Opinion ID: 3000706
Heading Depth: 2
Heading Rank: 3

Heading: Loss Amount and Sentencing Enhancement

Text: Finally, Sloan raises a series of challenges to his sentence based on the district court’s finding of the loss amount and its application of various sentencing enhancements. We reject each challenge.
The district court accepted the recommendations of the PSR as to the loss calculation. The PSR determined 4 Pursuant to Rule 28(j) of the Federal Rules of Appellate Procedure, Sloan submitted copies of the Fourth Circuit’s decision in United States v. Rita, No. 06-5754, which was before the Supreme Court on the issue of what “reasonableness” presumption, if any, is to be given to sentences within a properly constructed Guideline range. The Supreme Court recently issued its decision in this case, holding that federal appellate courts may apply a presumption of reasonableness to a district court sentence that is within a properly calculated Guideline range. ___ S. Ct. ___, 2007 WL 1772146. This decision, however, does not affect the outcome in this case because Sloan has not raised this challenge in his appeal. While he argues that the district court committed errors in determining the proper sentencing range, Sloan has not argued that his sentence was “unreasonable” when considered under the sentencing factors in 18 U.S.C. § 3553(a). No. 06-2392 15 that the amount of loss incurred by the eight victims named in the indictment and who testified at trial was $2,322. Additionally, the PSR explained that postal inspectors had identified an additional 82 victims, resulting in a total loss incurred by all ninety victims of $19,654.60. The PSR recommended a three-level increase in Sloan’s offense level pursuant to USSG § 2F1.1(b)(1)(D) because the loss was between $10,000 and $20,000. While Sloan raised an objection to the loss calculation, the basis of that objection was the “legal argument” that the jury did not find the specific amount beyond a reasonable doubt. In support of that objection, Sloan cited to Apprendi v. New Jersey, 530 U.S. 466, 120 S.Ct. 2348, 147 L.Ed.2d 435 (2000), Blakely v. Washington, 542 U.S. 296, 124 S.Ct. 2531, 159 L.Ed.2d 403 (2004), and United States v. Booker, 543 U.S. 220, 125 S.Ct. 738, 160 L.Ed.2d 621 (2005). He did not argue that calculation of the loss amount in the PSR was factually inaccurate. The district court overruled Sloan’s objection. The challenge that Sloan raises here is quite different. He now argues that the district court improperly calculated the loss amount. At sentencing, Sloan stipulated to the loss figure of $19,654.60. He did not reserve the right to argue that the amount was less or that the calculation was factually incorrect. Normally, our review of the district court’s factual findings at sentencing is for clear error; and our review of the application of those facts to the Sentencing Guidelines is de novo. United States v. Haddad, 462 F.3d 783, 793 (7th Cir. 2006). We need not go that far in this appeal, however, because this challenge is precluded by Sloan’s stipulation as to the loss amount. By stipulating to the loss amount, he effectively admitted the fact that the loss amount was $19,654.60 and waived any subsequent challenge to this fact. See, e.g., United States v. Newman,148 F.3d 871, 876 (7th Cir. 1998) (stipulation waives later denial of relevant conduct). See also United States v. Gramer, 309 F.3d 972, 975 (7th Cir. 2002) 16 No. 06-2392 (finding that district court properly applied sentencing enhancement pursuant to USSG § 2F1.1(b)(1) based on defendant’s stipulation as to loss amount at sentencing hearing). The district court credited this stipulation, and its application of the three-level increase in Sloan’s offense level pursuant to USSG § 2F1.1(b)(1)(D) was appropriate.
a Religious Organization Sloan next challenges the district court’s application of the two-point sentencing enhancement pursuant to USSG § 2F1.1(b)(4)(A), arguing that the offense did not involve a misrepresentation that Sloan was acting on behalf of a religious organization. At trial, JoAnn Bemiller testified that she had joined the Christian Freedom Foundation after attending a presentation at her sister’s house. Her sister had told her that she would receive a machine that would make electricity and give her a return on her money. Ms. Bemiller further testified that she had assumed that this was a good deal because it was a Christian organization. Relying on this testimony, the district court found that Sloan was trading on the religious affiliations of the organization that he had created as part of his scheme to defraud and that, in doing so, misrepresented to his victims that there was a religious purpose advanced by their buying into his schemes and participating in this matrix. We agree with the district court’s finding. USSG § 2F1.1(b)(4) states, in relevant part, “If the offense involved (A) a misrepresentation that the defendant was acting on behalf of a charitable, educational, religious or political organization, or a government No. 06-2392 17 agency . . . increase by 2 levels.”5 The commentary to this section offers examples of conduct to which § 2F1.1 applies: a defendant who “solicit[s] contributions to a non-existent famine relief organization by mail,” or “who diverts donations for a religiously affiliated school by telephone solicitations to church members in which the defendant falsely claims to be a fund-raiser for the school . . . .” The background to this section also specifies that the “guideline is designed to apply to a wide variety of fraud cases.” USSG § 2F1.1 comment. (backg’d). In United States v. Lilly, 37 F.3d 1222 (7th Cir. 1994), this Court found the district court’s application of the twolevel enhancement pursuant to § 2F1.1(b)(4)(A) appropriate where the defendant, a church pastor, sold “Certificates of Deposit,” telling potential purchasers that these Certificates of Deposit would be used to finance the improvement or expansion of the Church and to build a retirement complex. Id. at 1224-25. The defendant, however, took a significant portion of the proceeds for his own personal use. Id. at 1225. Admittedly, this case does not present as obvious an application of § 2F1.1(b)(4)(A) as Lilly. Sloan was less explicit in his offers than the defendant in Lilly; he did not make any express promises to use the funds ob- tained from new members to the Christian Freedom Foundation to advance a specific, religious goal. Instead, Sloan cloaked his fraudulent scheme with the mantle of a religious organization. Through the placement of his advertisements in the Christian Freedom Chronicle, which 5 The district court sentenced Sloan under the guidelines manual effective in 2001. On November 1, 2001, the U.S. Sentencing Commission deleted § 2F1.1 and consolidated its provisions in a revised § 2B1.1. See USSG App. C, amendment 617. This change has no effect on Sloan’s appeal. 18 No. 06-2392 included a special section, “Christian Singles News and Contacts,” Sloan clearly targeted a specific audience: Christians. These advertisements were not merely for generators or money-making opportunities, they were solicitations for membership in a “Christian” organization, the Christian Freedom Foundation. Thus, the advertisements created the appearance that a religious organization was involved in and party to the offer, giving the scheme an air of legitimacy. While many of Sloan’s victims joined the Christian Freedom Foundation with the aim of gaining free electricity and the chance to make money for themselves, at least one of Sloan’s victims, Ms. Bemiller, was duped by the Christian aspect of the organization into thinking that the fraudulent offer was legitimate. Under these circumstances, we find that the district court did not clearly err in applying the two-level adjustment under § 2F1.1(b)(4)(A).
ning Sloan also challenges the district court’s application of the two-level enhancement for “more than minimal planning” under § 2F1.1(b)(2)(A). Because Sloan did not raise this challenge to the district court first, we will review the district court’s application of this sentencing enhancement for plain error. United States v. Cunningham, 405 F.3d 497, 502 (7th Cir. 2005). Sloan contends that there was no planning other than his preparation and placement of the advertisements in the Christian Freedom Chronicle and, therefore, the enhancement for more than minimal planning was not applicable. We disagree. On a finding that the defendant engaged in “more than minimal planning,” § 2F1.1(b)(2)(A) allows a sentencing court to increase the defendant’s offense level by two. No. 06-2392 19 United States v. Sonsalla, 241 F.3d 904, 907 (7th Cir. 2001). This enhancement is applicable where “criminal acts, each of which are not purely opportune, are repeated over a period of time.” Id. (citing United States v. Brown, 47 F.3d 198, 204 (7th Cir. 1995)). In this case, the district court acted within its authority by accepting the recommended findings of the PSR, unchallenged by Sloan, that Sloan’s acts were not purely opportune but rather constituted evidence of more than minimal planning. Id. at 907-08 (citing United States v. Mustread, 42 F.3d 1097, 1101-02 (7th Cir. 1994)). Moreover, Sloan’s fraudulent activity spanned several months, during which time he drafted and printed four false advertisements, withdrew money from the bank ac- counts of his victims, and wrote and mailed checks to his victims under the guise of matrix earnings. These actions were deliberate and made in such a way as to conceal the fraudulent scheme. Thus, the upward adjustment for more than minimal planning was appropriate.
Finally, Sloan contends that the district erred in applying the three-level, mass-marketing enhancement pursuant to § 2F1.1(b)(3), arguing that this enhancement should not apply to a previously-established newspaper. Again, Sloan failed to raise this argument to the district court, so we will review the application of this enhancement for plain error. Cunningham, 405 F.3d at 502. Application note 3 to § 2F1.1 of sentencing guidelines define “mass-marketing” as “a plan, program, promotion, or campaign that is conducted through solicitation by telephone, mail, the Internet, or other means to induce a large number of persons to (i) purchase goods or services; (ii) participate in a contest or sweepstakes; or (iii) invest for financial profit.” USSG § 2F1.1, comment. (n. 3). 20 No. 06-2392 Nothing in the sentencing guidelines or the application note suggests that mass-marketing is limited to instances involving newly-created newspapers and the like, and we reject such a narrow interpretation. See United States v. Magnuson, 307 F.3d 333, 334 (5th Cir. 2002) (rejecting narrow construction of “mass-marketing” that would limit application of § 2F1.1(b)(3) to “active” rather than “passive” solicitations). The definition of “mass-marketing” is not limited to telephone, mail, or Internet solicitations but includes “other means.” Sloan used such “other means,” the Christian Freedom Chronicle, to reach a large number of individuals in order to have them pay to join the Christian Freedom Foundation. Accordingly, the district court’s application of the massmarketing enhancement was appropriate.