Wednesday, February 5, 2020
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Ninth Circuit:
Prison Sentence of Nearly 20 Years for Fraud to Stand
Judges Reject Contention That Enhancement Based on 25 or More Victims Must Fall Because 25 Specific Persons Were Not Identified by the Sentencing Court
By a MetNews Staff Writer
The Ninth U.S. Circuit Court of Appeals yesterday affirmed a prison sentence of nearly 20 years for a man who cheated nearly 5,000 persons out of a sum exceeding $7 million through a loan modification scheme, rejecting his contention that the District Court erred in applying an enhancement based on there being 25 or more victims without specifying who they were.
The appeals court, in an opinion by Circuit Judge Eric D. Miller, also found no merit in the argument by Christopher George that the enhancement was improper because the requirement of a “substantial financial hardship” to the victims was not met given that individual losses were between $1,000 to $3,000.
Miller’s opinion affirms a sentence of 19 years and 7 months imposed by Chief Judge Virginia A. Phillips of the Central District of California on George, who co-owed and operated various telemarketing outfits including 21st Century Legal Services, Inc. He was convicted in 2015 on various counts entailing mail fraud and wire fraud.
Victims Not Identified
Addressing George’s assertion that the enhancement was invalidly imposed because Phillips did not identify 25 specific victims who suffered substantial hardship, Miller wrote:
“We do not agree that the district court would have been required to identify specific victims by name even if it had been asked to do so. We have held that estimating losses does not require ‘absolute precision,’ and a district court may ‘make a reasonable estimate...based on the available information.’…We conclude that the same is true of counting victims.”
Rebuffing the position that the losses did not constitute “substantial financial hardship,” as required by the relevant sentencing guideline, Miller said:
“George is right that, for some victims, causing the loss of a few thousand dollars would not be substantial enough to trigger the enhancement. But the district court did not clearly err in determining that ‘given the state that most of [George’s] victims were in,’ a few thousand dollars was indeed substantial. And at least 25 victims lost much more than that amount in fees—some lost their homes: some filed for bankruptcy; and many others borrowed money to avoid foreclosure, fell further behind on mortgage payments, renegotiated their loans on worse terms, or paid additional penalties and fines. The district court did not abuse its discretion in concluding that 25 or more victims suffered substantial financial hardship.”
Causation Established
The defendant insisted that he did not cause the homeowners’ financial plight. Miller responded:
“George induced his victims to pay him money and. in some cases, to stop making mortgage payments. The court could reasonably infer that George’s conduct was the direct cause—and certainly a but-for cause—of the ensuing financial hardship….Clear and convincing evidence supports the district court’s finding that the necessary number of victims suffered substantial financial hardship as a result of George’s offense.”
George protested that he did the homeowners no harm because they were destined to lose their homes, in any event. The jurist scoffed:
“ ‘I stole only from those who were already poor’ is not often advanced as an argument in mitigation, and we find it unpersuasive.”
The case is United States v. George, 18-50268.
Previous Opinion
George’s conviction and an order to make restitution in an amount exceeding $7 million were affirmed in a Feb. 27, 2018 memorandum opinion. That opinion remanded the case for resentencing because Phillips imposed an enhancement based on a finding that “the offense involved…a misrepresentation that the defendant was acting on behalf of...a government agency.”
Although representations to victims entailed references to government programs, the opinion said, there was no evidence that that payments made were going to the government.
The initial sentence of George was to a 20-year term; upon resentencing, five months were shaved off that term.
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