United States v. Francis Sanchez

NONPRECEDENTIAL DISPOSITION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 October 1, 2013
Decided October 2, 2013
Before
FRANK H. EASTERBROOK, Circuit Judge
ANN CLAIRE WILLIAMS, Circuit Judge
JOHN DANIEL TINDER, Circuit Judge
No. 12-3297
Appeal from the United States District
UNITED STATES OF AMERICA, Court for the Northern District of Illinois,
Plaintiff-Appellee, Western Division.
v. No. 10 CR 50073-1
FRANCIS X. SANCHEZ , Philip G. Reinhard,
Defendant-Appellant. Judge.
ORDER
For almost a decade Francis Sanchez and his codefendant pretended to be in the
business of buying and flipping distressed residential properties. They lured almost 100
investors with promises of profits from their rehabbing projects, as well as from a
luxury rental community they were building near Acapulco with backing from Mexican
authorities. None of this was true; the partners were running a Ponzi scheme that
collapsed after they took in more than $10 million. The government charged Sanchez
with 20 counts of mail or wire fraud, see 18 U.S.C. §§ 1341, 1343, but dropped all but one
count as part of a plea agreement. He was sentenced to 136 months’ imprisonment and
ordered to pay restitution of $7.9 million. Sanchez filed a notice of appeal, but his newly
appointed lawyer contends that the appeal is frivolous and seeks permission to
No. 12-3297 Page 2
withdraw under Anders v. California, 386 U.S. 738 (1967). Sanchez opposes counsel’s
motion. See CIR. R. 51(b). We confine our review to the potential issues identified in
counsel’s facially adequate brief and in Sanchez’s response. See United States v. Schuh,
289 F.3d 968, 973-74 (7th Cir. 2002).
Sanchez has told counsel that he wants his guilty plea set aside, so the lawyer
first discusses whether the defendant might challenge the adequacy of the plea colloquy
or the voluntariness of the plea. See United States v. Konczak, 683 F.3d 348, 349 (7th Cir.
2012); United States v. Knox, 287 F.3d 667, 670–71 (7th Cir. 2002). Before sentencing
Sanchez contemplated moving to withdraw his plea, but he never filed a motion.
Accordingly, we would review only for plain error. See United States v. Dominguez
Benitez, 542 U.S. 74, 76 (7th Cir. 2004); United States v. Driver, 242 F.3d 767, 769 (7th Cir.
2001).
The transcript of the plea colloquy confirms that the district court substantially
complied with Federal Rule of Criminal Procedure 11, from which we can infer that
Sanchez understood his procedural rights and the consequences of pleading guilty.
See FED R. CRIM. P. 11; United States v. Blalock, 321 F.3d 686, 688 (7th Cir. 2003); Schuh, 289
F.3d at 975. The court neglected to tell Sanchez that he could compel witnesses to attend
and testify at trial, see FED. R. CRIM. P. 11(b)(1)(E), but the lawyer correctly dismisses this
omission as inconsequential because that information was included in the written plea
agreement that Sanchez admittedly had read and reviewed with his attorney. See United
States v. Davenport, 719 F.3d 616, 618 (7th Cir. 2013); Driver, 242 F.3d at 771. Counsel has
not identified any other shortcoming in the colloquy, and thus we agree with the lawyer
that an appellate challenge to Sanchez’s guilty plea would be frivolous.
Counsel next considers whether Sanchez could argue that the district court erred
in calculating a loss amount exceeding $7 million; that figure prompted an upward
adjustment of 20 levels. See U.S.S.G. § 2B1.1(b)(1)(K). The probation officer arrived at a
total loss of $7.9 million by subtracting from gross receipts the amounts returned to
investors as principal or “profits.” That is the appropriate means of calculating loss
from a Ponzi scheme, see U.S.S.G. § 2B1.1, cmt. n.3(E); United States v. Walsh, 723 F.3d
802, 807–09 (7th Cir. 2013); United States v. Setser, 568 F.3d 482, 497 (5th Cir. 2009); United
States v. Nichols, 416 F.3d 811, 819–20 (8th Cir. 2005), and at no time did Sanchez dispute
the probation officer’s math. As counsel notes, Sanchez’s failure to contest the probation
officer’s calculation and to offer competing evidence would render frivolous an
appellate claim challenging the district court’s adoption of that calculation. See Walsh,
723 F.3d at 809; United States v. Sensmeier, 361 F.3d 982, 989 (7th Cir. 2004).
No. 12-3297 Page 3
Counsel further contemplates whether an argument can be made that Sanchez’s
prison sentence is unreasonable. The 136-month term is within the guidelines range of
121 to 151 months, and thus it is presumptively reasonable. See Rita v. United States, 551
U.S. 338, 341 (2007). The district court arrived at that sentence after evaluating the
factors in 18 U.S.C. § 3553(a), including Sanchez’s “good personal history” and lack of
prior fraudulent conduct, the large number of victims, the significant loss, the small
chance that victims would be compensated, and the need to deter others from
committing similar frauds. See id. § 3553(a)(1), (a)(2)(B), (C). Counsel has not identified
any ground to rebut the presumption of reasonableness, and neither have we. Thus, an
argument that the prison sentence is unreasonable would be frivolous.
Counsel last considers whether Sanchez could argue that the amount of
restitution is overstated. The lawyer concludes, and we agree, that an appellate claim
would be frivolous. Restitution must reflect the amount of loss actually caused by the
defendant’s offense. See United States v. Dokich, 614 F.3d 314, 318-19 (7th Cir. 2010). The
government relied on the victims’ bank records and the defendants’ own business
records to trace the funds received from, and returned to, the victims. The net amount
of approximately $7.9 million is the correct calculation in setting restitution for
Sanchez’s fraudulent scheme. See 18 U.S.C. §§ 3556, 3663A; Dokich, 614 F.3d at 320. (In
his Rule 51(b) response, Sanchez proposes to argue that the restitution order must be set
aside because the amount was not charged in the indictment and proved beyond a
reasonable doubt; he makes the same contention about the guidelines loss. We have
said repeatedly, though, that Apprendi v. New Jersey, 530 U.S. 466 (2000), does not apply
to the calculation of restitution. United States v. LaGrou Distrib. Sys., Inc., 466 F.3d 585,
593 (7th Cir. 2006); United States v. Behrman, 235 F.3d 1049, 1054 (7th Cir. 2000). Likewise,
Apprendi does not apply to upward adjustments under the guidelines. See, e.g., United
States v. Hollins, 498 F.3d 622, 633 (7th Cir. 2007); United States v. Hale, 448 F.3d 971, 988
(7th Cir. 2006).)
Sanchez proposes one other appellate claim in his Rule 51(b) response: that the
indictment is insufficient to charge mail fraud because, on his view, it is short on dates
and does not accuse him in every numbered paragraph of engaging in “fraud” or
“fraudulent behavior.” Yet his unconditional guilty plea waived any claim about defects
in the indictment. See United States v. Cotton, 535 U.S. 625, 632–33 (2002). And, at all
events, the indictment outlines a nine-year scheme that Sanchez and his partner devised
to defraud investors of millions, and it describes numerous misrepresentations they
made to accomplish that end. The government needed only to allege that Sanchez
devised a scheme “to deceive or cheat” his victims and that he used the mail to execute
No. 12-3297 Page 4
that scheme. See United States v. Leahy, 464 F.3d 773, 789 (7th Cir. 2006); United States v.
Henningsen, 387 F.3d 585, 589 (7th Cir. 2004). Moreover, the only date that matters is the
date of the mailing. See United States v. Danford, 435 F.3d 682, 688 (7th Cir. 2005); United
States v. Tadros, 310 F.3d 999, 1006 (7th Cir. 2002). Thus, even a timely challenge to this
indictment would have been frivolous.
The motion to withdraw is GRANTED, and the appeal is DISMISSED.