-
USCA1 Opinion
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
____________________
No. 95-1389
UNITED STATES,
Appellee,
v.
JEFFREY PHANEUF,
Defendant, Appellant.
____________________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Nathaniel M. Gorton, U.S. District Judge] ___________________
____________________
Before
Selya, Circuit Judge, _____________
Campbell, Senior Circuit Judge, ____________________
and Stahl, Circuit Judge. _____________
____________________
Donald R. Furman, Jr., for appellant. _____________________
Sheila W. Sawyer, Assistant United States Attorney, with whom _________________
Donald K. Stern, United States Attorney, was on brief for appellee. _______________
____________________
August 2, 1996
____________________
CAMPBELL, Senior Circuit Judge. Pursuant to a plea agreement ____________________
with the government, defendant-appellant Jeffrey Phaneuf pled
guilty to three counts of making a false statement on credit
card applications in violation of 18 U.S.C. 1014, and two
counts of mail fraud in violation of 18 U.S.C. 1341. The
United States District Court for the District of
Massachusetts sentenced Phaneuf to 24 months in prison on the
first three counts to run concurrently with a 30-month
sentence on the last two counts, followed by 36 months of
supervised release. In addition, the court ordered Phaneuf
to pay $20,400 to the Bank of New England ("BNE") as
restitution for losses. Phaneuf appeals from his sentence.
I. I.
In April 1989, police officers in Massachusetts
discovered numerous stolen credit cards in Phaneuf's car
during a routine traffic stop. Police obtained a warrant to
search his residence in Hampton, New Hampshire. They
discovered numerous credit cards in his name, along with
receipts and credit card charge slips. A follow-up
investigation revealed that 31 of the cards recovered were
ones that Phaneuf had reported as stolen the previous year.
In June 1989, evidence from the state investigation
-- including credit card applications, receipts, stop payment
order receipts, and correspondence between Phaneuf and
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various banks -- was turned over to the United States Secret
Service in Boston. In July, Phaneuf complied with that
office's request for handwriting exemplars to compare with
the documents obtained from his home.
In August 1990, Phaneuf called Agent Hoelen of the
Secret Service to ask about the status of the investigation.
Phaneuf offered to cooperate with the Secret Service. In
September 1990, Phaneuf and Agent Hoelen met, without counsel
or a representative from the United States Attorney's Office
present. After Agent Hoelen advised Phaneuf of his Fifth
Amendment right against self-incrimination, Phaneuf explained
his scheme: from January 1988 through March 1989, he
obtained numerous credit cards from banks and credit card
companies by submitting false applications, used the cards
(or authorized others to use them), and then reported the
cards as stolen or failed to pay back the issuing
institutions. He also wrote checks against his personal
checking account at BNE to pay off credit card balances and
then issued stop payment orders on the checks after the
credit card balances had been reduced by the amount of the
checks. In this way, he was able to resume use of the credit
cards and incur more debt.
At the end of his meeting with Agent Hoelen,
Phaneuf signed a two-page typed statement outlining the above
scheme and initialled an additional ten or eleven pages of
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"certified inventory of evidence" forms. Phaneuf told Agent
Hoelen that he believed the total amount of fraud
attributable to his scheme was about $176,000. Phaneuf
apparently made this comment in response to a higher loss
estimate offered by Agent Hoelen.
In November 1994, the government filed a five-count
indictment in the United States District Court for the
District of Massachusetts charging Phaneuf with mail fraud
and making false statements on credit card applications. A
plea hearing was held on December 12, at which time the
government stated that the total loss attributable to Phaneuf
for sentencing purposes was approximately $175,000. Phaneuf
refused to agree to the $175,000 loss amount contained in the
plea agreement. Defense counsel questioned how the
government would prove this total amount, given the lower
amounts alleged in the various counts ($64,000 in counts I-
III and $57,182 in counts IV-V, for a sum of $121,182). As a
result of this dispute, the district court did not accept
Phaneuf's guilty plea and ended the plea proceedings. A
second plea hearing was held on December 20, at which the
court accepted Phaneuf's guilty plea but declared the amount
of the loss to be "in dispute."
On January 9, 1995, Assistant United States
Attorney Sheila Sawyer filed a notice of appearance replacing
Duane Deskins who had been handling Phaneuf's prosecution.
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Shortly thereafter, the probation department filed a
Presentence Investigation Report ("PSR") that relied
primarily upon Phaneuf's two-page signed statement of
September 1990 to characterize the offense conduct.
Phaneuf's base offense level was calculated to be six, and
was increased by six levels because he was found to be
responsible for a loss amount between $100,001 and $200,000.1
Two more levels were added because the offense involved more
than minimal planning. The probation officer then took into
account Phaneuf's acceptance of responsibility, and found
that his total adjusted offense level was twelve. Given that
offense level and a criminal history category of V, Phaneuf's
guideline sentencing range was put at 27 to 33 months.
The government did not object to the PSR. Phaneuf
made several objections. He asserted that neither he nor his
attorney had seen "any information in the possession of the
government" other than his two-page statement given to Agent
Hoelen. Phaneuf petitioned the probation department to
confine the loss calculation to the figures listed in the
mail fraud counts of the indictment. The probation officer
considered Phaneuf's objections but refused to alter the loss
calculations.
____________________
1. The applicable offense level for fraud claims increases
in proportion to the value of the fraud.
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Sentencing was scheduled for March 27, 1995. On
March 7, the government filed with the court a sentencing
memorandum in support of the probation department's loss
calculations. The government attached to its sentencing
memorandum an affidavit from Agent Hoelen describing the
investigation, the confession signed by Phaneuf in 1990, and
a certified inventory of evidence prepared by Agent Hoelen.
On Thursday, March 23, Assistant United States Attorney
Sawyer called defense counsel to see whether he still
intended to contest the loss amount and whether he "had any
interest in looking at the materials referenced in the
government's sentencing memorandum prior to the sentencing
hearing." Defense counsel rejected the government's offer to
look at the evidence, stating his intention to challenge the
government for alleged discovery violations.
At sentencing, the district court concluded that
the loss amount was "somewhere in the range of" $100,001 to
$200,000, and not less than $166,229.38. The district court
also found that the government had not failed to make
available to the defense the documentation supporting its
loss calculation. Phaneuf was sentenced to 30 months in
prison, to be followed by a 36-month term of supervised
release. The court imposed several special conditions of
supervised release: it required Phaneuf to obtain prior
approval of the probation department before "incurring any
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extension of credit, including charge cards, credit cards or
loans" and before making "any purchase . . . exceeding the
cost of $100." The court further ordered Phaneuf to make
restitution to the BNE in the amount of $20,400 for losses it
sustained in connection with the mail fraud scheme.
II. II.
Phaneuf assigns four errors on appeal: (1) that the
government's violation of a local discovery rule deprived him
of a fair sentencing; (2) that the district court erred in
calculating the loss amount for sentencing purposes; (3) that
the supervised release condition requiring him to obtain
prior approval for purchases over $100 was not reasonably
related to his offenses as required by 18 U.S.C.
3583(d)(1); and (4) that the court's restitution order was
improper.
1. Discovery Violation 1. Discovery Violation
Phaneuf contends that the government's purported
failure to provide the defense with documentation supporting
its loss estimate deprived him of a fair sentencing
procedure. He relies on Local Rule, D.Mass. 116.1(a), which
requires that, in criminal cases, the government
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automatically disclose certain written evidence in its
possession to the defense.2
Phaneuf argues that the government violated Local
Rule 116.1 by not spontaneously handing over to the defense
various pieces of evidence including the handwriting analyses
produced by the Forensic Services Division of the Secret
Service and evidence of "numerous legitimate payments" on
____________________
2. The Rule provides in relevant part:
In all criminal cases, the following
material and information . . . shall be
disclosed to the opposing party. Such
disclosure . . . shall occur . . . in all
events within fourteen (14) days after
arraignment.
(a) The government shall disclose, and
allow the defendant to inspect, copy and
photograph, all written material as
follows:
. . .
(3) All relevant reports of results of
physical or mental examinations, and of
all scientific tests, experiments and
comparisons, or copies thereof, made in
connection with a particular case.
(4) All . . . documents . . . which the
Government intends to use at the trial of
the case. . . .
(5) All exculpatory evidence within the
meaning of Giles v. Maryland, 386 U.S. _____ ________
66, 87 S. Ct. 793, 17 L. Ed. 2d 737 (1967),
Brady v. Maryland, 373 U.S. 83, 83 S.Ct. _____ ________
1194, 10 L. Ed. 2d 215 (1963) and Giglio v. ______
United States, 405 U.S. 150, 92 S.Ct. ______________
763, 31 L. Ed. 2d 104 (1972).
Local Rule, D.Mass. 116.1(a).
-8-
Phaneuf's credit card accounts. As a result, Phaneuf argues,
he could not effectively challenge the government's loss
estimate and the corresponding six-level increase in base
offense level. The government replies that Local Rule 116.1,
on its face, applies only to pre-trial discovery. At
sentencing, the government says, a defendant is entitled to
no more than fair notice of the evidence upon which the
government intends to rely.3 In any event, the government
insists that Phaneuf was fully advised in advance of the
sentencing hearing of the government's evidence and that his
counsel had made no request at all for evidence.
We need not linger over what role, if any, Local
Rule 116.1 should play at sentencing. Under any analysis,
Phaneuf is not entitled to relief here. He has only himself
to blame for any gaps in his knowledge of the basis of the
government's sentencing proposals. Counsel for the defense
conceded at the sentencing hearing that, during the two and
one-half month period leading up to sentencing, he did not
request any data from the prosecution, nor did he request the
court to compel the disclosure of any evidence.4 The absence
____________________
3. Neither party contends that Phaneuf did not have fair
notice of the evidence upon which the government intended to
rely at sentencing.
4. Although defense counsel requested certain information
from the government in the period before the institution of
formal judicial proceedings, he conceded at sentencing that
he did not request the documents at any point after the
hearing at which Phaneuf's plea was taken.
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of any such requests is especially telling given that three
weeks before sentencing the government had filed a sentencing
memorandum setting forth the government's position on the
loss amount. Moreover, some four days before sentencing,
Assistant United States Attorney Sawyer called defense
counsel and offered him an opportunity to inspect and copy
the materials referenced in the government's sentencing
memorandum -- an offer which defense counsel refused, citing
a strategic choice to pursue a prosecutorial misfeasance
argument. Even after this argument failed at sentencing,
defense counsel did not request a continuance of sentencing
to permit him an opportunity to investigate further the
government's evidence.
The district court, after hearing argument, found
that the government did not fail to make available to the
defense the documentation supporting its loss calculations.
This finding was amply supported by the facts and arguments
presented. See Fennell v. First Step Designs, Ltd., 83 F.3d ___ _______ ________________________
526, 532 (1st Cir. 1996) (holding that district court has
broad discretion over matters concerning discovery); United ______
States v. Tajeddini, 996 F.2d 1278, 1287 (1st Cir. 1993) ______ _________
(noting that rulings on discovery matters are reviewed for an
abuse of discretion). Moreover, by not, even then,
requesting a continuance during which the evidence allegedly
withheld could be disclosed and reviewed, Phaneuf further
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weakened any claim he might conceivably have had of an
alleged discovery violation. See United States v. Tardiff, ___ _____________ _______
969 F.2d 1283, 1286 (1st Cir. 1992) ("[E]ven if a defendant
is faced at sentencing with information that he has not had a
chance to rebut . . . we think it incumbent upon the
defendant to ask for a continuance then and there."); United ______
States v. Diaz-Villafane, 874 F.2d 43, 47 (1st Cir.) ("We ______ ______________
find it of decretory significance that defense counsel,
although seeking unsuccessfully to block the testimony
entirely, never moved for a continuance[;] [i]t is, we
think, incumbent upon a party faced with such a situation to
ask explicitly that the court grant the time needed to
regroup, or waive the point."), cert. denied, 493 U.S. 862 ____________
(1989).
Phaneuf's argument that he was denied discovery
documents is also weakened by the fact that much, although
not all, of the government's information that was directly
related to the loss estimate was information that Phaneuf
himself knew about or could have obtained. Phaneuf was aware
of the financial institutions which he had defrauded, and
could have contacted them himself to obtain information.
This is not a situation in which most of the information
relevant to sentencing was known only to the government.
We find no merit in Phaneuf's argument that the
government's purported failure to disclose evidence denied
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him his "constitutional right not to be sentenced on the
basis of invalid information." Diaz-Villafane, 874 F.2d at ______________
47 (quoting United States v. Fogel, 829 F.2d 77, 90 (D.C.Cir. _____________ _____
1987)).
2. Amount of Loss 2. Amount of Loss
Phaneuf claims that the district court made an
unreasonable determination of the amount of loss attributable
to him for sentencing purposes. A district court's loss
estimate is a factual determination, and "a party
dissatisfied with the sentencing court's quantification of
the amount of loss in a particular case must go a long way to
demonstrate that the finding is clearly erroneous." United ______
States v. Rostoff, 53 F.3d 398, 407 (1st Cir. 1995); see also ______ _______ ________
United States v. Pavao, 948 F.2d 74, 77 (1st Cir. 1991). _____________ _____
When determining the amount of loss for sentencing
purposes, the district court "need only make a reasonable
estimate of the loss, given the available information."
U.S.S.G. 2F1.1, comment. (n.8); see also Rostoff, 53 F.3d ________ _______
at 407 (stating that "[c]ourts can, and frequently do, deal
with rough estimates" when calculating the amount of loss).
The district court found that the loss attributable to
Phaneuf was "not less than $166,299.38" which placed him in
the $100,001 to $200,000 category necessitating a six-level
increase in base offense level. In reaching its loss
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determination, the court considered: (1) Agent Hoelen's
affidavit describing his investigation and the evidence
recovered from Phaneuf's home; (2) Phaneuf's signed statement
made to Agent Hoelen in September of 1990 stating that the
amount of loss was approximately $176,000; and (3) the
bankruptcy petition filed by Phaneuf in 1994 which discharged
many of his debts.5
Phaneuf challenges the court's loss determination
as not being based on "available information" within the
meaning of U.S.S.G. 2F1.1 comment (n.8), because it was
derived in part from Agent Hoelen's affidavit and Phaneuf's
statement rather than from the underlying evidence -- the
credit cards, receipts, sales slips, and other documents
collected during the investigation.6 This argument is
without merit. A district court may rely upon any relevant
evidence, including hearsay, to prove facts at sentencing
provided the evidence is sufficiently reliable. U.S.S.G.
6A1.3(a) (A sentencing court "may consider relevant
information without regard to its admissibility under the
____________________
5. According to the PSR, Phaneuf filed for Chapter 7
bankruptcy protection on February 8, 1994, and was discharged
from debts totalling $210,702 on May 31, 1994.
6. In his challenge to the loss determination, Phaneuf
reiterates his argument that the government, by failing to
disclose relevant documents, prevented him from presenting
any evidence regarding the specific loss amount. As we
determined in Part II.1 supra, this argument fails because _____
Phaneuf was offered an opportunity to inspect the documents
in the government's possession.
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rules of evidence applicable at trial, provided that the
information has sufficient indicia of reliability to support
its probable accuracy."); see also Rostoff, 53 F.3d at 407; ________ _______
Tardiff, 969 F.2d at 1287; United States v. Figaro, 935 F.2d _______ _____________ ______
4, 8 (1st Cir. 1991). Here, the district court relied on the
sworn affidavit of an officer who, having conducted the
investigation, had personal knowledge of the events in
question. This is the type and kind of evidence on which
sentencing courts often rely. See e.g., United States v. ________ _____________
Aymelek, 926 F.2d 64, 68 (1st Cir. 1991). _______
Phaneuf next argues that he made "numerous
legitimate payments" on his credit card accounts which may
have been included in the court's total loss amount.7 This
argument is equally unavailing. Phaneuf has not provided any
evidence that the legitimate payments were improperly taken
____________________
7. In making this claim, Phaneuf relies on an excerpt from
his 1990 statement to Agent Hoelen which discusses his
fraudulent practices:
During the course of my credit card
activity, I made numerous legitimate ____________________
payments on my accounts, however, ________
subsequent payments made on the following
accounts with checks from my personal
checking account . . . were made solely
for the purpose of making full payments
on the accounts to create either a zero
balance or a credit balance and to
increase credit available to me. After
submitting these checks for payment, I
would place a stop payment on them.
(emphasis added).
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into account in determining the loss amount. Absent such
evidence, we logically conclude that the loss calculations
upon which the court relied were based on the amount owing to
various institutions, rather than the amount paid. In
addition, we note that both Agent Hoelen and Phaneuf himself
(in his 1990 statement) attributed approximately $176,000 of
loss to Phaneuf's fraudulent activities. __________
We see no error, let alone clear error, in the
district court's loss determination. The government
introduced ample evidence upon which the court could conclude
that Phaneuf was responsible for not less than $166,299.38.8
Moreover, Phaneuf himself admitted to the court at sentencing
that the loss attributable to him was within the sentencing
guideline category of $100,001 to $200,000 requiring a six-
level increase in his base offense level.9
____________________
8. We also dismiss Phaneuf's perfunctory argument that the
district court erred in not holding a hearing on the issue of
loss amount. The denial of an evidentiary hearing at
sentencing is reviewable only for an abuse of discretion. We
cannot find that the district court abused its discretion in
not granting an evidentiary hearing when neither the
prosecution nor the defense requested such a hearing.
Tardiff, 969 F.2d at 1286 ("[T]he failure to ask the district _______
court to convene an evidentiary hearing ordinarily spells
defeat for a contention that one should have been held.");
see also United States v. Mala, 7 F.3d 1058, 1062 (1st Cir. ________ ______________ ____
1993), cert. denied, 114 S. Ct. 1839 (1994). ____________
9. Phaneuf stated at sentencing:
The amounts of money, at this point, I am
very confused as to what it is. I'm not
even going to argue it. I guess it has
to be somewhere in the range of my --
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3. Special Condition of Release 3. Special Condition of Release
Phaneuf argues that the district court erred in
imposing a special condition of supervised release requiring
prior approval from the probation department for purchases
over $100. We ordinarily review a district court's
imposition of a special release condition for an abuse of
discretion. See United States v. Thurlow, 44 F.3d 46, 47 (1st ___ _____________ _______
Cir.), cert. denied, 115 S. Ct. 1987 (1995). However, as _____________
Phaneuf did not object to the special condition at
sentencing, our review is for plain error. See United States ___ _____________
v. Peppe, 80 F.3d 19, 22 (1st Cir. 1996). _____
The court, adopting the recommendation in the PSR,
imposed the following special conditions on Phaneuf to be
observed during his three-year period of supervised release:
The defendant shall participate in a
mental health counselling program at the
direction of the probation department.
The defendant shall not open any new
lines of credit without prior approval of
the probation department.
The defendant shall not make any
purchases over $100 without prior
approval of the probation department.
The defendant shall provide the probation
department with any requested financial
information and records.
A sentencing judge has broad discretion to impose special
conditions of release that are "reasonably related" to (1)
the defendant's offense, history and characteristics; (2) the
____________________
within the hundred thousand and 200,000.
So I am not really going to argue it.
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need for adequate deterrence; and (3) the need to protect the
public from further crimes of the defendant.10 See U.S.S.G. ___
5D1.3(b) and the corresponding statutory provisions, 18
U.S.C. 3553(a)(2), 3583(d).
Phaneuf challenges the special condition limiting
his purchasing power, arguing that "[t]he record is silent on
a relationship between spending $100.01, accepting pre-
____________________
10. See, e.g., Peppe, 80 F.3d at 23 (condition that ___________ _____
defendant could not incur new credit charges or open
additional lines of credit without prior approval of
probation department permissible as an effort to monitor
defendant's use of funds where defendant had been convicted
of extortionate extension of credit); Thurlow, 44 F.3d at 47 _______
(condition that defendant convicted of theft-related offenses
abstain from consuming alcohol permissible because of
defendant's history of substance abuse and use of crime
proceeds to purchase alcohol on several occasions); United ______
States v. Johnson, 998 F.2d 696, 699 (9th Cir. 1993) (no ______ _______
abuse of discretion to impose, along with other restrictions,
condition requiring that defendant abstain from alcohol use
where defendant had history of substance abuse and had been
involved in alcohol-related incidents); United States v. _____________
Chinske, 978 F.2d 557, 560 (9th Cir. 1992) (conditions that _______
defendant own no firearms, attend a substance abuse treatment
program, and submit to searches of his person, vehicle, and
residence related to offense of maintaining a residence for
the cultivation of marijuana); United States v. Sharp, 931 _____________ _____
F.2d 1310, 1311 (8th Cir. 1991) (condition subjecting
defendant to warrantless searches to determine if he
possessed alcohol or drugs permitted when defendant convicted
of narcotics violation); cf. United States v. Abrar, 58 F.3d __ _____________ _____
43, 46-47 (2d Cir. 1995) (condition requiring defendant to
pay back personal loans unrelated to crime constitutes plain
error); United States v. Prendergast, 979 F.2d 1289, 1293 ______ ______ ___________
(8th Cir. 1992) (conditions requiring defendant convicted of
wire fraud to abstain from consuming alcohol and drugs, to
undergo drug tests, and to be subject to warrantless searches
of his premises, vehicle, or person, impermissible in absence
of "evidence indicating that [defendant] suffers from
alcoholism or that the use of alcohol in any way contributed
to the commission of the offense for which he was
sentenced").
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approved credit cards, and perpetrating a fraud on a bank."
While it would have been helpful had the court stated its
rationale, we can perceive a sufficient connection between
the restriction and Phaneuf's criminal conduct for the former
to pass muster under the plain error standard.
As Phaneuf concedes, he has a long history of
mental health problems11 and, at times, has been unable to
control his spending. The nature of the imposed conditions
strongly suggests that the district court viewed Phaneuf's
credit card crimes as stemming from a total lack of financial
discipline and a compulsion to make excessive expenditures.
The court could rationally have concluded that oversight of
expenditures over $100 would help deter the kind of
overspending and debt that might once more lead Phaneuf to
undertake fraudulent schemes.12
To overturn the condition under the plain error
standard, Phaneuf must show an obvious and clear error under
____________________
11. Phaneuf was hospitalized as an adolescent for "conduct
disorder" and "unsocialized aggressive" behavior and has been
treated for behavioral problems on and off throughout his
life.
12. Another justification of the limit on Phaneuf's
purchasing power stems from his outstanding restitution
obligation to pay $20,400 to BNE. The court's special
condition will help to ensure that Phaneuf satisfies to the
best of his ability his restitution obligation rather than
spending his money on other things. Because this
justification is not attributable to a factor set forth in
U.S.S.G. 5D1.3(b) or the corresponding statutes, 18 U.S.C.
3553, 3583, it does not deserve conclusive weight, but
still is a part of the total picture.
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current law that affected his substantial rights.
Fed.R.Crim.P. 52(b); United States v. Olano, 507 U.S. 725, _____________ _____
732-35 (1993); United States v. Laboy-Delgado, 84 F.3d 22, 31 _____________ _____________
(1st Cir. 1996). Even if plain error exists, Olano suggests _____
that courts should not exercise their discretion to correct
the error unless it "seriously affect[s] the fairness,
integrity or public reputation of judicial proceedings."
Olano, 507 U.S. at 736 (quoting United States v. Atkinson, _____ _____________ ________
297 U.S. 157, 160 (1936)). In this case, even if we were to
assume, arguendo, that the district court went too far, the ________
error was not "obvious and clear" nor does it implicate the
fairness or integrity of judicial proceedings. The condition
limiting Phaneuf's purchasing power is effective only during
his period of supervised release, does not prohibit
expenditures of over $100 but merely requires pre-approval of
the probation department, and bears at least an arguable
relationship to checking the irresponsible behavior that
underlay Phaneuf's crimes.
4. Restitution 4. Restitution
Phaneuf argues that the sentencing court erred in
ordering restitution in the amount of $20,400 to be paid to
BNE, pursuant to the Victim and Witness Protection Act
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(VWPA), 18 U.S.C. 3663-3664 (1995).13 Our review is for
plain error as Phaneuf did not object to the restitution
order at sentencing. See United States v. Springer, 28 F.3d ___ _____________ ________
236, 237, 239 (1st Cir. 1994).
A sentencing court is permitted to order
restitution "to any victim." 18 U.S.C. 3663(a) (1995).14
In ordering restitution the court is required to consider:
the amount of 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.
18 U.S.C. 3664(a) (1995).15
Phaneuf claims that the restitution order is
contrary to law for two reasons. First, he asserts that he
is incapable of making restitution, citing his history of
mental disorders, his lack of professional training, his
virtually non-existent employment record, and his lack of
assets. Phaneuf predicts that he will likely be incarcerated
____________________
13. The VWPA, 18 U.S.C. 3663-3664, was amended by the
Antiterrorism and Effective Death Penalty Act of 1996, Pub.
L. No. 104-132, 205, 206, 110 Stat. 1230, 1232 (Apr. 24,
1996). However, the 1996 amendments are effective for
sentencing proceedings in cases in which defendant is
convicted on or after April 24, 1996. See Pub. L. No. 104- ___
132, 211, 110 Stat. 1232. Therefore, the pre-1996 version,
cited throughout this section of the opinion, is controlling
in Phaneuf's case.
14. See supra, note 13. ___ _____
15. See supra, note 13. ___ _____
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again as a result of being unable to satisfy the restitution
order. We find Phaneuf's argument unpersuasive. The
district court was not required to make explicit findings
regarding Phaneuf's ability to pay before ordering
restitution, so long as it considered the factors set forth
in 3664(a). See United States v. Newman, 49 F.3d 1, 10 ___ ______________ ______
(1st Cir. 1995); Springer, 28 F.3d at 239. Moreover, Phaneuf ________
need not be able to pay the restitution award immediately.
See United States v. Lombardi, 5 F.3d 568, 573 (1st Cir. ___ _____________ ________
1993). Restitution awards may be imposed in order to make
victims whole should the defendant become able to pay in the
future. See Newman, 49 F.3d at 10-11. Here, given that ___ ______
Phaneuf is a 26-year-old high school graduate, it is not
unforeseeable that he may earn some income when released from
prison. Moreover, Phaneuf can later seek a modification of
the restitution order in the sentencing court if he can show
that it is too onerous. See Springer, 28 F.3d at 239 n.2. ___ ________
Second, Phaneuf argues that the district court
erred in ordering restitution to be paid to BNE because, at
the time of sentencing, BNE had failed and the Federal
Deposit Insurance Corporation ("FDIC") had been appointed its
receiver. Phaneuf further argues that the FDIC, which
succeeded to the assets and liabilities of the failed bank by
operation of law, see 12 U.S.C. 1821(d)(2)(A), is not a ___
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proper "victim" entitled to restitution under the VWPA.16
Phaneuf argues that the letter he received from the probation
department instructing him to make his restitution payments
to the FDIC was improper. He contends that an order
instructing him to pay an entity other than BNE had to come
from the court rather than the probation department.
According to Phaneuf, restitution can only be paid to someone
other than the victim, in this case BNE, pursuant to the
following provision of the VWPA:
the court may, in the interest of
justice, order restitution to any person
who has compensated the victim for such
loss to the extent that such person paid
the compensation.
18 U.S.C. 3663(e)(1) (1995).17 Since the court did not
award restitution to the FDIC pursuant to this provision,
Phaneuf argues that the restitution order was improper.
We find no plain error either in the court's
restitution order or in the probation department's
instructions to make restitution payments to the FDIC. BNE
was in fact a victim of Phaneuf's fraud when committed. The
failure of BNE and the appointment of the FDIC as its
receiver had not been brought to the court's attention when
____________________
16. Defendant also contends that his Mastercard debts of
$20,400 have subsequently been sold to Citibank by the FDIC.
However, there is no evidence of this in the record before
us.
17. See supra, note 13. ___ _____
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it entered its order, hence the court order understandably
named BNE. Given that the FDIC "steps into the shoes" of a
failed bank, O'Melveny & Myers v. FDIC, 114 S. Ct. 2048, 2054 _________________ ____
(1994), we see no reason why the probation department should
not substitute the FDIC for the failed bank as the "victim"
of Phaneuf's fraud. See United States v. Haddock, 50 F.3d ___ _____________ _______
835, 841 (10th Cir. 1995) (holding that restitution was due a
bank that purchased one of the banks involved in the loan
transactions for which defendant was convicted); United ______
States v. Smith, 944 F.2d 618, 621-22 (9th Cir. 1991) ______ _____
(holding that the VWPA "is intended to encompass both direct
and indirect victims of criminal acts" and therefore allowing
the FSLIC to receive restitution), cert. denied, 503 U.S. 951 ____________
(1992); United States v. Rochester, 898 F.2d 971, 980 n.7 ______________ _________
(5th Cir. 1990) (holding that the district court may award
the FSLIC restitution under the VWPA when the FSLIC has
acquired the claims of an insolvent savings and loan that was
the victim of defendant's crime). Needless to say, such
matters remain subject to the district court's continuing
oversight and control, but we see no error subject to
appellate correction at this juncture.
III. III.
For the foregoing reasons, the judgment and
sentence of the district court is affirmed. affirmed. _________
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Document Info
Docket Number： 95-1389
Filed Date： 8/2/1996
Precedential Status： Precedential
Modified Date： 9/21/2015