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

Heading: Enhancement for Misrepresentation Involving

Text: 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).