U.S. v. Dietz

• Citation: 950 F.2d 50
• Decision Date: 06 November 1991
• Docket Number: No. 91-1321,91-1321
• Parties: UNITED STATES of America, Appellee, v. William A. DIETZ, Defendant, Appellant. . Heard
• Court: United States Courts of Appeals. United States Court of Appeals (1st Circuit)

Page 50

950 F.2d 50

UNITED STATES of America, Appellee, v. William A. DIETZ, Defendant, Appellant.

No. 91-1321.

United States Court of Appeals First Circuit.

Heard Nov. 6, 1991.

Decided Nov. 27, 1991.

Arlene C. Halliday, Boothbay, Me., for defendant, appellant.

Victor A. Wild, Asst. U.S. Atty., with whom Wayne A. Budd, U.S. Atty., Boston, Mass., was on brief, for U.S.

Before SELYA, Circuit Judge, COFFIN, Senior Circuit Judge, and CYR, Circuit Judge.

SELYA, Circuit Judge.

Defendant-appellant William A. Dietz pled guilty to twenty-eight counts of fraud, conspiracy, and the like, implicating, inter alia, 18 U.S.C. §§ 2, 371, 1001, 1341 (1988) and 42 U.S.C. §§ 408(g)(2), 1383a (1988). The district court computed the guideline sentencing range (GSR) and sentenced Dietz within it. ¹ On appeal, Dietz challenges the court's determination of the GSR in three respects. Finding the assigned errors to be lacking in merit, we affirm.

I. BACKGROUND

Inasmuch as the underlying conviction resulted from a guilty plea, we draw the facts necessary to place this appeal into perspective from the uncontested portions of the Presentence Investigation Report (PSI Report), see U.S.S.G. § 6A1.2, and the transcript of the sentencing hearing, see United States v. Iguaran-Palmar, 926 F.2d 7, 10 (1st Cir.1991).

Appellant's youngest child, Gregory, is profoundly disabled as a result of birth defects and subsequent complications. In 1977, shortly after Gregory was born, the appellant filed forms with the Social Security Administration (SSA) indicating, falsely, that he was providing no income to the familial household and that he did not anticipate providing any income in the foreseeable future. The following year, Dietz's wife, Irene, filed forms with the SSA indicating that Dietz no longer lived with the family or provided any support, and that his whereabouts were unknown. These statements, too, were apocryphal. In each subsequent year up to and including 1989, Mrs. Dietz submitted forms perpetuating the same spurious scenario. Throughout this period, the appellant, although venturing out of state on occasion, resided primarily in the family home. He and his wife regularly received legitimate income from wages (some earned under an alias) and not-so-legitimate income from falsified unemployment claims. All told, Mr. and Mrs. Dietz euchred $59,498.93 from the SSA by means of their meretricious conduct. ²

During the latter part of this time frame, Dietz also exercised his considerable talent for cozenage by masterminding another scheme, this time defrauding not only the federal government, but seven state employment security agencies as well. In the course thereof, appellant, his wife, and their son, Christopher, filed false unemployment claims. Christopher and his brother, Kenneth, assisted in retrieving the benefit checks from a network of post office boxes, many rented under pseudonyms. Dietz's daughter-in-law, Lisa, who was employed from time to time by different banks, used her position to help in cashing the checks. In all, the unemployment insurance scam netted a total of $158,717. ³

II. ROLE IN THE OFFENSE

Appellant's first assignment of error concerns the district court's enhancement of his offense level based on the pivotal role he played in spinning the web of familial fraud. Because role-in-the-offense determinations are necessarily fact-specific, "considerable respect [must] be paid to the views of the nisi prius court." United States v. Ocasio, 914 F.2d 330, 333 (1st Cir.1990). Hence, absent mistake of law, we review such determinations only for clear error. See United States v. Akitoye, 923 F.2d 221, 227 (1st Cir.1991); United States v. McDowell, 918 F.2d 1004, 1011 (1st Cir.1990); United States v. Diaz-Villafane, 874 F.2d 43, 48 (1st Cir.), cert. denied, 493 U.S. 862, 110 S.Ct. 177, 107 L.Ed.2d 133 (1989). Careful perscrutation of the record below reveals no error, clear or otherwise; to the contrary, the district court was fully justified in rewarding the appellant's manipulative genius by conferral of the enhancement.

U.S.S.G. § 3B1.1(a) provides for an increase of four levels "[i]f the defendant was an organizer or leader of a criminal activity that involved five or more participants or was otherwise extensive...." See, e.g., McDowell, 918 F.2d at 1011; United States v. Preakos, 907 F.2d 7, 9 (1st Cir.1990) (per curiam). At the sentencing hearing in the instant case, Dietz did not contest the characterization of his role as that of an organizer/leader. Rather, while admitting that the circumstances at bar "technical[ly] fit" within the language of U.S.S.G. § 3B1.1(a), he contended that the provision was inapposite because his criminal activities implicated too limited a cast of characters to qualify for the four-level enhancement. ⁴ In his view, the individuals who were innocently involved in consummating the fraud (e.g., claims processors employed by the affected benefit programs), should not have been considered in gauging the schemes' scope--and, without those persons, too few participants were involved. The district court overruled Dietz's objection, holding that his criminal activities were sufficiently panoramic to merit the four-level increase. ⁵ We agree.

At the root of appellant's objection are two problematic contentions: (1) that there must be at least five persons involved before a criminal scheme can be deemed "extensive," and (2) that only those individuals who are active participants in the scheme may be aggregated for purposes of U.S.S.G. § 3B1.1(a). In mounting these contentions, the appellant relies almost exclusively on United States v. DeCicco, 899 F.2d 1531 (7th Cir.1990). While we have no quarrel with Judge Flaum's well-reasoned opinion in DeCicco, that opinion, like a wobbly lamppost with a burnt-out bulb, furnishes neither support nor illumination for Dietz's position. DeCicco stands for the unremarkable proposition that, in order for U.S.S.G. § 3B1.1 to apply, the defendant, who himself is to be counted as a criminally culpable participant, see Preakos, 907 F.2d at 10, must have "organize[d] at least one [other] criminally responsible individual." DeCicco, 899 F.2d at 1537. ⁶ There is simply no plausible way to read DeCicco as requiring a defendant to exercise hegemony over four criminally responsible individuals (who, when combined with the defendant himself, would achieve a total of five participants) as a prerequisite to applying section 3B1.1(a). Indeed, so anfractuous an interpretation of the guidelines would effectively nullify the "otherwise extensive" clause of U.S.S.G. § 3B1.1(a). As the Sentencing Commission's commentary makes clear, so long as a defendant and at least one other criminally responsible person are involved in the offense of conviction, the sentencing court is free to consider the use of unwitting outsiders in determining if a criminal enterprise is "extensive" within the contemplation of section 3B1.1:

In assessing whether an organization is "otherwise extensive," all persons involved during the course of the entire offense are to be considered. Thus, a fraud that involved only three participants but used the unknowing services of many outsiders could be considered extensive.

U.S.S.G. § 3B1.1, comment. (n.2). Furthermore, once the irreducible minimum of two (the defendant and some other criminally responsible participant) has been met, the extensiveness of a criminal activity is not necessarily a function of the precise number of persons, criminally culpable or otherwise, engaged in the activity. Rather, an inquiring court must examine the totality of the circumstances, including not only the number of participants but also the width, breadth, scope, complexity, and duration of the scheme.

This is not to say that a head count is either irrelevant or unimportant. In most instances, the greater the number of people involved in the criminal activity, the more extensive the activity is likely to be. Thus, while we do not feel any compulsion to determine the number of participants in these criminal schemes with exactitude, we think it is significant that the offenses of conviction involved the appellant himself, three other criminally culpable individuals (Irene, Christopher, and Lisa Dietz, all of whom were found guilty of charges arising out of the schemes in question), Kenneth Dietz, ⁷ and countless employees of the government offices that processed the bogus claims. When these sheer numbers are coupled with other relevant facts--the course of criminal activity spanned twelve years, crossed into seven states, ⁸ utilized many fictitious identities, infiltrated two distinct sets of programs, and snared eight different governmental agencies in its intricately spun web--extensiveness becomes apparent. Unless ordinary language is to lose all meaning, the district court did not err in finding that Dietz's course of conduct was sufficiently extensive to warrant a four-level increase.

III. AMOUNT OF LOSS

Appellant's second ground for appeal concerns the eight-level upward adjustment which the district court imposed because more than $200,000 was extracted from public coffers through the appellant's machinations. See U.S.S.G. § 2F1.1(b)(1)(I) (in respect to fraud crimes, add eight levels for losses ranging from $200,000 to $350,000). We need not reach the substance of the appellant's argument because his right to appellate review has not been preserved. We explain briefly.

In his written objections to the PSI Report and at sentencing, Dietz contested the loss calculation on the basis that, if the money legitimately obtainable from the SSA on Gregory's behalf were subtracted from the money fraudulently obtained, the net amount of the loss would be less than $200,000. He did not, however, proffer any reliable calculation of the benefits that Gregory might lawfully have been eligible to receive. See supra note 2. The district court rejected Dietz's asseveration,...