Opinion ID: 768508
Heading Depth: 2
Heading Rank: 4

Heading: Victim Restitution

Text: 35 The district court ordered victim restitution in excess of $2.7 million. This amount is comprised of the various fees (including expense retainer fees associated with preliminary commitment agreements) paid to Consortium by persons seeking financing. On appeal, Ross argues that the court erred in ordering restitution to persons who are not victims as defined in the Mandatory Victims Restitution Act, 18 U.S.C. § 3663, et seq., (MVRA). We first note that the district court has wide discretion in ordering restitution. See United States v. Manzer, 69 F.3d 222, 229 (8th Cir. 1995). Reviewing the restitution order for abuse of discretion and the court's application of the statute de novo, see United States v. Lively, 20 F.3d 193, 200 (6th Cir. 1994), we affirm the ruling of the district court. 36 Under the MVRA, the court shall order a defendant guilty of an offense against property under this title, including any offense committed by fraud or deceit to pay restitution to victims. 18 U.S.C. § 3663A(c)(1)(A)(ii). The Act defines victim as 37 a person directly and proximately harmed as a result of the commission of an offense for which restitution may be ordered including, in the case of an offense that involves as an element a scheme, conspiracy, or pattern of criminal activity, any person directly harmed by the defendant's criminal conduct in the course of the scheme, conspiracy, or pattern. 38 18 U.S.C. § 3663A(a)(2). 39 Ross argues that only the thirty-four persons who executed formal commitment agreements (as opposed to the remainder who only executed preliminary commitment agreements) are victims entitled to restitution because the language of the preliminary commitment agreements expressly stated that Consortium made no guarantees, warranties, or promises regarding the likelihood that a loan would be funded and that the $10,000 expense retainers were legitimately earned by Consortium. 40 Our precedent makes clear that victim restitution may be ordered for criminal conduct that is part of a broad scheme to defraud, without regard to whether the defendant is convicted for each fraudulent act in the scheme. See Manzer, 69 F.3d at 229-30 (affirming victim restitution of $2.7 million based on defendant's unlawful sale of 270 satellite descrambling discs, despite conviction on only two counts of mail fraud, two counts of wire fraud, and one count of copyright infringement). In this case, the jury convicted Ross of fifteen counts of wire fraud and eighteen counts of money laundering under an indictment that alleged a broad scheme to defraud. The court was presented evidence that 173 persons lost $3.5 million throughout the course of the scheme to defraud. The $3.5 million merely reflects the fees collected by Consortium and does not include expenditures made by would-be borrowers in reliance on the promise of funding, which trial testimony suggests far exceeds the challenged restitution ordered. Based on the evidence presented, there is little doubt that each of the persons who executed preliminary commitment agreements, paid expense retainers of $10,000, and were thereafter rejected for a loan by Consortium, were directly and proximately harmed by the scheme to defraud and fall well within the ambit of Congress' definition of victim under the MVRA. Ross' argument to the contrary is without merit.