U.S. v. Phaneuf

• Decision Date: 04 March 1996
• Docket Number: No. 95-1389,95-1389
• Citation: 91 F.3d 255
• Parties: UNITED STATES, Appellee, v. Jeffrey PHANEUF, Defendant, Appellant. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 255

91 F.3d 255

UNITED STATES, Appellee, v. Jeffrey PHANEUF, Defendant, Appellant.

No. 95-1389.

United States Court of Appeals, First Circuit.

Heard March 4, 1996.

Decided Aug. 2, 1996.

Donald R. Furman, Jr., Boston, MA, for appellant.

Sheila W. Sawyer, Assistant United States Attorney, with whom Donald K. Stern, United States Attorney, Boston, MA, was on brief, for appellee.

Before SELYA, Circuit Judge, CAMPBELL, Senior Circuit Judge, and STAHL, Circuit Judge.

LEVIN H. CAMPBELL, Senior Circuit Judge.

Pursuant to a plea agreement with the government, defendant-appellant Jeffrey Phaneuf pled guilty to three counts of making a false statement on credit card applications in violation of 18 U.S.C. § 1014, and two counts of mail fraud in violation of 18 U.S.C. § 1341. The United States District Court for the District of Massachusetts sentenced Phaneuf to 24 months in prison on the first three counts to run concurrently with a 30-month sentence on the last two counts, followed by 36 months of supervised release. In addition, the court ordered Phaneuf to pay $20,400 to the Bank of New England ("BNE") as restitution for losses. Phaneuf appeals from his sentence.

I.

In April 1989, police officers in Massachusetts discovered numerous stolen credit cards in Phaneuf's car during a routine traffic stop. Police obtained a warrant to search his residence in Hampton, New Hampshire. They discovered numerous credit cards in his name, along with receipts and credit card charge slips. A follow-up investigation revealed that 31 of the cards recovered were ones that Phaneuf had reported as stolen the previous year.

In June 1989, evidence from the state investigation--including credit card applications, receipts, stop payment order receipts, and correspondence between Phaneuf and various banks--was turned over to the United States Secret Service in Boston. In July, Phaneuf complied with that office's request for handwriting exemplars to compare with the documents obtained from his home.

In August 1990, Phaneuf called Agent Hoelen of the Secret Service to ask about the status of the investigation. Phaneuf offered to cooperate with the Secret Service. In September 1990, Phaneuf and Agent Hoelen met, without counsel or a representative from the United States Attorney's Office present. After Agent Hoelen advised Phaneuf of his Fifth Amendment right against self-incrimination, Phaneuf explained his scheme: from January 1988 through March 1989, he obtained numerous credit cards from banks and credit card companies by submitting false applications, used the cards (or authorized others to use them), and then reported the cards as stolen or failed to pay back the issuing institutions. He also wrote checks against his personal checking account at BNE to pay off credit card balances and then issued stop payment orders on the checks after the credit card balances had been reduced by the amount of the checks. In this way, he was able to resume use of the credit cards and incur more debt.

At the end of his meeting with Agent Hoelen, Phaneuf signed a two-page typed statement outlining the above scheme and initialled an additional ten or eleven pages of "certified inventory of evidence" forms. Phaneuf told Agent Hoelen that he believed the total amount of fraud attributable to his scheme was about $176,000. Phaneuf apparently made this comment in response to a higher loss estimate offered by Agent Hoelen.

In November 1994, the government filed a five-count indictment in the United States District Court for the District of Massachusetts charging Phaneuf with mail fraud and making false statements on credit card applications. A plea hearing was held on December 12, at which time the government stated that the total loss attributable to Phaneuf for sentencing purposes was approximately $175,000. Phaneuf refused to agree to the $175,000 loss amount contained in the plea agreement. Defense counsel questioned how the government would prove this total amount, given the lower amounts alleged in the various counts ($64,000 in counts I-III and $57,182 in counts IV-V, for a sum of $121,182). As a result of this dispute, the district court did not accept Phaneuf's guilty plea and ended the plea proceedings. A second plea hearing was held on December 20, at which the court accepted Phaneuf's guilty plea but declared the amount of the loss to be "in dispute."

On January 9, 1995, Assistant United States Attorney Sheila Sawyer filed a notice of appearance replacing Duane Deskins who had been handling Phaneuf's prosecution. Shortly thereafter, the probation department filed a Presentence Investigation Report ("PSR") that relied primarily upon Phaneuf's two-page signed statement of September 1990 to characterize the offense conduct. Phaneuf's base offense level was calculated to be six, and was increased by six levels because he was found to be responsible for a loss amount between $100,001 and $200,000. ¹ Two more levels were added because the offense involved more than minimal planning. The probation officer then took into account Phaneuf's acceptance of responsibility, and found that his total adjusted offense level was twelve. Given that offense level and a criminal history category of V, Phaneuf's guideline sentencing range was put at 27 to 33 months.

The government did not object to the PSR. Phaneuf made several objections. He asserted that neither he nor his attorney had seen "any information in the possession of the government" other than his two-page statement given to Agent Hoelen. Phaneuf petitioned the probation department to confine the loss calculation to the figures listed in the mail fraud counts of the indictment. The probation officer considered Phaneuf's objections but refused to alter the loss calculations.

Sentencing was scheduled for March 27, 1995. On March 7, the government filed with the court a sentencing memorandum in support of the probation department's loss calculations. The government attached to its sentencing memorandum an affidavit from Agent Hoelen describing the investigation, the confession signed by Phaneuf in 1990, and a certified inventory of evidence prepared by Agent Hoelen. On Thursday, March 23, Assistant United States Attorney Sawyer called defense counsel to see whether he still intended to contest the loss amount and whether he "had any interest in looking at the materials referenced in the government's sentencing memorandum prior to the sentencing hearing." Defense counsel rejected the government's offer to look at the evidence, stating his intention to challenge the government for alleged discovery violations.

At sentencing, the district court concluded that the loss amount was "somewhere in the range of" $100,001 to $200,000, and not less than $166,229.38. The district court also found that the government had not failed to make available to the defense the documentation supporting its loss calculation. Phaneuf was sentenced to 30 months in prison, to be followed by a 36-month term of supervised release. The court imposed several special conditions of supervised release: it required Phaneuf to obtain prior approval of the probation department before "incurring any extension of credit, including charge cards, credit cards or loans" and before making "any purchase ... exceeding the cost of $100." The court further ordered Phaneuf to make restitution to the BNE in the amount of $20,400 for losses it sustained in connection with the mail fraud scheme.

II.

Phaneuf assigns four errors on appeal: (1) that the government's violation of a local discovery rule deprived him of a fair sentencing; (2) that the district court erred in calculating the loss amount for sentencing purposes; (3) that the supervised release condition requiring him to obtain prior approval for purchases over $100 was not reasonably related to his offenses as required by 18 U.S.C. § 3583(d)(1); and (4) that the court's restitution order was improper.

1. Discovery Violation

Phaneuf contends that the government's purported failure to provide the defense with documentation supporting its loss estimate deprived him of a fair sentencing procedure. He relies on Local Rule, D.Mass. 116.1(a), which requires that, in criminal cases, the government automatically disclose certain written evidence in its possession to the defense. ²

Phaneuf argues that the government violated Local Rule 116.1 by not spontaneously handing over to the defense various pieces of evidence including the handwriting analyses produced by the Forensic Services Division of the Secret Service and evidence of "numerous legitimate payments" on Phaneuf's credit card accounts. As a result, Phaneuf argues, he could not effectively challenge the government's loss estimate and the corresponding six-level increase in base offense level. The government replies that Local Rule 116.1, on its face, applies only to pre-trial discovery. At sentencing, the government says, a defendant is entitled to no more than fair notice of the evidence upon which the government intends to rely. ³ In any event, the government insists that Phaneuf was fully advised in advance of the sentencing hearing of the government's evidence and that his counsel had made no request at all for evidence.

We need not linger over what role, if any, Local Rule 116.1 should play at sentencing. Under any analysis, Phaneuf is not entitled to relief here. He has only himself to blame for any gaps in his knowledge of the basis of the government's sentencing proposals. Counsel for the defense conceded at the sentencing hearing that, during the two and one-half month period leading up to sentencing, he did not request any data from the prosecution, nor did he request the court to compel the disclosure of any evidence. ⁴ The absence of any such requests is especially telling given that three weeks before sentencing the government had filed a sentencing memorandum setting forth the government's position on the loss...