Friday, October 21, 2011

Yesterday in Fraud

In an otherwise unremarkable bank and mail fraud affirmance, the Fifth Circuit reminds us that losses cannot be included as relevant conduct unless they are bottomed on criminal and/or fraudulent behavior. The appellant in U.S. v. Bernegger (loss must be criminally derived to count as relevant conduct), obtained two grants of $250K each from the State of Mississippi, which secured a first lien on the underlying collateral. Appellant later pledged the same collateral to other entities, but there was literally no evidence indicating that the original grants were procured through fraud. Nevertheless, the probation officer included the grants in the PSR's loss calculation and the trial court accepted the figure. The Fifth Circut also reiterates that "bare assertions" in a PSR are not, standing alone, evidence. This particular error did not affect appellant's Guidelines range, but did result in a reduced restitution award. The panel consisted of Judges Wiener. Clement, and Elrod. Opinion by the Dutchman.


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It's a significant decision and one that I'm glad you have shared with the readers since so often the proverbial "kitchen sink" is included in the claimed relevant conduct calculation by probation officers, too many of whom apparently seem to believe that it is their obligation to lard up the calculus to bump it into the stratosphere.

Posted by: Michael E. Clark | Oct 23, 2011 6:19:06 AM

It was a nice decision in granting the figure as this wont affect the obligation!thanks for sharing this1

Posted by: Solicitors in London | Oct 24, 2011 7:54:51 AM

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