US v. Rizzo, 96-2002.

• Decision Date: 11 August 1997
• Docket Number: No. 96-2002.,96-2002.
• Citation: 121 F.3d 794
• Parties: UNITED STATES, Appellee, v. Anthony J. RIZZO, Defendant, Appellant.
• Court: U.S. Court of Appeals — First Circuit

121 F.3d 794

UNITED STATES, Appellee, v. Anthony J. RIZZO, Defendant, Appellant.

No. 96-2002.

United States Court of Appeals, First Circuit.

Heard May 7, 1997.

Decided August 11, 1997.

James H. Budreau, for Defendant, Appellant.

John M. Griffin, Assistant United States Attorney, with whom Donald K. Stern, United States Attorney, was on brief for Appellee.

Before TORRUELLA, Chief Judge, CYR, Senior Circuit Judge, and STAHL, Circuit Judge.

STAHL, Circuit Judge.

Defendant-appellant Anthony J. Rizzo appeals the thirty-seven month sentence that the district court imposed upon him after he pleaded guilty to several counts involving possessing, negotiating, and uttering counterfeit securities in violation of 18 U.S.C. §§ 371, 513. Finding no merit to Rizzo's arguments, we affirm.

Facts

We consider the facts as set forth in "the presentence report, the sentencing transcript, and various other materials before the district court." United States v. Gill, 99 F.3d 484, 485 (1st Cir.1996).

The counterfeit scheme in which Rizzo was involved was designed to operate as follows: Rizzo supplied counterfeit checks to Ronald A. Moore, who forwarded them to Joseph Savarese. The checks were made payable to Savarese's business, Thermal Shield of New England ("Thermal Shield"). Savarese was to deposit the counterfeit checks in his business' bank accounts and then withdraw the funds after the checks had cleared. Rizzo, Moore, and Savarese were to share in the illegal proceeds from the counterfeit checks.

During the course of the scheme in 1992, Rizzo provided Savarese with five checks that were fraudulent reproductions of actual corporate checks. Moore operated as the middleman between Rizzo and Savarese for the first three checks; Rizzo dealt directly with Savarese for the final two checks. The companies whose checks had been counterfeited neither issued these checks nor authorized the disbursement of any funds to Thermal Shield.

In April 1992, Rizzo, Moore, and Savarese conducted their first illegal transaction. Moore gave Savarese a $160,000.00 counterfeit check that Rizzo had provided him listing Thermal Shield as payee and Hasbro, Inc. as payor. Savarese then deposited the counterfeit check into the Thermal Shield account at the Winthrop, Massachusetts branch of New World Bank and delivered the deposit slip to Moore. After the check cleared, Savarese withdrew the $160,000.00 proceeds from the check. There being little honor among the dishonest, it was not until Moore made threatening statements to Savarese on several occasions that he provided Moore with approximately $40,000.00 of the illicit proceeds to be shared with Rizzo as their portion of the illegal booty.

Prior to the Hasbro check transaction, for reasons not entirely clear in the record, Savarese had contacted agents of the Federal Bureau of Investigations ("FBI") concerning the counterfeit check scheme. The FBI agents instructed Savarese that under no circumstances was he to become involved with the Hasbro check. Savarese did not follow these instructions, and the FBI agents subsequently discovered Savarese's participation in negotiating the first counterfeit check. Following the Hasbro check transaction, Savarese began cooperating with the FBI in connection with the Bureau's investigation of the counterfeit check scheme. During this time, the FBI, with the knowledge of Savarese and the assistance of security officials at the Bank of Boston, established a "shell" account in the name of Thermal Shield at the Bank of Boston.

Emboldened by their success with the Hasbro check, Rizzo, Moore, and Savarese agreed to negotiate additional counterfeit checks drawn on unsuspecting corporations. On June 2, 1992, Moore gave Savarese two counterfeit checks from Rizzo; one in the amount of $47,750.00 naming New Wave Transport (U.S.A.) as payor and one in the amount of $47,785.00 naming The American Experience West Corp. as payor. Savarese deposited the checks in the Thermal Shield account at the Bank of Boston and delivered the deposit slip to Moore. On June 9, 1992, upon Moore's urging, Savarese visited the Bank of Boston in an effort to withdraw the funds from the two counterfeit checks. By previous arrangement between the FBI and the Bank of Boston, the teller furnished Savarese with a letter stating that his account was closed.

On July 1, 1992, Savarese met directly with Rizzo. During one conversation, Rizzo told Savarese that they would "do two more." Several days later, Rizzo gave Savarese two new counterfeit checks, one in the amount of $9,300.00 naming the Great Atlantic and Pacific Tea Company, Inc. as payor and one in the amount of $9,275.00 naming Waldbaum, Inc. as payor. The conspirators never negotiated either of these two checks.¹

Procedural Background

On December 14, 1995, a federal grand jury returned a three-count superseding indictment alleging that Rizzo engaged in a counterfeit check scheme. The indictment stated that Rizzo illegally conspired with co-defendant Ronald A. Moore and others to obtain cash through the negotiation of counterfeit corporate securities, in violation of 18 U.S.C. § 371. The indictment further alleged two counts of uttering and possessing counterfeited securities of a corporation, in contravention of 18 U.S.C. § 513.

On May 10, 1996, Rizzo entered a plea of guilty to all three counts. Following Rizzo's plea, the United States Probation Officer prepared a Presentence Report, which recommended an adjusted offense level of sixteen for Rizzo's participation in the counterfeit check scheme. The base offense level under U.S.S.G. § 2F1.1 was six and the Report suggested several enhancements. First, the Report recommended an eight-level increase because the intended loss from the scheme exceeded $200,000.00. See U.S.S.G. § 2F1.1(b)(1)(I). The Presentence Report calculated the amount of loss under U.S.S.G. § 2F1.1 by using the actual loss of $160,000.00 from the Hasbro check and adding the intended loss of $113,950.00, representing the total of the four other checks involved in the scheme. The next suggested enhancement entailed a two-level increase, which reflected the fact that the offense involved more than minimal planning. See U.S.S.G. § 2F1.1(b)(2)(A). Finally, the Presentence Report recommended a three-level increase because Rizzo committed the offense while awaiting sentencing on a 1992 federal conviction. See U.S.S.G. § 2J1.7. The Presentence Report recommended reducing the resulting offense level of nineteen to sixteen because Rizzo demonstrated acceptance of responsibility. See U.S.S.G. § 3E1.1(a),(b)(2).

The Presentence Report computed Rizzo's criminal history category as a IV. This computation included Rizzo's 1992 federal conviction for negotiating counterfeit checks and using stolen credit cards and false identification, for which he had been sentenced to thirty-three months' imprisonment on September 17, 1992. Rizzo completed the sentence on February 3, 1995, at which time he began a period of supervised release. Rizzo's criminal history computation also reflected a 1989 conviction in Charlestown District Court for possession of a firearm without proper identification.

Rizzo filed numerous objections to the Presentence Report. Of importance for purposes of this appeal,² Rizzo argued for a downward departure, asserting that his case fell outside the heartland of the Guidelines because he was unable to request concurrent federal sentences due to the fact that the thirty-three month sentence imposed in September 1992 had been discharged by the time he was indicted in this case. In support of this assertion, Rizzo advanced two arguments: first, he contended that the government purposefully delayed the indictment in the instant case until after he completed his thirty-three month sentence for his 1992 conviction in order to circumvent U.S.S.G. § 5G1.3(c); second, he claimed that the government was aware of the instant counterfeit check offenses when he was sentenced in September 1992 for his prior crimes, but improperly failed to inform the district court of the new offenses at the 1992 sentencing so that the sentencing judge could consider them as relevant conduct. According to Rizzo, if the government properly had informed the court of the relevant conduct involving this case, the court then "would have combined the two cases." If the court had combined the two cases, this process would have "resulted in a level 20 for the combined cases."³ A level twenty carries a sentencing range of thirty-seven to forty-six months, which is at least twenty-four and potentially thirty-three months shorter than the total of seventy months Rizzo received on the two separate indictments.

Also of importance for purposes of this appeal, Rizzo insisted that he should not have been subject to an eight-level increase reflecting the intended loss. According to Rizzo, the $273,950.00 of counterfeit checks involved in the scheme were "generated through a government sting operation," and, thus, "no loss was capable of occurring as a matter of law."

On July 19, 1996, following an hour-long sentencing hearing at which Rizzo voiced his objections to the Presentence Report, the district court (Gorton, J.) accepted the recommendations contained in the Report and declined to depart downward from the suggested adjusted offense level of sixteen. The district court sentenced Rizzo to thirty-seven months' imprisonment⁴ and three years of supervised release. Thirty-three months of the imprisonment term were to run concurrently on counts one, two, and three, and four months of the term were to run consecutively, pursuant to 18 U.S.C. § 3147.⁵ The district court also ordered Rizzo to pay $12,500 in restitution.

Standard of Review

"Our review of the legal conclusions and factual determinations underlying the district court's departure decision is ... conducted under a unitary abuse-of-discretion standard." United States v. Cali, 87 F.3d 571, 580 (...