United States v. Andrews, Anthony H. ( 2007 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 06-3343
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
ANTHONY H. ANDREWS,
Defendant-Appellant.
____________
Appeal from the United States District Court
for the Western District of Wisconsin.
No. 06 CR 5—Barbara B. Crabb, Chief Judge.
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ARGUED FEBRUARY 15, 2007—DECIDED APRIL 30, 2007
____________
Before EASTERBROOK, Chief Judge, and POSNER and
KANNE, Circuit Judges.
KANNE, Circuit Judge. Anthony Andrews pled guilty
to one count of mail fraud in violation of 18 U.S.C. § 1341pursuant to a written plea agreement. In calculating his
advisory Sentencing Guidelines range, the district court
imposed a two-point increase in offense level for abuse
of a position of trust pursuant to U.S.S.G. § 3B1.3. The
district court sentenced Andrews to sixty months’ im-
prisonment as well as restitution in the amount of
$110,045.25. Andrews appeals the district court’s two-
point adjustment for abuse of a position of trust. We
affirm.
2 No. 06-3343
I. BACKGROUND
Anthony H. Andrews owned and operated Siren Auto
Sales, a used car dealership located in Siren, Wisconsin.
Andrews was licensed by the State of Wisconsin Depart-
ment of Transportation as a retail vehicle dealer. As a
licensed dealer, Andrews was required to follow Wisconsin
Department of Transportation regulations governing the
purchase and sale of vehicles.
Wisconsin regulations require a licensed dealer to
complete a Used Motor Vehicle Purchase Contract for each
used vehicle he sells. If a trade-in vehicle is part of the
transaction, the licensed dealer enters the details of any
outstanding loan on the vehicle on a standard form,
including the relevant financial institution and the
amount due at the time of the transaction. From this
information, the dealer determines how much he is owed
upon completion of the transaction. The dealer receives
his payment for the purchased vehicle either from the
purchaser or from an institution financing the transaction.
The dealer, rather than the purchaser, is then responsible
for making sure that any lien appearing on the trade-in’s
certificate of title is paid off and for certifying such
payment to the Wisconsin Department of Transportation.
When purchasers traded in vehicles, Andrews filled out
all of the required paperwork and certified to the Wiscon-
sin Department of Transportation that any liens had been
paid off in full. But, rather than actually paying off the
liens, Andrews made payments to the lien holders—
usually a bank. Through this scheme, Andrews could
continue using the lien holders’ funds without the lien
holder knowing that the security for the loan (the vehicle)
had actually been sold and that the lien had been fraudu-
lently removed from the title. Andrews engaged in this
conduct from January 2000 through January 2006, steal-
ing in the vicinity of one million dollars.
No. 06-3343 3
The presentence investigation report recommended a
two-point adjustment for Andrews’s role in the offense
pursuant to U.S.S.G. § 3B1.3 due to his abuse of a position
of trust. Andrews’s counsel objected to the adjustment
and argued that Andrews’s position as a car dealer does
not qualify as a position of trust, public or private. At the
sentencing hearing, the district court found that Andrews
had held a position of trust, and that he abused it in a way
that significantly facilitated his commission or conceal-
ment of his crime. The court stated: “You were licensed as
an automobile dealer. Your customers trusted you to pay
off the liens on their trade-in vehicles as promised, and in
accordance with state regulations, and the purchasers
of those vehicles relied on your certifications that the
vehicles were not encumbered.” R. 18, p. 12.
The two-point adjustment resulted in a total offense
level of twenty-three. Paired with a criminal history
category of II, this resulted in an advisory guideline range
of fifty-one to sixty-three months’ imprisonment.1 The
district court sentenced Andrews to sixty months’ impris-
onment as well as $110,045.25 in restitution.
II. ANALYSIS
Andrews raises only one issue on appeal: whether the
district court properly applied the two-point role in the
1
The question of whether Andrews’s sentence would still have
fallen within the guidelines range without the two-point ad-
justment was raised at oral argument and Andrews’s counsel
submitted a supplemental filing on the issue thereafter. Without
the adjustment, Andrews’s offense level is twenty-one, leading
to a guidelines range of forty-one to fifty-one months. As An-
drews was sentenced to sixty months’ imprisonment, we need
not consider the effect that overlapping ranges might have had
on our decision.
4 No. 06-3343
offense adjustment for his abuse of a position of trust. We
review the district court’s interpretation and application of
the Guidelines de novo, and its findings of fact for clear
error. United States v. Bothun, 424 F.3d 582, 586 (7th Cir.
2005); United States v. Frykholm, 267 F.3d 604, 612 (7th
Cir. 2001) (“We review de novo the district court’s inter-
pretation of what constitutes a ‘position of trust.’ ”).
The § 3B1.3 adjustment applies when “the defendant
abused a position of public or private trust . . . in a manner
that significantly facilitated the commission or conceal-
ment of the offense . . . .” U.S.S.G. § 3B1.3. In order to
determine whether the adjustment is appropriate for a
particular defendant, we ask: “1) whether the defendant
occupied a position of trust; and 2) whether his abuse
of the position of trust significantly facilitated the crime.”
United States v. Stewart, 33 F.3d 764, 768 (7th Cir. 1994)
(citing United States v. Boyle, 10 F.3d 485, 488 (7th Cir.
1993)); see also United States v. Fife, 471 F.3d 750, 753
(7th Cir. 2006). “District courts need not be overly formal
when determining whether a given position is one of trust;
rather, they should look beyond labels, to the nature of
the position the defendant is in and the responsibilities
entrusted to him.” Fife, 471 F.3d at 753 (citing United
States v. Snook, 366 F.3d 439, 445 (7th Cir. 2004); United
States v. Mabrook, 301 F.3d 503, 510 (7th Cir. 2002)); see
also United States v. Davuluri, 239 F.3d 902, 908 (7th
Cir. 2001).
A defendant may occupy a position of trust if he has been
given “access or authority over valuable things.” United
States v. Lamb, 6 F.3d 415, 421 (7th Cir. 1993). Positions
of trust are often characterized by great discretion to act
on another’s behalf. United States v. Baldwin, 414 F.3d
791, 799 (7th Cir. 2005); Davuluri, 239 F.3d at 909 (citing
United States v. Hernandez, 231 F.3d 1087, 1091 (7th Cir.
2000); United States v. Hoogenboom, 209 F.3d 665, 671
No. 06-3343 5
(7th Cir. 2000); United States v. Gellene, 182 F.3d 578, 596
(7th Cir. 1999)). Additionally, a position of trust signifi-
cantly facilitates a crime when it makes the crime either
easier to commit or more difficult for others to detect.
Stewart, 33 F.3d at 768 (citing United States v. Gould, 983
F.2d 92, 94 (7th Cir. 1993)).
The § 3B1.3 adjustment applies not only to public
positions of trust, but also to private positions of trust.
Baldwin, 414 F.3d at 797-99 (affirming application of
abuse of trust adjustment where defendant used years-
long friendship to convince victim to invest millions of
dollars); United States v. Strang, 80 F.3d 1214, 1220 (7th
Cir. 1996) (affirming application of abuse of trust ad-
justment where defendant, although not a licensed invest-
ment broker, befriended victims and convinced them to
invest in fraudulent scheme). While we draw no bright
line where the abuse of a position of trust begins or
ends, more than a mere contractual or arm’s length
commercial relationship is required. United States v.
Dorsey, 27 F.3d 285, 289 (7th Cir. 1994) (citing United
States v. Parker, 25 F.3d 442 (7th Cir. 1994)).
Andrews relies heavily on United States v. Dorsey where
we reversed the imposition of an abuse of trust adjust-
ment to the sentence of a car dealer who defrauded a
bank. 27 F.3d 285. Dorsey obtained a “floor-plan” loan
from his bank for the purchase of cars directly from the
manufacturer. Id. at 287. Dorsey then sold those cars,
while representing to his bank that the cars remained
unsold at his dealership. Id. This allowed Dorsey to use
both the loan money and the proceeds from the sales for
his personal use. Id. We reversed the district court’s ap-
plication of the position of trust adjustment in Dorsey,
holding that he was merely engaged in a standard com-
mercial relationship with the bank. Id. at 289.
The circumstances in Dorsey stand in contrast with those
of United States v. Stewart. 33 F.3d at 764. Stewart, a
6 No. 06-3343
licensed insurance broker, solicited elderly customers to
purchase annuities to fund their own funerals on a pre-
need basis as a legal way of reducing their financial
estates in order to qualify for Medicaid funds for nursing
home expenses. 33 F.3d at 766. Rather than actually
securing payment of their funeral expenses, Stewart
converted his customers’ investments for his own use
while representing to the designated funeral directors
that the annuities had been purchased. Id. We held that
the district court clearly erred in not applying the § 3B1.3
adjustment. Id. at 770. Stewart could not have purchased
the annuities if he was not a licensed insurance broker,
and his licensed status also enabled him to convince the
funeral directors that their services would be funded.
Id. at 768-69. While licensed status does not per se place
an individual in a position of trust, it is one factor
among many to be considered in the factual context of the
case. See id. at 766-70.
The facts of this case are more akin to Stewart than to
Dorsey. Andrews was licensed by the state of Wisconsin as
a retail vehicle dealer. His licensed status subjected him to
Wisconsin Department of Transportation regulations
requiring him to pay off his customers’ prior loan obliga-
tions and to certify such payment to the Department of
Transportation. His responsibility to remove the liens
took the situation out of the purchasers’ hands, and his
certification to the Department of Transportation allowed
him to conceal his crime.
Andrews argues that the mandatory nature of his
responsibilities as a licensed dealer is precisely why he
did not hold a position of trust. Because positions of trust
are often characterized by broad discretion, Andrews
argues that his obligation to pay off his customers’ liens
cannot place him in a position of trust. But Andrews
was entrusted with his customers’ money to act on their
behalf. His customers need not have given him assets
No. 06-3343 7
and told him to do what he pleased with them. They
trusted him to act in their interests and in accordance
with law, and his licensed status fostered that trust and
his concealment of his actions.
Andrews’s licensed status and responsibility to act on
behalf of his customers placed him in a position of trust.
His abuse of that position gave him control of the assets
and allowed him to conceal his actions by certifying
payment to the Wisconsin Department of Transportation.
The district court’s application of the two-point adjust-
ment for an abuse of a position of trust pursuant to
§ 3B1.3 was not clearly erroneous.
III. CONCLUSION
For the foregoing reasons, the judgment of the district
court is AFFIRMED.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—4-30-07