans fro m N ati onalCi ty Bank and LaSal l e Bank, b ot h s ecure d byN o. 11

- 1347 3 th e Lak e Pa r kpr o per ty

. In do i ngs o , he c o nc ea l ed th e o th erl o ana ppl i ca ti o ns fr o m the l en der s, c r ea tingthe appearance thatea ch l ender w as the o nl y l ender provi din g a H EL OC l oan on the pro perty

. These appli catio n s c on ta in ed fals e re p re se n ta tio n s a s t o D on g ’ s cit izenshi p, soc i al secur i ty num ber, em plo ym ent histor y, an d s a l a r y. In t h e c as e o f th e a p p lica tio n to L aS alle Bank, the appli cati on a l so conta i ned a co p y of th e o ri gi na l p urc ha se mor tg ag e an d s et tl ements ta te m en t that had been a l tered to f al sel y r educe the am ount o f the o r i g i na lmo r t g a g e o n the p r o pe r t y b y $300, 0 0 0

. On M ay 5, 20 08 , D on g a c c om p an ied K im an d Su n g A r K im to LaSal l e Bank f orthe cl osing o n the $350, 000 l i ne o f cre dit s ec u red by the Lake Parkpro perty

. Dong was schedule d to re cei ve the funds fro m the cl osing o n M ay 9, 2008 , but no fund s were u l ti m ate l y r ecei ved bec ause he w as arrested prior to th e disbu rsem en t. T he La ke Pa rk proper ty w as sol d i n Decem ber20 09 f or$1 35, 000, re sul ti ng i n a $ 337, 250 l oss to Country w i de. Don gpl ed g ui l tyt o Co unt s S ev ena nd Ei g hto fthe I ndi ct m en t, whi chc ha r g ed hi m wi th enga g i ngi n a sc he m e wi thhi s co - defen dan ts to de fr au d fi na nc i ali nsti tuti ons and to ob ta i n m oni es and funds owned by an d unde r the c us tod y a nd c o nt r o lo fthe fi na nc i ali nst i tu ti o ns b y mean s o fmate r i al l y f al se a nd fr au dul en t p re te n se s, re p re se n ta tio n s, p ro m ise s, an d om iss ion in vi ol ati on o f18 U

. S. C. § 1 344. Pr i o r t o s e nt e nc i ng, the P r o b a t i o n Offi c e i s s ue d a pr es en te nc e r epo r t ca l cul at i ng an adv i so r y gui del i ne ran ge of 51 t o 6 3 m ont hs and a cri m inal history category4 N o. 11

- 1347 ofI

. The to talo ffense l eve lwas proj ecte d to be 2 4 base d i n parto n a 1 6- l eve lin c re ase as a re sul t o fa sta tem ent in Dong ’s P lea Decl ar ati on that the to tali ntended l o s s wa s b e t we e n $ 1 , 0 0 0 , 0 0 0 a n d $ 2 , 5 0 0 , 0 0 0 g i ve n t he $472 , 250 m or tga ge fro m Country w id e and the $784, 900 i n HELOC l o an s r eque st ed fr o m Nat i o na lCi tya nd L aS alle B an k, les s t h e $ 13 5,0 00 ob ta in ed fr o m t h e sa le ofthe Lake Par k pr oper ty. A t s entencing, Dong s ei zed upon the prese ntence re port ’ s char ac teri zati on o fthe Countrywide m or tga ge as “r el evantco nd uct” a nd ar gued that h e co uld notbe or dered to pay re sti tuti on f orthatam ount. H e a l so obj ecte d t ha t the $337,250 loss to Cou nt ryw ide w as overstate d gi ven the signifi ca n t d ifferenc e betw een the p urchase pri ce of $675 , 000 and the sal e pri ce tw o yea rs lat er o f$ 1 3 5 , 0 0 0

. E xcl ud i ngthi s a mou nt, Do nga r g ue d, w oul d res ulti n an o ffense l eve li ncre ase o fo nl y 1 4 l ev els an d a n a dv i s o r y g ui de l i ne r a ng e o f4 1 t o 5 1 mo nths

. On J anua r y 1 4 , 2 0 1 1 , the di s t r i c tc o ur ta pp e a r s t o h a v e a ccep ted Do ng ’s argum en t and se n t e nc ed him as i f th ere w as onl y a 14

- l eve li ncre ase and an o ffense l eve lo f 22 ra therthan 24. Dong was se ntenced t o a t er m o f 51 months i n pr i so n o n e ac h o fCo unt s S ev ena nd Eight to be s er ved co ncurr ently fo llowed by thr ee yea rs o f su per vi se d r el ea se . H e was al so f o und j o i nt l y a nd se ve r a lly liab le w ith h is c o-d efe n d an ts for $ 33 7,2 50 in re sti tuti on, w hi ch r epres ents the $ 472, 250 m or tga ge fro m Country w i de, m i nus the $135 , 000 re cove re d w hen the p r o pe r t y wa s s o l d. On app eal, Dong chal l enges o nl y the r estitu ti on port i on o fhi s s entence

. S peci fi cal l y, h e c onte nd s thatN o. 11

- 1347 5 the di str i ct c ourter red i n or deri ng r est i tuti on f or re l e v a nt c o nd uc t t o whi c h he di d no t pl e a d g ui l ty, as th e t w o t ra n s a c t i o n s t o w h ich h e p led gu ilty res u lte d in no a ctuall oss . H e furtheras ser ts that the r est i tuti on am ount e x c ee d s the a ctuall oss cause d by hi s j oi ntl yu n d er ta k e n cr im in al a c tiv ity an d w as n otrea so n ab ly for es ee ab le t o h im

.

II. D I SC US SI ON The di st ric t co ur t’ s i nt er pr et at i o n o fthe S en te nc i ng Gu i del i nes i s r evi ew ed d e no vo, and i ts f actualfi nd i ngs ar e r evi ew ed f or c learer ro r. A ccor dingl y, the chal l enged cal cul ati on o fthe re sti tuti on am ount in thi s ca se i s r evi ewe d f o r c l ear er r o r a nd wi l lb e r ev er se d “ o nl y i fthe dist rict co urt used i napp ro pri ate f acto rs o r did not exer ci se disc re ti on a t a l l

. ” U nite d States v. F ri th , 46 1 F

. 3d 914, 919 (7th C ir. 2006). I ni ti al l y, th e Cou r t no te s th at th e ar g um en t re g ar di ng th e amoun t o fthe Co untryw i de m o r tg ag e be i ng i nc l ude d i n the l o ss c al cul at i o n i s di ffer en t fr o m the ar gum ent that the $3 37, 250 fi gure was ove rs tat ed because the sal e pri ce was unre aso nabl y l ow. I n f act, Don g ’ s Pl ea De cl ar at i o n a l so i nc l ude d a pr oj ec te d s en tenci ng es ti m ate that c ontai ned an offense l eve li ncre ase of 16 fo r a n int en ded l o ss b etwee n $ 1, 00 0, 00 0 an d $2, 500 ,00 0, wh i ch enco m passed am ounts f orthe i ni ti al p u r c h a s e mo r t g a g e fr o m C o u n t r y wi de a n d th e t wo HELO C l o a ns fr o m Nat i o na lCi t y a nd La Sa l l e Ba nk

. By ad m itt in g t h at th e C ou n tr yw id e m or tg ag e w as p ro p er ly i nc l ude d i n the l o ss c o m put at i o n, Do nge ss en ti al l y r el i n-6 N o. 11

- 1347 quis hed his r i ght t o m ake thi s a rgum ent a s a ta cti cal ch oice i n favor of the stron ger argu m en t regard ing o verstate m en t of loss. Fail ure to rai se th is argum en t before th e di st r i ctc o ur t r es ul ts i n the wai ve r o ftha t ar g um en t on ap p ea l. U nited St at e s v. M ur r ay, 39 5 F

. 3d 712, 71 7 (7th C ir. 2005). Even ass u m i ng argue ndo thatthe ar gum ent has not been w aived , t he restitution aw ard doe s not su p p ort a finding ofcl earer ro r. Dong i s co rr ect that a l oss to Countrywide w as not speci fi cal l y set f or th in C ounts Se ven a nd Ei g ht o f the I nd i c t men t

. Ho we v e r, he f a i l s to a c k no wl e dg e tha t fr a ud c a us i ng a l o s s t o Countr y wi de wa s e x p r e s s l y s t a t e d i n th e d e s c r i pt i o n o fth e s c h e me conta i ned i n parag ra phs 1 thro ugh 67 ofCount One, w hi ch w as i ncor pora ted byr efer ence i n Counts S even and Eight . P ar agr aphs 56 and 57 o fthe I nd i ctm ent a l l ege tha tp a r to fthe s c he me i nv o l v e d D o ngma k i ngf al se st at ement s to Co unt r y wi de i n o r der to obta i n the i ni ti alpurchas e m ortga ge f orthe Lake Par k pr oper ty, whi ch w as the n us ed as c o l l at er alt o s uppo r t fr au dul en t equi ty l oans. M or eo ve r, in h is P lea D ec lar a tio n, D on g s p ec ifica lly a dmi t t e d: Begi nning no l ate r th an i n orar ound A pri l, 20 08, and conti nuing unti latl eas t o n orabo ut M ay 9, 20 08, in t he Nor th ern Di st r i cto fI l l i no i s, Ea st ern Di vi si o n, defe n d an t par ti ci pated w i th hi s co - defe nd ants Yoon S ae Ki m , Su ng A r Ki m , M y ungJ a Pa k, a nd Yo o J ung Lee , i n a s ch eme to d efr au d c er ta i n fi na nc i ali ns ti tu

tions and to o btain m oni es and funds owned byN o. 11

- 1347 7

an d u n d er th e c u st od y a n d co n tr ol of c er ta in fi nanci ali nsti tu ti ons by m eans ofm ate ri al l y f al se and fr audu l ent pr ete nses, r epres entat i ons, pro m i ses and om i ssi ons. I n o r a r o u n d Ap r i l, 2 0 0 8 , d e fe n d a nt J I N HUA DO N G m et w i th Yoo n Sa e K i m i n the Ch i cago ar ea. D e fe n d a n tJ I N HU A D O NG u n d e r s t o o d a t th e t i me th at ap p lyin g f o r m or e t h an on e loa n on a sin gle pr o pe r t y wi tho ut i nfo r mi ng e a c h b a nk o f thi s was illeg al . .

. . O n o r ab o u tAp r i l3 , 2 0 0 8 , d e fe n dan t J I N HUA DO N G pu rchas ed a s i ngl e- f am i l y ho m e l oca ted at 4066 So uth Lake Park, Ch i cago , I l l i nois , ( here i nafter “the La k e Pa r kpr o per ty ”) f o r $ 675, 00 0 f o r the p u rp os e o f u sin g it fra u d u len tly to ob ta inm u ltip le H E L O C l oan s. D efend an t J I N H U A DO N G pu rch as ed an d fi nanc ed th e Lak e Pa r kpr o per tya t th e d i r e c t i o n a n d u n d e r th e c o n t r o lo fY o o n S a e K i m. Defen dan t J I N HU A DON G m ade a do wn-p ay m en t o fa pp r o xi mat e l y $ 2 0 0 , 0 0 0 o n the La k e P a r kp r o per ty. Defen dant J I N H U A DO N G had r ecei ved th e $ 2 0 0 , 0 0 0 d o wn - p a y me n tfr o m Y o o n S a e K i m. Defe n d an t J I N H U A DO N G hel ped to f aci l i tat e Yo o n S a e Ki m’ s subm i tt i ngo fa mo r t g a g e l o a n a ppl i ca ti o n t o Co unt r y wi de Ban kt o financ e th e p u rc h as e o f th e L ak e P ar k p ro p er ty w h ich fals ely rep resen ted t h a t JI N H U A DO N G w as th e true p urc h a s e r o fth e p r o p e r t y . In f a ct, d e fe n d a n tJ I N HUA DO N G w as acting as nom i nee purchas erf orYoon Sae K im

. In additi on, the m or tga ge l oan appli cati on8 N o. 11

- 1347 f orthe Lake Parkpro pertywas fra ud ule nt i n that i t co ntai ned fa lse sta tem ents, i ncl ud i ng st ate m ents r e g a r di ngthe p ur c ha s e r ’ s i nt e ntto occ up y the p r o per ty, e m pl o y m en t, i nc o m e an d a ss et s, whi chw ere i ntended to in du ce Countr ywide Bank t o approve a mo r t g a g e l o a n. Co un t r y wi de Ba nku l t i matel y a ppr o ve d the mor tg ag e l o an . A ccor dingl y, Dong cl ear l y pl ed gui l ty to th e condu ct that re sul ted i n the actuall oss o f$3 37, 250 to Count ry w id e, an d h is a ss er tio n th at h e is be in g h eld res p on sib le f o r a n a m o unto fr es ti tu ti o n tha t i s ba se d o n “ r el ev an t c on d u c t” or c on d u c t t h at w as be yo n d t h e s c op e o f h is ple a a gr eem ent i s pl ai nl y incor re ct. A s s et f or th abo ve, Do n g ’ s P l e a De c l a r a t i o n a l s o c o n t a i n e d a p r oj e c t e d s en tenci ng es ti m ate ofan intended lo ss between $1 , 000, 000 and $2, 500, 00 0, w hi ch i ncl ud ed am ounts f orthe i ni ti al pu r c h a s e mo r t g a g e fr o m C o u n t r y wi de. Thi s co nsti tutes an a ffi rm ati ve a cknowle dgm ent b y Dong that th e C o u n t r yw id e m or tg ag e w as p ro p er ly in c lu d ed in th e l o ss c al cul at i o n. Dong con te n d s that the di str i ct c ourtf ai l ed to m ak e th e fi ndi ng s r equi r ed byU. S. Sen te nc i ngGui del i ne § 1 B 1

. 3 ( a ) ( 1 ) ( B ) , wh i c h r e q u i r e s a d e t e r mi n a t i o n o ft he sc o pe o fthe j o intl y unde r ta k enc r i m i na la ct i vi tya nd fi nd i ngs as to w hether the conduct w as in further ance oftha t j oi nt cr i m i nalact i vi ty and the f or ese eabi l i ty of th e c on d u c t. H ow ev er , Sen te n c in g G u id elin e § 1B 1.3 Appli ca ti o n Not e 2 m ak es c l ea r tha t th i s r equi r ement a p p l i e s o n l y w h e r e th e a c t s i n qu e s t i o n w e r e n o tc o mm i tte d by the defend an t but ra therwere sol el y the act sN o. 11

- 1347 9 ofo ther s. The r eco rd i n thi s ca se, as di scu sse d ab o v e , r e fut e s Do ng ’ s s ug g e s t i o n tha tthe Co untr ywi de m o r tg ag e l o ss was “rel ev an t co nduc t” a r i singfr o m the acts o r om i ssi ons ofo ther s r atherthan conduct that co n s t i t u t e d p a r t o f h i s o ffe n s e o f c o n v i c t i o n . As s uch, hi s r e l i a nc e o n S e nt e nc i ngGu i del i ne § 1 B1

. 3 ( a ) ( 1 ) ( B) i s mi s pl a c e d. Fi nal l y, Dong was se nt en c ed withi n the preci se gui del i ne r ange that he ar gued to be appli cabl e. The di strict co ur t ag r ee d tha t th e l o ss a m o untwas ov er st at ed an d sente nced Dong as i f he had an o ffense l eve lo f22 i nstea d of24, wh i ch co i nci des with a l oss of between $4 00, 000 and $1, 000, 000 base d on the H EL OC l oans al one. A ccor dingl y, he ha s f ai l ed to dem onst ra te any pl ai n erro r o r a c t ua lh a r m a s a r e s ul to fthe s e nt e nc e i mpo s e d.

I I I . C ONC L US I ON Forthe re aso ns st ate d h er ein , we A FFIRM Do ng ’ s se ntence

.

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