Opinion ID: 662498
Heading Depth: 2
Heading Rank: 1

Heading: Joseph Colello

Text: 5 We turn first to the four-level enhancement that Joseph Colello received as an organizer of the scheme. The Guidelines require this increase [i]f the defendant was an organizer or leader of a criminal activity that involved five or more participants or was otherwise extensive. United States Sentencing Commission, Guidelines Manual, Sec. 3B1.1(a) (Nov. 1992). The district court's determination that a defendant was an organizer or leader is a factual finding that we may reverse only if it is clearly erroneous. United States v. Miller, 962 F.2d 739, 745 (7th Cir.1992) (citing United States v. Herrera, 878 F.2d 997, 1000 (7th Cir.1989)). 1 6 Factors the court should consider include the exercise of decision making authority, the nature of participation in the commission of the offense, the recruitment of accomplices, the claimed right to a larger share of the fruits of the crime, the degree of participation in planning or organizing the offense, the nature and scope of the illegal activity, and the degree of control and authority exercised over others. 7 U.S.S.G., Sec. 3B1.1, comment. (n. 3). 8 Having reviewed the record in light of these factors, we discern no error in the district court's conclusion that Mr. Colello was an organizer or leader of this scheme. Of the more than sixty claims listed in the government's summary of the scheme (R. 107, Gov. Ex. Summary Chart), the accuracy of which Mr. Colello has largely conceded (see R. 106 at 5), Mr. Colello was involved in forty-eight. There is also substantial evidence indicating that he (1) recruited (among other scheme participants) Dr. Lawrence Levin, a chiropractor who typically signed off on the fraudulent medical documentation for personal injury claims, and Sigmund Bilski, a fellow employee of the Chicago Streets and Sanitation Department, who deliberately crashed his garbage truck into selected automobiles at Mr. Colello's direction; (2) supplied the bulk of the documentation submitted in support of insurance claims, including medical bills and wage loss verification forms; 2 (3) physically arranged and participated in many of the staged automobile accidents and visited emergency rooms after they were completed in order to supply a basis for phony medical expenses; (4) directed fellow participants as to what they should say about the accidents; (5) supplied the cars and title documents required for staged accidents and thefts; (6) supplied money to other participants to purchase insurance policies; (7) hired attorneys to handle certain fraudulent claims; (8) distributed insurance proceeds to fellow participants; (9) arranged for estimates on damaged vehicles; (10) filed false personal injury claims for genuine automobile accidents in which he had not been involved; and (11) used the radio in the truck he drove as a Streets and Sanitation worker to report a found vehicle whose theft had been staged. A number of the participants in the scheme also testified before the grand jury 3 that when they received payment on their claims from the insurance companies, they would pay a share of the proceeds (typically one-half) to Mr. Colello. Indeed, his own profit from the scheme--some $266,000--was substantial. Although, as Mr. Colello contends, his efforts in furtherance of the scheme were not in all cases unique, this does not detract from the inescapable inference that amongst all of the participants, he was the most responsible for the affairs of the scheme. 9 Finally, we find it quite telling that in the Spring of 1989, when the scheme participants became aware that they were under investigation, Mr. Colello directed the others to tell the authorities that a mythical Diane--purportedly the wife or girlfriend of scheme participant Charles Jedrzejas--had been the person who orchestrated the scheme. 4 According to Jedrzejas, he and Colello had agreed that Jedrzejas would initially accept responsibility for the scheme and then point the finger at Diane; in return, Colello had promised to take care of [him] financially. Jedrzejas Tr. 21-22. The natural inference from this evidence is that Colello was attempting to hide his own role as the ringleader of the scheme, and that is exactly what scheme participants William Bascom and Donna Bilski testified. W. Bascom Tr. 15-16; D. Bilski Tr. 11. Under these circumstances, the district court's decision to apply the organizer enhancement was quite sound. 10 The two-level enhancement for obstruction of justice pursuant to Guidelines section 3C1.1 was also amply justified by the evidence. Indeed, Colello's contention is not that he did not merit the enhancement, but that other defendants should have received it for the comparable lies they told to the authorities investigating the scheme. Yet, as we have explained, it is not our province to examine the sentences of Mr. Colello's co-defendants. See cases cited at pages 194-95, supra. We are confined to his sentence alone, and in that context we find no clear error in application of the enhancement. See United States v. Carson, 9 F.3d 576, 583 (7th Cir.1993); United States v. Pitz, 2 F.3d 723, 730 (7th Cir.1993) (obstruction enhancement reviewed for clear error). Mr. Colello himself told a number of material lies to government investigators, insisting that none of the accidents underlying the fraudulent insurance claims had been staged and embellishing the Diane tale with a physical description and some of the false identifications she had purportedly used. See R. 98 at 6-7; R. 107 Gov. Ex. Agent's Notes. Witness after witness informed the grand jury that Colello had instructed his accomplices to likewise place the blame for their scheme on the fabled Diane and to deny that any of the accidents had been staged. See, e.g., W. Bascom Tr. 15-16; Jedrzejas Tr. 21-22; J. Bilski Tr. 32-33; Steve Bilski Tr. 21; D. Bilski Tr. 11. Indeed, Mr. Colello went so far as to prepare a written script for Charles Jedrzejas to use during electronically monitored telephone calls that Colello would later place to him purportedly in aid of the government's investigation. R. 107 Gov. Ex. Script; Jedrzejas Tr. 21-22. These transparent efforts to downplay the gravity of the scheme and to deflect responsibility away from himself rendered the obstruction enhancement singularly appropriate in Mr. Colello's case. The fact that Mr. Colello's campaign of deception ultimately failed is immaterial; [s]ection 3C1.1 provides an increase for attempts to obstruct justice as well as actual obstruction of justice. United States v. Gaddy, 909 F.2d 196, 199 (7th Cir.1990) (emphasis in original); see also United States v. Stevenson, 6 F.3d 1262, 1269 (7th Cir.1993); United States v. Caicedo, 937 F.2d 1227, 1235 (7th Cir.1991). 11 Finally, we believe it was appropriate for the district court to calculate the loss caused by Mr. Colello's criminal conduct based on the total amount of money of which the insurance companies had been defrauded (approximately $668,000), a determination that resulted in an eight-level increase in his offense level. See U.S.S.G. Sec. 2F1.1(b)(1)(I) (Oct. 1987). 5 Although the district court's loss calculation is a factual finding that we review for clear error, the meaning of loss for purposes of section 2F1.1 is a question of law that is subject to de novo review. United States v. Holiusa, 13 F.3d 1043, 1045 (7th Cir.1994). 12 Mr. Colello himself may have only reaped $266,000 from the scheme, but the relevant loss for purposes of section 2F1.1(b) is not limited to a defendant's personal gain from the fraud. Given section 2F1.1's emphasis on the victim's loss rather than the defendant's profit, see Application Note 8 ([t]he offender's gain from committing the fraud is an alternative estimate that ordinarily will underestimate the loss), Mr. Colello certainly may be held to account for fraudulent claims that he assisted in some way, even if he did not share in the proceeds. Moreover, section 1B1.3(a)(1)(B) directs the sentencing court to consider, in the case of a jointly undertaken criminal activity, ... all reasonably foreseeable acts and omissions of others in furtherance of the jointly undertaken criminal activity. See Smith, 897 F.2d at 910-11; see also United States v. Chichy, 1 F.3d 1501, 1510 (6th Cir.), cert. denied, --- U.S. ----, 114 S.Ct. 620, 126 L.Ed.2d 584 (1993); United States v. Lorenzo, 995 F.2d 1448, 1460 (9th Cir.), cert. denied, --- U.S. ----, ----, ----, 114 S.Ct. 225, 227, 589, 126 L.Ed.2d 180 (1993). Thus, the district court's decision to look beyond Mr. Colello's profit was a correct application of the law. On the factual side of the loss determination, Mr. Colello does not attempt to argue that any of the claims resulting in the total loss figure were not in furtherance of the scheme that he and his co-defendants pursued; nor does he suggest that any were not foreseeable to him. In light of his role as the leader of this scheme as well as its most active participant, it was perfectly appropriate for the district court to attribute to Mr. Colello the total loss inflicted on the insurance companies for sentencing purposes.