Court Opinion

ID: 2964722
Source: CourtListenerOpinion
Date Created: 2015-09-21 21:30:06.946033+00
Date Added: 2024-06-11T11:43:00.467752
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USCA1 Opinion

	

                            UNITED STATES COURT OF APPEALS
                            UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT
                                FOR THE FIRST CIRCUIT

                              _________________________

          No. 96-1394

                              UNITED STATES OF AMERICA,

                                      Appellee,

                                          v.

                                    MOSHE VAKNIN,

                                Defendant, Appellant.

                              _________________________

          No. 96-1393

                              UNITED STATES OF AMERICA,

                                      Appellee,

                                          v.

                                   E. ERIC YEGHIAN,

                                Defendant, Appellant.

                              _________________________

          No. 96-1373

                              UNITED STATES OF AMERICA,

                                      Appellee,

                                          v.

                                 MICHAEL J. FONSECA,

                                Defendant, Appellant.

                              _________________________

                    APPEALS FROM THE UNITED STATES DISTRICT COURT

                           FOR THE DISTRICT OF RHODE ISLAND

                 [Hon. Francis J. Boyle, Senior U.S. District Judge]
                                         __________________________

                              _________________________

                                        Before

                                Selya, Circuit Judge,
                                       _____________

                            Bownes, Senior Circuit Judge,
                                    ____________________

                              and Stahl, Circuit Judge.
                                         _____________

                              _________________________

               Mark J. Gillis,  by appointment of the  court, for appellant
               ______________
          Vaknin.
               C. Leonard O'Brien for appellant Yeghian.
               __________________
               John A. MacFadyen for appellant Fonseca.
               _________________
               Ira Belkin,  Assistant  United States  Attorney,  with  whom
               __________
          Sheldon  Whitehouse, United  States  Attorney, and   Margaret  E.
          ___________________                                  ____________
          Curran, Assistant United States Attorney, were on brief,  for the
          ______
          United States.

                              ________________________ 

                                     May 6, 1997
                              _________________________

                    SELYA,  Circuit  Judge.    These  consolidated  appeals
                    SELYA,  Circuit  Judge.
                            ______________

          raise, inter alia, an interesting  question anent the standard of
                 _____ ____

          causation  that  courts must  apply in  fashioning restitutionary

          orders under  the Victim  and Witness  Protection Act (VWPA),  18

          U.S.C.     3663(a), 3664(a) (1994).   The appeals arise out  of a

          multi-count indictment:   each of the three appellants bribed the

          same bank official in  connection with the making of  loans; some

          of the loans soured; the bank failed; and the Federal Deposit and

          Insurance Corporation (FDIC) was left holding an empty bag.  When

          the  appellants pled  guilty  to criminal  charges, the  district

          court imposed  sentences which included orders  of restitution to

          cover what the court considered to be the attributable losses.

                    The appellants now challenge these impositions, and, in

          addition,  one  appellant,  citing   his  cooperation  with   the

          prosecution,  assails  the  district court's  refusal  to  depart

          downward from the  guideline sentencing range  (GSR).  We  affirm

          the  court's  eschewal  of   a  downward  departure,  uphold  one

          restitutionary order (albeit with a modest  modification), vacate

          the other two, and remand for further findings.

          I.  AN HISTORICAL PERSPECTIVE
          I.  AN HISTORICAL PERSPECTIVE

                    Compulsory  restitution  as   a  societal  response  to

          criminal  wrongdoing dates back over  4,000 years to  the Code of

          Hammurabi and the Old Testament.  See, e.g., Exodus 22:1-3 ("If a
                                            ___  ____  ______

          man shall steal . . . he should make full restitution.").  In its

          earliest iterations, the practice was designed to forfend against

          the high social costs of blood feuds and the wreaking of personal

                                          3

          vengeance by compensating victims  in a more civilized way.   See
                                                                        ___

          generally Thomas  M. Kelly, Note,  Where Offenders Pay  for Their
          _________                          ______________________________

          Crimes:   Victim Restitution and Its  Constitutionality, 59 Notre
          _______________________________________________________

          Dame  L. Rev. 685, 686-88  (1984).  By  the Middle Ages, however,

          the sovereign had begun to administer the  criminal law directly,

          and  criminal  restitution fell  into desuetude.    See id.   The
                                                              ___ ___

          device remained moribund  for several centuries.   In the  United

          States, for  example,  federal judges  were  not able  to  impose

          criminal restitution as a condition  of probation until 1925 when

          Congress  passed  the Federal  Probation  Act, 18  U.S.C.    3651

          (repealed 1984).   Even  then, judges  used the  power sparingly.

          See  Peggy M.  Tobolowsky,  Restitution in  the Federal  Criminal
          ___                         _____________________________________

          Justice System, 77 Judicature 90, 90-91 (1993).
          ______________

                    The  tectonic plates  shifted  in  1982  when  Congress

          enacted  the VWPA in response to a growing cognizance of victims'

          rights.  Notable for the speed of its election-year passage   the

          legislation was introduced in  the Senate on April 22,  1982, and

          signed into  law by President Reagan less than six months later  

          the VWPA transmogrified criminal restitution from a  sporadically

          imposed condition of probation into  the sentencing norm in cases

          involving quantifiable economic loss.

                    The congressional purpose that  animated the VWPA is no

          secret:   "the court  in devising just  sanctions for adjudicated

          offenders, should insure that  the wrongdoer make good[], to  the

          degree possible, the harm he has caused his victim."  S. Rep. No.

          532, at 31 (1982), reprinted in 1982 U.S.C.C.A.N. 2515, 2536.  To
                             _________ __

                                          4

          accomplish  this  purpose,  a district  court,  when  pronouncing

          sentence, "may  order, in  addition to  . .  . any other  penalty

          authorized by  law, that the  defendant make  restitution to  any

          victim  of such offense."   18 U.S.C.    3663(a).  In determining

          whether  to award restitution (and,  if so, in  what amount), the

          sentencing court "shall consider the amount of the loss sustained

          by any victim as a result of the offense, the financial resources

          of  the defendant, the financial needs and earning ability of the

          defendant and the defendant's  dependents, and such other factors

          as the court deems appropriate."  Id. at   3664(a).
                                            ___

                    In general,  restitution under  the VWPA is  limited to

          "the loss caused by the specific conduct that is the basis of the

          offense of conviction."   Hughey v. United States, 495  U.S. 411,
                                    ______    _____________

          413 (1990).1   When the  fact, cause,  or amount of  the loss  is
                              
          ____________________

               1The  defendant  in  Hughey  had used  credit  cards  in  an
                                    ______
          unauthorized  manner, and  the Court  limited restitution  to the
          loss attributable to the  lone count on which he had  pled guilty
          (as opposed to the  total loss from all his  fraudulent conduct).
          Congress reacted by amending the VWPA in November of 1990, adding
            3663(a)(2) [the former    3663(a) became   3663(a)(1),  but its
          substance  remained  essentially  unchanged].     This  amendment
          provides that "a victim of an offense that involves as an element
          a scheme, a conspiracy,  or a pattern of criminal  activity means
          any person directly harmed by the defendant's criminal conduct in
          the  course  of  the scheme,  conspiracy,  or  pattern."   As  we
          explained in United States  v. Hensley, 91 F.3d 274,  276-77 (1st
                       _____________     _______
          Cir.  1996), restitution  for all  criminal  conduct done  in the
          course  of a single scheme, conspiracy, or pattern of activity is
          now appropriate, whether or not  the defendant has been convicted
          of  (or even  charged with)  the  specific acts,  as long  as the
          offense  of  conviction has  as  an element  the  broader scheme,
          conspiracy, or pattern.
               There  are two reasons why the 1990 amendment has no bearing
          here.   In the  first place,  the criminal  conduct of  which the
          appellants  stand convicted  occurred  prior to  the date  of the
          amendment.   Thus, the pre-1990  version of the  VWPA governs our
          inquiry.  See  United States v. Royal,  100 F.3d 1019,  1032 (1st
                    ___  _____________    _____

                                          5

          disputed, the government must establish it by a preponderance  of

          the evidence.  See  United States v. Baker, 25 F.3d 1452, 1454-55
                         ___  _____________    _____

          (9th  Cir. 1994);  United States  v. Diamond,  969 F.2d  961, 967
                             _____________     _______

          (10th Cir. 1992); see also 18 U.S.C.   3664(d).
                            ___ ____

          II.  THE FACTUAL PREDICATE
          II.  THE FACTUAL PREDICATE

                    We present  the facts relevant to these appeals as best

          they  have  presented  themselves,  mindful that  the  record  is

          noticeably underdeveloped.

                    Kenneth  Annarummo was a bad apple.  While working as a

          loan officer  for Attleboro-Pawtucket  Savings Bank (APSB  or the

          Bank), he solicited and  accepted bribes from numerous customers.

          Annarummo's  skulduggery came to light after  the Bank failed and

          the  FDIC intervened.   In  due course,  the  government indicted

          Annarummo  and several complicit  borrowers, including appellants

          Moshe Vaknin, Michael J.  Fonseca, and E. Eric Yeghian  (all real

          estate  developers).2    We  recount the  circumstances  of  each

          appellant's involvement.

                                A.  Vaknin's Troubles.
                                A.  Vaknin's Troubles.
                                    _________________

                    Vaknin  first  approached  APSB  in  1987,  seeking  to

          refinance  several properties.   Informed  by Annarummo  that his

          request  for funds would be facilitated if he greased the wheels,

                              
          ____________________

          Cir. 1996); United States v. Gilberg, 75 F.3d 15, 20-21 (1st Cir.
                      _____________    _______
          1996).  In the second  place, the offenses of conviction  here do
          not  have as  an  element  any  broader  scheme,  conspiracy,  or
          pattern.

               2Annarummo eventually  pled guilty  to three counts  of bank
          bribery,  18 U.S.C.   215 (1994), and one count of subscribing to
          a false tax return, 26 U.S.C.   7206(1) (1994).

                                          6

          Vaknin paid  Annarummo $17,500 and thereafter  received the loan.

          In 1988, Vaknin sought  to borrow more money and  Annarummo again

          asked for a bribe in  exchange for his assistance in getting  the

          loan underwritten.   Vaknin  paid him  $12,500 prior to  securing

          loan  approval.  This  sequence repeated  itself later  that same

          year, when Vaknin slipped  Annarummo another bribe and secured  a

          third loan  (which was  approved by  the bank after  a series  of

          machinations in  which Annarummo  presented false  information to

          the  credit  committee).    Although Vaknin  repaid  the  initial

          refinancing in full,  he defaulted on both the 1988 loans and the

          Bank sustained losses in excess of $900,000.

                    When indicted, Vaknin pled guilty to a single  count of

          bank  bribery.   See 18  U.S.C.    215 (1994).    The Presentence
                           ___

          Investigation Report  (PSI Report) did not recommend restitution.

          In response to the prosecution's objection, the probation officer

          explained:

                         [I]t  is  not clear  as  to  whether the
                    losses  incurred by  the bank  were  a direct
                    result of a  fraudulent loan being negotiated
                    as a  result of  the bank bribery  or whether
                    the   losses   were  attributable   to  other
                    factors, such  as a  downturn in  the economy
                    which affected the real estate market.

                    At  the  disposition  hearing,  Judge  Boyle  sentenced

          Vaknin to an incarcerative term of twelve months and one day, two

          years'  supervised release, and a $50 special assessment.  On the

          restitution  issue,  the   judge  sided  with  the   prosecution;

          concluding  that there would have  been no funds  advanced if the

          bribes  had not been paid,  the judge held  Vaknin liable for the

                                          7

          losses resulting from the defaulted loans, rejected the probation

          officer's  "downturn  in  the economy"  hypothesis,  and  ordered

          Vaknin to pay restitution to the FDIC in the sum of $1,000,000.

                               B.  Fonseca's Troubles.
                               B.  Fonseca's Troubles.
                                   __________________

                    By the time Annarummo arrived on the scene, Fonseca was

          a  valued customer  of  the  Bank,  having  roughly  $750,000  in

          outstanding loans.   This debt had  been incurred through  normal

          channels  and  without  subterfuge,  mostly  in  connection  with

          single-family residential properties in  Rhode Island.  Annarummo

          made no immediate  demands on Fonseca,  and Fonseca succeeded  in

          securing additional financing through APSB.

                    In 1987, Fonseca  encountered business difficulties and

          became fearful that he  would not be able  to meet the  repayment

          schedule on an outstanding APSB note.  When  he voiced concern to

          Annarummo,  the banker demanded a  bribe for his  help in warding

          off  trouble  should a  default  ensue.   Fonseca  paid Annarummo

          $3,000 but proved able to meet his payment obligation on time and

          in full.

                    In 1988, Fonseca applied for a $4,250,000 loan to cover

          the development of a much larger project than he had ever tackled

            a subdivision  of more than 50  lots in Bristol,  Rhode Island.

          The record suggests  (though it  does not pin  down) that,  after

          approval of  the  loan request  but  prior to  its  disbursement,

          Annarummo  demanded  one  of  the  lots  as  a  bribe.    Fonseca

          acquiesced and transferred title to Annarummo's  nominee, leaving

          one less lot as security for APSB's loan.

                                          8

                    The  Bank  terminated Annarummo's  employment  in March

          1990.    Fonseca's  subdivision   loan  (which  had  a  remaining

          principal balance of $611,500)  was then 30 days in  arrears, and

          Annarummo's   successor   recommended   foreclosure.      Fonseca

          negotiated  with APSB (which knew nothing of the bribes), and the

          parties agreed to enter  into a forbearance agreement (FA)  under

          which Fonseca would make  a lump-sum payment of $450,000  in full

          satisfaction of  the outstanding indebtedness.   Fonseca tendered

          the funds within  the agreed 35-day  period.  In  time, the  Bank

          failed, the FDIC intervened, the bribes were discovered, and  the

          indictment materialized.

                    Fonseca pled guilty to a single count of  bank bribery.

          The district court sentenced  him to serve twelve months  and one

          day in prison and a  three-year term of supervised release.   The

          court  also imposed a $5,000  fine and a  $50 special assessment.

          The matter of  restitution proceeded  much as  in Vaknin's  case.

          The  probation  officer  recommended  against   a  restitutionary

          impost;   the  prosecution  objected;   and  the  district  judge

          sustained the objection, ordering  Fonseca to make restitution in

          the  sum of $161,500 (the difference between the loan balance and

          the amount that Fonseca paid pursuant to the FA).

                               C.  Yeghian's Troubles.
                               C.  Yeghian's Troubles.
                                   __________________

                    Yeghian, a  newcomer  to APSB,  applied for  a loan  of

          $2,930,000  in 1988 to fund the purchase of real property located

          in  Providence,  Rhode Island.    Annarummo demanded  a  bribe of

          $20,000  (although   the  record  is  tenebrous   as  whether  he

                                          9

          approached Yeghian  before or after the loan  had been approved).

          In  any event, Yeghian, using a corrupt lawyer as an internuncio,

          paid the bribe out of the loan proceeds.

                    Later  that  same  year,   Yeghian  sought  a  loan  of

          $1,400,000  to acquire  and develop  a parcel  of real  estate in

          Seekonk, Massachusetts.   Once again, Annarummo  demanded a bribe

          and  received $22,909.52.3  Both  loans turned sour.   The Bank's

          demise, the FDIC's entry  onto the scene, the deterration  of the

          bribes, and the indictment followed.

                    Yeghian pled guilty to  one count of bank bribery.   At

          sentencing, Judge  Boyle imposed  a ten-month prison  sentence, a

          three-year supervised  release term, a  $10,000 fine,  and a  $50

          special assessment.  Rejecting  a recommendation contained in the

          PSI Report, the judge  ordered Yeghian to pay restitution  in the

          sum of $2,213,654.74.

          III.  THE DEPARTURE DECISION
          III.  THE DEPARTURE DECISION

                    Vaknin  challenges  the  incarcerative  portion  of his

          sentence.  The salient facts are as follows.  The court sentenced

          Vaknin  under   the  1988  edition  of   the  federal  sentencing

          guidelines.  The court  figured the GSR as 8-14  months (adjusted

          offense  level  11;  criminal   history  category  I),  and  this

          calculation is not  in dispute.  At  the time of sentencing,  the

          government asked the court to depart downward  because Vaknin had

          made a good faith  effort to render substantial assistance.   See
                                                                        ___
                              
          ____________________

               3The odd amount stems from the fact that the bribe  took the
          form of a  payment by  Yeghian to liquidate  an outstanding  loan
          encumbering Annarummo's Porsche.

                                          10

          USSG  5K1.1  ("Upon motion  of  the government  stating that  the

          defendant has  made a  good faith  effort to  provide substantial

          assistance in the investigation  or prosecution of another person

          who  has  committed an  offense, the  court  may depart  from the

          guidelines.").   For  his part,  Vaknin  solicited an  even  more

          generous  departure.     Nevertheless,  departure  decisions  are

          entrusted  primarily to  the courts,  and the  sentencing judge's

          role cannot be  usurped by agreements between the  prosecutor and

          the defendant.  See United States v. Mariano, 983 F.2d 1150, 1154
                          ___ _____________    _______

          n.3,  1155-56 (1st  Cir. 1993).   Exercising this  authority, the

          court refused to impose a sentence below the GSR.  Vaknin assigns

          error.

                    Vaknin's  claim of error is  doubly flawed.  The short,

          entirely  dispositive  answer to  it is  that  he stakes  out his

          position  in a perfunctory manner.  For that reason, the argument

          is deemed waived.  See, e.g.,  United States v. Tardiff, 969 F.2d
                             ___  ____   _____________    _______

          1283, 1287 (1st Cir. 1992); United States v. Zannino, 895 F.2d 1,
                                      _____________    _______

          17 (1st Cir. 1990).

                    The slightly  longer but equally  dispositive answer is

          that,  in the  main, departure  decisions are  discretionary, and

          appellate review of refusals  to depart is tightly circumscribed.

          See Koon v. United States, 116 S. Ct. 2035, 2046-47 (1996); Bruce
          ___ ____    _____________

          M.  Selya & Matthew  Kipp, An  Examination of  Emerging Departure
                                     ______________________________________

          Jurisprudence Under the  Federal Sentencing Guidelines, 67  Notre
          ______________________________________________________

          Dame  L. Rev.  1, 13-14  (1991).   Jurisdiction will  only attach

          "when  it appears  that the  failure to  depart stemmed  from the

                                          11

          sentencing court's  mistaken impression that it  lacked the legal

          authority   to   depart   or,   relatedly,   from   the   court's

          misapprehension of the rules  governing departure."  Mariano, 983
                                                               _______

          F.2d at 1153.  No such bevue occurred here.

                    To be sure, Vaknin labors  to find a cognizable  error.

          In this vein, he contends that the district court believed itself

          unable  to  depart  downward  because  Vaknin  had  not  provided

          information about  his fellow borrowers' criminal  activities but

          only about the bribe-taker's criminal activities.  He builds this

          contention on scraps drawn from counsel's colloquy with the judge

          at the disposition hearing.   But an appellate court,  seeking to

          ascertain  a sense of what transpired at sentencing, must look to

          the  whole of the record  rather than isolated snippets extracted

          from it.   See, e.g., United  States v. Santiago, 83  F.3d 20, 25
                     ___  ____  ______________    ________

          (1st  Cir. 1996); United States v. Rostoff, 53 F.3d 398, 407 (1st
                            _____________    _______

          Cir. 1995);  cf. United States v.  Tavano, 12 F.3d 301,  304 (1st
                       ___ _____________     ______

          Cir. 1993).   Applying this  tenet here,  the record,  read as  a

          seamless whole, belies Vaknin's contention.

                    We  need not  tarry.   The sentencing  transcript shows

          with  pristine clarity that Judge Boyle knew he could depart once

          the government invoked USSG  5K1.1, but chose instead to impose a

          sentence within the GSR.  As we read the record,  his reasons for

          demurring  were clear   and  entirely permissible.   In his view,

          Vaknin's cooperation had been adequately rewarded because (a) the

          government had prosecuted only  one count of bribery  despite the

          fact that Vaknin  had paid multiple bribes referable  to separate

                                          12

          borrowings, and (b) Vaknin's offense level (and, hence, the  GSR)

          already had  been reduced for acceptance  of responsibility under

          USSG  3E1.1.

                    The transcript also reveals  that the court weighed the

          quintet of  factors under  which a substantial  assistance motion

          must  be  evaluated:   the nature  and  extent of  the assistance

          provided; its  significance and  utility to the  prosecution; its

          timeliness; the  truthfulness and reliability of  the information

          conveyed; and the injury  to, or risk exposure of,  the defendant

          resulting  from his cooperation.   See Mariano, 983  F.2d at 1156
                                             ___ _______

          (enumerating factors  and  explaining that  "[a] district  court,

          faced  with  a  section 5K1.1  motion,  must  at  a bare  minimum

          indicate its cognizance  of these factors").  After mulling these

          and  other relevant  considerations, the  court  determined that,

          under the  specific circumstances of Vaknin's  case, no departure

          was warranted.   Such a decision  is quintessentially a  judgment

          call, and, thus,  within the sentencing court's discretion.   See
                                                                        ___

          Tardiff,  969 F.2d  at  1290.   Consequently,  we lack  both  the
          _______

          authority  to   second-guess  the  departure   decision  and  the

          inclination to do so.

          IV.  THE CAUSATION QUANDARY
          IV.  THE CAUSATION QUANDARY

                      All three appellants  challenge the district  court's

          restitutionary orders.   Those challenges are  similar insofar as

          they implicate  the standard of  causation.  Therefore,  we treat

          them in the ensemble to that extent.

                               A.  Standard of Review.
                               A.  Standard of Review.
                                   __________________

                                          13

                    Restitution  orders customarily  are reviewed  under an

          abuse of discretion  rubric.   See United States  v. Hensley,  91
                                         ___ _____________     _______

          F.3d 274, 277 (1st Cir. 1996).  In the course of this review, the

          sentencing  court's subsidiary factual  findings must be credited

          unless they are clearly erroneous.  See id.  To the extent that a
                                              ___ ___

          challenge to  a restitution  order hinges  on  a legal  question,

          however,  the  sentencing  court's  answer to  that  question  is

          reviewed de novo.  See  United States v. Gilberg, 75 F.3d  15, 20
                             ___  _____________    _______

          (1st Cir. 1996); United States v. Savoie, 985 F.2d 612,  619 (1st
                           _____________    ______

          Cir. 1993).   The appellants' allegation that  the district judge

          employed an improper legal standard  of causation presents such a

          question.

                               B.  The Legal Landscape.
                               B.  The Legal Landscape.
                                   ___________________

                    The level of causation required  under the VWPA is  not

          immediately apparent, and the  parties' views on the subject  are

          sharply divergent.  The  appellants advance a theory  of "direct"

          causation, exhorting us  to rule that restitution can  be imposed

          only if the victim's  losses result directly from the  offense of

          conviction and therefore that  restitution cannot be imposed when

          an intervening phenomenon (e.g., a collapsing real estate market)

          is the more  immediate cause of the  loss.4  Transposed  into the

          m tier  of  this case,  the  appellants'  theory seemingly  would

          require the government to eliminate the possibility of concurrent
                              
          ____________________

               4While the appellants profess  to know direct causation when
          they  see  it,  they   have  been  unable  either  to   muster  a
          comprehensive  definition of  the  term or  to  suggest a  viable
          limiting principle.  The government's arguments in support of but
          for causation, see infra, suffer from much the same vice.
                         ___ _____

                                          14

          causes  and prove  that the  FDIC's losses  occurred as  a direct

          result  of the bribes that Annarummo solicited and received.  The

          government cannot  do so,  the appellants posit,  because stimuli

          unrelated  to  the bribes,  such  as  intervening market  forces,

          caused the ultimate losses.

                    The  government's counter-argument  is  that "but  for"

          causation suffices; it urges  us to rule that restitution  can be

          imposed  as long as the victim's losses would not have eventuated

          but for  the criminal activity.  But  for the bribes, this thesis

          runs, there would have  been no loans, without which  there would

          have been no  losses.   In this  very general  sense, the  bribes

          caused  the losses     and  that,  to  the  government's  way  of

          thinking, is enough.

                    The  appellants'  rejoinder  is twofold.    First, they

          debunk the legal standard articulated by the government.  Second,

          they say that even  if this articulation accurately  reflects the

          state  of the  law,  it does  not  justify the  district  court's

          restitutionary orders.  On the appellants' shared hypothesis, the

          loans  would   have  issued  whether  or  not   the  bribes  were

          forthcoming; thus, the  Bank would have incurred  the losses even

          if the appellants had played it straight.

                    The  parties' positions  stand  at opposite  ends of  a

          continuum.   Our effort to  determine where on  the continuum the

          correct  legal standard is housed starts with the language of the

          VWPA  itself.   Section  3663(a) authorizes  restitution to  "any

          victim"  for a covered offense.   This provision  must be read in

                                          15

          tandem with  section 3664(a), which directs  the sentencing court

          to consider  "the amount of the loss sustained by any victim as a

          result  of the offense."   For purposes  of this  case, see supra
                                                                  ___ _____

          note 1, restitution is  appropriate only for "the loss  caused by

          the  specific conduct  that  is  the  basis  of  the  offense  of

          conviction."  Hughey, 495 U.S. at 413.
                        ______

                    Since the text of the VWPA does not speak explicitly to

          the dimensions of  the requisite standard of causation,5  we must

          consult other sources  in our quest to discover it.   Next on the

          list  is legislative  history.  This  material, like  the statute

          itself,  does not  specifically limn  the standard  of causation.

          Nonetheless, it offers some important insights.

                    In  enacting  the VWPA,  Congress  strove to  encourage

          greater  use of a  restitutionary remedy.   See S.  Rep. No. 532,
                                                      ___

          supra,  1982 U.S.C.C.A.N.  at  2536-37.   At  the same  time,  it
          _____
                              
          ____________________

               5Though  the amended version of  the VWPA does  not apply to
          this case, see supra  note 1, the appellants asseverate  that the
                     ___ _____
          amendment's use of the adverb "directly" heralds Congress' intent
          vis- -vis the  type of causation that  it envisioned.   We do not
          agree.   The legislative  history of  the 1990  amendment plainly
          indicates that the language  employed, albeit containing the word
          "directly," does not support the appellants' theory of causation.
          As Congress explained:

                    The use of "directly" precludes, for example,
                    an argument that a  person has been harmed by
                    a financial institution offense  that results
                    in a payment from the insurance fund because,
                    as a taxpayer, a part of a  person's taxes go
                    to the insurance fund.

          H.R.  Rep. No.  681(I),  at 177  n.8  (1990), reprinted  in  1990
                                                        _________  __
          U.S.C.C.A.N. 6472, 6583 n.8.   This definition ranges  far afield
          from the definition of direct that the appellants tout.  Thus, we
          conclude  that the 1990 amendment  did not alter  the standard of
          causation applicable to VWPA cases.

                                          16

          disclaimed  any intent to convert the main event   the sentencing

          hearing    into a time-consuming sideshow    prolonged litigation

          over  restitution-related  issues.    This  disclaimer  was  made

          manifest  in a  variety  of  ways.    For  example,  rather  than

          requiring  great precision  in fixing  the amount  of restitution

          due, Congress  visualized the VWPA as "authoriz[ing] the court to

          reach  an  expeditious, reasonable  determination  of appropriate

          restitution  by  resolving  uncertainties  with  a  view  towards

          achieving fairness to the victim."  Id. at 2537.
                                              ___

                    In  short,  the legislative  history clearly  signals a

          congressional preference for rough remedial  justice, emphasizing

          victims'  rights.  In our view,  this preference counsels against

          importing a  stringent standard  of causation  (such as might  be

          appropriate in a tort context) into the VWPA.

                    Of course, rough remedial justice does not mean leaving

          matters to the whim of the sentencing judge, and Congress did not

          conceive  of  restitution  as  being   an  entirely  standardless

          proposition.  The government must bear the burden of establishing

          the  loss, 18  U.S.C.    3664(d), and  an award  cannot be  woven

          solely from the gossamer strands of speculation and surmise.  See
                                                                        ___

          United States v. Neal, 36 F.3d 1190, 1200-01 (1st Cir. 1994).  By
          _____________    ____

          like token, just as insisting upon a modicum of reliable evidence

          reinforces the specific advantages  of the restitutionary remedy,

          so  too does insisting upon a certain degree of causal precision.

          As  the  Supreme Court  has noted,  demanding a  "direct relation

          between  the harm  and the  punishment  gives restitution  a more

                                          17

          precise deterrent  effect than  a  traditional fine."   Kelly  v.
                                                                  _____

          Robinson, 479 U.S. 36, 49 n.10 (1986).
          ________

                    Finding the legislative  history suggestive rather than

          compelling, we examine  the caselaw.  In previous decisions, this

          court  has  remarked  the broad  policy  goals  of  the VWPA  and

          concluded that  difficulty in  achieving an exact  measurement of

          victim loss  should not  preclude the imposition  of restitution.

          See  Savoie, 985  F.2d  at 617.   On  the  subject of  causation,
          ___  ______

          however, our  decisions have tended to  involve either situations

          in which the  closeness of the causal link could not seriously be

          questioned, see, e.g.,  United States  v. Lilly, 80  F.3d 24,  28
                      ___  ____   _____________     _____

          (1st Cir. 1996),  or those in which we  found restitution to have

          been ordered in contravention of Hughey, see, e.g., United States
                                           ______  ___  ____  _____________

          v. Newman,  49 F.3d 1, 11 (1st Cir. 1995).  Neither polar extreme
             ______

          brings  much light  to  the  vexing  issue  which  these  appeals

          present.

                    Neal is  the only  notable exception to  this taxonomy.
                    ____

          That case  featured a defendant who had been found guilty both of

          being  an accessory  after  the fact  to a  bank  robbery and  of

          laundering funds.   The  district court imposed  a restitutionary

          award that equalled the bank's entire loss from the thievery.  We

          vacated the award, noting that it could  not be determined on the

          sparse record  available "whether the court  calculated, pursuant

          to  Hughey, the portion of [the bank's] losses that were actually
              ______

          caused by the  specific criminal  conduct forming  the basis  for

          Neal's  convictions."   36 F.3d  at 1200  (italics omitted).   We

                                          18

          instructed  the district court, on  remand, to hold  a hearing on

          the  causation issue and modify the award  to the extent that any

          portion of  the loss was  not "attributable  to" Neal's  criminal

          conduct.  Id. at  1201.  In dictum, we  cautiously suggested that
                    ___

          some varietal  of but for  causation might  suffice.  See  id. at
                                                                ___  ___

          1201  n.10 ("If . . .  evidence is presented indicating that Neal

          played a significant role in helping  the other defendants escape

          and  that but for his actions, there was a substantial likelihood

          that the full proceeds would have been recovered, the court could

          well  be  within its  statutory  authority in  imposing  the full

          [restitutionary amount].").  Thus, circuit precedent  furnishes a

          weak  indication that  but  for causation  can suffice  under the

          VWPA.

                    Reading the  out-of-circuit cases  is like attending  a

          bar association meeting in  a small town; one can  find congenial

          cases,  like friendly faces in  the crowd, to  support almost any

          standard  of causation  for the  VWPA.   We have  found decisions

          which appear at  least superficially to reject  but for causation

          in favor of a "direct result" standard.  See, e.g., United States
                                                   ___  ____  _____________

          v.  Silkowski, 32  F.3d 682,  689-90 (2d  Cir. 1994);  Ratliff v.
              _________                                          _______

          United  States, 999  F.2d  1023, 1026-27  (6th  Cir. 1993).    By
          ______________

          contrast,  we   have  found   decisions  which  seem   to  accept

          unqualified but for causation as sufficient under the VWPA.  See,
                                                                       ___

          e.g.,  United  States v.  Keith, 754  F.2d  1388, 1393  (9th Cir.
          ____   ______________     _____

          1985); United States  v. Richard,  738 F.2d  1120, 1122-23  (10th
                 _____________     _______

          Cir. 1984).  We have found decisions which straddle the question,

                                          19

          see Government of the Virgin Islands v. Davis, 43 F.3d 41, 46 (3d
          ___ ________________________________    _____

          Cir. 1994) (seemingly endorsing, in  a single paragraph, both but

          for  and direct causation), and those  which confess confusion on

          the issue,  see United States  v. Cloud, 872  F.2d 846, 856  n.13
                      ___ _____________     _____

          (9th  Cir.  1989)  (acknowledging  "a conflict  in  this  circuit

          regarding  the nexus  the government  must establish  between the

          defendant's criminal conduct and the victim's losses to support a

          VWPA restitution order").

                               C.  Choosing a Standard.
                               C.  Choosing a Standard.
                                   ___________________

                    Upon   close   perscrutation,  the   extreme  positions

          advocated by  the parties  do not hold  out much  promise in  our

          quest for a serviceable standard of causation.

                    On the one hand, the sort of  direct causation standard

          that the appellants  propose is  simply too rigid.   Under  their

          theory  of   intervening  forces,   a  court  could   not  impose

          restitution even  if the  defendant's conduct were  a substantial

          cause of a loss, unless  it were the last cause.  Such a standard

          would flout  the basic purpose  of the  VWPA.6  In  our judgment,

          Congress did  not contemplate  such adamantine formalism  when it

          moved to  expand the  availability of restitutionary  remedies by
                              
          ____________________

               6Imagine  a situation in which  D, a convicted  felon who is
          carrying  a handgun, is speeding down a highway, fleeing from the
          authorities.  D's car slams into an unregistered automobile, with
          defective brakes, owned and  operated by Stranger (S), causing  S
          to swerve  and hit V,  who suffers  severe injuries.   D is  then
          prosecuted  for  reckless endangerment  and  found  guilty.   S's
          miscreancy  should not preclude a  court from ordering  D to make
          restitution for V's medical expenses.  Yet the appellants' theory
          would erect just such a barrier.

                                          20

          enacting the VWPA.  See S. Rep. No. 532, supra, 1982 U.S.C.C.A.N.
                              ___                  _____

          at 2537.

                    On  the other hand, concerns of  fairness require us to

          reject  the  unbridled  but   for  causation  standard  that  the

          government propounds.  Under it, a court could impose restitution

          based on the most tenuous of connections.7  While it is true that

          for want of a nail  the kingdom reputedly was lost,  cf. Benjamin
                                                               ___

          Franklin,  Poor Richard's  Almanac (1758),  it could  hardly have
                     _______________________

          been  Congress'  intent  to  place   the  entire  burden  on  the

          blacksmith  if  the  nail  was  an  insignificant  factor  in the

          calculus of concurrent  causes.  Such a  result would countervail

          principles of fundamental fairness and, in the bargain,  would be

          at  odds with the majority of reported  cases.  See, e.g., United
                                                          ___  ____  ______

          States v. Holley,  23 F.3d  902, 914-15 (5th  Cir. 1994);  United
          ______    ______                                           ______

          States v. Tyler, 767 F.2d 1350, 1351-53 (9th Cir. 1985).
          ______    _____

                    Having rejected the parties'  proposals, it falls to us

          to fashion the appropriate  legal standard.  Despite the  gaps in

          the statute  and in its legislative  history, and notwithstanding

          the  contradictions that  permeate  the  cases,  we think  it  is

          possible to  distill certain bedrock principles  from the sources
                              
          ____________________

               7Imagine  a situation similar  to that described  in note 6,
          supra; but, instead  of being prosecuted for a vehicular offense,
          _____
          D is charged with and convicted of being a felon in possession of
          a handgun.  While but  for causation may be present    after all,
          but for his unlawful possession of a weapon, D would  have had no
          occasion  to flee from the authorities, and, thus, would not have
          been  careening down the road and would not have precipitated the
          accident    it is  hard to  make a  principled argument  that the
          offense  of conviction  (felon in  possession) supports  an order
          against  D to make restitution for V's medical expenses.  Yet the
          government's theory ordains just such a result.

                                          21

          that we have consulted.

                    First:  Restitution should not be ordered in respect to
                    First:
                    _____

          a loss  which would have  occurred regardless of  the defendant's

          conduct.  A good  illustration of this principle in  operation is

          found in United States v. Blackburn,  9 F.3d 353 (5th Cir. 1993).
                   _____________    _________

          There,  the  sentencing court  included  foreclosure expenses  in

          calculating the amount  of restitution  due.   The Fifth  Circuit

          reversed, citing  proof that the foreclosure  would have happened

          even if  the defendant had not  committed the crime.   See id. at
                                                                 ___ ___

          359; see also  United States v. Walker, 896 F.2d 295, 305-06 (8th
               ___ ____  _____________    ______

          Cir. 1990)  (holding that when  defendants, who owned  a company,

          defrauded  the United  States,  restitution to  laid-off  company

          employees was improper because the record failed to show that the

          fraud caused the company to cease operations).

                    Second:   Even  if but  for causation is  acceptable in
                    Second
                    ______

          theory, limitless but for  causation is not.   Restitution should

          not  lie if the conduct  underlying the offense  of conviction is

          too far removed,  either factually or temporally,  from the loss.

          We offer two examples of remoteness in fact.  The first arises in

          a case that bears some similarity to the instant case.

                    In  Diamond, 969  F.2d  at 963-64,  the defendant  pled
                        _______

          guilty to filing false financial reports with a lender.  The loan

          had  already been made  before Diamond authored  the reports, but

          the  reports apparently  helped in  obtaining an extension.   The

          loan  proved uncollectible.    The sentencing  court ordered  the

          defendant to  make restitution,  reasoning that the  loss stemmed

                                          22

          from the false  reports.  The court of  appeals refused to equate

          the  extension of an existing loan with  the granting of the loan

          in the first place, and negated the restitutionary  order because

          there  was  no proof  that  the extension  worsened  the lender's

          position.  See id. at 966.
                     ___ ___

                    A somewhat different  example of factual  remoteness is

          found in  United States v. Sablan,  92 F.3d 865  (9th Cir. 1996).
                    _____________    ______

          There, the defendant had  been convicted of computer fraud.   The

          district court  ordered restitution for expenses  incurred by the

          victim  in meeting with investigators  to discuss the  case.  The

          Ninth Circuit  struck these amounts  from the award,  ruling that

          the expenses were not connected closely enough to  the fraudulent

          conduct.   See id. at 870; see  also United States v. Kenney, 789
                     ___ ___         ___  ____ _____________    ______

          F.2d 783, 784  (9th Cir.  1986) (invalidating that  portion of  a

          restitution order  which was designed to  reimburse the corporate

          victim  for the  cost  of having  its  employees testify  at  the

          defendant's  trial,   but  upholding  that  part   of  the  order

          encompassing the  cost of  removing film chronicling  the robbery

          from the bank's surveillance cameras).

                    Typical of  the situations  in which but  for causation

          existed  but restitution  was denied  because the  claimed losses

          were  temporally  remote is  Holley,  in which  the  court deemed
                                       ______

          restitution improper  when the  victim, who  received foreclosure

          property  from the  defendant  in  the  course  of  the  criminal

          activity,  unnecessarily held  onto  the property  for a  lengthy

          interval  after  the  crime  was  discovered,  and  the  property

                                          23

          declined  in  value  during that  period.    23  F.3d at  914-15.

          Similarly, in Tyler, the  defendant cut down a tree in a national
                        _____

          forest and  was apprehended as  he tried to  take it to  a nearby

          lumber  mill.   767 F.2d  at 1351.   The government  retained the

          lumber, needlessly,  for a long period of time, then sold it in a

          fallen market for considerably less than it would have fetched if

          sold  promptly.  See id.  The district court ordered restitution,
                           ___ ___

          pegging  the loss  by  reference  to  the  reduced  price.    The

          appellate court  disagreed, pointing out that,  although abstract

          but for causation existed,  it was too attenuated to  support the

          award.  See id. at 1351-53.
                  ___ ___

                    Consistent  with  these  two  principles  and  with our

          dictum in Neal, 36  F.3d at 1201 & n.10, we  hold that a modified
                    ____

          but  for standard  of  causation is  appropriate for  restitution

          under  the VWPA.  This means, in effect, that the government must

          show not only that a particular  loss would not have occurred but

          for  the conduct underlying  the offense of  conviction, but also

          that the causal nexus between the conduct and the loss is not too

          attenuated (either  factually or  temporally).  The  watchword is

          reasonableness.     A   sentencing  court  should   undertake  an

          individualized inquiry; what constitutes sufficient causation can

          only be determined case by case, in a fact-specific probe.

                              D.  Applying the Standard.
                              D.  Applying the Standard.
                                  _____________________

                    Having  elucidated the  appropriate legal  standard, we

          turn finally to the  causation questions embedded in  the appeals

          that  are before us.  These appeals, like the decisions canvassed

                                          24

          above, provide some insights into the standard's operation.

                    1.  In Vaknin's case,  restitution is appropriate.  The
                    1.

          district court  specifically found  that the bribes  which Vaknin

          paid  were a but for cause of  the Bank's losses on the defaulted

          loans.  The record contains no basis on which to mount a credible

          challenge to this finding.   After all, the arrangements  for the

          bribes  preceded the  making of  the loans,  and the  bribes were

          admittedly  paid  in  exchange   for  Annarummo's  assistance  in

          procuring the loans.

                    Moreover,  common  sense  must  inform  inquiries  into

          restitution under the  VWPA.  See  S. Rep.  No. 532, supra,  1982
                                        ___                    _____

          U.S.C.C.A.N. at 2536-37.  In Vaknin's case, the  evidence clearly

          shows  not only that the loans were  procured by bribery but also

          that the bribe-taker connived to bend the rules;  in at least one

          instance  Annarummo  shaded  the presentation  to  APSB's  credit

          committee  to  increase the  likelihood  that the  loan  would be

          forthcoming.   We  believe that  where,  as here,  the government

          establishes that arrangements  for a bribe precede  and relate to

          the  making  of  a  loan,  a  commonsense  inference  arises that

          subsequent  losses referable  to the loan's  uncollectibility are

          causally linked in reasonable proximity to the bribe.  Cf., e.g.,
                                                                 ___  ____

          Blinzler v. Marriott Int'l, Inc., 81 F.3d 1148, 1158-59 (1st Cir.
          ________    ____________________

          1996) (discussing  commonsense inference  that arises  from proof

          that a  relevant document has  been destroyed); United  States v.
                                                          ______________

          Olbres, 61  F.3d 967,  971-72 (1st Cir.)  (discussing commonsense
          ______

          inference   that  arises  in  tax  evasion  case  from  proof  of

                                          25

          expenditures in excess of declared income and disposable assets),

          cert. denied, 116 S.  Ct. 522 (1995).   Of course, the  inference
          _____ ______

          can be  rebutted if the  defendant produces specific  evidence of

          factual or temporal  remoteness.  Here,  however, Vaknin made  no

          such  showing.   To the  contrary, there  is no  compelling proof

          either of an unforeseeable intervening cause or of any cognizable

          remoteness, factual or temporal.

                    That ends  the matter.   Because the  record adequately

          supports Judge Boyle's finding of but for causation, and contains

          no  sufficient  suggestion  of  factual or  temporal  remoteness,

          restitution for  the losses resulting  from the tainted  loans is

          altogether appropriate.

                    2.  We treat Fonseca's and Yeghian's appeals in tandem.
                    2.

          In  both instances,  the  record is  so  exiguous that  the  very

          existence of but for causation seems problematic.  As to Fonseca,

          the single loan in respect to which the court ordered restitution

          may  have been approved by the  Bank independent of, and prior in

          time  to, Annarummo's solicitation of  a bribe.8   On the present

          record,  we simply  cannot tell    and  the lower  court made  no

          specific  finding on  the  point.   The  question is  potentially

          important because, if  it turns  out that the  Bank approved  the

          loan prior to  any arrangements for a  bribe, then in such  event

          the circumstances  would  not support  an  inference of  but  for

          causation;  and, in  the  absence of  such  an inference,  it  is
                              
          ____________________

               8Fonseca's past lending relationship  with the Bank tends to
          support this inference.  It suggests, at the least, that the Bank
          considered him creditworthy well before Annarummo hove into view.

                                          26

          difficult (although not impossible)  to conceive how a sufficient

          causal link between bribe and loss could be forged.

                    Moreover,  the record  suggests  that even  if but  for

          causation  exists, the requisite  connectedness might be lacking.

          Fonseca  argues  with some  force that  the  Bank's loss,  if one

          occurred at all, was occasioned by its need for an immediate cash

          infusion; that this exigency gave birth to the FA; and therefore,

          no cognizable loss occurred.9  But this argument, too, depends on

          facts which  the record does not contain,  and on which the lower

          court  made  no  particularized  findings.    It  is  clear  that

          Fonseca's loan  was overdue and that the Bank had a right to call

          the  loan.  From  that point forward,  it is unclear  whether the

          Bank entered  into the  FA  merely as  a quick  fix  for its  own

          problems or because it wanted to mitigate an inevitable loss.

                    As to Yeghian, the record is similarly inexplicit about

          the  timing  of his  arrangements  with  Annarummo vis- -vis  the

          Bank's approval of the  subject loans.  There is  some indication

          that one  (if not both)  of the loans  on which he  defaulted may

          have been approved  independent of any  deal with Annarummo,  but

          the sentencing  court made  no detailed  findings and  the extant

          record  is  too  sparse to  permit  us  to  answer the  causation

          questions with confidence.
                              
          ____________________

               9In  substance,  Fonseca   asserts  that  by   accepting  an
          accelerated $450,000  payment under a consensual pact (the FA) in
          satisfaction of the outstanding loan balance ($611,500), APSB did
          no more than make a  business judgment designed not to salvage  a
          failing loan    Fonseca says he  could have paid it  off in full,
          given time   but to shore up  a failing bank.  On that basis,  he
          reasons that APSB (and ultimately the FDIC) suffered no loss.

                                          27

                    It  would be  unprofitable  to delve  more deeply  into

          these  matters.   We  are  confronted  by a  largely  undeveloped

          record,  embellished  with few  specific  findings.   Given  that

          enigmatic  reality, remand  is required.   We  envision  that the

          district  court, the next time around, will direct the parties to

          augment the record with respect to (a) the presence or absence of

          a causal  link between  Fonseca's and Yeghian's  criminal conduct

          and the FDIC's losses,  (b) if that causal link  is demonstrated,

          the  closeness  of  the  connection,  factually  and  temporally,

          between  that conduct and the ultimate losses, and (c) such other

          matters  as the court may  deem suitable.   We anticipate further

          that the court will make particularized findings on each disputed

          issue. Weintimateno viewastothe properoutcomeof thoseproceedings.

          V.  MISCELLANEOUS
          V.  MISCELLANEOUS

                    Three final matters require brief attention.  The first

          is a  matter raised by  Fonseca and  Yeghian.  The  others relate

          solely to Vaknin's obligations.

                               A.  Picking up the Tab.
                               A.  Picking up the Tab.
                                   __________________

                    It is apodictic that restitution only can be ordered to

          redress  a loss to  a victim.   See United States  v. Gibbens, 25
                                          ___ _____________     _______

          F.3d  28, 33  (1st Cir.  1994).   Using this  truism as  a lever,

          Fonseca and Yeghian question whether the VWPA allows the court to

          order restitution to the FDIC for losses  originally sustained by

          the (now failed) Bank.  The question is easily answered.

                    Following existing circuit precedent, we hold  that the

          benefit of the VWPA's remedial provisions extends to a government

                                          28

          agency  which, in  the exercise of  duly delegated  powers, steps

          into  the shoes of the original victim.  See id. at 32-35.  Thus,
                                                   ___ ___

          if  a  failed  bank was  a  victim  of  the defendant's  criminal

          activity, the FDIC, as its insurer and receiver, itself qualifies

          as  a victim  for purposes  of a  restitutionary order  under the

          VWPA.  See  United States v. Phaneuf, 91 F.3d  255, 265 (1st Cir.
                 ___  _____________    _______

          1996).

                                 B.  Ability to Pay.
                                 B.  Ability to Pay.
                                     ______________

                    Vaknin  argues  that  the  district  court  abused  its

          discretion   by   ordering  him   to  make   restitution  without

          considering his ability to  pay.  We agree with  Vaknin's premise

          that judicial  consideration of a  defendant's ability to  pay is

          statutorily  mandated   as  a   prerequisite  to  an   order  for

          restitution.  See  18 U.S.C.    3664(a).   We disagree,  however,
                        ___

          with  his conclusion that the lower court neglected to touch this

          base.

                    We  have  stated with  a  regularity  bordering on  the

          monotonous that the consideration  requirement does not mean that

          a judge must decide the question in a particular way or even that

          he must make express findings on the record as to the defendant's

          ability to  pay.  See, e.g.,  Newman, 49 F.3d at  10; Savoie, 985
                            ___  ____   ______                  ______

          F.2d at 618.  It is enough  if "the record on appeal reveals that

          the judge made implicit  findings or otherwise adequately evinced

          his consideration" of this factor.  Savoie, 985 F.2d at 618.
                                              ______

                    Here, the PSI Report spelled out Vaknin's past earnings

          history and  current financial condition  in appreciable  detail.

                                          29

          The sentencing transcript indicates  that the judge absorbed this

          information,  voiced his  skepticism  about  Vaknin's ability  to

          comply  with  the  restitution  order  as  matters  stood,10  but

          nonetheless impliedly  found  that a  sufficient  possibility  of

          eventual  repayment  existed.    We think  that  this  finding is

          supportable.  A defendant's  impoverishment today is no assurance

          of future poverty, and,  hence, present impecuniousness is  not a

          bar  to  the imposition  of restitution.    See United  States v.
                                                      ___ ______________

          Brandon,  17  F.3d 409,  461 (1st  Cir.  1994); United  States v.
          _______                                         ______________

          Lombardi, 5 F.3d  568, 573 (1st Cir.  1993).  A  sentencing court
          ________

          permissibly may take into  account a defendant's earning capacity

          and the prospect that his fortunes will improve.  See Lombardi, 5
                                                            ___ ________

          F.3d at 573; Savoie, 985 F.2d at 619.
                       ______

                    Here, the judge apparently  issued a restitution  order

          as a  hedge against his  founded belief that  the defendant    an

          individual  of demonstrated  entrepreneurial  bent    might  well

          acquire assets in the  future.  While this conclusion  would have

          been  less  controversial  had  the judge  made  a  more  pointed

          reference to  Vaknin's past accomplishments  and future financial

          prognosis, we cannot say that  an abuse of discretion transpired.

          See Lombardi, 5 F.3d at 572-73.
          ___ ________

                          C.  The Government's Concessions.
                          C.  The Government's Concessions.
                              ____________________________

                    The district  court ordered Vaknin to  make restitution

          in the amount of  $1,000,000.  This figure  is vulnerable on  two
                              
          ____________________

               10Indeed,  the  judge explicitly  declined  to  levy a  fine
          against Vaknin, noting on the judgment form that no fine would be
          imposed due to an inability to pay.

                                          30

          fronts.  First, the  government has brought  to light on its  own

          initiative a mathematical error that, when corrected, will reduce

          the  amount of restitution owed.11   Second, the sentencing court

          premised the  loss  calculation  on the  amount  which  the  Bank

          received when it resold the property Vaknin had pledged to secure

          the defaulted loans, rather than on its fair market  value at the

          time of foreclosure.  Because the district court used fair market

          value as of the  foreclosure date when determining the  amount of

          restitution that  Yeghian owed,  the government concedes  that it

          would be fair to employ the  same barometer in respect to  Vaknin

          (a similarly  situated codefendant).  We  accept the government's

          concessions  at face  value,  without passing  substantively upon

          them, and direct the district court to make these two adjustments

          to the restitutionary award.  The resultant  obligation thus will

          be reduced to $902,000. 

          VI.  CONCLUSION
          VI.  CONCLUSION

                    We  need  go no  further.   For  the reasons  set forth

          herein, we affirm  the convictions of all  the defendants; modify

          the restitution  order imposed against Vaknin,  and, as modified,

          affirm it; vacate  the restitution orders imposed  on Fonseca and

          Yeghian, respectively;  and remand for further  proceedings as to

          them.

                    Affirmed in part; vacated in part; remanded.
                    Affirmed in part; vacated in part; remanded.
                    ___________________________________________

                              
          ____________________

               11This  is very  professional behavior,  and we  commend the
          prosecutors for it.

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