Opinion ID: 780297
Heading Depth: 2
Heading Rank: 1

Heading: Misrepresentation of Action on Behalf of a Charitable Organization

Text: 5 The United States Sentencing Guidelines Manual § 2F1.1(b)(4)(A) provides for a 2-point enhancement if the offense involves a misrepresentation that the defendant was acting on behalf of a charitable, educational, religious or political organization, or a government agency. 1 The plain text of the guideline clearly encompasses Wiant's offense — Wiant misrepresented to Fifth Third Bank that he was acting on behalf of the American Cancer Society when he instructed them to transfer nearly $7 million of the charity's money to his personal bank account. That fact is not in dispute. 6 However, the application and background notes to the guideline arguably create some ambiguity as to the propriety of this enhancement in this case. The application notes for § 2F1.1 provide certain examples of conduct falling within the scope of the section. The notes state: 7 Examples of such conduct to which this factor applies would include a group of defendants who solicit contributions to a non-existent famine relief organization by mail, a defendant 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, or a defendant who poses as a federal collection agent in order to collect a delinquent student loan. 8 U.S.S.G. § 2F1.1, cmt. n. 5. 9 The background notes for § 2F1.1 observe that use of false pretenses involving charitable causes ... enhances the sentence of defendants who take advantage of victims' ... generosity and charitable motives. Taking advantage of a victim's self-interest does not mitigate the seriousness of fraudulent conduct. However, defendants who exploit victims' charitable impulses... create particular social harm.... U.S.S.G. § 2F1.1, cmt. background. 10 Wiant argues that based on the nature of the examples listed in the application notes and the purpose asserted by the background notes, the § 2F1.1(b)(4)(A) enhancement should be given a narrower reading than its text literally supports. He asserts that, as a matter of law, the enhancement is meant to apply only where defendants solicit funds by misrepresentation. To hold otherwise, he says, would violate 18 U.S.C. § 3553, which directs sentencing courts to follow the Guidelines' commentary. 11 This Court has not yet had the opportunity to define the scope of § 2F1.1(b)(4)(A). However, the majority of circuits that have had such an opportunity have rejected a narrower reading of the enhancement such as the one proposed by Wiant in this case. See United States v. Aramony, 166 F.3d 655 (4th Cir.1999); United States v. Bennett, 161 F.3d 171 (3d Cir.1998), cert. denied, 528 U.S. 819, 120 S.Ct. 61, 145 L.Ed.2d 53 (1999); United States v. Marcum, 16 F.3d 599 (4th Cir. 1994); United States v. Ferrera, 107 F.3d 537 (7th Cir.1997). But see United States v. Frazier, 53 F.3d 1105 (10th Cir.1995). 12 We find that the majority rule rejecting a narrow reading of the enhancement is more convincing. There is not a sufficient basis in the Guidelines for reading a limitation into the text of § 2F1.1(b)(4)(A). The plain language of the rule clearly encompasses Wiant's offense, and it contains no textual support for limiting the rule to solicitation by misrepresentation. The examples listed in the application notes are obviously illustrative not exhaustive, and thus provide no mandate for limiting the scope of the enhancement's actual language. 13 Application of the § 2F1.1(b)(4)(A) enhancement to the facts of this case is not inconsistent with the purpose asserted in the background notes, for two reasons. First, in misrepresenting his authority to the banks, Wiant exploited the pretense that the transferred funds were to be used for funding research grants on behalf of a charitable organization. Bank officials might easily have been put at ease by the ostensibly charitable purpose asserted by Wiant. Had Wiant been employed by a private, for-profit corporation, bank officials might have been more skeptical of such an uncommonly large transfer of funds to a financial institution in Austria. Second, the social harm Wiant caused by tarnishing the reputation of the American Cancer Society is closely analogous to the social harm caused by scam artists who exploit victims' willingness to contribute to charity. Both acts tend to discourage donations and diminish charitable impulses. As the sentencing judge noted, Wiant stole money that was given in grief and based on the hope that a cure could be found. So in a very real sense he stole the hope of the donors. (J.A. at 190). Wiant's acts are therefore consistent with the harm intended to be addressed by this enhancement. 14 We therefore affirm the sentencing court's application of an enhancement for misrepresentation of action on behalf of a charitable organization.