United States v. Harley

Opinions of the United
2008 Decisions States Court of Appeals
for the Third Circuit
1-8-2008
USA v. Harley
Precedential or Non-Precedential: Non-Precedential
Docket No. 05-5086
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Recommended Citation
"USA v. Harley" (2008). 2008 Decisions. Paper 1791.
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NOT PRECEDENTIAL
IN THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
______________
No: 05-5086
______________
UNITED STATES OF AMERICA
v.
MICHAEL K. HARLEY,
Appellant
_______________
On Appeal from the United States District Court
for the Middle District of Pennsylvania
(D.C. No. 05-cr-00192)
District Judge: Honorable Sylvia H. Rambo
_______________
Submitted Under Third Circuit LAR 34.1(a)
January 7, 2008
Before: FUENTES and JORDAN, Circuit Judges
and O’NEILL*, District Judge.
(Filed : January 8, 2008)
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OPINION OF THE COURT
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JORDAN, Circuit Judge.
_______________
*Honorable Thomas N. O’Neill, Jr., District Court Judge for the Eastern District of
Pennsylvania, sitting by designation.
On this appeal from the sentence he received after being convicted of wire fraud,
Michael K. Harley contends that the District Court erred in its application of the United
States Sentencing Guidelines. Finding no error, we will affirm.
Background
Because we write solely for the parties’ benefit, we assume familiarity with the
case and discuss only those facts necessary to our decision. Harley served for several
years in the accounting department of Voith Siemens Hydro Power Generation, Inc.
(“Voith”). In 1998, following a promotion to General Accounting Manager, he was given
authority to initiate and approve wire transfers, to draw funds from Voith’s checking
account, and to reconcile monthly bank statements. Shortly before that promotion, and
with increasing frequency after it, Harley used his position to embezzle. He left his job
with Voith early in 2004. By August, the company had discovered accounting
irregularities and had begun to investigate Harley’s transactions over the years. The
investigation revealed that Harley had stolen more than $5.3 million from the company.
On June 30, 2005, Harley waived indictment and pled guilty to an information
charging him with committing wire fraud in violation of 18 U.S.C. § 1343. He was
sentenced to sixty-three months imprisonment, three years of supervised release, no fine,
and restitution of nearly $3 million.
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Discussion
Harley makes four arguments on appeal.1 First, he asserts that the District Court’s
decision to apply a two-point increase to his offense level for use of a sophisticated
scheme is error. The only basis Harley provides for that assertion is that he was only
using standard accounting tools and techniques. We think he gives himself and other
accountants too little credit. Accountants have the benefit of specialized knowledge, and
the embezzlement scheme Harley employed required specialized, sophisticated
knowledge to engineer and execute. It involved not only the theft of the money but the
continuing need to conceal the thefts. Cf. U.S.S.G., § 2B1.1, Application Note 8(B)
(“Conduct such as hiding assets or transactions, or both, through the use of fictitious
entities, corporate shells, or offshore financial accounts ... ordinarily indicates
sophisticated means.”). That the scheme was ultimately detected makes it no less
sophisticated and no less worthy of the dubious honor of a two-point increase in the
1
The District Court had jurisdiction over this case pursuant to 18 U.S.C. § 3231.
We have jurisdiction under both 28 U.S.C. § 1291 and 18 U.S.C. § 3742(a). We look for
clear error when reviewing the District Court’s factual findings related to sentencing.
United States v. Grier, 475 F.3d 556, 570 (3d Cir. 2007) (en banc). Our review of the
District Court’s interpretation of the Sentencing Guidelines is plenary. Id. “We review
the District Court's application of the Guidelines to facts for abuse of discretion.” United
States v. Tupone, 442 F.3d 145, 149 (3d Cir. 2006). And we also review for abuse of
discretion the determination of the appropriate sentence; we will not disturb a sentence
that can be characterized as “reasonable.” See Gall v. United States, 2007 WL 4292116,
at *6 (U.S., Dec. 10, 2007) (“[A]ppellate review of sentencing decisions is limited to
determining whether they are ‘reasonable.’ Our explanation of ‘reasonableness’ review ...
made it ... clear that the familiar abuse-of-discretion standard of review now applies ... .”).
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offense level. The District Court’s conclusion to that effect was not an abuse of
discretion.
Second, Harley argues that the District Court erred in applying another two-point
offense level increase based on his having abused a position of trust. In particular, he
contends that the abuse-of-trust aspect of his crime, to the extent there is any such aspect,
is already accounted for in the Guideline setting his base offense level. Given the record,
this argument is particularly strained. The specific Guidelines provision used to calculate
the base offense level was § 2B1.1, which applies to all manner of theft, fraud, and deceit,
including wire fraud, the offense for which Harley was convicted. It is simply not the
case that all fraud involves a breach of trust, though this fraud most certainly did. Harley
gained his employer’s trust and, having attained the power to initiate funds transfers on
his own, he abused that trust to line his pockets. The District Court’s decision to impose
the two-point abuse-of-trust enhancement called for by Guideline § 3B1.3 is fully
justified. Cf. U.S.S.G., § 3B1.3, Application Note 1 (“This adjustment, for example,
applies in the case of ... a bank executive's fraudulent loan scheme ... .”).
Harley’s final two arguments are that the District Court erred in refusing to grant
him a downward departure for exceptional acceptance of responsibility and that his
sentence of sixty-three months incarceration is unreasonable under 18 U.S.C. § 3553(a).
As to the former argument, the District Court’s discretionary decision is not subject to
review. United States v. Cooper, 437 F.3d 324, 333 (3d Cir. 2006) (declining to review a
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district court's decision to deny departure). As to the latter argument, we conclude that,
particularly under the broad discretion afforded to district courts in sentencing, the
sentence imposed was reasonable. See Gall, 2007 WL 4292116, at *8 (“The sentencing
judge is in a superior position [to an appellate court] to find facts and judge their import
under § 3553(a) in the individual case.” (internal quotation marks and citation omitted)).
Conclusion
Accordingly, we will affirm the judgment of sentence.
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