Court Opinion

ID: 3007383
Source: CourtListenerOpinion
Date Created: 2015-10-06 15:00:32.639469+00
Date Added: 2024-06-11T11:46:07.842615
License: Public Domain

14-1110-cr
         United States v. Loles

                           UNITED STATES COURT OF APPEALS
                               FOR THE SECOND CIRCUIT

                                        SUMMARY ORDER
     RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED
     ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE
     PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A
     DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
     ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST
     SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

 1            At a stated term of the United States Court of Appeals
 2       for the Second Circuit, held at the Thurgood Marshall United
 3       States Courthouse, 40 Foley Square, in the City of New York,
 4       on the 6th day of October, two thousand fifteen.
 5
 6       PRESENT: DENNIS JACOBS,
 7                PIERRE N. LEVAL,
 8                              Circuit Judges,
 9                GEOFFREY W. CRAWFORD,*
10                              District Judge.
11
12       - - - - - - - - - - - - - - - - - - - -X
13       UNITED STATES OF AMERICA,
14                Appellee
15
16                     -v.-                                                      14-1110
17
18       GREGORY LOLES,
19                Defendant-Appellant.
20       - - - - - - - - - - - - - - - - - - - -X
21
22
23       FOR APPELLANT:                             JEREMIAH DONOVAN, Old Saybrook,
24                                                  Connecticut.
25

                *
                The Honorable Geoffrey W. Crawford, United States District Judge for the District of
         Vermont, sitting by designation.

                                                       1
 1   FOR APPELLEE:              MICHAEL S. MCGARRY (with Marc H.
 2                              Silverman on the brief) for
 3                              Deirdre M. Daly, United States
 4                              Attorney for the District of
 5                              Connecticut, New Haven,
 6                              Connecticut.
 7
 8        Appeal from a judgment of the United States District
 9   Court for the District of Connecticut (Thompson, J.).
10
11        UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED
12   AND DECREED that the judgment of the district court be
13   AFFIRMED.
14
15        Gregory Loles appeals from the judgment of the United
16   States District Court for the District of Connecticut
17   (Thompson, J.), sentencing Loles to a term of imprisonment
18   for 300 months. We assume the parties’ familiarity with the
19   underlying facts, the procedural history, and the issues
20   presented for review.
21
22        1. Loles argues that the downward departure pursuant
23   to United States v. Lauersen, 348 F.3d 329, 344 (2d Cir.
24   2003) was insufficient. This Court lacks jurisdiction to
25   entertain such a claim. See United States v. Campo, 140
26 F.3d 415, 419 (2d Cir. 1998) (“[A] court’s failure to state
27   its reasons for refusing to downwardly depart, or for
28   refusing to downwardly depart more extensively than it did,
29   is not appealable.”); United States v. Lawal, 17 F.3d 560,
30   564 (2d Cir. 1994) (“[W]e do not review, at defendant’s
31   request, the extent of any [downward] departure the court
32   may grant . . . The circumstances of this appeal justify
33   adherence to the general rule that the beneficiary of a
34   downward departure is not in a position to complain about
35   its reasonableness or extent.”) (internal quotation marks
36   omitted).
37
38        2. Loles challenges the finding that the loss amount
39   attributable to Loles’s scheme was $27,198,025.94. “We
40   review the district court’s factual findings on loss for
41   clear error . . . .” United States v. Carboni, 204 F.3d 39,
42   46 (2d Cir. 2000). The inclusion of $14,488,939.24 invested
43   by Milbury Holdings and Somerset Associates was not clearly
44   erroneous, as the district court properly weighed relevant

                                  2
 1   testimony and evidence and acted within its discretion in
 2   finding Loles’s testimony on this point “unbelievable.”
 3   Government Appendix (“G.A.”) 1588. And although the
 4   district court did not place “material reliance on hearsay
 5   statements,” id., in reaching this conclusion, it was not
 6   precluded from considering such evidence during sentencing.
 7   See United States v. Broxmeyer, 699 F.3d 265, 280 (2d Cir.
 8   2012).
 9
10        Loles’s remaining arguments advocating reduction in the
11   loss amount are similarly meritless, especially in view of
12   the deference owed to the district court on such factual
13   findings. In any event, even if these additional objections
14   had force, the loss amount would still be above $20 million
15   dollars, and the applicable enhancement would be unchanged.
16   Therefore, any error committed was harmless. See United
17   States v. Sharpley, 399 F.3d 123, 127 (2d Cir. 2005) (noting
18   that the “prototypical example of harmless error” is one
19   where the defendant “cannot obtain any improvement in his
20   sentence in resentencing”).
21
22        3. Loles argues that the district court incorrectly
23   applied a two-level sentencing enhancement based upon the
24   finding that some of his misrepresentations were made while
25   acting on behalf of a charitable or religious organization.
26   We review a district court’s legal determinations de novo,
27   “giving due deference to the district court’s application of
28   the guideline provision to the facts.” United States v.
29   Kinney, 211 F.3d 13, 19 (2d Cir. 2000). The enhancement at
30   issue is “designed to apply to a wide variety of fraud
31   cases.” Id. at 20 (internal quotation marks and citation
32   omitted). On this record, the enhancement was correctly
33   applied. Loles collected $700,000 ostensibly “for the
34   benefit of the church,” G.A. 415, in part by making
35   statements such as “the church will get a lot more money out
36   of this deal.” G.A. 434.
37
38        4. Loles challenges the two-level enhancement based on
39   his use of sophisticated means. Loles advocates a sliding
40   scale for sophistication, arguing that the means he employed
41   are commonplace in similar fraudulent schemes. Loles
42   concedes that he “can cite no judicial, statutory, or
43   regulatory support for [the] contention that sentencing
44   courts should adopt a relative standard for sophistication.”

                                  3
 1   Brief of Defendant-Appellant at 40. This is unsurprising
 2   for this is not the law; rather, “the creation and use of
 3   false documents, and other tactics to conceal offense
 4   conduct, are indicia of the sophistication of an offense.”
 5   United States v. Fofanah, 765 F.3d 141, 146 (2d Cir. 2014).
 6   The district court made precisely such findings to support
 7   the enhancement. G.A. 1573-74 (“Here the defendant
 8   falsified hundreds of documents using his computer to create
 9   fake forms and account statements reflecting fictitious bond
10   prices . . . controlled what proved to be shell companies
11   . . . sent out false tax forms . . . and by taking all these
12   steps managed to conceal the scheme from his victims for
13   nearly eight years.”). Loles’s argument must accordingly be
14   rejected.
15
16        5. Loles contends that the imposition of a 300 month
17   sentence is substantively unreasonable. “We review a
18   sentence for procedural and substantive reasonableness under
19   a deferential abuse-of-discretion standard.” United States
20   v. Thavaraja, 740 F.3d 253, 258 (2d Cir. 2014) (internal
21   quotation marks omitted). This Court recently rejected such
22   a challenge to a 240 month sentence in similar circumstances
23   based on the “seriousness of [the defendant’s] crime” and
24   its “effect on . . . victims, some of whom had lost their
25   homes and their livelihoods”. United States v. Norman, 776
26 F.3d 67, 86 (2d Cir. 2015). Here too, the district court
27   amply supported the sentence by explaining the repugnant
28   nature of Loles’s crime. G.A. 1659 (“In each of these
29   instances, even ones where the fraud ran for several years,
30   the defendants duped their victims, but they did not
31   cultivate them sometimes over long periods of time the way
32   that you did . . . These victims included people who were
33   among the most vulnerable, for example, elderly individuals
34   living on fixed incomes and people in ill health who could
35   not afford to lose their life savings.”); G.A. 1661-62
36   (“Over the years I have sentenced a lot of people who
37   committed the category of crimes that you committed. I can
38   think of only one other defendant whose conduct was as
39   depraved and callous as yours. That individual stole a lot
40   less money than you did and he had an addiction.”). The
41   district court did not abuse its discretion in sentencing
42   Loles to 300 months in prison.
43
44

                                  4
1        For the foregoing reasons, and finding no merit in
2   Loles’s other arguments, we hereby AFFIRM the judgment of
3   the district court.
4
5                              FOR THE COURT:
6                              CATHERINE O’HAGAN WOLFE, CLERK
7

                                 5