US v. Wayland
| Decision Date | 03 December 2008 |
| Docket Number | No. 08-2194.,08-2194. |
| Citation | 549 F.3d 526 |
| Parties | UNITED STATES of America, Plaintiff-Appellee, v. Ronald E. WAYLAND, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Michael C. Carr, Attorney (argued), James M. Cutchin, Attorney, Office of the United States Attorney, Benton, IL, for Plaintiff-Appellee.
Melissa A. Day, Attorney, Federal Public Defender's Office, Benton, IL, Todd Schultz (argued), Office of the Federal Public Defender, East St. Louis, IL, for Defendant-Appellant.
Before RIPPLE, EVANS and TINDER, Circuit Judges.
A jury found Ronald E. Wayland guilty of making false statements relating to health care matters, in violation of 18 U.S.C. §§ 1035(a)(2), 24(b). At sentencing, the district court concluded that Mr. Wayland used "sophisticated means" to perpetrate the fraud and, accordingly, applied a two-level upward adjustment to his offense level, see U.S.S.G. § 2B1.1(b)(9). The district court sentenced Mr. Wayland to 41 months' imprisonment; Mr. Wayland filed a timely notice of appeal. Because the district court did not clearly err in determining that Mr. Wayland used sophisticated means to commit this fraud, we affirm the judgment of the district court.
The Illinois Department of Rehabilitation Services ("the Department") oversees a program through which Illinois residents with disabilities can use Medicaid funds to pay for the services of in-home personal assistants and thereby avoid transfer to nursing homes. Dorothy Wayland, a program participant, was essentially incapacitated. Consequently, her son Ronald Wayland, acted on her behalf under a power of attorney. In that role, Ronald Wayland defrauded the Department of more than $108,000 by claiming that a man named Cyril Sturm was serving as his mother's personal assistant.
Sturm, in fact, had died in 1983, but Mr. Wayland persuaded the Department that Sturm was caring for Dorothy Wayland. Mr. Wayland somehow obtained Sturm's social security number and submitted it, along with identification cards that he created by using a relative's photograph, to the Department. Mr. Wayland also registered a post office box in both his name and Sturm's, to which the Department sent correspondence addressed to Sturm. Mr. Wayland also opened a joint checking account into which he, and later the Department, deposited checks payable to Sturm. The bank let Mr. Wayland establish the account because he represented that Sturm was homebound. Because the Department would pay Sturm to assist Dorothy Wayland only during those hours in which Mr. Wayland could not be at home, Mr. Wayland also submitted fraudulent documents showing that he was employed at local hospitals. Additionally, Mr. Wayland filed tax returns for Sturm because, the Government asserts, Mr. Wayland knew that the Department was withholding taxes on Sturm's behalf, and he did not want the scheme to attract the IRS' attention.
After nine years, the scheme began to unravel. The Department sent letters to Sturm and to Mr. Wayland requesting a meeting with Sturm; he never showed up. The Department pressed Mr. Wayland to document Sturm's existence and employment. In three written responses, Mr. Wayland insisted that Sturm existed and diligently was looking after Dorothy Wayland and that all of the identification submitted to the Department was genuine. These letters formed the basis of his indictment on three counts of making false statements regarding health care matters. 18 U.S.C. §§ 1035(a)(2), 24(b). A jury found Mr. Wayland guilty on each count.
The probation officer recommended a two-level upward adjustment under U.S.S.G. § 2B1.1(b)(9)(C) for Mr. Wayland's use of sophisticated means to perpetrate the fraud. Mr. Wayland disputed that his conduct met this standard, but the district court stated: "If this wasn't a sophisticated means of perpetrating a fraud, I don't know what is." R.95 at 71. Mr. Wayland's total offense level of 20 and criminal history category of I yielded an advisory guidelines range of 31 to 41 months' imprisonment. After considering the sentencing factors set forth in 18 U.S.C. § 3553(a), the court imposed three concurrent prison terms of 41 months.
We review for clear error a district court's finding that the defendant employed sophisticated means. United States v. Robinson, 538 F.3d 605, 607 (7th Cir.2008).
The sentencing guidelines call for a two-level upward adjustment if an individual has perpetrated a fraud through sophisticated means. See U.S.S.G. § 2B1.1(b)(9)(C). Application note 8 to U.S.S.G. § 2B1.1 states: "`Sophisticated means' means especially complex or especially intricate offense conduct pertaining to the execution or concealment of an offense." The note goes on to provide several examples of such conduct, including the use of fictitious entities or corporate shells; but this list is not exhaustive and merely suggests the wide variety of criminal behavior covered by the guideline. United States v. Allan, 513 F.3d 712, 715 (7th Cir.2008).
Mr. Wayland contends that fraudulently registering both a post office box and checking account, as well as filing false tax returns, are not complex or intricate actions, and therefore, are not sophisticated. He relies on two cases from other circuits holding that sophisticated conduct did not extend to fraudulently registering a post office box, United States v. Hance, 501 F.3d 900, 911 (8th Cir.2007), or to filing false tax returns, United States v. Lewis, 93 F.3d 1075, 1083 (2d Cir.1996).
Offense conduct is sophisticated if it displays "a greater level of planning or concealment" than a typical fraud of that kind. See Robinson, 538 F.3d at 607-08 (); United States v. Fife, 471 F.3d 750, 753-54 (7th Cir.2006) (); Hance, 501 F.3d at 909 (). We must decide whether Mr. Wayland's crime involved a greater level of planning or concealment than the typical health care fraud case.
Mr. Wayland's conduct was far more intricate than that in a typical health care fraud scheme. According...
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