U.S. v. Wimbish ( 1992 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_____________________
No. 92-1060
_____________________
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
BOBBY GLEN WIMBISH,
Defendant-Appellant.
_______________________________________________________
Appeal from the United States District Court
for the Northern District of Texas
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(December 17, 1992)
Before WILLIAMS, HIGGINBOTHAM, and BARKSDALE, Circuit Judges.
JERRE S. WILLIAMS, Circuit Judge:
Bobby Glen Wimbish pleaded guilty to one count of bank fraud
and to one count of possession of stolen mail. From stolen mail,
Wimbish had obtained personalized checks and bank statements. He
deposited forged checks with several banks and then received as
cash back a portion of each deposit. At sentencing, Wimbish
objected to the district court's use of the face value of the
forged checks to determine loss under the Sentencing Guidelines.
The court overruled Wimbish's objection and imposed sentence of two
concurrent terms of 30 months in prison followed by five years of
supervised release. Wimbish challenges the district court's
calculation of his sentence under the guidelines. We affirm.
I. FACTS AND PRIOR PROCEEDINGS
In June and July 1991, Bobby Glen Wimbish purchased
personalized blank checks and bank statements. They had been
stolen from the mail. Wimbish used these checks to commit fraud on
several banks in the Dallas-Fort Worth area. Generally, Wimbish
and a female companion would forge a stolen check drawn on one
account, use a stolen deposit slip to deposit the check into
another account, and request cash back from the deposit. The
presentence report (PSR) calculated the face value of the
fraudulently deposited checks as $100,944 and the actual loss to
the banks as $14,731, which was the amount Wimbish received.
On November 1, 1991, Wimbish pleaded guilty to one count of
bank fraud under 18 U.S.C. § 1344 and to one count of possession of
stolen mail under 18 U.S.C. § 1708. The PSR then calculated the
offense levels pursuant to the Sentencing Guidelines, U.S.S.G.
§ 2F1.1 for fraud and U.S.S.G. § 2B1.2 for possession of stolen
mail. Although a different sentencing guideline applies to each
count, the grouping rule of U.S.S.G. §§ 3D1.2(d) and 3D1.3 calls
for the sentencing court to calculate both guidelines and to apply
the one that produces the highest offense level. Therefore, the
PSR calculated both offense levels in order to determine which was
higher.
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Both guidelines enhance the base offense level on a graduated
scale according to the amount of the victims' loss. The PSR used
the $100,944 face value of the checks, not the $14,731 actually
obtained, to determine the amount of loss. For the bank fraud
count, the face value of the checks led to enhancing the base
offense level of six by six levels, resulting in a total offense
level of twelve. U.S.S.G. § 2F1.1(b)(1)(G). For the possession of
stolen mail count, the face value caused the PSR to enhance the
base offense level of four by eight, also reaching a total offense
level of twelve. U.S.S.G. §§ 2B1.2(b)(1) and 2B1.1(b)(1)(I).
Because both total offense levels were the same, the PSR simply
used the offense level of twelve, coupled with a criminal history
category of V. The resulting sentencing guideline range was 27-33
months.
At the sentencing hearing Wimbish objected to the PSR's
recommendations. He argued that he intended to defraud the banks
only in the amount of cash he actually received. Under his
contention, the loss of $14,731 would produce a total base offense
level of nine and a sentencing range of 18-24 months. Despite
Wimbish's objection, however, the district court adopted the PSR's
calculations and sentenced Wimbish to two concurrent terms of 30
months' imprisonment; a two-year and a five-year term of supervised
release, to run concurrently; and a $100 mandatory special
assessment.
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II. DISCUSSION
Wimbish argues on appeal that the district court erred in
using the face value of the checks to calculate the loss. He
asserts that for bank fraud he did not intend a loss of $100,944.
Wimbish also urges that for possession of stolen mail the district
court should have fixed the amount of loss at the value of the
items stolen. Because he possessed only blank checks, the loss
should have been merely the replacement value of the checks, a de
minimis amount. His assertions, therefore, would result at most in
a total offense level of nine, producing a sentencing range of
18-24 months.
We review the application of the Sentencing Guidelines de novo
and the district court's findings of fact for clear error. United
States v. Sanders, 942 F.2d 894, 897 (5th Cir. 1991). Because the
calculation of amount of loss is a factual finding, we review that
determination for clear error. As long as a factual finding is
plausible in light of the record as a whole, it is not clearly
erroneous. United States v. Watson, 966 F.2d 161, 162 (5th Cir.
1992).
The Sentencing Guidelines' grouping rule directs the court to
apply the highest offense level. U.S.S.G. §§ 3D1.2 and 3D1.3.
Consequently, if the court erred in calculating one offense, but
not the other, the higher offense level of twelve would still
stand, rendering the error harmless. Since we have analyzed both
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offenses, we give our analysis although we find no error in the
calculation of loss for either count.
A. Bank Fraud under U.S.S.G. § 2F1.1
Application Note 7 of U.S.S.G. § 2F1.1 provides guidance on
how to determine loss and also incorporates the discussion of loss
valuation found in the commentary for § 2B1.1. Application Note 8
of § 2F1.1 further provides that the sentencing court need not
determine loss precisely, as long as its estimate is reasonable.
Note 7, however, changed between Wimbish's commission of the
offense and the sentencing. Pursuant to 18 U.S.C. § 3553(a)(4),
district courts should apply the Sentencing Guidelines in effect on
the date of sentencing, unless the guideline in effect on the date
of the offense is substantially more favorable to the defendant.
United States v. Suarez, 911 F.2d 1016, 1021-22 (5th Cir. 1990).
Because there is no ex post facto problem here, the guideline
effective at Wimbish's sentencing applies.
Before November 1, 1991, Note 7 provided that “if a probable
or intended loss that the defendant was attempting to inflict can
be determined, that figure would be used if it was larger than the
actual loss.” U.S.S.G. App. C., 393 (emphasis added). Effective
November 1, 1991 (and therefore effective when Wimbish was
sentenced in January 1992), the Commission deleted the reference to
probable loss. Therefore, amended Application Note 7 directs the
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sentencing court to substitute “intended loss that the defendant
was attempting to inflict” for the actual loss. U.S.S.G. § 2F1.1
comment. (n. 7) (emphasis added). Both versions of Note 7 included
the following example: “[I]f the fraud consisted of . . .
representing that a forged check for $40,000 was genuine, the loss
would be $40,000.”
Wimbish first argues that the district court erred because the
amendment of Note 7 authorizes a district court to consider only
the intended loss, not the probable loss. To support his argument,
Wimbish refers to United States v. Brigman, 953 F.2d 906, 908 (5th
Cir.), petition for cert. filed, --- U.S.L.W. --- (U.S. Aug. 4,
1992) (No. 92-5417). In Brigman, we considered U.S.S.G. § 1B1.7,
which directs courts to treat the commentary to the guidelines “as
the legal equivalent of a policy statement.” Section 1B1.7 warns
that “[f]ailure to follow such commentary could constitute an
incorrect application of the guidelines, subjecting the sentence to
possible reversal on appeal.” Wimbish further contends that
amendments to a commentary can effectively repudiate prior
decisions that were grounded on the former commentary. United
States v. Fitzhugh, 954 F.2d 253, 254 (5th Cir. 1992). Wimbish
also notes that the guideline itself has never defined loss; the
commentary has always been the source for the definition and method
of calculation.
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Congress clearly authorized the Sentencing Commission to
promulgate policy statements. 28 U.S.C. § 994(a)(2) (Supp. 1992).
The Sentencing Commission in turn promulgated its commentaries,
giving them the force of policy statements. U.S.S.G. § 1B1.7.
Congress then provided that courts must consider the Sentencing
Commission's policy statements when imposing sentence. 18 U.S.C.
§ 3553(a)(5) (Supp. 1992).
Nevertheless, at issue is the weight that a policy statement
should carry. Congress has mandated that courts sentence within
the guidelines. 18 U.S.C. § 3553(b) (Supp. 1992). No such mandate
exists regarding policy statements. Therefore, although courts
must consider the commentary, they are not bound by them as they
are by the guidelines. THOMAS W. HUTCHISON & DAVID YELLEN, FEDERAL
SENTENCING LAW AND PRACTICE 46 (1989). In Brigman, 953 F.2d at 908, we
held:
[T]hese amendments to the commentary were intended by the
Sentencing Commission to clarify the operation of § 3E1.1
. . . [I]f Congress sought to create a “rebuttable
presumption” surely it would have amended the guideline
itself rather than simply the accompanying commentary.
. . . [T]he changes in the commentary are plainly more a
matter of emphasis than of substantive applicability.
The guidelines themselves limit the binding effect of the
commentary. Section 1B1.7 states that the application notes serve
both to interpret and explain the guidelines and to detail
circumstances that justify departing from them. U.S.S.G. § 1B1.7.
Although U.S.S.G. § 1B1.7 states that a court's failure to follow
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a commentary could result in reversal, the commentary to U.S.S.G.
§ 1B1.7 undermines the force of that statement. The commentary
explains:
In stating that failure to follow certain commentary
“could constitute an incorrect application of the
guidelines,” the Commission simply means that in seeking
to understand the meaning of the guidelines courts likely
will look to the commentary for guidance as an indication
of the intent of those who wrote them. In such
instances, the courts will treat the commentary much like
legislative history or other legal material that helps
determine the intent of a drafter.
Wimbish attempts to bolster his contention that the
commentary's amendment controls this case in his favor by pointing
to United States v. Fitzhugh, 954 F.2d 253 (5th Cir. 1992) and its
progeny. In Fitzhugh, this court vacated and remanded a sentence
for possession of a firearm because of an amendment to the
commentary of the career-offender provision, U.S.S.G. § 4B1.2.
Under prior caselaw, a sentencing court applying § 4B1.2 could
consider a defendant's underlying conduct even when that conduct
was not charged in the indictment. The 1989 amendment to the
commentary, however, clearly limited consideration to “the conduct
set forth in the count of which the defendant was convicted.”
Fitzhugh, 954 F.2d at 254 (quoting U.S.S.G. § 4B1.2, comment. (n.
2)). Additionally, the 1991 amendment to the commentary expressly
excluded the offense of unlawful possession of a firearm by a
felon. Id. at 255. Thus, we determined that the Sentencing
Commission had repudiated the prior caselaw.
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Wimbish's case is not at all controlled by Fitzhugh. With
regard to § 2F1.1, the Sentencing Commission intended merely to
clarify the commentary and to provide “additional guidance with
respect to the determination of loss.” U.S.S.G. App. C, 393
(emphasis added). Dropping the word “probable” does not constitute
the clear change of direction embodied either in the amendments to
§ 4B1.2 or in Wimbish's argument.
Second, Wimbish argues that the face value of the checks is
neither the probable nor the intended loss, but merely a possible
loss. The banks were able to detect the fraudulent transactions
and stood to lose only the cash that Wimbish received. Therefore,
contends Wimbish, the court erroneously calculated the loss value
under either version of Note 7.
To buttress his argument, Wimbish points to United States v.
Kopp, 951 F.2d 521 (3rd Cir. 1991). Kopp had submitted fraudulent
financial information to a lender in order to obtain a $14 million
loan. In vacating and remanding for resentencing, the court
rejected “possible” loss as an appropriate measure for calculating
fraud loss under U.S.S.G. § 2F1.1. The court analyzed the
difference between a theft loss and a fraud loss such as that
resulting from Kopp's bank-loan fraud. With a theft, the
perpetrator intends the loss of the full amount. In fraud,
however, the perpetrator might have obtained a loan or contract
fraudulently, but still may intend to repay or perform.
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Even if we were to accept Kopp, its facts do not parallel
Wimbish's scheme. Wimbish proffered as genuine a check in the full
amount, although he obtained for himself only a portion of the face
value of the check. Wimbish put the victims at risk for the full
loss, despite the subsequent recovery of the amount Wimbish did not
receive. Wimbish's act is thus much more akin to theft than to
obtaining a loan fraudulently. If a bank had failed to detect the
fraud in a timely manner, the bank's depositor could have withdrawn
sums represented by the forged check. Likewise, the owner of an
account on which a forged check was drawn might have lost the full
check amount by failing to detect the fraud.
Wimbish attempts to distinguish United States v. Hooten, 933
F.2d 293 (5th Cir. 1991). In Hooten, a credit union employee
offered to sell a borrower's $1.5 million note back to the borrower
for $150,000. Although the employee maintained that his intended
victim was the borrower, and not the credit union, we held that
$1.5 million was the correct value of the loss because it
represented the potential loss to the credit union. Wimbish points
out that the Court did not cite the sentencing guideline it was
using; that Hooten predates the 1991 amendment to § 2F1.1; and that
once Wimbish had deposited the forged checks, he could not obtain
any more money from them.
Despite its indirect effect, Hooten is instructive. Hooten
stole the note, putting the credit union at risk of losing the
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entire amount. Wimbish forged checks, also putting the banks and
depositors at risk for the entire loss. In United States v.
Cockerham, 919 F.2d 286, 289 (5th Cir. 1990), we noted in applying
§ 2B1.1 (cross-referenced by § 2F1.1's Note 7), that loss “includes
the value of all property taken, even that recovered or returned.”
Further, in carrying out his scheme Wimbish acted with conscious
indifference to the impact his scheme would have on the victims.
His testimony at the sentencing hearing underscored his ignorance
and indifference to what would happen to the remaining check
amount. Wimbish's callous indifference to his victims' loss falls
within the ambit of intended loss.
The district court's calculation is supported broadly by the
caselaw. We recently held that the intended loss was the full
value of insurance claims fraudulently filed, despite the fact that
the defendant was paid only a portion of the claims. United States
v. Lghodaro, 967 F.2d 1028, 1031 (5th Cir. 1992). We also affirmed
as intended loss a calculation that included the face value of
checks that the defendant had stolen from the mail and forged, but
had not yet cashed. United States v. Quertermous, 946 F.2d 375,
376 (5th Cir. 1991). The First Circuit has held that possessing or
passing forged checks produces an intended loss of the full check
amount, regardless of how much the defendant hoped to obtain.
United States v. Haggert, --- F.2d ---, No. 91-2293, 1992 WL 337963(1st Cir. Nov. 20, 1992) (defendant submitted valueless sight
drafts to pay a mortgage); United States v. Resurreccion, --- F.2d
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---, No. 91-2015, 1992 WL 312704 (1st Cir. Oct. 30, 1992)
(defendant possessed forged checks that he hoped to sell at a
discount). Additionally, the Ninth Circuit affirmed a
determination that the defendants intended the loss of a bad
check's face value when they attempted to pass the check. United
States v. Joetzki, 952 F.2d 1090, 1096 (9th Cir. 1991).
Wimbish effectively stole the checks when he offered the
forged documents as genuine. His actions and his conscious
indifference put his victims at risk for the entire loss,
regardless of how much he actually obtained. Thus the court did
not clearly err in calculating the loss value under U.S.S.G.
§ 2F1.1 as the face value of the checks deposited.
B. Possession of Stolen Mail and U.S.S.G. § 2B1.2
U.S.S.G. § 2Bl.2 incorporates the offense levels of § 2B1.1
and its commentary's discussion of property valuation. Wimbish
argues that the appropriate value of theft loss under U.S.S.G.
§ 2B1.1 is the value of the blank checks. This argument is also
without merit. The Commentary to § 2B1.1 provides:
“Loss” means the value of the property taken, damaged, or
destroyed. Ordinarily, when property is taken or
destroyed the loss is the fair market value of the
particular property at issue. Where the market value is
difficult to ascertain or inadequate to measure harm to
the victim, the court may measure loss in some other way,
such as reasonable replacement cost to the victim. . . .
Examples: (1) In the case of a theft of a check or money
order, the loss is the loss that would have occurred if
the check or money order had been cashed.
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U.S.S.G. § 2B1.1, comment. (n. 2) (emphasis added). Wimbish
contends that the commentary's example applies to the theft of
completed checks, not blank checks. The guideline, however, does
not distinguish between stealing a check that is already filled out
and stealing a blank check. In light of the commentary to § 2B1.1,
the district court did not clearly err in calculating the total
value of the deposited checks as the loss value.
III. CONCLUSION
The commentaries to the Sentencing Guidelines are policy
statements which help interpret and explain the guidelines. As
such, the commentaries guide but do not bind the sentencing court.
We hold that the district court properly calculated loss when it
used the face value of the deposited checks instead of the amount
Wimbish actually obtained. Wimbish's sentence accords with the
guidelines.
AFFIRMED.
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