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July 30, 2008

More Circuit Activity About The Meaning Of “Victim” In § 2B1.1

            As previously discussed here, the Fifth Circuit held on Tuesday that the reimbursed credit card holders in a fraud conspiracy were not “victims” within the meaning of § 2B1.1 because the district court did not point to any evidence establishing their pecuniary loss.  Today, the Second Circuit ruled in United States v. Emmanuel Abiodun, et al. (available here) that individuals who are reimbursed by banks or credit card companies in the aftermath of a fraud scheme may qualify as “victims” for purposes of § 2B1.1 if there is evidence that they incurred a measurable monetary harm:

“We agree with the Sixth Circuit and Eleventh Circuit that individuals who are ultimately reimbursed by their banks or credit card companies can be considered ‘victims’ of a theft or fraud offense for purposes of U.S.S.G. § 2B1.1(b)(2) if—as a practical matter—they suffered (1) an adverse effect (2) as a result of the defendant’s conduct that (3) can be measured in monetary terms.”

            The wrinkle here is that the loss must be able to be measured in “monetary terms.”  In Abiodun, the Second Circuit agreed that “loss of time” in terms of “securing reimbursement from their banks or credit card companies” could be measured in monetary terms.  However, since the district court counted those who had lost time as victims for purposes of the enhancement without calculating the monetary value of this lost time, the court remanded so that the district court could “(1) recalculate the loss amount associated with each of the defendants’ crimes to include the time lost by these potential victims or (2) determine whether, if these individuals are excluded from the count, it is still ‘more likely than not’ that Abiodun’s crimes affected ‘250-plus victims.’”

            

            But just how easy is it to convert lost time into monetary terms under these circumstances? Must the court consider each affected individual’s respective salary, calculate his or her functional hourly wage, and then determine how much time he or she spent trying to get reimbursed? What is the monetary loss, if any, to an unemployed person?  What if the individual calls the credit card company on a weekend when he or she is not working?  How exactly do you value the monetary cost to a victim from lost “leisure time” spent dealing with a bank or creditor? Surely these questions will be the subject of future litigation.

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July 30, 2008 at 11:25 PM | Permalink

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Comments

Sorry to veer from the subject, but this reminds me of a nagging question always simmering on the back burner of my mind, which is, why is the word "victim" used during a court case, if the defendant is presumed innocent? I freely admit that I am not an educated woman, merely an advocate, but this has always stumped me. It seems to pretty clearly presuppose guilt. Can someone clear this up for me? Thank you.

Posted by: Tosh Dawson | Jul 31, 2008 1:35:16 PM

Well, in the context of these cases, the issue does not come up until sentencing, so the defendant has already been found guilty beyond a reasonable doubt.

Posted by: Not the same | Jul 31, 2008 1:39:58 PM

It is important to emphasize a factual difference between Abiodun and the Fifth Circuit case, Conner, which makes them doctrinally consistent. The Abiodun court counted the credit card account holders as victims because the record before the district court "clearly support[ed]" a finding that they suffered a monetarily measurable loss of time recouping their losses (i.e., an actual loss). See slip op. at 11. In Conner, the Fifth Circuit said that the district court erred by counting the account holders as victims because it did not point to ANY evidence that they suffered pecuniary harm from a loss of business time. Slip op. at 17. It speculation was not enough. Id. But the court held that "with a proper evidentiary foundation . . . unreimbursed business losses [from a loss of time] could be considered 'actual losses' for the purposes of counting 'victims.'" Id. The important lesson is that the Government bears the burden of providing by "reliable information and a preponderance of the evidence" (U.S.S.G. s 6A1.3 commentary) that the facts support a sentencing enhancement. See id. at 17-18.

Posted by: Law Horn | Jul 31, 2008 9:52:44 PM

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