Court Opinion

ID: 3000236
Source: CourtListenerOpinion
Date Created: 2015-09-24 20:02:44.880984+00
Date Added: 2024-06-11T11:25:24.280338
License: Public Domain

NONPRECEDENTIAL DISPOSITION
                       To be cited only in accordance with
                               Fed. R. App. P. 32.1

           United States Court of Appeals
                             For the Seventh Circuit
                             Chicago, Illinois 60604

                             Submitted March 20, 2007
                              Decided March 22, 2007

                                      Before

                   Hon. ILANA DIAMOND ROVNER, Circuit Judge

                   Hon. TERENCE T. EVANS, Circuit Judge

                   Hon. ANN CLAIRE WILLIAMS, Circuit Judge

Nos. 05-2055 & 05-2056

UNITED STATES OF AMERICA,                      Appeals from the United States
    Plaintiff-Appellee,                        District Court for the Northern
                                               District of Illinois, Eastern Division
      v.
                                               No. 97 CR 516
JAMES R. SKRZYPEK and JANICE
M. SKRZYPEK                                    James B. Moran,
     Defendants-Appellants.                    Judge.

                                    ORDER

      The Chicago Housing Authority uses security guards employed by private
companies to provide security for residents of its housing projects. Husband and
wife James and Janice Skrzypek owned several companies that offered armed
guards on a contract basis. The CHA selected one of those companies, Federal
Security, Inc., to keep watch over some of its housing projects. Federal Security did
not have enough guards to fulfill its obligation to the CHA, but it nevertheless led
the CHA to believe that the positions were fully staffed—and it charged accordingly.
Federal Security also inflated the number of hours that its existent guards worked,
and ultimately defrauded the CHA of over $1.1 million. At the same time, the
Skrzypeks understated the number of employees working for their companies and
Nos. 05-2055, 05-2056                                                           Page 2

underpaid several insurance companies by $2.3 million for mandatory policies that
tied rates for liability and workers’ compensation coverage to payroll costs. The
Skrzypeks also defrauded the United States of approximately $2.5 million in taxes
by embezzling payroll taxes withheld from their employees and understating the
income derived from their various companies.

       To cover their tracks, the Skrzypeks bribed several CHA employees, but
eventually a CHA worker informed the FBI of the Skrzypeks’ scheme. The FBI
then worked with that CHA employee to secure enough evidence to prosecute the
couple. In a 160-count, second superseding indictment, the Skrzypeks, along with
Federal Security and others, were charged with various offenses, including
racketeering, 18 U.S.C. § 1962(c); conspiracy to defraud the United States, id. § 371;
mail and wire fraud, id. §§ 1341, 1343; bribery of a public official, id. § 201; and
willful failure to pay taxes, 26 U.S.C. § 7202. The Skrzypeks went to trial, and a
jury found them guilty on all but one of the counts. The district court sentenced
both of the Skrzypeks to a total of 90 months’ imprisonment and five years’
supervised release, and ordered them jointly to pay roughly $3.5 million restitution.
The court directed that the restitution be paid immediately instead of setting a
payment schedule.

       On appeal the Skrzypeks make just one argument. They contend that the
district court committed plain error when it failed to impose a payment schedule for
restitution. According to the probation officer, the Skrzypeks had virtually no
assets and monthly income of just $360 by the time they were sentenced. The
Skrzypeks, however, did not object when the court ordered immediate payment, so
we review for plain error, that is, error that affected their substantial rights. See
United States v. Thigpen, 456 F.3d 766, 771 (7th Cir. 2006).

       We held after the sentencings in this case that district courts have a non-
delegable duty to fix a payment schedule for restitution when the defendant does
not have the resources to make immediate payment. United States v. Day, 418 F.3d
746, 761 (7th Cir. 2005). The district court did not have the benefit of our later case
and understandably did not set a payment schedule even after noting that the
Skrzypeks had only a “remote” chance of repaying the money owed. Even so, the
government urges us to remand for the limited purpose of allowing the district court
to set a payment schedule as Day now requires. We do so here at the government’s
invitation. See Thigpen, 456 F.3d at 771 (holding that failure to set payment
schedule for restitution constituted plain error).

     In addition to the brief filed by counsel on behalf the Skrzypeks, we gave
James Skrzypek permission to file a pro se brief. We have reviewed the arguments
he makes and conclude that none of them have merit.
Nos. 05-2055, 05-2056                                                       Page 3

      The convictions and sentences of both James and Janice Skrzypek are
AFFIRMED, except that we REMAND both cases for the limited purpose of
allowing the district court to set a payment schedule for restitution.