2004 D e c i sion s O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit

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UNIT ED STA TES C OURT OF AP PEA LS F OR TH E TH IRD CIR CU IT

NO. 03-1511

UNITED S TATES OF AMERI CA

v.

PHILI P ANDRE RENNERT,

Appellant

NO. 03-1518

UNITED S TATES OF AMERI CA

v.

GEORGE R AYMOND JENS EN,

Appellant

NO. 03-1519

UNITED S TATES OF AMERI CA

v.

MICHAEL LEWI S MILLER ,

Appellant

On A ppeal from the United States Distri ct Court f

or the Easte rn D istrict of P enns ylvania (D.C. Crim. No. 96-cr- 00051) Dis trict Ju dge : Ho n. C laren ce C

. Newcomer

Argued December 5, 2003

Be for e: S LO VI TE R, A LIT O, Circu it Judges and OBERDORFER *
, Distri ct Judge
(Fil ed: June 10, 2004)

James H. Feldman, Jr. (Argued) Law Offices o f A lan E llis Ardmore, PA 19003-2276

Atto rney for Ap pellan t, Philip An dre Re nnert

Peter Goldberger Law Office of Peter Goldber ger Ardmore, PA 19003-2276

Atto rney for Ap pellan t, George Raymond Jensen

Christ opher D. Warren (Argued) Philadelphia, PA 19103

Atto rney for Ap pellan t, Michael Lewis Mill er

* Hon. Louis F. Oberdor fer, Unit ed State s Distri ct Court f

or the Dis tri ct of Columbia, s itting by

designation.2

Patri ck L. Meehan United Stat es Attor

ney Lau rie M agid Deputy Unit ed State s Attorne y for P olicy and Ap peals Robert A. Zauzmer Assist ant Unite d States Attorney Senior Appell ate Counsel Andrea G. Foulkes( Argued) Assist ant Unite d States Attorney Office of United St ates Att orney Philadelphia, PA 19106
Attorney s for Appell ee

OPINI ON OF THE COURT

SL OV ITE R, Circu it Judge

.

I. Ap pellan ts Michael Mille r and Philip Renn ert were co nvicted by a jury of

co ns pi ra cy, wire fraud, and securi ties fraud; Appellant

Geo r ge Jensen was convict ed by a ju ry o f securi ties fraud. The ir conv ictions re sulted f rom their involvement

in a com plex scheme under which t hey l eased the worthles s stocks of severalpublic c o mp anies to the T eale Netw ork (“Teale”), a frau dulent netw ork of offshore and dom estic companies. The details of the oper ation of the Tea le Network, through i ts principal Alan Teale,

are set for

th in our

earli er opini on i n UnitedS tate s v. Yeaman , 194 F.3d 442 (3d Cir. 1999) , andwe re peat onl y suc h details as are necessar

y t o decide the is sues befo re us in this app eal. In ess ence, Teal e repres ented the worthless leased s tocks as valua ble ass ets that could be li qui dat ed t o paycl ai ms pursuant to re in surance cont

racts entere d into with World Life and Health Ins urance Company (“W orld L ife”), a P enns ylvania insurance com pany tha t was alread y in financi al diffi culty . When World Life atte mpted to liq uida te the se asset s to pay its outst anding med ical reins uran ce cla ims , the stocks were found to be w orthless.

Wo rld Life bec a me insolvent at

som e point during orbefore 198 8, but d id

no t revea l its finan cial difficulty to regulators o r t o its insure ds. I n 1989 and 1990, Worl d Li fe issued f our group medical policie s. Tea le ente red into contra cts reinsu ring W orld Life’s pol icie s from November 1989 to November 1990. Pursuant to thes e ag reem ents, T eale assumed 100 pe rce nt of th e liability associ atedwith World Life’ s fo ur group medical insurance poli cies i n exchange for recei pt of 92 percent

of the prem iums paid byWorld Life’s insureds on those policies. Ap pellan ts suppli ed Teale with stocks from offs hore com panie s that T eale co uld list a s putatively

valuabl e coll atera l backing the company , though t he stocks

were es se nt ial ly w ort hles s. Yeaman , 194 F.3d at 447.

I n 1990, Rennert

creat ed For u m Rothm ore to serve as an interm ed iary between Teale and the publicly t raded

co rpo rati ons that de sired to lease th eir stockto Teale. Th is ar

rangement cr eated the appearance of

le gi timac yintwo ways. First, Forum Rothmor e helpe d the T eale Netw ork co mply with Pen nsylvan ia3

r einsu rance regu lations th at requ ir e unli censed offshore reinsu ranc e companies, such as Te ale, to de posit i n
escrow acco unts collateral(in t he form of corp orate stoc ks) equa l to the liab ility associ atedwith it s reinsurance contacts. Secon d, Foru m R othm ore en tered in to “surpl us contrib ution a greem ents ” with Teale, which gave Teale the appearance of being bac ked by i ndepend e n t stoc kho ldin gs. Id.

Tea le and Rennert fi rst met and disc ussed this fraudulent scheme in August 1990 and executed t

he first of th eir surplus

co ntributionagreem ents on S eptemb er 1 , 199 0. Under the terms of these agree men ts , public s hell c orporat ions leased their stock t o Teale and aut

horized the sale of t

he s tock, if neces sary , to pay cl ai ms under ins urance polici es that T eale had reins ured. Teal e then li sted these shares at inf

late d val ues on the fi nancial statem ents prese nted to Wo rld Life. Afte r recei ving insurance pr emi ums from Wo rld Life , Teale paid monthly leasi ng fees t o For um Ro thmore, which in tur n spli t the fees with the s tock pro vid ers. Id. The Tea le Ne two rk w as Fo rum Ro th mo re’s sol e client, and Forum R othmore was th e Tea le Network’s only

consist ent sour ce of assets.
In p ar ticular, Forum R othmo re enter ed into su rplus c ontribu tio n agree men ts with Eco t ech Corporat ion ( “Eco tech”). Jensen was at various times in controlof and presi dent of Ecotech. On Decembe r 15, 1990, J ensen manipul ated Ecotech’s stock pr ice and t hen lease d one mill ion dollars wo rth of E cotec h’s stoc k to Teale. Although Eco tech ’s shares w ere virtually wo rthless, A ppell ant s fraud ulently over-valued Ecotech ’s shares

on the company ’s fi nanci a l stat ements. Me mbers of the conspiracy manipulat ed the market for Ecotech and ot her corp oratio ns’ stock in ord er to m aintain the inflated t

rading prices. Miller, a lawyer, was c orp o rate counsel fo r Forum Rothmore and a sharehol de r i n Ecotech. The Ecot ech stockat issue was not tr adeable and c arri ed

a restrictive legen d to tha t e ffe ct. Miller issue d op inion l ette rs st ating t hat Forum Rothm ore could remove that legend fr om stockcerti ficat es so that it falsely appeared that the stoc k cou ld be freel y t raded and leased to Te ale. The Government submitt ed evide nce th at M iller wa s paid $130,208 for re pr esenting the company and $10 4,000 from le as ing Ecotech s tock to Teale.

I n 199 1, th e Pen nsylvan ia Insuranc e Departmentdis c overed W orld Life’s insol vencyand ordered i ts l iquidation. Because Teale had bee n payi ng insurance cl ai ms wit

h r ece nt ly -r ece iv ed p re miums and had n o oth er sign ifican t assets to draw upon, this liqui dation de prive d Tea le of the ab ili tyto pay further

insurance claims. Wo rld Life’s po licyholders th us we re unab le to re ceive i nsurance pay ments as needed.

Fo llowing Wor ld Life’s liqui dation , the Pennsy lvania Life and H ealt h Insuranc e Gu arante e Fund, a st ate fund throughwhich Pennsy lvania insurance companies pay t

he outst anding li abilities4

o f insolv ent c arri ers, provide d appr oxim ately $6.4 mil lion for group

m edicalreins urance cl aims lef t unpaid a s a resul t of the fraud.

II. Ap pellan ts were indic ted on Februa ry6, 1996 andwere convict ed by a jury on April 16, 1997. At the sentencing hearing held January

22, 1998, the Dist

rict Cou rt assign ed ea ch A ppella nt a one-point upw ard departur e forloss of c onfidence in

an important

inst itution, but

found no

mon etary loss attri butable to th e Ap pellan ts because Wo rl d Life was i n solvent at the tim e it entere d into reins urance contrac ts with Teale. The Distri ct Cou rt also r eject ed the applic ation of additio nal sen tencin g enh ance men ts for

use of specia l ski lls and s ubs tantially jeop ard izing a fin anc ial in stitutio n. Ap pellan ts appealed their indivi dua l verd icts and senten cing c alcula tions to this court in 1998 an d we se t out the full factualand procedura l his tory of the ir

cases in prio r u npu blish ed o pin ion s. See UnitedStates v. Ren nert , Nos. 98-1145 & 98-1101, slip o p. (3 d C ir. O ct. 15, 1999); UnitedStates v. Jens en , Nos. 98-1 148 & 98-1104, slip o p. (3 d C ir. O ct. 15 , 199 9); and United Stat es v. Mill er , Nos. 98-1147 & 98 -1103 , sl ip op. ( 3d Cir. Oct . 15, 1999). Appellant s chall enged the Dist rict C o urt’s instructi ons to the jury , the suffici encyof the evi dence supporting the i r convict ions, and the upwar d adjus tmen t for los s of confidenc e in an important

institutio n . The Government

cross- appealed, arguing that the Distric t C ourt ha d e rr edinfi nding t ha t t he re wa s
no loss caus ed by the fraud , in failing to increase Miller’ s offense l evel because he had used spe cial (lega l) skills in further ance of the conspiracy , and in fa iling to increase allAppellants’ offense levels for causi ng a substantial e ffecton a financi al ins tit

ution.

In Miller , we re jected M il l er’s argumentthat he acted “only as an att orn ey.” Instead, we held that M iller’s involvement

we nt “beyond t

he role of legal repr e sentation” and coul d not “be categor izedas sim pl e leg al ad vice ,” espe cially giv en Miller’ s ownership of Ecot ech stock and hi s letters regardi ng removal of r estric tive l ege nds

. Miller , slip op. at 6. In Renn ert and Jense n , we also uph eld Rennert and Je nsen’s convi ctions and affirmedthe imposi tion of a one-point upw ard departur e based on los s of confidence to an important inst itu tion. How ever, we rema nded all three c ases for

re-se ntenci ng to consider 1 ) wheth er there

was a cau sal con nectio n betw een the Appellants’ misr e present ations and the fraudloss ca

used byTeale’s col l ecti on of premiums, and 2) in M iller’s case, whether

an enhancement would be appropri ate for Miller’s use of speci al (leg al) sk ills. With

re sp ectto fraud l oss, we cl arifi ed that the fraudloss ca lcula tion s hould be based on the dates of Appel lants ’ agreement to the

cons pirac y, rather th an the dates o f their misrepresentati ons. Also, i n a r el ated cas e,
we s ug gested t

hat the loss ca lculation mightbe base d on the ne t gain to Teale or the bala nce of u npa id cla ims

. See Yeaman , 194 F.3d at 458- 59 (invol ving5

another co -d efendant i n the conspi racy who is not a party to the instant appea l). 1

On Fe b ruary

3, 2003, t

he Distr ict Co ur t held a re -sent encing hearing for Miller , J ensen, and Renner t. Mil ler

a ttempt ed to pres ent te sti mony and docu men ts in support

of his argument that the scope of his involvement in the conspir acywa s less tha n that o f his coconspirators and that

the ext ent of

the tot al loss caused b y the fra ud was not fores eeab le to him. In part icular, Mill er atte mpted to contest the G overnm ent’s

ar gume n ts that he was present at the A ugust 1990 Teale-Rennert meeti ng, that he pre pared opinion l ette rs in s upport of the conspi racy , that he rec eivedpayme nts for servi ces as a s tockprovider , andthat he falsi fi ed r ecords bearing the date of Ecotech ’s merger w it h a go ld min e to create additional st ock shares for Teale. The Distri ct Court de c lined to perm it Miller to submit

additi onal evi dence that

was not alr eady pr esented at trialbecause the issue w as “su bsum ed” b y th e jury’s verdict and w as ther efore imm aterial to sentencing. S ee Ap p. at 350-53 (fi nding Miller’s factualalle gations were “m atters of de fense for t

he tri al, not for sentencing ”).
On the issue of fraud los s causat ion, the Governm ent presented two witnesses, a repres entat ive from the Liquidations and Rehabili tati on Sectio n of the P enns ylvania Departmentof Insurance and a ge ner al

cou n sel to a third-party administrator. They state d th at, h ad t heir organizat ions kno wn that Appellants’ asset s we re worthless, they

would have halt ed the fl ow of pre miu ms months earl ier and f orced Wo rld Life to ob tain a solvent reinsu rer.
On Feb ru ary13, 200 3, th e Di st rict Cou rt i ssued a sent encing o pinio n concludi ng that Mil ler, Rennert, and Jensen ent ered int o an agreemen t conspir ing to d efrau d W orld L ife an d its policyholders no late r than August 30, 1990. The Distri ct Court he ld that the total fraudloss ca

us ed by t

he Appellant s was appr oxim ately $3.2 mil lion: the dif ference between th e total pre mium s paid to Te ale minus the cl aims p aid by T eale to Wo rld Life’s policy

holders . The District

Cour t fur ther found that

there was “acaus a l

conn ectio n between the misrepresent ations of the Defendants and the cont inued payment of pr em i um s to Wo rl d L ife . . . and th e Defendants. ” App. at 12-13. Fi na lly, the Dist

rict Court incr eased M il ler’s sentence based on his use of specialskil ls and more t han m i nimal pl anni ng. The Appellants also r eceived upw ard d epar tures for causi ng the los s of confidence in an important ins tit ution(the stockmarket). The D istrict Court sentence d Miller to 51 months, Ren nert to 63 mo nth s, and Jensen t o 30 months of impris onm ent.
All three Appel lants contest the Distri ctCou rt’s factualfinding of a causal connecti o n between thei r 1 Yeaman again appeale d to this court in United Stat es v. Yeaman , 248 F.3d 223 (3d Ci r. 200 1), and we remanded forresentencing. He was re- sen tenced on Feb ruary 5, 20 03 an d did not ap peal.6

misrepr esentations and t he fra ud lo ss to the victim s of $ 3.2 m illio n . Mill er chall enges the Dist

rict Court’s order barri ng him fr om submitt ing additional test imonyand d ocum ents to d emo nstrate the “limi ted” s c ope o f his in volv eme nt in th e co nsp ir acy . We wil l a ffirm.

III.
Th e Distri ct Court ha d juri sdict ion under 18 U.S.C. § 3231 and this court has juri sdict ion over the a

ppeal purs uant to 28 U.S .C. § 129 1 an d 18 U.S .C. § 37 42

. We review the D istr ict C ourt’ s factua l findings for clea r erro r. United Stat es v. Weaver , 2 67 F. 3d23 1, 23 5 ( 3dCi r

. 20 01 )

. We review the D istrict Co urt’s de cis io n to adm it or de ny evidence for abuse of discr etion. United Stat es v. Ser af in i , 233 F.3d 75 8, 768 n.14 (3d Cir. 200 0).
A. Fraud Loss Causat ion Ap pellan ts as se rt

two pr imar y ch al lenges to the Dis tri ct Court’ s findi ng that the ir cons piracy ca used appr oxim ately $3.2 million in fra ud lo ss. First, all Ap pellan ts ar gue th at

th e Di str ict Court

e r rone ously fou nd th at t hei r misrepr esentations of sto ck value s actua lly causedTeale to c ontinue r eceivi ng pr emi ums f

rom Wo rld Life po licyholders by preventi ng the P ennsy lvani a Departmentof Insurance from discovering the fraud andha lting the fl ow of pr emiums. This is one of the i ssues w e direct ed the Dist

rict Court to cons ider on remand. Sec ond , R en nert cont ends that

even if the Distri ct Court were correct that the Pen nsylvan ia Department of I nsurance
wo uld have stopped t

he flow of insur ance premium s to Teale Network if it had kno wn Appellant s were over- valuing stock, Ren nert on ly should have been held liable for the a

pproximate ly

$1.3 mil lionin losses that oc curred on or after December 29, 1990, ra ther t

han counti ng losses beginning in September 1990. Because this lower fraud l oss amount would have reducedRenn ert’s sentence , he argues t hat a remand for r e-sent encing i s requi red.
1. Rela ti onsh ip B etwee n Appe llants ’ Misreprese ntati on of S to c k Values and W orld Life’s Continued P aymen t o f Pre miums Ap pellan ts contend that th e vi ct im, Wo rld Life , did no t rely on the ir misrepr esentations of sto ck asset s as valua ble and theref ore the i r misrepr esentations did not cause t he fraud loss. M oreo ver, the y conte nd tha t it was Wo rld Life’ s own obstruct ion of the invest igati on by t he Pennsy lvani a Departmentof In suran ce – n ot their misrepr esentations – t h at preve nted the Departmentfrom discovering the f raud and imm ediate ly halti ng the fl ow of pr emi ums to Te ale. A ppella nts thus argue that the Dist

rict Court com m itt ed clear

error. The Government responds t hat Wo rld Life and its p olicyhold ers pa id Tea le mill ions of d ollars fo r reinsu rance in

re l iance on the Appell ants’ fraudule nt repres entat ions th at their stocks w ere valua ble and redeemable as asset s, as they purport ed.

We have addr essed th e issue of7

fraud loss causati on in connect ion with t he Tea le conspir acy in Yeaman , w he re we stat ed, “[ w]i thout t

he asset s of the defe ndan ts and the res ulting appearance of

so lv en cy, the most r easonable infere nce is that Wo rld Life would have ceased paying pr emi ums to Teale l ong b efore it

even tually did.” Yeaman , 194 F.3d at 458. We expla ine d the causa lit y analysi s as follows:

Tea le could not have entere d and remainedin the business of reins urin g Wo rld Li f

e but for its fraudul e n t misrepr esentat ions

. Although the District Cou rt made no finding on t

he issue [before ], the rec o r d w ould also appear to u s to suppo rt the prop ositio n that W orld Life was not capabl e of insuring any of th e four grou p medica l policie s withouthaving rec eived a

co mmitment for 100 % reinsu ra nce. It fol lows that if the Teale f

ra u dulent reins urance contrac ts had not been availa ble, W orld Life w ou ld eit

her have securedother r einsur ance or
wo uld not ha ve issued t he group poli ci es involved . If reins urance from a solvent reins urerhad been obtai ned, all cl ai ms under the poli cies

wo uld have been paid t o the reinsurer; if the gro u p polici es had not been iss ued, t h e e mpl o y e r s wh o purchasedthe poli cies from Wo rld Life would have obtaine d g ro up medica l coverage from anothe r
source and all clai ms of the benefici aries w ould have b een paid in f

ull. In eit

he r event

. . . t here would have been a causal nexus between the fraud and al l unpa i d claims.
Id. at 459. In short , we found that the most reasonabl e infer ence is t ha t Wo rld Life relie d on t he A ppella nts ’ misrepr esentations about the value of their stockasset s when it pai d Teale addi tional pre miu ms

. On remand , the District Court

conc lude d that t

here was “a causa l connecti on between the misr epresentation s of the Defendants and the cont inued payment of pre mi ums to World Life, and

. . . Tea le and the Defendants. ” App. at 12, 34. I n p articular, the District Court made the following findings:
-Had t he true va lue of the Def e ndants’ stocks be en known, atthe very least , the Pen nsylvan ia Depar tment of In surance would hav e stoppedthe pay

ment of pr emi ums to th e Te ale Network.

-In additi on, because Wo rld8 Life wa s insolv ent, had the reinsurance
c o ntr acts bee n termin ated , th e company would have be en liqui dated much

soonerthan it was, and t he pol icyholders

wo uld have never made those premium payme nts at all. App. at 13, 35. Although Appellant s argue that t he Distri ct Court’s f

indings do not answer the questi o n of whe ther th e i r misrepr esentations caused the fraud loss, it is apparen t that t

he Department of Insuranc e did n ot interc ede b ecau se it did not know “the true value of t he [A ppella nt s’] stocks. ” App. at 13. That lack of knowledge was the re sult of Appellants’ misrepr esentations of t he value of those s tocks. This, in turn, caused the Depa rtm ent of

Insura nce to perm it Wo rld Life’s c ontinued ope rati on and causedWorld Life to c ontinu e pr oviding Te ale insurance premiums i n reli ance on Appellants’ misrepr esentat ions

. Appellants’ attem pt to sev er th e connecti o n between thei r misrepr esentations and the Departmentof Insuranc e’s delay ed inte r vention i s unpersuasive. 2 Ap pellan ts next chal lenge the suffici encyof the evi dence supporting the Distri ct Cou rt’ s findi ng that t he flow of insurance pr em iums would have been halte d but fortheir mis rep rese ntati ons

. At the Appellants’ re-se ntenci ng he ar in g, two Gove rnme nt witnesse s testifie d that but fo r Appellants’ misrep r esentations about the value of t

he stock assets T eale clai med as col lat eral, World Life would not have continue d payi ng its policy ho lders ’ pr emi ums t o Tea le – that is , the Departmentof Insurance or vari ous policyholders would have h a lted t he flow of premiums if t

hey had kn ow n th e true value of Appellants’ stocks. One witness, the Direct or of Liqui dations an d Rehabili tat io n for the Penns yl vani a Departmentof Insurance, t esti fied that the Department coul d have halte d the fl ow of insurance payment s had it known that Ap pellants’ assets were worthless. 3

2 Ap pella nts suggest t hat Teale ’ s inso lve ncywould not have provi ded Wo rld Life with autom atic gro und s to termin ate its relati onsh ip w ith Te ale beca use th eir reinsu rance contra ct did not provide for ter

minati on based on T eale ’s in so lv en cy. We do not ac cept th is argu men t. If Teale were insolvent , it no longe r c ould meet i ts contractua l obligations to pro vide re insura nce to Wo rld Life. Becaus e Appellant s have identi fiedno c ontract

provisi on requiring Wo rld Life to co ntinue pro vidin g pr emi ums after

Tea l e has mate rially breachedtheir co ntract, we have no reason to as sum e that

World Life would be bound to contin ue ho norin g a co ntract th at Te ale had breached.

3 Appellant s emphasize t hat the Insuranc e Dire ctor s tat ed tha t th e9

Because Appellants f raud ulentl y misrepr esented

their ass ets ’ value and made it appe ar that T eale w as solv ent, how e ver, the Department was no t authori zed to i ntervene

. 4

Si m ila rly, the general counsel t o a third-p arty insura nce a dm inistrato r test ifie d that he recom men ded th at W orld Li fe p artner

with Teale ba sed, i n part, on Appellants’ misrepr esentations of t he value of the ir as sets ba sed on the manipulat ed ma rk et pri ces. The general counsel an aly ze d the A ppella nts ’ f raudulent

mark et valu ations o f th eir asset s and inferr ed that

the Teale Network w as a legitimate, solvent

business based on those representati ons. He furthe r testified that if he had known that the stocks backing Tea le were w ort hle ss, he would have removed his company ’s group polici es and reinvested them with a solve nt carrier.

We come then to Ap pellants’ argumentthat it was W orld Life’s fa ilure to coo per ate w ith the P enns ylvania Departmentof Insurance – not Appellants’

m isre present ations – that de lay ed t h e discovery of T eale ’s fr aud. But t he fraud victim’s neglig ence or lack of d iligenc e in uncovering the fraud is not a defens e

. UnitedStates v . Coyle , 63 F.3d 1239, 1244 (3d Cir. 19 95) (“ The negli ge nce of the victim in fai ling t o discove r a f raudulent

sc heme is not

a d efense t o crimina l conduct. ”) (citation s om itted); se e also UnitedStates v . Ben nett , 9 F.Supp. 2d 513, 523 (E.D. Pa. 19 98) (“Taking advantage of a v ictim’s s elf-inte rest d oes not mitiga te the se riousn ess of fraud ule n t conduct. ”) (quotations a nd cita ti ons omitted). Nor do th e Ap pellants ci te any

case la w su ggesti ng that c ourts may not findfraudloss ca usation wh ere the victim has not im med iately assisted th e authori ties in inves tigating the f raud.

In a d diti on, the Government p rope rlynotes t

hat even as suming tha t Department“could . . . have acted months

sooner

. . . to stop the flow of p rem ium s,” Ap p. at 386 -87, b ut did n ot state th at it

wo uld have don e so. T he D istric t C ourt did not cle arly err in co ncluding t hat the Departmentwould have acted i f it ha d know n the true va lue of the ass ets Ap pellan ts mis rep rese nted , g iv en its late r invest igati on and liq uidatio n of Wo rld Life. We also r eject

Appellant s’ argument that the Department could not have stoppedWorld Life f

ro m co ntinuin g to provide Te ale with premiums “ months sooner” based on administ rati ve hurd les to the invest igat ory and liqui dation proce sses. The Distri ct Court di d no t err i n crediting the Director ’s st atement t hatit could have mobili zed its administ

rati on to act

qu ick ly.

4 Ap pella nts sugges t that the De partment

of Insurance did not

be gi n invest igating World Life u nti l January 1991 and the refore Ap pellan ts ’ misrepr esentations had n o effect prio r to that date

. This argument

assumes that the De par tmentwould not have begun invest igating World Life if it wer e know n that it s r ei nsur er, Te ale, lacked col late ral assets as o f 19 90. T his arg um ent is withoutsupp ort and is directly co ntrary to th e D ire cto r’s tes tim on y.10

Wo rld Life could be held to be contrib utorily neglig ent, such an argument ign ores our prior find ing that the fra u d vi ct ims a lso i ncluded Wo rld Lif e policyhol ders, wh o cou ld no t b e reimburs ed for their medicalcosts untilthe Co mm onw ealth’s bail- out

. Yeaman , 1 9 4 F.3d at 458. Nothing in t he r ecord sugg ests that the poli cyholders act ed neglig ently or that

they should have bee n expectedto be suspi cious of t he true value of its rei nsurance agent’s assets.

In l ig htof t

he e vi den ce f

ro m t h e tri al as well as the re -sent encing hearing, t he Di strict Co urt did n ot clea rly err in finding a cau sal connec tion bet ween the Appellants’ misrepresentati ons a n d the losses inc urr ed by

Worl d Li fe and its policyhol ders.
2. Renn ert’s Sentence and t he Beginning Date of

the Fraud

Renn ert also argues that the Dist rict Cou rt shou l d have calculated the fraud loss for the peri od aft er December 1990 because the Depa rt ment of Insur ance Director state d thathad it known of the true value of A ppellants’ s tock s in De cember 1990, it

would have halt ed th e flow o f prem iums. Re nnert did no t assert this alte rnati ve loss ca lculation during the Distri ct Cou rt ’s sentencing hearing and, thus, has waivedthe a rgu me nt. See United States v. Bethan court , 65 F.3d 1074, 1082 (3d Cir. 199 5).

B. Miller’s Claim Regarding the Scope of His Involve ment
1. Relevant Conduct In his separ ate appeal, Miller

asse r ts that the Distric t Cou rt erron eous ly conflat ed the jur

y’ s “general ” conspir acy convict ion with the c ourt’ s conclus ion that M ille r should be hel d liabl e for al l los ses relat ed to the conspi racy under the rel evant conductprovisi on of the Unit ed State s Sentenci ng Gui de line s, U. S. S. G. § 1B1.3. Miller contends t

hat even if a defendant has been convict ed of a conspi racy charge, th e tri al court

must make part icularized findings a s to the scope of each conspirator’s inv o lvem ent in o rder to increase the conspi rator ’s sent ence under Sec tion 1B 1.3.
Under the Sente ncing Guidelines, a defend ant’s off

ens e leve l is subje ct to increase depending on the amo unt of loss causedby t

he fraud. Section 1B 1. 3(a) provides thatthe distric t court s hou ld adjustthe speci fic offens e levelby t aking into account al l conduct relevant to t

he offense. U. S. S. G. § 1B 1.3(a). T his include s “all re ason ably fore seeab le acts and omissi ons of others in furt herance of [a] jointly

undertake n crimina l activ ity.” U.S.S.G . § 1B1 .3(a)(1)(B).
Mi ll er asserts th at United Stat es v. Collado , 975 F .2d 985 (3 d Cir. 199 2), requir es that we re mand this ca se in l ight of the D istrict C our t’s l ack of findi ngs as to the pre cise sc ope a nd tim ing o f his agreementto join the cons pira cy. 5 In

5 Miller a lso cites Un ite d States v. Studley , 47 F.3d 5 69 (2d Cir. 199 5). Ho we ver, Studley

is not a binding precedent

on this court and we have made11

Col lado , we stated th at the district court must consider whether the loss res ulting from the actions of

co-consp irators was 1) “in furthe rance of th e . . . jo in tlyundertak en

. . . acti vity ,” 2) wit hin “the scope of the defend ant’s agreements ,” and 3) “reasonably for eseeabl e in co nnecti on
w ith the criminal activit y t he defenda n t agreedt o undertake .” 975 F.3d at 995 (citing U.S.S.G. § 1B1. 3, applic ationnote 1); see also United Stat es v. Duli ga , 204 F.3d 97, 100 (3d Cir. 2000) . We held that the relevant conduct

provisi on depends upon each defe ndan t’s role in t he conspir acyand s ta ted that courts must conduct“a searc hing andi ndividual ized inquiry into the cir cumstances s urroun ding each defendan t’ s invol vement in t he conspi rac y” in order

to “ensur e that

the defend ant’s se n tence accu rately reflec ts his or her r ole” i n the co ns pi ra cy. Collado , 975 F.3d at 995. We added tha t d ist rict

co urts also should consider other factors , such as whether t

he def enda nt profi ted or assist ed oth ers in the c ons pira cy. Id. at 99 1- 94. We furthe r clarified that a conspir acyconvict ion does not obviat e the need f or analy sis under

the rel evant

con duc t pro visio n. Id. at 993, 997.
Collado dealt

with the l iabil ity

of two brother s invol ved in a l arger dr ug
co ns pi ra cy. The district c ourt had not made an y fa ctual findings as to t he scope of

the br others ’ invol vement in t he conspir acyor in each other’s tr ansactions, but in ste ad on ly a d opted the findings of the present ence report in at tributing to each of them the dr

ug quantit

y fr om the

co ns pi ra cy. Alt ho ugh we required indivi dualiz ed in quiry , w e did not impose

an immutable r equirement that the dis tri ct court hold exte nsive hearings t o make

e xplicit, particu larized findin gs as to th e exactdate on which eac h defendant committed

to the c onspira cy or

the precise contours of each conspirator’s agree men t. We instead em ployed a mo re fl exible approach. We remanded the ca se to t he district co urt to de te rmine wh en the defend ants had joine d the la rge r
co nsp iracy

because the dist

rict court had made no finding onth e issue and the record was not

clear on this issue.
C riti ca lly, however, we a lso affirmedthe dis tri ct court ’s attribut i on to

one broth e r the amount s the ot her brot her suppli ed to the c onspira cy. We affirmed this finding ba sed on our review of the record, despit e the di st rict court’ s lack of explic it findings on this issue. Because the record was clear on i ts face , the di stri ct court’s lack of par

ticul arize d findings was not disp ositiv e. We insteadconcluded t hat the district

court’ s accompli ce att

ribu tio n conclusi on bet we en the brot hers was supporte d by t

he r ec ord e viden ce of

their

awareness of and assist ance to each ot her in d rug tran sac tion s. See id. at 997.
Mo re recent ly , in Duliga , w e reaffi rmed the proposition that even absent explic it findings on the preci se scope of a defend ant’s invo lvem ent, a district court’s clear that the resolu tion of

such issues is governedby this Court ’s d ecision in Collado

. United Stat es v. Duli ga , 204 F.3d 97, 101 n.1 (3 d Cir. 200 0). Acco rd in gl y, our analy sis foc uses on Collado

.12

decisi on may be affirm ed if it is a dequ ately supporte d by t

he tri al court

record. 2 04 F.3d at 101 n.2. A lthough the distri c t court in tha t case “ did n ot nec essarily undertake a se ar ching and i ndividual ized inquiry befo re att ri buting the en tire amount of [f

raud] lo ss

. . . to Du li ga ,” we affirmedwit

hout remanding b ec au se we
were convinced t

hat t he attribut ion of the fra ud lo ss w as “f

irm ly su pp or ted by th e record. ” Id. Here, the rec ord evi d ence suffi ces to support t

he conclusi on that Mil ler had agreedto the conspiracy by at least August 1990 and s hou ld be h eld liabl e forthe fu ll amount of

lo ss ca us ed by t he co ns pi ra cy. In contra st to C ollado ’s under- developed record, the rec ord in thi s case i ncluded Miller’s opinion l ett ers on fr audulent stock transacti ons, hi s demand letters to prot ect artificially in flated stock quo tes, and his letters advi si ng the removalof rest rictive st ock certi ficat e legends s o that nonmark etable shares would a p pe ar to be tradea ble. Miller pl ayed a cri tica l rol e, enabli ng the conspi racy to funct ion and providi ng it an impr imat ur of leg itim ac y. The record evi dence of Mille r’s ext ensive involvement

in the c onspira cysupports the Distri ct Court’s a

pplicationof

the rel evant conduc t p rovisi on. 6 As with Duliga , “ we se e no re ason to rem and th e case only to have the dis tri ct court reach the s ame sentencing decisi on.” 204 F.3d at 101 n. 2.
2. Evidenti ary

Issues
Miller also c ontends t

hat the Distri ctCourt abused i ts di scret ion b y denyi ng his re ques t t o submit addi tional evidence th at

al le ge dl ywo uld have had a dir ect be aring on t

he scope and t iming of his invo lvem ent in th e con spirac y and his inability to f

oresee the totalfraud loss causedby the conspiracy. In particular, Miller attem pted to subm it evide nce to dispu te 1) his presence at the fi rstmeeting be t ween Rennert and Teale in Au gust 1990 (the time a t which the Government suggeste d that Mil ler j oi ned th e
cons pir acy ); 2) Forum Rothmore’ s designation of p aymen ts to Mille r as legal fees or leas ing fe es in its financial records; and 3 ) the timing of Miller’s first discuss ion with the owne rs of the go ld mine corpo rat ion (wit h which Ecotech merged) about rec eiving Ecot ech stockin orderto bolst e r Ecotech’ s financi al statements. Because th e District Cou rt found that t

he issue of foreseea

bili ty was subsumed in the jur

y ver dict, it s tate d that it would not perm it Mill er to r e-tr y an issue that t

he jury had alre ady det ermined. We consider ea ch piece o f M iller’s

ev id en ce be lo w.
Even assum ing M ill er was not present at Re nnert and Teale’s August 1990 mee ting, sev eral of M ill er’ s other

a ctio ns evidence hi s invol vement in t he conspir acyby August 1990. For example, in June 1990, t

wo months before the 6 Bec ause we rely on th e record evidence of Miller ’s agre ement and

co m pl ici ty, we n eed no t reach M iller’s cl aim th at t he D ist ric t C ou rt m ay hav e impro perly conflat ed the jury’s conspir acy verdict with a fi nding of ful l li ability under the rel evant conduct

provisi on.13

Renne rt -Te a le meeting, Miller provided Renn ert with an o pinion letter to supp ort Forum Ro th m ore’s pr acti ce of leas ing worthless as se ts . O n July 13, 1990, Miller authored an opinion le tter

recommending the re-i ssue of the rest

rict ed Ecotech stock held by J ensen, Renner t, and Miller withouta restrictive legen d. Th is mad e it appearthat Fo rum Ro thmo re cou ld provide Tea le with million s of m arketa ble shares. In an Augus t 2 8, 1990 le tter , one week afte r the Rennert -Teale meet ing, Miller wrote to Teale expressi ng his interest a nd commitment t o what he termedthe “cred it enh anc ement p ro gr am” that forms the bas is of the fraud charge s againstthe defendant s, al ong wi th a $25 mil lionoffer of st ocks from Ecotech an d other corporations. Supp. App. at 638- 47. Regardless of whether he w as prese nt at the Rennert -Teale meet ing, the remainder of M ille r’s ac tio ns str on gl y s upp ort t he Distri ct Co urt’s co nclu sion that he had joined the conspi racy

by or before August 1990.
Miller

responds t

hat he undertook the aforementi oned acti ons “in good faith. ” Mi ller

Reply Br. at 8-9. Yet, the cumulati v e effect ofM iller’ s aforementi oned acti ons (the June opini on lett er , th e July

lett er recommending r eissue of stock , a nd th e A ugu st letter to Teale) suggests that Mil ler was t oo centra l to th e operat ion to bel ieve naï vely that he and his ass ociat es were allwithin t he bou nds of the law . Based o n the re cor d evidence, Miller’ s e xplanat ion is not credib le and the Dist

rict Court did not abuse its dis c r etion in rejecting M iller’s at t empt to sub mit ev idenc e rega rding his presence at the Renner

t-Teal e meeting.
Mi ll er also atte mp ted to su bm it evidence from his per sonal r ecords and journ als that he contended showed that he

wa s not paid to provide s tock to For um Rothm ore with know led ge of his codefendants’ fraudulent activi ties, but o nly recei ved l egal fees and a loan. Miller emphasizes that For

um Rothm ore’s faulty

a ccounti n g sys tem imp roperl y denominatedhis pay ment s as stoc k provider fees, ra ther th an tradi tional payments for legal fees.
As th e Go ver nment point s out, the designat ion of F orum Ro th m ore’ s payme nts as “lea sing fees” or “legal fees” is inconsequential be cause the payment

was made in exchan ge for M il ler’s servi ces in advancing a fraudul ent scheme. B ecause Miller doe s not cont est t he Distri ctCo urt’s fin ding th at he used his legal skil ls i n further ance of the fraud, t

he factof p aymen t for fra udu lent serv ices is th e cr itical poin t wh ile the fo rm o f his payment is irreleva nt. Mo re ove r, as we notedin Miller , Miller’s servi ces could not “be categor ized as s imple leg al ad vice .” Miller , sl ip op. at 7. Although M il ler r esponds that he

was acti ng in good fai th when he rendered th e leg al ser

vices for which he recei ved

remuner a tionand w as no t awa re that h is legal services w ere being m isused for a crimina l conspir acy, the rec ord does not support his cont ention. We also note t hat Miller’s argument that Fo r um R othmo re only pai d hi m f

or good-faith legal servi ces,rather

than fraudulent s tock- leasi ng activit ies, goes to whether or not he acted in f urther ance of the cons piracy . The ju ry’ s v erdict

shows that it deci ded that issue adversely to M iller. Despite M iller’s insi stence that hi s n ew evide nce o nly per taine d to the tim ing o r scop e of h is

co m mitm ent, M iller also a ttemp ted to argue that he wa s enti t led to su bm it evidence to attempt to nu llify t he jury’s conspir acyconnecti on, es pecia lly in his earli er p le adings. We emphasize that Collado does not en title a defendantto relitigate his or h er gu ilt or in nocence and thus, the is sue of wh ether h e w as pa id to fra udul ently provide s tock is not the subject of a Collado analysi s. Lastly , M iller attem pted to subm it

ev idence to counte r the Government ’ s alle gationthat

h e falsif

ied rec ords to dece ive his accoun tant and regu latory authori ties regardi ng the val ue and

ma rk etability of Ec otech’s assets. In parti cular , Miller s tate s that in September and October of 199 1 or earl ier, he discuss ed providi ng restrict ed , non
mark etable Ecotech st ock to the gol d mine corporation with which Ecotec h merged. A s such, Mill er suggest s that he sho ul d only be acc ountable for los ses inc urred after fall 1991, but not

before.

Even if Mill er did not falsi fy records untillate 1991, the re w ere still enough other in dicia o f his in volv eme nt in 1990, disc uss ed above, t o support t he conclusi on that he alrea dy had commit ted to t he conspiracy in 1990, regardl ess o f whetherhe committed a dditi onal fraud s in connecti on with Eco te c h’s merger with the gold mine co rp or ation. In sum, even

as suming that Mil ler would have be e n per mi tted to sub mi t his proffered e vidence, Miller’s eviden ce would not have been suffici ent to unde rmine the basi s in the record for

imp o sin g a cc om pl ice lia bi lity. We hold the Dis tri ct Court di d not abu se its discr etion in denyi ng Miller’ s proffer of the evi dence.

IV.
We will af

firm the judgment of t

he Distri ct Court f

or the r easons set

forth.