F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
MAR 10 1999
TENTH CIRCUIT
PATRICK FISHER
Clerk
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 98-8027
(D.C. No. 97-CR-077-D)
ROBERT L. GIESSE, (District of Wyoming)
Defendant-Appellant.
ORDER AND JUDGMENT*
Before BRORBY, Circuit Judge, KELLY, Circuit Judge, and McWILLIAMS, Senior
Circuit Judge.
The only issue in this appeal is whether the district court erred in increasing
Giesse’s offense level by two levels because his victim was a “vulnerable victim” as
provided for in the United States Sentencing Guidelines (“USSG”) § 3A1.1(b).1
We conclude the district court did not err in so doing, and therefore affirm.
Pursuant to a plea agreement, Robert L. Giesse pled guilty to Count One of a four
*
This order and judgment is not binding precedent, except under the doctrines of
law of the case, res judicata, and collateral estoppel. The court generally disfavors the
citation of orders and judgments; nevertheless, an order and judgment may be cited under
the terms and conditions of 10th Cir. R. 36.3
1
USSG § 3A1.1 appears as Attachment A.
count indictment, which count charged him with mail fraud under 18 U.S.C. § 1341. In
the plea agreement, the government agreed to recommend a downward adjustment in
Giesse’s offense level of three levels for acceptance of responsibility (which the district
court later made, although somewhat reluctantly), but the agreement left open any
possible upward adjustments in Giesse’s offense level. The district court accepted
Giesse’s plea of guilty and later sentenced him to imprisonment for 30 months to be
followed by three years of supervised release, conditioned on payment of a $50.00
special assessment and restitution in the amount of $50,000.00. In imposing sentence,
the district court made three two-level upward adjustments in Giesse’s offense level: one
for more than minimal planning; a second for abuse of a position of trust; and a third
pursuant to the “vulnerable victim” provision of USSG § 3A1.1(b). Giesse only appeals
the upward adjustment of his offense level based on USSG § 3A1.1(b).
The presentence report recommended a two level increase in Giesse’s offense
level pursuant to USSG § 3A1.1(b). In this regard, the presentence report read as
follows:
Victim-Related Adjustments: Pursuant to USSG 3A1.1(b),
a two level increase for a vulnerable victim enhancement
appears appropriate. When approached by Giesse to bring
her financial portfolio under his management, the victim was
a recent widow who was also unsophisticated in financial
matters. Prior to her husband’s death, the victim had never
filled out or signed a check. All financial matters had been
left to her husband. The victim was particularly susceptible
to Giesse’s criminal conduct because he knew she was
unsophisticated towards the financial responsibilities she had
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suddenly encountered. He admits as much in his defendant’s
statement through his claim she had spent nearly $115,000 of
a $150,000 settlement, and had nothing set up. As a recent
widow whose husband had always taken care of financial
matters, Giesse clearly understood he was dealing with a
vulnerable individual. (Emphasis added.)
Counsel filed an objection to the recommendation in the presentence report that
there be a two level upward adjustment under USSG § 3A1.1(b). (It is apparently agreed
that the statement contained in that recommendation that “[p]rior to her husband’s death,
the victim had never filled out or signed a check” was, in fact, incorrect.) The foregoing
objection, along with other objections, was heard by the district court at the sentencing
hearing. The only witness testifying at the sentencing hearing was the victim,
Dorothy Robarge. At the conclusion of that hearing, the district court, after argument of
counsel, held that, based on the presentence report and the testimony of Dorothy Robarge,
a two level upward adjustment under USSG § 3A1.1(b) was warranted. The court’s
colloquy in this regard is set forth in Attachment B to the order and judgment.
From the record we learn that Dorothy Robarge, a 40-year old widow when she
met Giesse, was the victim of Giesse’s criminal activities. At the age of 17, Ms. Robarge
dropped out of high school and married her childhood sweetheart, Leroy Robarge. She
thereafter assumed the role of homemaker in a marriage that produced four children,
while Mr. Robarge was responsible for the income and financial security of the family. In
addition to raising their four children, the Robarges assumed the care of Ms. Robarge’s
developmentally disabled sister and her daughter. Ms. Robarge had a very limited
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experience working outside the home, having previously worked as a motel maid and a
highway construction flagger, each for a period of only a few months, prior to her
husband’s death. Mr. Robarge, an electrician at a cement plant, was killed in a work
related accident in 1991.
Upon the death of her husband, Ms. Robarge received approximately $100,000.00
in life insurance benefits. She later initiated a wrongful death action against her deceased
husband’s employer. While this suit was pending, Ms. Robarge first met Giesse. He at
the time was a registered securities agent for Mutual of Omaha Investor Services and a
registered life insurance agent for Mutual of Omaha, and was doing business as Gem City
Investments, Inc. in Laramie, Wyoming. Their introduction occurred through her son,
Christopher, who had worked as a clerk at a local Laramie motel and had met Giesse’s
wife, who also worked at the motel. Christopher met Giesse who would occasionally
drop by the motel to visit his wife. Christopher suggested to his mother that she consult
with Giesse concerning her investment portfolio. About the same time, Giesse offered
Christopher a job as an agent in his office, even though Christopher had no prior
experience in this sort of business activity. Ms. Robarge thereafter met with Giesse to
discuss her financial situation. Giesse advised Ms. Robarge that her “whole portfolio was
at risk.” About this time Ms. Robarge settled her lawsuit against her late husband’s
employer and shortly thereafter turned over about $350,000.00 to Giesse to manage on
her behalf, which sum included insurance benefits as well as the settlement monies
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realized from her wrongful death claim. Suffice it to say, Giesse misappropriated about
$250,000.00 of Ms. Robarge’s monies to his personal use, in the course of which he used
the U.S. mail. All of this came to a head in early 1996 when Ms. Robarge, who had
become “suspicious,” turned to an attorney for assistance. An investigation of the matter
resulted in the present prosecution of Giesse for mail and wire fraud, and his plea of
guilty to the one count of mail fraud.
As indicated, counsel’s position on appeal is that the district court erred in
increasing Giesse’s base offense level by two levels under the “vulnerable victim”
provision of USSG § 3A1.1(b). That guideline provides that an offense level shall be
increased by two levels if the defendant knew or should have known that his victim was
“unusually vulnerable” due to age, physical or mental condition or if the victim was
“otherwise particularly susceptible” to the criminal conduct.
As stated, Giesse pled guilty to Count One of the four count indictment, and the
United States, by plea agreement, dismissed the other three counts, so there was no trial.
On acceptance of his plea, the district court referred the case to the probation department
for a presentence report. That report contained a “Victim Impact Statement” in which
Ms. Robarge in a narrative letter set forth her chronology of the events, in great detail.
The report also contained a “Prosecutor’s Statement,” as well as Giesse’s “Personal and
Family Data,” also in considerable detail. In recommending the increase in Giesse’s
offense level by two levels under USSG § 3A1.1(b), the presentence report noted that
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when Ms. Robarge met Giesse she was a “recent widow who was unsophisticated in
financial matters” and was “particularly susceptible” to Giesse’s criminal conduct
because he knew she was unsophisticated in handling the financial responsibilities she
had suddenly encountered.
As indicated, Giesse’s counsel filed an objection to the foregoing recommendation
and a hearing was held on that objection. The only witness who testified at the
sentencing was Dorothy Robarge, the victim, who testified at length about her
relationship with Giesse, and was then cross-examined by his counsel.
It was on this state of the record that the district court adopted “the
recommendation of the probation officer that the provisions of 3A1.1, paren (b), should
apply in this case.” In so doing, the district court itemized some of the factors which it
took into consideration, namely the “emotional state” of the victim in the aftermath of her
husband’s accidental death, and the “obvious lack of sophistication” concerning the
financial matters that suddenly confronted Ms. Robarge.
It is agreed that in the district court the government had the burden to establish the
applicability of USSG § 3A1.1(b). United States v. Kirk, 894 F.2d 1162, 1164 (10th Cir.
1990). It is also agreed that on appeal the district court’s findings of fact should not be
overturned unless clearly erroneous, although the district court’s interpretation of §
3A1.1(b) is to be reviewed by us de novo. United States v. Hardesty, 105 F.3d 558, 559
(10th Cir. 1997); United States v. McAlpine, 32 F.3d 484, 487-488 (10th Cir. 1994).
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Our study of this matter convinces us that the district court’s findings, i.e., the
emotional state of Ms. Robarge after her husband’s accidental death and her total lack of
sophistication in financial matters, all known to Giesse from the inception of their
relationship, are not clearly erroneous and indeed find support in the record. Further, in
our view the district court did not misinterpret or misapply § 3A1.1(b). It seems quite
apparent to us that Ms. Robarge, under the described circumstances, i.e., her emotional
state resulting from her husband’s death, her inexperience in handling financial matters,
coupled with the fact that she had just acquired about $350,000.00, was a “particularly
susceptible” victim. In this general connection, see, for example, United States v.
Tissnolthtos, 115 F.3d 759, 761 (10th Cir. 1997) (“[t]he focus of the inquiry must be on
the victim’s personal or individual vulnerability,” citing United States v. Brunson, 54 F.3d
673, 676 (10th Cir. 1995)); Brunson, 54 F.3d at 676 (“As these cases indicate, ‘vulnerable
victims’ are those who are in need of greater societal protection”); United States v.
Creech, 913 F.2d 780 (10th Cir. 1990) (The focus is on the victim’s unusual personal
vulnerability, rather than on an assumed vulnerability of a class of which the victim was a
member.) Also, and more specifically, in United States v. Lowder, 5 F.3d 467, 472 (10th
Cir. 1993), we upheld a district court’s enhancement of the defendant’s offense level
based on the vulnerability of the victim, and in so doing we quoted with approval the
district court’s comment thereon, which was:
“I can’t imagine how we could have a more perfect example
of a vulnerable victim . . . . They were people who were
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inexperienced, they were elderly and they were particularly
reliant on these funds for their retirement and for their income
and I think they were particularly vulnerable victims.”
Judgment affirmed.
ENTERED FOR THE COURT,
Robert H. McWilliams
Senior Circuit Judge
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ATTACHMENT A
§3Al.l Hate Crime Motivation or Vulnerable Victim
..........
(b) If the defendant knew or should have known that a victim of the
offense was unusually vulnerable due to age, physical or mental
condition, or that a victim was otherwise particularly susceptible
to the criminal conduct, increase by 2 levels.
..........
Commentary
Application Notes:
..........
2. Subsection (b) applies to offenses involving an unusually vulnerable victim in
which the defendant knows or should have known of the victim’s unusual
vulnerability. The adjustment would apply, for example, in a fraud case where
the defendant marketed an ineffective cancer cure or in a robbery where the
defendant selected a handicapped victim. But it would not apply in a case
where the defendant sold fraudulent securities by mail to the general public and
one of the victims happened to be senile. Similarly, for example, a bank
teller is not an unusually vulnerable victim solely by virtue of the teller’s
position in a bank.
Do not apply subsection (b) if the offense guideline specifically incorporates
this factor. For example, if the offense guideline provides an enhancement for
the age of the victim, this subsection would not be applied unless the victim was
unusually vulnerable for reasons unrelated to age.
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ATTACHMENT B
In looking at the issue of whether the provisions of 3A1.1, paren (b), apply here,
the Court believes that if this is an example – if this case is not an example of an instance
where this provision of the guideline manual applies, then there is no example that
equitably could be made to this Court.
Granted, there are no cases in the Tenth Circuit that will address the issue of
whether a widow can be vulnerable, and the fact that this person was widowed and even
the fact that she was widowed in a tragic accident of her husband in and of itself would
not rise to the level of “vulnerable victim” as established by this guideline provision.
But taking all other factors in consideration, the emotional state of this victim after
her husband’s death, the obvious lack of sophistication of this witness as exemplified by
her testimony here just a moment ago, and the unique position that Mr. Giesse had to
manipulate her events through the use of a power of attorney, all make this victim about
as vulnerable as any victim could be.
This Court has been reluctant to apply this provision of the guidelines in the past
because oftentimes people who are victims of fraudulent schemes allowed their own
greed and stupidity to make them victims.
Now, that is not the case here. The victim here is not a stupid woman; she’s
simply unsophisticated. And there’s no evidence to believe that she was trying to get
something for nothing or that she was greedy. She thought she was doing something
prudent, relying upon a person who had authority to do business with a well known,
nationally renowned investment company. And she gave this defendant the power of
attorney, and with that legal artifice he had as much of a strangle hold on this victim as
one could obtain. He had an exquisite position of trust and really dominion over the
financial well-being of this victim.
It would be virtually impossible, even for a person with sophistication, having
granted that extraordinary power by that instrument, to even maintain a good
understanding of what their financial position was; and that would certainly be true of a
person of such limited skill on financial matters as is this victim.
For the reasons I’ve just stated, the Court believes that there is ample justification
in the record to support the recommendation of the probation office that the provisions of
3A1.1, paren (b), should apply in this case, and the Court will apply them.
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