U.S. v. Fox, 89-1498

Citation889 F.2d 357
Decision Date22 September 1989
Docket NumberNo. 89-1498,89-1498
PartiesUNITED STATES of America, Plaintiff, Appellee, v. Carolyn L. FOX, Defendant, Appellant. . Heard
CourtUnited States Courts of Appeals. United States Court of Appeals (1st Circuit)

Dorothy F. Silver, Manchester, N.H., for appellant.

Peter E. Papps, Acting U.S. Atty., for appellee.

Before BOWNES and TORRUELLA, Circuit Judges, and TIMBERS, * Senior Circuit Judge,

BOWNES, Circuit Judge.

This is an appeal from a sentence imposed under the Federal Sentencing Guidelines. Defendant-appellant Carolyn L. Fox raises two issues on appeal: (1) the application of the guidelines violated her right to due process; and (2) the sentence imposed contravened the provisions of a plea agreement between defendant and the government depriving her of her right to due process. We reject both contentions.

I. THE FACTS

The facts are taken from the presentence report, none of which were objected to by defendant. 1 Defendant began work as an Assistant Consumer Credit Officer at the Bedford Bank, Bedford, New Hampshire in April, 1987. On June 6, 1988 a bank official discovered two questionable loans authorized by defendant. In reviewing these loans it was found that defendant had made a loan to a Lorraine Duclos. This loan was unusual because the loan payment book was kept by the defendant. After investigation the bank found out that defendant had made a $1500 unsecured loan to Duclos in March of 1988 that became overdue on May 18, 1988. On that day a $3250 unsecured loan was made to Duclos, the proceeds of which were used to pay the principal and interest on the $1500 loan. The bank concluded that Duclos was a fictitious person and that the money had gone to defendant.

On June 9, 1988, bank officials confronted defendant with the information they had. She admitted that Duclos was a fictitious person and signed a statement to that effect. Defendant agreed to made restitution in the amount of $3,279.74. She told the bank officials that she had not made any other loans to herself. Defendant was discharged by the bank.

On June 13, 1988 bank auditors discovered four additional fictitious loans with outstanding balances. Proceeds from the loans were either taken in cash or in cashier's checks payable to different banks. The cashier's checks were used to make payments on personal loans and credit accounts of defendant. On June 14 two bank officials met with defendant. She admitted making five fraudulent loans to herself in the total amount of $21,650. She made full restitution on the same day as the meeting with the bank officials.

II. INDICTMENT, PLEA AND SENTENCING

On December 14, 1988 the defendant was indicted. The indictment charged that, while an employee of the Bedford Bank, defendant made a fictitious loan in the amount of $3,250 and retained the proceeds, in violation of 18 U.S.C. Sec. 656 (theft, embezzlement or misapplication by bank officer or employee).

On February 13, 1989 the defendant entered into a plea agreement and then pled guilty to the indictment. After questioning the defendant and her attorney in accord with Rule 11, the court was satisfied that the guilty plea was made voluntarily with a full understanding and appreciation of all of the consequences. Defendant's plea of guilty was then accepted.

Prior to the sentencing hearing, defendant filed a memorandum making two objections to the presentence report pertinent to this appeal. The core of defendant's first objection is stated in paragraph 12 of the memorandum: "12. It is defendant's position that the conduct considered by the Probation Officer in calculating the offense level at level ten is not 'relevant conduct,' and it should be removed as an element for consideration." The second objection was that the offense for which she was indicted did not involve more than minimal planning.

At the sentencing hearing defendant made no objection to the facts stated in the presentence report. The district court found that the sentencing recommendation of the probation department was correctly calculated and adopted it. The recommendation contained in the presentence report was based on defendant's obtaining five fraudulent loans, four in addition to the one to which she pled guilty. The offense level computation was as follows: The base offense level pursuant to section 2B1.1(a) of the Guidelines is four. The court, following the presentence report, took into account the four loans not mentioned in the indictment as "relevant conduct." Six levels were therefore added under section 2B1.1(b)(1)(G). Two more levels were added under section 2B1.1(b)(4) because the court found that more than minimal planning was involved. There was, therefore, an adjusted offense level of twelve. This was reduced by two levels for acceptance of responsibility under section 3E1.1(a), resulting in a total offense level of ten.

Defendant was placed on probation for a period of three years subject to certain conditions. One of the conditions was that defendant be confined to a community corrections center for a period of six months. The Probation Department was given discretion to reduce the three year probationary period. Defendant was also fined the minimum fifty dollars, as required. The court had been advised that defendant's financial condition precluded payment of a fine of any larger amount.

III. THE ISSUES
A. Whether the District Court's Application of the Sentencing Guidelines Denied Defendant Due Process.

Defendant argues that she was denied due process in four ways: (1) she was denied the right to be sentenced on accurate and reliable information; (2) she was denied the due process right to individualized sentencing; (3) the "relevant conduct" consideration factored into the determination of the offense level was based on insufficient evidence; and (4) the conclusion by the court that "more than minimal planning" was involved was based on acts for which there was no proof.

We do not think that defendant's first argument, that she was denied her right to be sentenced on the basis of accurate and reliable information, is properly before us. Defendant did not challenge the accuracy of the facts set forth in the presentence report on any grounds, either in her presentencing memorandum 2 or at the sentencing hearing. Defendant attacks the presentence-report facts on the grounds of hearsay for the first time before us, and now argues that there had to be corroborating independent evidence before the facts stated in the presentence report could be considered by the district court. This is a perfect example of the reason for our rule, "that an issue not presented in the district court will not be addressed for the first time on appeal." United States v. Curzi, 867 F.2d 36, 44 (1st Cir.1989); see also United States v. Figueroa, 818 F.2d 1020, 1025 (1st Cir.1987); United States v. Argentine, 814 F.2d 783, 791 (1st Cir.1987). In light of defendant's failure to object to the factual presentation in the presentence report, the district court had a right to believe that defendant agreed that the facts therein were true and accurate. If the objection now raised had been formulated below there would have been an opportunity for the court to consider it and rule accordingly.

Moreover, it flies in the face of reality for defendant to claim that her two confessions were not accurate and reliable. We also disagree that the facts were hearsay. Defendant told the bank officials that she obtained five fraudulent loans. We think this was akin to an admission against interest. But even if it was hearsay it was admissible. What we said in United States v. Wright, 873 F.2d 437, 441 (1st Cir.1989) is applicable here:

Insofar as appellant challenges this testimony as hearsay, he cannot prevail in light of case law that clearly establishes the sentencing court's power to rely upon hearsay evidence that appears reliable. United States v. Fatico, 603 F.2d 1053, 1057 (2d Cir.1979) (allowing use of hearsay evidence in sentencing hearings, if reliable), cert. denied, 444 U.S. 1073, 100 S.Ct. 1018, 62 L.Ed.2d 755 (1980). Regardless, the "hearsay" at issue here was a reported statement by appellant himself; a statement that the rules of evidence would classify as a "party's own statement," and not hearsay at all. See Fed.R.Evid. 801(d)(2)(A).

Whatever merit defendant's second contention may have had prior to the advent of the guidelines, it is now generally agreed that there is no due process right to individualized sentencing. See United States v. Harris, 876 F.2d 1502, 1505 (11th Cir.1989); United States v. Seluk, 873 F.2d 15 (1st Cir.1989); United States v. Vizcaino, 870 F.2d 52 (2d Cir.1989); United States v. Frank, 864 F.2d 992, 1008-10 (3rd Cir.1988), cert. denied, --- U.S. ----, 109 S.Ct. 2442, 104 L.Ed.2d 998 (1989). Although the Court in Mistretta v. United States, --- U.S. ----, 109 S.Ct. 647, 102 L.Ed.2d 714 (1989) did not address the due process question directly, it did make some comments that indicate where it is tending.

Congress, of course, has the power to fix the sentence for a federal crime, United States v. Wiltberger, 18 U.S. (5 Wheat.) 76, 5 L.Ed. 37 (1820), and the scope of judicial discretion with respect to a sentence is subject to congressional control. Ex parte United States, 242 U.S. 27, 37 S.Ct. 72, 61 L.Ed. 129 (1916).

Id. 109 S.Ct. at 650.

Before settling on a mandatory-guideline system, Congress considered other competing proposals for sentencing reform. It rejected strict determinate sentencing because it concluded that a guideline system would be successful in reducing sentence disparities while retaining the flexibility needed to adjust for unanticipated factors arising in a particular case. The Judiciary Committee rejected a proposal that would have made the sentencing guidelines only advisory.

Id. at 652 (citations omitted).

Defendant's third argument, that the four fraudulently obtained loans not charged in the indictment should...

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