Opinion ID: 547492
Heading Depth: 2
Heading Rank: 1

Heading: Incorrect Guideline Applied

Text: 10 Beard argues that the district court erred in sentencing him under the Fraud and Deceit Guideline, 2F1.1 rather than the Perjury Guideline, 2J1.3. His argument rests on two grounds: (1) that the guideline most applicable to the conduct involved in his offense is the guideline for perjury and not fraud; and (2) that the court's use of the fraud guideline violated Beard's due process rights because punishment by fraud and deceit standards was not contemplated in the plea agreement. We find neither argument compelling.
11 Under the Sentencing Guidelines Sec. 1B1.1(a) directs the court to look to the statute of conviction to determine the most appropriate offense guideline, while Sec. 1B1.2(a) directs the court to look to the offense of conviction in making that determination. T. Hutchison & D. Yellen, Federal Sentencing Law and Practice 21 ann. 3 (1989) [hereinafter Sentencing Practice ] (citing U.S.S.G. Secs. 1B1.1(a) & 1B1.2(a)). Beard argues this means that even though the Statutory Index specifies the guideline to apply, the court should ignore the referenced guideline and choose the one closest to the conduct contemplated in the statute of conviction. In this case, Beard argues, the perjury guideline is the closest to the conduct contemplated in the statute of conviction because 18 U.S.C. Sec. 152 uses the phrase under penalty of perjury. He claims that the offense of conviction, making a false statement, is more similar to perjury than it is to fraud; therefore, perjury is the most applicable guideline to the conduct. Beard further argues that applying a fraud standard is incorrect because the status of the $175,000 was unknown at the time of his offense; therefore, he could not have committed a fraud upon his creditors because the funds, or at least most of the funds, belonged to him. 12 Beard incorrectly characterizes his offense. He was under the duty to disclose to the court the existence of assets whose immediate status in the bankruptcy is uncertain, even if that asset is ultimately determined to be outside of the bankruptcy estate. See United States v. Cherek, 734 F.2d 1248, 1254 (7th Cir.1984). His failure to disclose the existence of the $175,000 and his continued attempts to conceal its presence constituted a fraud upon the court. Therefore, ownership of the assets is irrelevant to the selection of the correct guideline, in light of Beard's duty to disclose the existence of the asset to the bankruptcy court. Fraud is therefore a part of Beard's offense of conviction. 13 It is clear to us from the language in sections 1B1.1(a) and 1B1.2(a) that the Commission intended the choice of most applicable guideline to apply only when two or more guideline sections are listed in the Index for the statute of conviction. See U.S.S.G. Sec. 1B1.1(a) (June 15, 1988) (If more than one guideline is referenced for the particular statute, select the guideline most appropriate for the conduct of which the defendant was convicted). In such an instance, the court must choose the most appropriate guideline from among the ones listed, using the conduct for which the defendant was convicted to determine the choice. 2 The sentencing court is not to look beyond the referenced guidelines listed in the Index unless only one guideline is listed and that guideline is deemed inappropriate in light of the statute or offense of conviction. See Sentencing Practice, supra at 21 & 25 n. 2. Only when the Index lists a single guideline should the court look beyond the guideline referenced. Therefore, if more than one guideline is referenced in the Index, the court must choose the most appropriate guideline of those listed, based on the offense of conviction. 14 In the instant case, the statutory index references two guidelines for convictions under 18 U.S.C. Sec. 152. The first, 2B4.1, deals with commercial bribery and is clearly inappropriate to Beard's offense of conviction. The second, 2F1.1, deals with offenses involving fraud and deceit. 15 Guideline 2F1.1 is the more appropriate guideline for two reasons. First, Beard's offense specifically included fraud as a part of the offense because Beard pled guilty to knowingly and fraudulently making a false statement under the language of the statute. See 18 U.S.C. Sec. 152. Second, irrespective of the statute of conviction, his conduct constituted fraud because he attempted to conceal funds from the bankruptcy court while he was under a duty to reveal their existence and allow the court to determine their ownership. Therefore, the only appropriate choice between the two guidelines referenced is Guideline 2F1.1. Furthermore, the Statutory Index does not list Guideline 2J1.3, the perjury guideline, in reference to violation of 18 U.S.C. Sec. 152. Clearly, perjury was not contemplated as a sentence for Beard's offense.
16 Beard's due process argument is even less compelling. He argues that he knowingly and intelligently pled guilty to an offense subjecting him to a penalty of perjury; therefore, to sentence him under any other guideline would be clearly erroneous on its face and violate his due process rights. Beard argues that the crucial issue is whether the term imposed by the sentencing judge comport[s] with the reasonable understanding and expectations of the defendant as to the sentence for which he had bargained. Paradiso v. United States, 689 F.2d 28, 31 (2d Cir.1982). He also argues that, in order for a guilty plea to stand, it must be voluntarily, knowingly and intelligently given. Boykin v. Alabama, 395 U.S. 238, 241, 89 S.Ct. 1709, 1711, 23 L.Ed.2d 274 (1969). According to Beard, he pled guilty under the assumption that he would be sentenced under a perjury standard and not fraud. He therefore knowingly and intelligently bargained for that sentence and the court erred in holding him accountable for fraud. 17 We disagree. First, when Beard pled guilty he acknowledged that no promises or predictions were made as to what his sentence would be and that no agreement limiting or enhancing his rights were made. No one promised that Beard would be sentenced by a perjury standard and in fact no promises concerning his sentence were made at all. Therefore, his expectation that he would be sentenced under the perjury guideline was fostered solely by his own false hopes. 18 Second, in the presentencing report and in the sentencing hearing Beard admitted facts that established a factual basis for a finding of fraud. Under the Guidelines, if in a guilty plea a defendant stipulates to facts that establish a more serious offense than the offense of conviction, that person may be sentenced to the higher offense. U.S.S.G. Sec. 1B1.2(a). Sentencing a person under this rule does not violate due process because the Sentencing Guidelines are public records that put a defendant on notice that he could be sentenced under this rule. See United States v. Strong, 891 F.2d 82, 85 (5th Cir.1989). Once Beard stipulated and acknowledged facts which established fraud, the district court was free to consider those facts when fashioning his sentence. See Id. 19 For the above stated reasons we hold that the district court correctly applied Guideline 2F1.1, fraud and deceit, to Beard's offense because (1) fraud is an element of Beard's offense therefore making 2F1.1 the only proper choice of sentences referenced in the Statutory Index, and (2) Beard stipulated to facts which established his fraudulent conduct, so that even if fraud and deceit were not the sentence referenced in the Index it was appropriate for the court to sentence Beard to the higher fraud standard under Guideline 1B1.2(a) and our holding in Strong.