Opinion ID: 560540
Heading Depth: 2
Heading Rank: 1

Heading: Double Counting Argument

Text: 9 The district court enhanced defendants' sentence by two points under section 2F1.1(b)(2) and by four points under section 3B1.1(a) of the Guidelines. For a fraud offense, section 2F1.1 permits a two-point enhancement if the offense involved more than minimal planning or a scheme to defraud more than one victim. U.S.S.G. Sec. 2F1.1(b)(2)(A) & (B). Section 3B1.1 pertains to the defendant's role in the offense and provides for a four-point enhancement [i]f the defendant was an organizer or leader of a criminal activity that involved five or more participants or was otherwise extensive.... Defendants concede that the court properly enhanced their sentence under section 3B1.1 because they were organizers of an otherwise extensive scheme. They add, however, that because the section 3B1.1 enhancement is proper due to the otherwise extensive provision, enhancing their sentence for more than minimal planning under section 2F1.1 is enhancing the sentence twice for the same conduct. They argue that this constitutes improper double counting. Defendants' argument fails for several reasons. 10 Defendants misinterpret the section 3B1.1 meaning of otherwise extensive. The commentary to that section explains that [i]n assessing whether an organization is 'otherwise extensive,' all persons involved during the course of the entire offense are to be considered. Thus, a fraud that involved only three participants but used the unknowing services of many outsiders could be considered extensive. U.S.S.G. Sec. 3B1.1, comment. (n. 2). See United States v. DeCicco, 899 F.2d 1531, 1536 (7th Cir.1990). Section 3B1.1 states that the enhancement applies if there were five or more participants or the activity was otherwise extensive; otherwise extensive activity therefore applies to the number of people involved in the operation, not the extent of the criminal activity. Boula and Gordon were the active participants in and organizers of the fraud, and during the course of the fraud, they employed between eight and eleven salesmen and between eight and eleven staff persons who contributed to their fraudulent activities. Their use of these additional participants made their fraud scheme otherwise extensive for section 3B1.1 enhancement purposes. 11 Defendants incorrectly argue that according to the section 3B1.1 commentary, the degree of planning of the offense is the primary factor in this enhancement and that such otherwise extensive planning is the same as more than minimal planning in section 2F1.1. The commentary actually states, however, that the degree of participation in planning or organizing the offense is the key factor, not the planning itself. U.S.S.G. Sec. 3B1.1, comment. (n. 3) (emphasis added). The purpose of section 3B1.1 is to increase the sentence due to a defendant's leadership role in an offense, not because of the nature of the offense itself. The Guidelines indicate that a defendant could have a key role in a criminal scheme that required minimal planning, and thus receive the section 3B1.1 enhancement because of the number of people involved and the defendant's leadership role. 12 More than minimal planning, as defined in the commentary to the Guidelines application instructions, includes the following: more planning than would be typical for the particular offense; steps taken by defendants to conceal the criminal activity; or repeated acts over time. U.S.S.G. Sec. 1B1.1, comment. (n. 1) Defendants' scheme lasted for eight years. This time element, the elaborate advertising, investment seminars designed to lure investors, and the staff involved are just some of the many examples of more than minimal planning by defendants in conducting their criminal scheme. 13 Defendants' double counting argument is further hindered by the fact that section 2F1.1(b)(2) allows for a two-point enhancement when the scheme to defraud involves more than one victim. The defendants' sentence could have been increased by two points regardless of their degree of planning, simply because there were three thousand victims in their scheme. As it is, the defendants participated in elaborate planning, justifying the section 2F1.1(b)(2) enhancement, and leadership of an extensive criminal enterprise, justifying the section 3B1.1(a) enhancement. These Guidelines sections are not mutually exclusive and therefore no double counting occurred from these sentencing determinations.