Opinion ID: 794551
Heading Depth: 2
Heading Rank: 4

Heading: Boccagna's Plea and Sentencing

Text: 11 Meanwhile, on March 14, 2001, Boccagna pleaded guilty to one count of making false statements for the purpose of influencing the lending decisions of federally insured financial institutions, for which crime he faced a statutory maximum prison sentence of thirty years. See 18 U.S.C. § 1014. Pursuant to the MVRA, the district court was required, in sentencing Boccagna, to order him to pay restitution to any victim of his scheme that had sustained a pecuniary loss. See id. § 3663A. 12 In its Presentence Report (PSR) to the district court, the Probation Department recommended that Boccagna be held accountable, both for purposes of Guidelines calculation, see U.S.S.G. § 2F1.1(b)(1)¶ (1998), and restitution, for a $15,683,074 loss to HUD. Although the Probation Department did not provide the court with numerical calculations supporting its recommendation, it stated that the reported loss represent[s] the difference between the amounts paid out by HUD and the sales prices of the properties to the third parties. PSR ¶ 16. Both the defendant and the government filed written submissions with the district court challenging this calculation. 13 In an August 13, 2004 letter, Boccagna's counsel submitted that HUD had sustained no loss either for purposes of Guidelines calculation or restitution. He noted that the defense had not been provided with any documentation to support the loss amount recommended in the PSR. In any event, he submitted that, if the court were to consider the fair market value of the foreclosure properties at the time of sentence, that offset value would exceed the outlays made by HUD. Rosenberg Letter at 6. 14 In its August 17, 2004 submission to the court, the government contended that the PSR overstated the loss amount relevant to the calculation of Boccagna's Sentencing Guidelines range and understated the loss relevant to restitution. It argued that, for Guidelines purposes, HUD's loss should be calculated not by reference to its outlays with respect to all of the foreclosure properties, but only with respect to the eleven properties whose sale to HPD was final at the time of sentencing. See U.S.S.G. § 2B1.1, Application Note 3(E)(ii) (2003). Thus, it proposed a Guidelines loss figure of $3,384,425, representing HUD's total payments of $3,984,426 in connection with these properties minus the total $600,001 purchase price paid by HPD. With respect to restitution, however, the government argued that the court was required to order Boccagna to pay HUD $18,629,716, representing HUD's $20,609,746 out-of-pocket loss reduced by the $1,980,030 it expected to realize when the sales of all foreclosure properties to HPD were finalized. 15 In an addendum to the original PSR, the Probation Department adopted the government's actual loss figure of $3,384,425 to recalculate Boccagna's Guidelines, resulting in a recommended 27-to-33 month prison range. Probation further urged that restitution to HUD be limited to this same amount, explaining that recent appraisals of the forty-two foreclosure properties whose sale to HPD had not yet been finalized had been determined by the Government to be equivalent to HUD's loss. PSR Addendum at 1. Thus, because the possibility exists that the [remaining forty-two foreclosure] properties could be sold at higher prices [than those agreed to by HPD] and thus could effectively cancel out any remaining restitution, Probation recommended an award of $3,384,425, representing the final actual loss amount at the time of sentence. Id. In an apparent reference to 18 U.S.C. § 3664(d)(5) (affording victim sixty days after discovery of further losses to petition court for amended restitution order), Probation noted that [s]hould this figure rise in the future, the restitution order may need to be modified. Id. 16 When Boccagna appeared for sentencing on August 20, 2004, the parties' primary focus was understandably on circumstances that might support a non-incarceratory sentence. After the district court stated its intent to impose a probationary sentence, however, they shifted their attention to the calculation of restitution. The government renewed its written request for an $18,629,716 restitution order, explaining that HUD expected to recover only $1,980,030 of its out-of-pocket loss through the sale of foreclosure properties to HPD. Similarly, defense counsel reiterated his complaint about the lack of documentation to support the government's restitution calculation and repeated his request to use the fair market value of the foreclosure properties to offset HUD's out-of-pocket loss. Noting simply that Boccagna's early plea likely afforded him an advantage in the calculation of HUD's loss, see Sentencing Tr. at 36 (You come in early on, you get a much better number because there aren't that many properties in default.), the district court ordered restitution in the full amount requested by the government, $18,629,716, that amount to be paid by Boccagna jointly and severally with ten other persons prosecuted separately for their participation in the same fraud scheme.