Opinion ID: 221339
Heading Depth: 2
Heading Rank: 2

Heading: Calculation of Samuels’ Sentence

Text: Samuels argues that the district court erred when it held him responsible for more than $400,000 in loss, based on the amount fraudulently obtained (or attempted) by all members of the 7 The district court stated that it found “a sentence that’s incrementally greater than Mr. Holloway’s . . . is appropriate and justifiable on the facts and the circumstances of the case” under the same analysis that it “found a four-point enhancement appropriate for Mr. Erwin . . . as compared to the three points for Mr. Holloway.” (Erwin Sent. Tr. at 75.) 14 Nos. 10-1103, 10-1843 scheme from the time that Samuels joined in July of 2008.8 Because he was “not involved in the planning, execution, or sharing of proceeds from fraud trips led by other defendants,” he contends that “[h]is offense level should therefore be increased only by 10 levels for losses between $120,000 and $200,000 under § 2B1.1(b)(f) from the trips for which he was responsible.” (Samuels Br. at 6.)9 We “review de novo the district court’s method of calculating loss for purposes of sentencing enhancements under the Guidelines.” United States v. White, 492 F.3d 380, 414 (6th Cir. 2007). “Under the Guidelines, the district court is to determine the amount of loss by a preponderance of the evidence, and the district court’s findings are not to be overturned unless they are clearly erroneous.” United States v. Triana, 468 F.3d 308, 321 (6th Cir. 2006). In determining the amount of loss attributable to a defendant, the district court may not “blindly embrace[] the figures set forth in [a defendant’s] PSR . . . . Rather, the district court must actually find facts.” White, 492 F.3d at 416. Under U.S.S.G. § 1B1.3(a), offense level and characteristics are determined in relation to certain relevant conduct, including: 8 Samuels does not challenge the mathematical calculation that the district court used in reaching a dollar figure for attempted loss from all co-conspirators post-June 2008. 9 Samuels’ math is somewhat difficult to follow. Samuels’ PSR, as he points out, only reports his having personally traveled on one trip, from October 15-18, 2008. The total attempted loss for that trip was $81,427.79 and the actual loss $73,927.79. (Samuels PSR ¶ 88.) Though the trip that Samuels directly participated in generated an attempted loss of between $70,000 and $120,000—equating to an 8-level increase—Samuels “maintain[s] that he should be held accountable for under $200,000,” (Samuels Br. at 7), because “he personally received no more than $150,000 from the criminal activity he jointly undertook with others.” (Samuels Sent. Memo at 2.) How Samuels could have received $150,000 from the one trip in which he participated, which grossed only $74,000, is inexplicable. 15 Nos. 10-1103, 10-1843 in the case of jointly undertaken criminal activity (a criminal plan, scheme, endeavor, or enterprise undertaken by the defendant in concert with others, whether or not charged as a conspiracy), all reasonable foreseeable acts and omissions of others in furtherance of the jointly undertaken criminal activity, that occurred during the commission of the offense of conviction, in preparation for that offense, or in the course of attempting to avoid detection or responsibility for that offense. U.S.S.G. § 1B1.3(a)(1)(B). We have held that U.S.S.G. § 1B1.3(a)(1)(B) “requires that the district court make particularized findings with respect to both the scope of the defendant’s agreement and the foreseeability of his co-conspirators’ conduct before holding the defendant accountable for the scope of the entire conspiracy.” United States v. Campbell, 279 F.3d 392, 400 (6th Cir. 2002). It is Samuels’ position that the district court did not make particularized findings as to the scope of his agreement with co-conspirators, and that furthermore, the record does not support the finding that Samuels was jointly involved in the trips that he did not personally attend. (Samuels Br. at 9.) Samuels further argues that the conduct of his co-conspirators was not foreseeable, as he “was [not] involved in any way whatsoever in the separate fraud trips conducted by Defendants Holloway and Erwin, the other two leaders in this triple conspiracy.” (Id.) The district court made the following specific factual findings regarding the scope of Samuels’ participation in the criminal enterprise—“that no later than July of 2008 Mr. Samuels has joined this particular conspiracy” and: there’s no question that Mr. Samuels operated at a higher level, at a planning level, at a level that warrants responsibility for the entire operation that occurred on his watch. And I think in Mr. Samuels’ case that includes trips certainly that he went on and also includes trips that he didn’t go on but that other people, in particular Mr. Holloway or Mr. Erwin, were personally supervising. And that’s because in my view Mr. Samuels on this presentence record was somebody who was intimately involved once he got into the conspiracy in the planning, execution, implementation, and then 16 Nos. 10-1103, 10-1843 ultimately the attempt to clean it up . . . . And I think the evidence on this point is particularly telling and supportive of an inference that, certainly by a preponderance of the evidence, Mr. Samuels’ role is at that high level. (Samuels Sent. Tr. at 59-60, 63.) The district court noted that Samuels had introduced other participants, who went on trips that he did not supervise, to the conspiracy. (See Id. at 64.) The district court found this to be an additional indication that Samuels was intertwined in the entire enterprise, not just the trips that he attended. (See Id.) The district court also credited the proffers offered by many of Samuels co-conspirators, which repeatedly indicated that Samuels was a leader in the conspiracy and performed an “identical” role to Holloway and Erwin, the other supervisors. (See Id. at 59.) This role was greater than that of the walkers, who were only involved in and responsible for the trips that they attended, and extended to the whole of the scheme. (See Id. at 57-58.) Regarding foreseeability, in addition to the foregoing, the district court found that the evidence of co-conspirators’ jailhouse calls to Samuels after the arrest supported to the conclusion that Samuels was aware of the conduct of all of the teams. (See Id. at 60-61.) When arrested, several co-conspirators called Samuels, and during these conversations Samuels discussed not only trips that he personally supervised, but also trips that other supervisors led. (See Id. at 64; Samuels PSR ¶ 50.) He discussed “cleaning” up whatever evidence of the conspiracy might be in California; presumably not just evidence of his own trips (which his co-conspirators would have no reason to tell him to clean up), but evidence of the operation as a whole. (Samuels Sent. Tr. at 64; Samuels PSR ¶ 48.) The co-conspirator also told Samuels that Erwin wanted him to “shut it down,” which again speaks to the conspiracy as a whole and not just to Samuels’ own trips. (Samuels PSR ¶ 49.) 17 Nos. 10-1103, 10-1843 Samuels replies that the district court’s findings were nonetheless insufficiently particularized, as “the district court failed to distinguish the three conspiracies in this case and determine the separate losses caused by each group.” (Samuels Reply at 1.) This argument fails for two reasons: first, the district court properly found that there was only a single conspiracy, which Samuels joined in 2008; and secondly, because the walkers worked for different supervisors’ teams at different times, and because supervisors sometimes traveled on the teams together, it would be impossible to separate out “three conspiracies” in the way that Samuels seems to envision. (See Samuels PSR ¶ 88.) There is no evidence in the record to undermine the conclusion that Samuels was a supervisor in the single conspiracy from June 2008 forward, and that all activity after that point was jointly undertaken within the meaning of U.S.S.G. § 1B1.3(a)(1)(B). The district court made particularized findings regarding both the scope of Samuels participation and the foreseeability of his coconspirators’ actions, and those findings are supported by a preponderance of the evidence. Therefore, the district court did not err in assessing Samuels a 14-level enhancement.
We review the district court’s application of the Guidelines for clear error. See United States v. Kraig, 99 F.3d 1361, 1371 (6th Cir. 1996). The district court determined that Samuels qualified for a two-level sentencing enhancement, pursuant to U.S.S.G. § 2B1.1(b)(9), for the use of sophisticated means. The Guidelines defines “sophisticated means” as: [E]specially complex or especially intricate offense conduct pertaining to the execution or concealment of an offense. For example, in a telemarketing scheme, 18 Nos. 10-1103, 10-1843 locating the main office of the scheme in one jurisdiction but locating soliciting operations in another jurisdiction ordinarily indicates sophisticated means. Conduct such as hiding assets or transactions, or both, through the use of fictitious entities, corporate shells, or offshore financial accounts also ordinarily indicates sophisticated means. U.S.S.G. § 2B1.1 cmt. n.8 (2008). While Samuel acknowledges that “he arranged or ‘sponsored’ some of the [fraud] trips . . . purchased false identifications, recruited persons to go on the trip, scheduled the flights, and located the banks to hit,” he claims that the district court committed clear error in applying the enhancement to his sentence. (Samuels Br. at 2) Samuels argues that sophisticated means, if any, were only used in the commission of Count IV, for which no enhancement can be applied. The government responds that Samuels’ efforts to minimize the complexity of the operation by examining each aspect of the scheme piecemeal—e.g., booking airfares or locating bank branches—obscures the fact that the combination of all of these activities required extremely sophisticated planning. Therefore, as “Defendant’s objection asks the Court to focus on one aspect of the offense instead of the totality of the scheme, it should be overruled.” (Pl.’s Br. at 20.) Samuels is correct that the charged activities of Count IV cannot be used to enhance his sentence for Counts I through III. The Guideline addressing aggravated identity theft states: If a defendant was convicted of violating 18 U.S.C. § 1028A, the guidelines sentence is the term of imprisonment required by statute. Chapters Three (Adjustments) and Four (Criminal History and Livelihood) shall not apply to that count of the conviction. U.S.S.G. §2B1.6(a). There is no question that the district court did not directly apply any enhancement to the 24month sentence it imposed upon Samuels on Count IV. Instead, Samuels argues that, in applying 19 Nos. 10-1103, 10-1843 an enhancement to his sentences for Counts I through III, the district court used only the factual basis underlying Count IV. On the contrary, the district court found that “this situation involves a whole variety of sophisticated means and that go well beyond the Count IV, aggravated identity theft, which certainly involved sophisticated means.” (Samuels Sent. Tr. at 65.) The district court continued: [The conspirators] picked out locations across the country as opposed to concentrating all their efforts in one place. . . . and it’s probably one of the things that allowed the conspiracy to thrive as long as it did. And certainly sophisticated means include efforts taken not just to commit the offense but to conceal the offense as well. Another, it seems to me, obvious sophisticated means is the whole description of how Mr. Samuels handled proceeds by depositing it into an account of a daughter, not his own personal account, and then using increments that are below the reporting threshold of $10,000. That seems to me a well-known means among people who understand the banking system to conceal or at least slow down the path of law enforcement. And it’s happened here. I think the only reasonable inference is that it was part of an effort, successful for a while, to conceal what was going on. The third and certainly the most obvious sophisticated means, it seems to me, is the logistical planning involved. Flying in your own name with legal lawful documents is hard enough these days. To do it with false documents, to do it across the country, to coordinate the trips of multiple players, and to include housing and everything else that goes along with that, rental cars, this is a group of people whose logistical skills are quite remarkable, it seems to me, and that was necessary to conceal the fraud as long as it went on. (Id. at 66-67.) Each of these activities was charged under Counts I through III. Count II charged that the co-conspirators “traveled to the Western District of Michigan and other states where they used [counterfeit] documents to make fraudulent, in-person cash withdrawals of approximately $211,319 from the BOA accounts of those persons, resulting in a financial loss to BOA of approximately $174,585.” (Samuels PSR ¶ 5.) This kind of cross-jurisdictional conduct, for the purposes of 20 Nos. 10-1103, 10-1843 avoiding detection, is exactly the type of conduct described in the Guidelines definition of “sophisticated means.” See U.S.S.G. § 2B1.1 cmt. n.8 (2008). Count III charged that “defendants used the Internet to determine the addresses of BOA branches for the purpose of committing bank fraud and aggravated identity theft. They also used a GPS to assist in locating bank branches, lodging, and otherwise traveling as necessary to carry out the scheme.” (Id. ¶ 6.) This count addresses the complicated logistics involved in targeting the banks “to hit.” It also encompasses the sophistication required to target out-of-state banks in transition onto BOA systems, which the conspirators identified as being particularly vulnerable to their kind of fraud. (Samuels Sent. Tr. at 11-12.) Furthermore, Samuels’ structuring of deposits into his daughter’s bank account was an attempt to cover up not the crime of identity theft, but to cover up his participation in a bank fraud conspiracy, as charged under Counts I through III. This Court has held that such funneling of transactions through relatives in order to disguise the origin of funds is sufficient to support an enhancement for sophisticated means. See United States v. May, 568 F.3d 597, 607 (6th Cir. 2009) (citing United States v. Clear, 112 F. App’x 429, 431 (6th Cir. 2004)). Just as in United States v. Masters, “[w]hile each of the individual steps in the fraud scheme was not particularly sophisticated, it is the totality of the defendant’s conduct—the entire scheme—that the district court found was carried out using ‘sophisticated means.” 216 F. App’x 524, 527 (6th Cir. 2007). In determining that Samuels’ offense conduct under Counts I through III involved the use of sophisticated means, the district court did not commit clear error.