Opinion ID: 773717
Heading Depth: 2
Heading Rank: 2

Heading: Occupying a Position of Trust

Text: 12 We have held that a stockbroker occupies a position of trust within the meaning of Section 3B1.3 if his victim entrusts him with discretionary authority. See Hirsch, 239 F.3d at 227-28. Hussey and Alexander argue, however, that this holding extends only to those who are actually licensed stockbrokers, and not to those who merely pretend to be licensed stockbrokers. They contend that such a result is required by United States v. Echevarria, 33 F.3d 175 (2d Cir. 1994), where we held that a person holds a position of trust within the meaning of Section 3B1.3 only where he legitimately occupies that position. Id. at 181 (emphasis in original). 13 In Echevarria, we reviewed the sentence of a defendant who misrepresented himself as a licensed physician to insurance companies and low-income patients, among others, and submitted claims for medical services that were never provided or were fraudulently provided. The defendant was convicted of committing fraud on the insurance companies, and the district court enhanced his sentence under Section 3B1.3 for abuse of a position of trust. We vacated the defendant's sentence, holding that Section 3B1.3 is reserved for those who legitimately occupy, rather than pretend to occupy, a position of trust. Id. at 181. As a basis for this conclusion, we noted that the commentary to Section 3B1.3 suggested that the enhancement was reserved for those who actually hold[ ] a position of public and private trust; accordingly, an imposter who merely pretends to hold a position falls outside the scope of Section 3B1.3. See id. (quoting U.S.S.G. § 3B1.3, application note 1 (1993)). 14 We also held that the two-level enhancement was improper because it was duplicative of the underlying fraud for which [the defendant] was convicted. Id. As we explained, [t]he core of the offenses of which [the defendant in Echevarria] was convicted...was his misrepresentation that he was a qualified physician, and [h]is underlying convictions addressed, and punished, that misrepresentation. Id. Accordingly, we concluded that the two-level enhancement was inappropriate because it duplicated the punishment imposed for the underlying conviction. See id. 15 Hussey and Alexander argue that Echevarria requires us to vacate their sentences. They contend that they, like the defendant in Echevarria, did not legitimately hold a position of trust when they committed their crimes; accordingly, they did not abuse...a position of trust within the meaning of Section 3B1.3. We disagree. 16 The instant case is distinguishable from Echevarria for two reasons. First and more importantly, whereas the defendant in Echevarria did not create the impression that he stood in a fiduciary relationship with his principal victims-the defrauded insurance companies-Hussey and Alexander created such an impression, and in fact enjoyed a relationship of trust, with their victims-the defrauded investors. See United States v. Jolly, 102 F.3d 46, 49 (2d Cir. 1996) (explaining that to occupy a position of trust, a defendant must generally have a fiduciary-like relationship[ ] with his victims). The principal victims in Echevarria were not under the impression that the defendant in that case was acting as their fiduciary. See generally Wright, 160 F.3d at 910 (noting that whether a defendant occupies a position of trust is assessed from the perspective of the defendant's victims). In contrast, the victims here were under an impression that Hussey and Alexander were acting as their fiduciaries in suggesting and trading stocks; therefore, they entrusted Hussey and Alexander with the kind of discretionary authority that is characteristic of a position of trust. This distinction is crucial, because the primary trait that distinguishes a position of trust from other positions is the extent to which the position provides the freedom to commit a difficult-to-detect wrong. United States v. Laljie, 184 F.3d 180, 194 (2d Cir. 1999) (quotation marks and alteration omitted). Hussey and Alexander enjoyed a great deal of freedom to commit a difficult-to-detect wrong because, unlike the defendant in Echevarria, they created an impression in their principal victims that they occupied a fiduciary-like relationship with them. 17 Second, we note that the two-level enhancement here, unlike the one in Echevarria, was not duplicative of the punishment for the underlying offenses of conviction. The core of the offenses, Echevarria, 33 F.3d at 181, of which Hussey and Alexander were convicted, was not their misrepresentations as to their status as licensed stockbrokers; rather, the core of the[ir] offenses was their sale of securities without disclosing their commissions. Their misrepresentations as to their status as licensed stockbrokers were simply steps they took to commit these core offenses. In contrast to the enhancement in Echevarria, therefore, the enhancement here did not duplicate the punishment for the underlying offenses of conviction. 18 Accordingly, we conclude that Echevarria does not bar a decision that Hussey and Alexander each occupied a position of trust within the meaning of Section 3B1.3. 3 In light of this conclusion, we hold that the District Court properly enhanced their sentences under Section 3B1.3 for abuse of a position of trust. From the perspective of the offense victim, Wright, 160 F.3d at 910, both Hussey and Alexander were legitimate stockbrokers and therefore occupied positions of trust. Moreover, the evidence presented at trial adequately supports the District Court's finding that both Hussey and Alexander used this position to facilitate the commission of the offenses for which they were convicted.