U.S. v. Olson, 95-1522
| Decision Date | 17 January 1997 |
| Docket Number | No. 95-1522,95-1522 |
| Citation | 104 F.3d 1234 |
| Parties | UNITED STATES of America, Plaintiff--Appellee, v. Ray William OLSON, also known as Robert G. Johnson, also known as Bob Johnson, also known as Andrew J. Johnson, also known as Logan Counts, Defendant--Appellant. |
| Court | U.S. Court of Appeals — Tenth Circuit |
Raymond P. Moore, Assistant Federal Public Defender (Michael G. Katz, Federal Public Defender, with him on the briefs), Denver, Colorado, appearing for the Appellant.
Gregory C. Graf, Assistant U.S. Attorney (Henry L. Solano, United States Attorney, with him on the brief), Denver, Colorado, appearing for the Appellee.
Before TACHA, HENRY, and BRISCOE, Circuit Judges.
In a period of six years, Ray Olson defrauded over 800 people of $6,097,155 by falsely representing that their money would be invested in securities and commodities. After federal grand juries in Louisiana and Colorado indicted Olson, he pleaded guilty to one count of mail fraud, one count of wire fraud, and one count of money laundering. As part of his sentence, the district court ordered Olson to pay $6,097,155 in restitution to his victims.
Olson seeks review of two issues on appeal. First, Olson contends that the district court abused its discretion in ordering him to pay $6,097,155 as restitution. Specifically, Olson argues that he lacks any assets or earning potential sufficient to create a realistic possibility that he can pay full restitution. Olson maintains that the district court imposed the restitution order by speculating that the defendant may have some assets unknown to the court. Second, Olson argues that the record does not provide a factual basis to support the district court's restitution order. Thus, Olson claims that we cannot reasonably review the propriety of the restitution order. We have jurisdiction pursuant to 28 U.S.C. § 1291 and affirm.
From June 1987 to June 1989, Olson lived in Louisiana where he defrauded approximately 120 people by falsely representing that he would invest their money in securities and commodities. Instead of investing the money as promised, Olson used the money for his personal expenses. Over the two year period, Olson obtained $2,697,065 through his fraudulent scheme.
In 1989, Olson fled to Colorado where he assumed the identity of "Robert Johnson." From June 1989 through the spring of 1993, Olson defrauded approximately 700 people of $4,178,698. The Colorado scheme differed from the Louisiana scheme in two ways. First, in Colorado Olson used several individuals (Kathleen Jardine, Vanita West, and Wallace Drew) to solicit and collect money from the investors on his behalf. Second, Olson transferred much of the money from Colorado to offshore bank accounts.
On May 21, 1992, the government filed a ten-count indictment against Olson in the Western District of Louisiana. On December 8, 1994, the government filed a twenty-six count indictment against Olson in the District of Colorado.
On September 5, 1995, the Louisiana case was transferred to Colorado. On September 18, 1995, pursuant to a plea agreement, Olson pleaded guilty to one count of wire fraud, one count of mail fraud, and one count of money laundering. He agreed to pay a minimum of $130,420 in restitution and to assign all of his interest in his bank accounts and other assets to the government. He admitted however, that he "used several bank accounts and offshore accounts in the Bahamas, as a repository of investor funds."
On October 23, 1995, the district court held a sentencing hearing on the issue of restitution. The record indicates that Olson and his associates placed approximately $3-$4 million in various bank accounts. For example, Olson controlled approximately $1.7 million in a bank account in the Bahamas called the "Goldwing" account. Olson also maintained a bank account in Mexico City containing Olson employed a Bahamian lawyer, Cyril Fountain, to help him start several Bahamian companies and open Bahamian bank accounts in the name of the companies. Fountain, however, considered Olson to be the "beneficial owner" of these accounts. Olson's associates (Jardine, West, and Drew) used a similar approach to launder their money. Jardine started a company called "Relas Ltd." and opened a bank account in the company's name. West started a company called "Ouray Ltd." and opened an account in its name. Drew started a company called "Columbine Ltd." and opened a bank account in its name.
$300,000 to $400,000 and a bank account in Vanuatu, an island near New Zealand.
At the restitution hearing, Fountain testified on behalf of Olson. Fountain testified that he kept $88,860 in cash in his law firm safe for Olson. Fountain then turned over $193,188 to the government on behalf of Olson ($88,860 from the law firm safe and $101,328 from the Goldwing account). Fountain also brought corporate records for all of the companies for which Olson was the "beneficial owner." Fountain, however, did not bring any bank records for the companies. He also did not know the remaining balances in the bank accounts of any of the companies.
On November 27, 1995, the court sentenced Olson to 87 months imprisonment and three years of supervised release. In addition, the court imposed a restitution order in the amount of $6,097,155. The figure represented the amount misappropriated by Olson in both the Louisiana and Colorado schemes minus $415,988 in restitution that Olson had already made to his victims. 1 The court however, recognized that the amount of restitution might be lowered after the government finished tracing all of Olson's bank records and assets.
We review the district court's factual findings underlying a restitution order for clear error. United States v. Teehee, 893 F.2d 271, 273-74 (10th Cir.1990). We review the amount of a district court's restitution order for an abuse of discretion. United States v. Rogat, 924 F.2d 983, 985 (10th Cir.), cert. denied, 499 U.S. 982, 111 S.Ct. 1637, 113 L.Ed.2d 732 (1991).
The Victim and Witness Protection Act (VWPA), 18 U.S.C. §§ 3663-64 governs the restitution order at issue in this case. 2 When determining the appropriate amount of restitution, a sentencing court "shall consider the amount of the loss sustained by any victim as a result of the offense, the financial resources of the defendant, the financial needs and earning ability of the defendant and the defendant's dependents, and such other factors as the court deems appropriate." 18 U.S.C. § 3664(a). The fact that a defendant is without financial resources at the time of sentencing is not itself a bar to a restitution order. United States v. Gabriele, 24 F.3d 68, 73 (10th Cir.1994). A restitution order, however, must be consistent with a defendant's ability to pay. United States v. Gilbreath, 9 F.3d 85, 86 (10th Cir.1993). Thus, "[a] restitution order will be upheld if the evidence indicates a defendant has some assets or earning potential and thus possibly may be able to pay the amount ordered." Rogat, 924 F.2d at 985 (emphasis added). Moreover, the burden is on the defendant to prove that he lacks the ability to pay full restitution. 18 U.S.C. § 3664(d).
Today we hold that when a defendant has secreted proceeds from an illegal activity, the illegal proceeds are presumed assets of the defendant unless the defendant proves otherwise. As the Third Circuit recently stated:
[We] place the burden of proof on the defendant to show what has happened to all of the illegally obtained assets. All assets for which the defendant cannot account may be included in the amount of restitution ordered. To the extent that records are unavailable, the risk of inaccuracy should be borne by the defendant rather than the victims.
United States v. Voigt, 89 F.3d 1050, 1092 (3d Cir.1996) (quoting United States v. Copple, 74 F.3d 479, 486 (3d Cir.1996) (Alito, J., concurring) (citation omitted)), cert. denied, --- U.S. ----, 117 S.Ct. 623, 136 L.Ed.2d 546 (1996). See also United States v....
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