United States v. Reyes-Rivera , 812 F.3d 79 ( 2016 )

United States Court of Appeals
For the First Circuit
No. 14-1712
UNITED STATES OF AMERICA,
Appellee,
v.
DILEAN REYES-RIVERA,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
[Hon. Aida M. Delgado-Colón, Chief U.S. District Judge]
Before
Lynch, Stahl, and Barron,
Circuit Judges.
Michael R. Hasse, for appellant.
Nelson Pérez-Sosa, Assistant United States Attorney, Chief,
Appellate Division, with whom Rosa Emilia Rodríguez-Vélez, United
States Attorney, was on brief, for appellee.
January 29, 2016
LYNCH, Circuit Judge. Dilean Reyes-Rivera was the
mastermind of a Ponzi scheme, operated largely in Puerto Rico,
which defrauded over 230 vulnerable people out of approximately
$22 million. In 2012, he pled guilty to bank fraud and to
conspiracy to commit wire fraud, and in 2013 he was sentenced to
concurrent terms of 60 months of imprisonment on the wire fraud
conspiracy count and 242 months on the bank fraud count. He
appeals, bringing a number of challenges to his 242-month sentence,
basically saying the sentence is too high because his was only a
"run-of-the-mill" Ponzi scheme. Finding no error, we affirm.
I.
Because this sentencing appeal follows a guilty plea, we
draw the relevant facts from the plea agreement, the change-of-
plea colloquy, the presentence investigation report ("PSR"), and
the transcript of the sentencing hearing. United States v. King,
741 F.3d 305, 306 (1st Cir. 2014).
Reyes-Rivera was the president of Global Reach Trading
("GRT"), a for-profit corporation registered in Florida and Puerto
Rico that operated as a front for an extensive Ponzi scheme. As
president, Reyes-Rivera had access to and signatory authority on
all GRT bank accounts and business transactions. Reyes-Rivera's
younger brother, Jeffrey Reyes-Rivera ("Jeffrey"), a licensed
attorney in Puerto Rico, was one of the incorporators of GRT as
well as its accountant, and was a co-defendant.
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Between 2001 and 2007, the Reyes-Rivera brothers, along
with promoters and sales agents who worked for GRT, solicited money
from unsuspecting individuals, mostly from Puerto Rico, by
promising to invest the money in low-risk, short-term, high-yield
investment programs. Investors were guaranteed a particular rate
of return, ranging between five percent and twenty percent.
Neither Reyes-Rivera, Jeffrey, nor GRT was registered or licensed
to offer or sell investments to the general public by either the
U.S. Securities and Exchange Commission or the Office of the
Commissioner of Financial Institutions of Puerto Rico.
The money they secured from misled investors was not
actually invested but instead funded a Ponzi scheme, in which they
used the money they received from later investors to pay "returns"
to earlier investors. The Reyes-Riveras took about $4.6 million
from the proceeds of the scheme to purchase or lease for their own
benefit luxury vehicles, houses, furniture, jewelry, and trips.
During the course of the scheme, the Reyes-Riveras also
operated other entities, incorporated in Puerto Rico, Antigua and
Barbuda, and Florida, in order to conduct businesses similar to
GRT. In 2005, Reyes-Rivera, on behalf of one of these entities,
WR4 Equity Corporation, secured a mortgage loan with First Bank,
a federally insured financial institution, for approximately $1.7
million with the use of fraudulent documents, including personal
financial statements and a GRT financial statement.
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To conceal the scheme, the Reyes-Riveras placed the
funds invested in GRT in eighteen different bank accounts, held in
their personal names and in the names of their various entities,
and with at least three different banks in multiple countries.
They also did not refer to the investors' signed investment
contracts as involving "securities." Instead, they used various
misleading euphemisms like "Private Programs of Commercial Paper"
and "Special Private Placement Programs." In addition, they
imposed a strict code of confidentiality and non-disclosure on
their investors.
Dilean Reyes-Rivera was the mastermind of the operation.
He admitted after his arrest that he influenced Jeffrey to assist
him in perpetrating the fraud and that Jeffrey followed his
instructions. He also stated that he was the one who made all of
the business decisions, that Jeffrey always consulted him before
making a contract or bringing in a new investor, and that he never
actually explained the business to Jeffrey.1
When all was said and done, Reyes-Rivera had defrauded
more than 230 investors out of over $22 million. Many of these
victims were retirees or pensioners. The PSR includes summaries
of victim impact statements submitted by roughly fifty of Reyes-
1 At oral argument, Reyes-Rivera's counsel stated that
Jeffrey was fully aware of the nature of the scheme. But this
representation is inconsistent with a contrary statement in the
PSR, to which Dilean did not object.
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Rivera's victims. The victims described how much they invested
and how many lost their life savings. Many now suffer physical
and emotional problems, such as anxiety, high blood pressure,
insomnia, depression, and panic attacks. One victim described
becoming incapacitated and being hospitalized in a psychiatric
facility and placed on psychotropic medications. Another became
suicidal.
II.
On September 25, 2008, the Reyes-Riveras were indicted
by a grand jury on counts of conspiracy to commit securities fraud,
conspiracy to commit wire fraud, and conspiracy to commit money
laundering, as well as a forfeiture allegation. Reyes-Rivera alone
was also indicted on an additional count of bank fraud based on
the WR4 Equity Corporation mortgage loan. Reyes-Rivera fled and
remained a fugitive until he was arrested in Spain on September 6,
2009 and extradited to the United States on October 18, 2010.
On November 21, 2012, the Reyes-Riveras entered into a
package plea deal. Dilean Reyes-Rivera pled guilty to conspiracy
to commit wire fraud, which carries a statutory maximum term of
five years' imprisonment, 18 U.S.C. §§ 371, 1343, and bank fraud,
which carries a statutory maximum term of thirty years'
imprisonment, id. § 1344. He also admitted the forfeiture
allegation. Id. § 982(a)(2)(A).
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The plea agreement calculated Reyes-Rivera's guidelines
sentencing range to be 121 to 151 months, based on the following:
a base offense level of seven, U.S.S.G. § 2B1.1(a)(1), a criminal
history category of I, a twenty-point enhancement because the
amount of loss exceeded $7 million, id. § 2B1.1(b)(1)(K), a four-
point enhancement because more than fifty victims were involved,
id. § 2B1.1(b)(2)(B), a two-point enhancement because Reyes-Rivera
derived more than $1 million in gross receipts from one or more
financial institutions, id. § 2B1.1(b)(15)(A), a two-point
enhancement for his leadership role in the scheme, id. § 3B1.1(c),
and a three-point reduction for acceptance of responsibility, id.
§ 3E1.1.2 The government, however, agreed to recommend a sentence
of between 72 and 136 months of imprisonment. The plea agreement
also stated that the government intended to seek full restitution
in the amount of $22 million. On November 21, 2012, a magistrate
judge recommended that the district court accept Reyes-Rivera's
guilty plea.3
2 Because Reyes-Rivera was sentenced on June 26, 2013, the
November 2012 version of the sentencing guidelines applies. See
U.S.S.G. § 1B1.11(a).
3 The PSR was filed on May 22, 2013. It calculated Reyes-
Rivera's guidelines sentencing range to be 235 to 293 months of
imprisonment. This calculation differed from the calculation in
the plea agreement because it imposed 1) a twenty-two-point
enhancement for losses in excess of $20 million, U.S.S.G.
§ 2B1.1(b)(1)(L); 2) a two-point enhancement for use of
sophisticated means, id. § 2B1.1(b)(10)(C); and 3) a four-point
enhancement for Reyes-Rivera's leadership role, id. § 3B1.1(a).
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Sentencing took place on June 26, 2013.4 Many of the
victims appeared and the district court heard statements from those
who wished to speak. The district court calculated Reyes-Rivera's
guidelines sentencing range to be 188 to 235 months, which is not
independently challenged on appeal. The district court used a
base offense level of seven and a criminal history category of I.
The court then imposed a twenty-point enhancement for amount of
loss, a two-point enhancement for Reyes-Rivera's leadership role,
a four-point enhancement for the number of victims, a two-point
enhancement for gross receipts in excess of $1 million, and a
three-point reduction for acceptance of responsibility, as
recommended by the plea agreement. It additionally imposed a two-
point enhancement for use of sophisticated means, as recommended
The PSR also recommended restitution in the amount of $22 million,
and noted that if the court were to consider a variance, it could
factor in the severe harm caused to the victims of the scheme and
the fact that Reyes-Rivera remained a fugitive before his arrest
and extradition. Reyes-Rivera filed objections to the
enhancements for amount of loss, sophisticated means, and
leadership role; the $22 million restitution recommendation; and
the statement of factors that might support a variance.
4 Before sentencing, Reyes-Rivera filed a sentencing
memorandum raising the issue of sentencing disparity, referencing
three cases -- two from within the District of Puerto Rico and one
from the Southern District of New York -- that he alleged were
substantially similar to his case and resulted in sentences similar
to the lower end of what was recommended in the plea agreement.
His sentencing memorandum also urged the district court to consider
his efforts to assist the government in investigating the scheme
and his "fruitful efforts to rehabilitate."
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by the PSR. The court also, sua sponte, imposed a two-point
enhancement for abuse of a position of trust. Id. § 3B1.3.
After calculating the guidelines range and explaining
its consideration of the 18 U.S.C. § 3553(a) factors, the court
sentenced Reyes-Rivera to concurrent terms of imprisonment of 60
months on the wire fraud conspiracy count and 242 months on the
bank fraud count. In choosing to impose a seven-month upward
variance, the district court placed particular emphasis on the
"pain and suffering" that Reyes-Rivera caused his victims,
recounting in detail the physical, emotional, and financial harm
inflicted upon them. Restitution was also ordered in the amount
of $10,629,021.01. This appeal followed.
Jeffrey, who was not indicted on the bank fraud count
and so only pled guilty to the wire fraud conspiracy count, was
sentenced to 48 months of imprisonment by the same judge.5
III.
We review a district court's imposition of a sentence
for abuse of discretion. United States v. Clogston, 662 F.3d 588,
590 (1st Cir. 2011). Our analysis is two-fold: "we first determine
5 The judgment entered on June 12, 2014 in Jeffrey Reyes-
Rivera's case states that he was sentenced to 48 months of
imprisonment. However, Dilean Reyes-Rivera, in his brief before
this court, represents that Jeffrey was sentenced to 58 months.
Citing Reyes-Rivera's brief, the government also places Jeffrey's
sentence at 58 months. In any event, whether Jeffrey was sentenced
to 48 or 58 months does not impact our resolution of the case.
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whether the sentence imposed is procedurally reasonable and then
determine whether it is substantively reasonable." Id.
We review the district court's interpretation of the
guidelines de novo and its fact finding for clear error. United
States v. O'Connell, 252 F.3d 524, 528–29 (1st Cir. 2001). When
the defendant fails to raise a procedural objection at sentencing,
however, we review only for plain error. United States v. Millán-
Isaac, 749 F.3d 57, 66 (1st Cir. 2014). To show plain error, a
defendant must establish: "(1) that an error occurred (2) which
was clear or obvious and which not only (3) affected the
defendant's substantial rights, but also (4) seriously impaired
the fairness, integrity, or public reputation of judicial
proceedings." United States v. Duarte, 246 F.3d 56, 60 (1st Cir.
2001).6
A. Procedural Reasonableness
A sentence is procedurally reasonable if "the district
court committed no significant procedural error, such as failing
to calculate (or improperly calculating) the Guidelines range,
treating the Guidelines as mandatory, failing to consider the
§ 3553(a) factors, selecting a sentence based on clearly erroneous
facts, or failing to adequately explain the chosen sentence --
6 The parties are correct that the waiver of appeal
provision in Reyes-Rivera's plea agreement does not bar the instant
appeal because the sentencing judge did not sentence Reyes-Rivera
in accordance with the plea agreement's recommended sentence.
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including an explanation for any deviation from the Guidelines
range." United States v. Martin, 520 F.3d 87, 92 (1st Cir. 2008)
(quoting Gall v. United States, 552 U.S. 38, 51 (2007)). Reyes-
Rivera launches several attacks on the procedural reasonableness
of his sentence, only some of which are preserved, and all of which
we reject.
1. Abuse of Position of Trust Enhancement
Reyes-Rivera argues that the district court erred in
imposing an enhancement for abuse of a position of trust, saying
he does not meet the qualifications. U.S.S.G. § 3B1.3 provides
for a two-point enhancement "[i]f the defendant abused a position
of public or private trust . . . in a manner that significantly
facilitated the commission or concealment of the offense." For
the enhancement to apply, "the district court must first decide
that the defendant occupied a position of trust and then find that
he used that position to facilitate or conceal the offense."
United States v. Gill, 99 F.3d 484, 489 (1st Cir. 1996).
Application note 1 to § 3B1.3 states that a position of
public or private trust is one "characterized by professional or
managerial discretion" and that "[p]ersons holding such positions
ordinarily are subject to significantly less supervision than
employees whose responsibilities are primarily non-discretionary
in nature." U.S.S.G. § 3B1.3 cmt. n.1; see United States v.
Chanthaseng, 274 F.3d 586, 589 (1st Cir. 2001).
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Application note 3 clarifies that the enhancement
applies equally to those holding a "sham position of trust."
United States v. Haber, 251 F.3d 881, 891 (10th Cir. 2001).
This adjustment also applies in a case in
which the defendant provides sufficient
indicia to the victim that the defendant
legitimately holds a position of private or
public trust when, in fact, the defendant does
not. For example, the adjustment applies in
the case of a defendant who (A) perpetrates a
financial fraud by leading an investor to
believe the defendant is a legitimate
investment broker; or (B) perpetrates a fraud
by representing falsely to a patient or
employer that the defendant is a licensed
physician. In making the misrepresentation,
the defendant assumes a position of trust,
relative to the victim, that provides the
defendant with the same opportunity to commit
a difficult-to-detect crime that the defendant
would have had if the position were held
legitimately.
U.S.S.G. § 3B1.3 cmt. n.3; see United States v. Ghertler, 605 F.3d
1256, 1265–66 (11th Cir. 2010) (explaining the history and purpose
of application note 3).
Reyes-Rivera asserts that he did not possess any
professional or managerial discretion because he was just an
"investment lender, or salesman," which "did not in any way give
him any special ability to commit a difficult-to-detect wrong."
He argues that all fraud schemes require some level of trust
between the fraudster and the victim, and so "the mere fact that
the victim-investors in this case may have trusted . . . Reyes-
Rivera is not sufficient to justify the application of this
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increase." See United States v. Hirsch, 239 F.3d 221, 227 (2d
Cir. 2001).
He understates his role, and the district court
committed no error. Reyes-Rivera "in fact exercised considerable
authority and discretion" at GRT. United States v. Sicher, 576
F.3d 64, 72 (1st Cir. 2009). He was not a simple salesman; he was
the president of, what appeared to be, a legitimate investment
company. He retained access to and signatory authority on all GRT
bank accounts and business transactions.7
As to the question whether he "used [his] position to
facilitate or conceal the offense," id. at 71 (quoting Gill, 99
F.3d at 489), it is close to self-evident that Reyes-Rivera was
able to operate and conceal his scheme in large part because he
held himself out as the president of a purportedly legitimate
investment company. The district court found that Reyes-Rivera
used his position to "seek[] persons to trust in his ability to do
investments and to receive the monies to be placed under his
trust . . . in promise of a high yield return." The court further
characterized Reyes-Rivera as having "invite[d] [the victims] as
president of a corporation that was doing this type of investment
7 As for his actual authority, Reyes-Rivera conceded that
Jeffrey followed all of his instructions, that Reyes-Rivera was
the one who made all the business decisions, and that Jeffrey
always consulted him before making a contract or bringing in a new
investor. In fact, he admitted that he never even explained the
business to Jeffrey.
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when [he was] lying to them in terms of [his] abilities, [his]
potential or the investments."
Reyes-Rivera had also previously held a valid license to
sell securities for a prior employer. As the district court found,
"his training in securities, the experience he had gained allowed
him to step in, make all of these representations concerning this
huge, magnificent investment he was offering out there." This
fits neatly into application note 3.
Several of his victims stated that he in fact betrayed
their trust. And Reyes-Rivera recognized at sentencing that "they
trusted in me." See id. at 73 (While "testimony by individuals
that they trusted someone who betrayed their trust does not itself
establish that the position was a position of trust[, t]he
testimony . . . is not irrelevant.").
The enhancement was correctly applied.
2. Sophisticated Means Enhancement
Reyes-Rivera argues that the district court erred in
imposing a two-point enhancement for his use of "sophisticated
means" in operating the scheme. U.S.S.G. § 2B1.1(b)(10)(C).
Application note 8(B) provides: "[c]onduct such as hiding assets
or transactions, or both, through the use of fictitious entities,
corporate shells, or offshore financial accounts . . . ordinarily
indicates sophisticated means." Id. § 2B1.1 cmt. n.8(B). The
district court found, in accordance with application note 8(B),
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that Reyes-Rivera operated several different corporate entities
with bank accounts at various institutions in several countries
"in order to conceal the illegal nature and source of funds [the
Reyes-Riveras] had received from GRT." Reyes-Rivera appears to
have accepted this finding on appeal, conceding that "this
enhancement was part of his stipulated conduct." Either way, there
was no error in the district court's finding.
His argument on appeal instead urges this court to "apply
a relative scale in making findings as to sophistication," claiming
that relative to other Ponzi schemes, his was just "run-of-the-
mill." He candidly admits that he has "no judicial, statutory, or
regulatory support" for his theory. On this admission, we agree.
There is no error.
3. Overlapping Enhancements
Reyes-Rivera makes two related arguments to the effect
that the district court erred by imposing a series of enhancements
that are "substantively overlapping." Both of these arguments are
raised for the first time on appeal, and so the government argues
they are waived.8 See United States v. Torres-Landrúa, 783 F.3d
8 Simply to say that Reyes-Rivera did not raise the issue
in the trial court is insufficient to establish waiver. See United
States v. Walker, 538 F.3d 21, 23 (1st Cir. 2008). The arguments
may well be waived, though. Reyes-Rivera not only failed to object
to the series of enhancements, but he also affirmatively agreed in
his plea agreement to four of the six enhancements accounting for
twenty-eight of the thirty-two enhancement points he received.
See United States v. Rivera-Orta, 500 F. App'x 1, 3 (1st Cir. 2013)
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58, 66 (1st Cir. 2015); United States v. Falu-Gonzalez, 205 F.3d
436, 440 (1st Cir. 2000).
The arguments, whether waived or not, still fail plain
error review. Reyes-Rivera's first argument is that the district
court engaged in impermissible "double counting." He is wrong.
"[W]hen 'neither an explicit prohibition against double counting
nor a compelling basis for implying such a prohibition exists,
clearly indicated adjustments for seriousness of the offense and
for offender conduct can both be imposed, notwithstanding that the
adjustments derive in some measure from a common nucleus of
operative facts.'" United States v. McCarty, 475 F.3d 39, 46 (1st
Cir. 2007) (quoting United States v. Lilly, 13 F.3d 15, 20 (1st
Cir. 1994)); see United States v. Fiume, 708 F.3d 59, 62 (1st Cir.
2013) ("Given the Commission's proclivity for indicating when
double counting is forbidden, we are reluctant to infer further
such instances out of thin air.").
Reyes-Rivera does not point to any explicit prohibition
against applying these enhancements as double counting and offers
("A defendant cannot agree to both an enhancement and its factual
predicate, reiterate that agreement in open court, and later
repudiate it merely to suit his later convenience."); United States
v. Serrano-Beauvaix, 400 F.3d 50, 56 (1st Cir. 2005). "These
actions ring not of 'oversight, inadvertence, or neglect in
asserting a potential right,' but rather of a deliberate course of
conduct." United States v. Gaffney-Kessell, 772 F.3d 97, 100 (1st
Cir. 2014) (quoting United States v. Eisom, 585 F.3d 552, 556 (1st
Cir. 2009)).
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no compelling explanation for inferring a prohibition. Sentencing
enhancements serve different purposes, see Lilly, 13 F.3d at 18–
19, and we see no plain error in the court's determination that
each of these enhancements applied.9
Reyes-Rivera's second argument is that the district
court erred by not granting a "downward departure"10 in light of
the allegedly overlapping enhancements, citing United States v.
Jackson, 346 F.3d 22, 26 (2d Cir. 2003). We will treat this issue
under the topic of substantive reasonableness below.
4. Cooperation with the Government
Reyes-Rivera next argues that "the sentencing court
should have considered and reduced [his] offense level or at least
have imposed the agreed upon sentence because of [his] complete
and candid cooperation [with the government], in accordance with
9 At one point in his brief, Reyes-Rivera takes aim at the
amount of loss enhancement. He argues that the district court
miscalculated the amount of loss, pointing to a debate at
sentencing about the proper restitution amount. He offers
$8,154,700 as the appropriate figure. But the twenty-point
enhancement he received under U.S.S.G. § 2B1.1(b)(1)(K) applies to
an amount of loss in excess of $7 million. So the enhancement
plainly applies.
10 It is not clear from his brief if Reyes-Rivera is arguing
that the district court should have granted a downward departure
or a downward variance. These terms have different meanings. See
United States v. Vega-Santiago, 519 F.3d 1, 3 (1st Cir. 2008) (en
banc). Either way, we reject his claim.
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U.S.S.G. § 5K1.1."11 Though the parties acknowledged Reyes-
Rivera's assistance in the plea agreement, § 5K1.1 is inapplicable.
That provision states: "Upon motion of the government stating that
the defendant has provided substantial assistance in the
investigation or prosecution of another person who has committed
an offense, the court may depart from the guidelines." U.S.S.G.
§ 5K1.1. Reyes-Rivera does not identify any motion from the
government stating that he provided substantial assistance.
Neither is there a mention of one in the sentencing transcript or
in his sentencing memorandum. And on appeal, he raises no
challenge to the government's decision not to file such a motion.
See United States v. Mulero-Algarín, 535 F.3d 34, 38–39 (1st Cir.
2008).
He may be arguing that the district court should have
considered, on the record, his assistance to the government and
accordingly given him a lower sentence. See United States v.
Pacheco, 727 F.3d 41, 47 (1st Cir. 2013) (recognizing government
cooperation as section 3553(a) factor). This amounts to an
argument that the district court did not properly consider the
11 The government makes no attempt to respond to this
argument in its brief. This, along with the government's two-
sentence, perfunctory response to Reyes-Rivera's abuse of trust
argument, compels us to repeat the warning issued in United States
v. Villanueva Lorenzo, 802 F.3d 182, 187 n.5 (1st Cir. 2015): "The
government risks losing a case it should not lose . . . with that
kind of advocacy."
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section 3553(a) factors. We reject the argument. The district
court stated that it considered the section 3553(a) factors. See
United States v. Madera-Ortiz, 637 F.3d 26, 31 (1st Cir. 2011)
("[T]he fact that the court stated that it had considered all the
section 3553(a) factors is entitled to some weight." (quoting
United States v. Dávila-González, 595 F.3d 42, 49 (1st Cir.
2010))). And after carefully reviewing the sentencing transcript,
we are confident that the district court gave sufficient
consideration to the section 3553(a) factors, and it did not err
by not expressly stating on the record its consideration of Reyes-
Rivera's assistance to the government. A district court need not
verbalize its evaluation of each and every section 3553(a) factor.
See Dávila-González, 595 F.3d at 49; United States v. Quiñones-
Medina, 553 F.3d 19, 26–27 (1st Cir. 2009).
"Merely raising potentially mitigating factors does not
guarantee a lesser sentence," Dávila-González, 595 F.3d at 49, and
"having discretion to consider something does not entitle a
defendant to force the district court to factor the issue being
considered into its final decision," Pacheco, 727 F.3d at 48.
B. Substantive Reasonableness
The substantive reasonableness of a sentence is
reviewed, considering the totality of the circumstances, for abuse
of discretion. United States v. Ruiz-Huertas, 792 F.3d 223, 226
(1st Cir. 2015). A sentence will stand so long as there is "a
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plausible sentencing rationale and a defensible result." Martin,
520 F.3d at 96. The district court had plenty of reason to sentence
as it did.
1. Disproportionality
Reyes-Rivera's first argument is that the district court
erred by giving him a sentence that was, as he says, "grossly
disproportionate" to the sentence that was given to his brother,
Jeffrey, and to sentences given to defendants in cases he claims
involved similar conduct.12 See 18 U.S.C. § 3553(a)(6); see also
United States v. Reyes-Santiago, 804 F.3d 453, 468 (1st Cir. 2015)
(addressing claim under the rubric of substantive reasonableness).
Section 3553(a)(6) "is primarily aimed at national
disparities, rather than those between co-defendants." United
States v. Marceau, 554 F.3d 24, 33 (1st Cir. 2009). "Unless two
'identically situated defendants' receive different sentences from
the same judge, which may be a reason for concern, our general
rule of thumb is that a 'defendant is not entitled to a lighter
sentence merely because his co-defendants received lighter
sentences.'" United States v. Rivera-Gonzalez, 626 F.3d 639, 648
12 Reyes-Rivera tries to characterize this as a procedural
error, claiming the district court failed to consider the issue of
disparity. See 18 U.S.C. § 3553(a)(6). But elsewhere in his
briefing, he admits that "the court commented on the issue of
disparity." Indeed, the court expressly asked defense counsel at
sentencing to address the disparity issue raised in the sentencing
memorandum.
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(1st Cir. 2010) (quoting United States v. Wallace, 573 F.3d 82, 97
(1st Cir. 2009)).
Dilean Reyes-Rivera and Jeffrey were not identically
situated. First, and most importantly, they pled guilty to
different offenses. Reyes-Rivera pled guilty to both bank fraud
and conspiracy to commit wire fraud, the first of which carries a
maximum term of thirty years of imprisonment, see 18 U.S.C. § 1344.
Jeffrey pled guilty only to conspiracy to commit wire fraud, which
means that Jeffrey could not have been sentenced to more than the
five-year statutory maximum permitted for that crime, see id.
§§ 371, 1343. Second, as the district court found, Reyes-Rivera
"was considered the leader, organizer of the criminal activity."
Reyes-Rivera admitted that Jeffrey followed his instructions and
that he never even explained the business to Jeffrey. The district
court acted well within its discretion in giving Reyes-Rivera a
harsher sentence than Jeffrey. See Reyes-Santiago, 804 F.3d at
467 ("We have routinely rejected disparity claims . . . because
complaining defendants typically fail to acknowledge material
differences between their own circumstances and those of their
more leniently punished confederates.").
As to national disparity, Reyes-Rivera's sentencing
memorandum briefly discussed three cases from the District of
Puerto Rico and the Southern District of New York that he alleged
were substantially similar to his case, each of which resulted in
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a sentence of fifty-one months or fewer. In response, the district
court stated:
I will say that you have done an excellent job
in raising the issue of disparity within the
same districts. I do know that the cases that
you have cited involve perhaps huge amounts of
money. I don't know what the role of each one
of those defendants was. I don't know how
persuasive the arguments or the background of
this defendant was in terms of prognosis for
rehabilitation, their entire background, how
many people were effected [sic].
The district court plainly considered Reyes-Rivera's
section 3553(a)(6) argument, and it gave an adequate explanation
for why Reyes-Rivera's case "was not in the same camp" as those he
offered. United States v. García-Ortiz, 792 F.3d 184, 192 (1st
Cir. 2015).13
2. Upward Variance
Reyes-Rivera claims that the district court erred by
imposing a seven-month upward variance to account for the impact
that his Ponzi scheme had on his victims. He claims that "the
conduct described to the Court by the various vocal victims was
13 Reyes-Rivera's brief on appeal simply "incorporates the
arguments set forth and submitted in the sentencing memorandum."
That does not work. "Such an attempt to incorporate by cross-
reference does not comport with our ordinary rule that claims made
to this court must be presented fully in an appellate brief and
not by cross-reference to claims made in the district court."
Lawrence v. Gonzales, 446 F.3d 221, 226 (1st Cir. 2006); see also
Fed. R. App. P. 28(a)(8). "By failing to develop" this argument
on appeal, Reyes-Rivera "has waived [his] claim." Universal Ins.
Co. v. Office of Ins. Comm'r, 755 F.3d 34, 38–39 (1st Cir. 2014).
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already fully considered and calculated in the advisory guideline
offense level, and the various enhancements recommended in the
defendant's sentence guidelines calculation that was set forth in
the plea agreement." He also makes a related second argument: "A
close examination of the District Court's comments about the
guidelines suggests that the sentencing judge saw the guidelines
sentencing as a mandatory base-line from which the court was to
steeply upwardly depart."14
The first argument fails. The district court gave a
plausible and sensible rationale for placing particular weight on
victim impact and correctly noted -- contrary to Reyes-Rivera's
claim -- that certain aspects of victim impact are not expressly
contemplated in the guidelines:
Mr. Reyes made the victims believe that
he was selling high yield investment products
in retirement plans. Instead, he was
basically aware that all of this was leading
to a scheme. The victims were mostly retired
employees, unemployed individuals, persons
that basically disposed of whatever they had,
including their houses, credit lines, in order
to make these investments. . . .
In general, most of . . . the victims
mortgaged their properties, had to go back to
work after being in retirement. Some of them
have incurred in additional expenses, paying
for psychiatric or psychological treatment.
14 It is not true that the district court "steeply upwardly
depart[ed]." The district court, as we have found, correctly
calculated the guidelines sentencing range to be 188 to 235 months.
In sentencing Reyes-Rivera to 242 months, the district court only
imposed a seven-month upward variance.
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Some of them have attempted suicide. Some
have suffered cardiac arrest and
symptoms. . . .
The guidelines do factor in the
characteristics of the crime, economic loss,
the number of victims, but all of that that
you heard about is not factored in. All those
other expenses, it's not even factored in in
the amounts that they are calculating for
restitution purposes. And those are losses
that they have experienced at this time.
The court also considered the "blatant disregard" manifested by
Reyes-Rivera when he refused to return $5000 to an investor who
needed the money to take care of a bedridden cancer patient. This
explanation was more than adequate enough to justify the relatively
minor seven-month variance.
The second argument is easily disposed of as well.
Reading the sentencing transcript as a whole, it is obvious from
statements in the record that the district court did not consider
the guidelines to be a mandatory baseline.
3. Overlapping Enhancements
Because the district court provided a plausible and
sensible rationale for the sentence it imposed, we find no abuse
of discretion in its decision not to adjust downward to counteract
the effect of the various enhancements it correctly applied.
IV.
We affirm.
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