2000 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

2-10-2000

USA v. Duliga

Precedential or Non-Precedential:

Docket 99-5251

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Recommended Citation

"USA v. Duliga" (2000). 2000 Decisions. Paper 28.

http://digitalcommons.law.villanova.edu/thirdcircuit_2000/28
Filed February 10, 2000 

UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT 

No. 99-5251 

UNITED STATES OF AMERICA 

v. 

DANIEL DULIGA 

 Appellant 

Appeal from the United States District Court 

For the District of New Jersey 

D.C. No.: 96-cr-326 

District Judge: Honorable Nicholas H. Politan 

Before: GREENBERG, ROTH, and ROSENN, 

Circuit Judges. 

Submitted Under Third Circuit LAR 34.1(a) 

January 25, 2000 

(Filed February 10, 2000) 

OPINION OF THE COURT 

ROSENN, Circuit Judge. 

This is an appeal from a judgment of conviction and

sentence in the United States District Court for the District 

of New Jersey in connection with telemarketing operations. 

The defendant, who was convicted on a multi-count 

indictment charging conspiracy to commit mail and wire 

frauds, contends that in imposing sentence, the district 

court incorrectly determined his base level offense under 

the United States Sentencing Guidelines by attributing to 

him the entire amount of loss generated by the conspiracy 

rather than the amount of loss he generated through his 

own telemarketing efforts. 

The district court had subject matter jurisdiction 

pursuant to 18 U.S.C. S 3231. We have appellate 

jurisdiction pursuant to 18 U.S.C. S 3742 and will affirm. 

I. 
A. The Telemarketing Scam 

In December of 1990, Rita Holz, her husband Julius 

Schurkman, and a third person, Adie Lipton, set up All-Win 

Financial Corporation in Del Rey Beach, Florida. The 

company began operations in January of 1991. It then 

placed advertisements in newspapers across the nation 

advertising personal loans and debt consolidation. No 

advertisements, however, were placed locally. All-Win 

wished to avoid face-to-face confrontations with disgruntled 

clients. 

The advertisements offered loans of up to $10,000, even 

to those with acute credit problems, and included a toll-free 

telephone number. When a prospective applicant called the 

toll-free number, a telemarketer would solicit basic 

background information from the applicant, including 

name, social security number, and any credit problems. 

The telemarketer would then ask the applicant to call back 

in approximately one hour so the loan could be processed. 

When the applicant called back, the telemarketer would 

congratulate the applicant and tell him that he had

qualified for the loan. Of course, no processing occurred 

during that interval, and the time lapse between calls was 

merely pretextual. 

After "approving" the applicant on the telephone, the 

telemarketer would then give the applicant an express mail 

or Federal Express number and tell the applicant to use the 

number to send All-Win its $199 application fee. Once AllWin received the fee, it forwarded the applicant's name, 

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along with a $25 fee, to North American Acceptance 

Exchange ("NAAE"). NAAE was not a real lender, but was a 

"denial mill." NAAE helped create the illusion that the loan 

process was legitimate by sending loan application papers 

to the applicants. The loan application was sent to the 

applicants to string them along and add to the illusion of 

legitimacy. Upon completing the application and mailing it 

to NAAE, or another denial mill used by All-Win, the 

applicant would ultimately receive a rejection letter. 

In June of 1991, All-Win experienced "legal problems" 

and decided to relocate to Cherry Hill, New Jersey. Holz 

undertook the majority of the relocation effort. She rented 

space, obtained phone lines, and set up a new company 

under the name A-1. By July of 1991, the telemarketing 

scam was up and running again and continued to utilize 

the same procedures as All-Win, except that the application 

fee increased to $249. A-1 remained in business until 

November of 1991. By that time, A-1 and All-Win had
defrauded their "clients" of approximately $1.2 million. 

B. The Defendant's Role in the Telemarketing Scam 

The defendant, Daniel Duliga, joined the All-Win 

telemarketing scam in January of 1991, shortly after the 

company commenced operations. All-Win generally 

employed eight to ten telemarketers at any one time, and 

Duliga, like the other telemarketers, worked in a single, 

large room using a script provided by All-Win. A daily tally 

was kept of the application fees received, and all of the 

telemarketers, including Duliga, were aware that All-Win 

was not engaged in a legitimate business endeavor. The 

telemarketers often spoke freely of the fraudulent nature of 

their employment and joked about the gullible people from 

whom they received application fees. Duliga even admitted 

to a Postal Inspector that within the first week of his 

employment at All-Win he realized that All-Win was not 

processing any loans and that the individuals requesting 

the loans never received them. 

Despite his awareness of All-Win's illegitimacy, Duliga 

developed into one of All-Win's top telemarketers and the 

company frequently called upon him to train newly 

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recruited telemarketers. For his efforts, he received both a 

salary and commissions. In addition, when All-Win decided 

to relocate to New Jersey in June of 1991, Holz and the 

other principals requested that Duliga join them in setting 

up the new business. Holz testified that she considered the 

talents of Duliga, as well as those of two other experienced 

telemarketers, crucial to a successful relocation. She even 

sought their opinions when determining where to relocate 

the business. 

Duliga agreed to join the telemarketing operation in 

Cherry Hill, New Jersey and continued to work as a 

telemarketer for the newly established A-1 until November 

1991. During his employment with the two companies,

Duliga earned over $42,000 in salary and commissions and 

generated application fees in excess of $150,000. 

C. Procedural History 

On June 4, 1996, a federal grand jury sitting in New 

Jersey returned a twenty-six count indictment against 

Duliga and several other individuals. Count I charged 

Duliga and the others with conspiracy to commit mail and 

wire fraud, contrary to 18 U.S.C. SS 1341 and 1343, in 

violation of 18 U.S.C. S 371. Counts II through VI charged 

him and the others with mail fraud in violation of 18 U.S.C. 
SS 1341 and 1342. Counts VII through XV charged him and 

the others with wire fraud in violation of 18 U.S.C. SS 1343 

and 1342. Prior to trial, the United States Attorney 

dismissed several counts of the indictment and proceeded 

against Duliga only on counts I through VIII and counts XI 

through XV. The jury found Duliga guilty on all of these 

remaining counts. 

On March 25, 1999, the court imposed sentence in 

accordance with the presentence report recommendation. 

Pursuant to U.S.S.G. S2F1.1(a), Duliga received a base 

offense level of six. Because the loss generated by the 

telemarketing scam was more than $800,000 but less than 

$1.5 million, Duliga received an eleven level increase in his 

base offense level pursuant to U.S.S.G. S 2F1.1(b)(1)(L). He 

also received an additional two level increase under 

U.S.S.G. S 2F1.1(b)(2) because the offense involved more 

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than minimal planning. Duliga's final offense level was 19 

and his criminal history category was II, which resulted in 

an imprisonment range of 33 to 41 months. The district 

court sentenced him to 33 months' imprisonment, three 

years' supervised release, and a special assessment of 

$650. 

II. 

On appeal, Duliga contends that the district court 

incorrectly determined his base offense level by attributing 

to him the entire amount of loss generated by the 

conspiracy (approximately $1.2 million) rather than the 

amount of loss he generated through his own telemarketing 

efforts (approximately $155,000). "When reviewing the 

sentencing decisions of the district courts, `[w]e exercise 

plenary review over legal questions about the meaning of 

the sentencing guidelines, but apply the deferential clearly 

erroneous standard to factual determinations underlying 

their application.' " See United States v. Fuentes, 954 F.2d 

151, 152-53 (3d Cir. 1992) (quoting United States v. Inigo, 

925 F.2d 641, 658 (3d Cir. 1991)). 

III. 

Under U.S.S.G. S 2F1.1(a), a defendant convicted of a 

crime of fraud receives a base offense level of six. This 

offense level, however, is subject to increase depending on 

the amount of loss generated by the fraud. See U.S.S.G. 

S 2F1.1(b); see also United States v. Boatner, 99 F.3d 831, 

835 (3d Cir. 1996). In calculating the amount of loss 

generated by the fraud, a sentencing court obviously may 

include amounts directly attributable to the fraudulent 
conduct of the defendant. See U.S.S.G. S 1B1.3(a)(1)(A). In 

addition, where, as here, the crime of fraud for which the 

defendant has been convicted involves jointly undertaken 

criminal activity, the sentencing court may also attribute to 

the defendant amounts of loss resulting from the 

"reasonably foreseeable acts and omissions of others in 

furtherance of the jointly undertaken criminal activity." See 

U.S.S.G. 1B1.3(a)(1)(B); see also Boatner, 99 F.3d at 835. 

However, to do so, the loss resulting from the acts or 

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omissions of others must be: (1) in furtherance of the 

jointly undertaken activity; (2) within the scope of the 

defendant's agreement; and (3) reasonably foreseeable in 

connection with the criminal activity the defendant agreed 

to undertake. See United States v. Evans, 155 F.3d 245, 

254 (3d Cir. 1998); United States v. Price, 13 F.3d 711, 732 

(3d Cir. 1994); United States v. Collado, 975 F.2d 985, 995 

(3d Cir. 1992).1 

Applying this test, we believe that the district court 

correctly included the entire amount of the loss generated 

by the telemarketing scam when determining Duliga's

offense level.2 

First, all of the losses generated by All-Win and A-1 were 

in furtherance of the jointly undertaken activity. The goal of 

these two companies, and those who worked for them, was 

to produce as many fraudulent application fees as possible. 

All of the telemarketers used the same script to accomplish 

this goal, and all of the telemarketers were aware of the 

companies' fraudulent nature. 

Second, all of the losses generated by All-Win and A-1 

were within the scope of Duliga's agreement. He learned 

during his first week of work at All-Win that All-Win was 

_________________________________________________________________ 

1. As a preliminary matter, Duliga suggests that the Second Circuit's 

decision in United States v. Studley, 47 F.3d 569 (2d. Cir. 1995)(holding 

that the Guidelines require that a district court make a particularized 

finding as to the scope of the criminal activity agreed upon by a 

defendant and outlining the factors relevant to such a finding), should 

guide our disposition of this case. However, we think the resolution of 

this case is governed by this Court's decision in Collado and therefore 

adhere to the wisdom of that case. 

2. We note that the district court did not necessarily undertake a 

searching and individualized inquiry before attributing the entire amount 

of loss generated by All-Win and A-1 to Duliga. See Collado, 975 F.2d at 

995. However, because we are convinced that the attribution of that loss 

is firmly supported by the record, we see no reason to remand this case 
only to have the district court reach the same sentencing decision. See 

id. at 997 ("The district court made no findings regarding the propriety 

of attributing to one brother sales made by the other, but after reviewing 

the transcripts of the telephone calls cited in the presentence 

investigation report, we are convinced that this instance of accomplice 

attribution was justified."). 

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not a legitimate venture, yet he continued to defraud 

individuals into believing that their application fees would 

materialize into loans. He also received a substantial salary 

from the companies, not just commissions based on his 

own application fees. Therefore, he possessed a stake in the 

success of the companies as a whole. Moreover, although 

Duliga characterizes himself as merely an employee that 

agreed to telemarket for the principals, the evidence plainly 

contradicts this characterization. Duliga was one of the top 

three telemarketers for the two companies, and when, the 

All-Win principals decided to relocate to New Jersey as A-1, 

they considered Duliga's assistance in the relocation 

crucial. Duliga clearly understood the illegal objectives of 

All-Win and A-1 and agreed to use his best efforts to 

further those objectives. 

Third, all of the losses generated by All-Win and A-1 were 

reasonably foreseeable in connection with the criminal 

activity Duliga agreed to undertake. All of the 

telemarketers, including Duliga, worked side by side in one 

large room, and the telemarketers frequently joked about 

the naive applicants from whom they received application 

fees. Moreover, a daily tally was kept of the application fees 

received. Thus, far from being unforeseeable, the losses 

generated by All-Win and A-1 were within Duliga's plain 

view. 

In sum, the evidence readily demonstrates that Duliga 

was a key player in the telemarketing scam from its

inception to its conclusion and that the losses generated by 

that scam were reasonably foreseeable in connection with 

the scope of the criminal activity Duliga agreed to jointly 

undertake. He was more than aware of the scope of the 

operation and of its fraudulent character. Therefore, the 

district court committed no error in attributing them to 

Duliga. 

IV. 

Accordingly, the judgment of conviction and sentence of 

the district court will be affirmed. 

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A True Copy: 

Teste: 

 Clerk of the United States Court of Appeals 

 for the Third Circuit 

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